1 Introduction
Life on Earth is in crisis. Our climate is changing faster than scientists predicted and the stakes are high. Biodiversity loss. Crop failure. Social and ecological collapse. Mass extinction. We are running out of time, and our governments have failed to act.1
The planet is facing a climate crisis of a magnitude that is difficult to grasp, and we need all hands on (the policy) deck to address it. The international response to the climate crisis has been the Paris Climate Accord, and the EU has begun with implementing its very own response in the form of the European Green Deal. In particular, the EU aims at becoming a climate-neutral economy by 2050. The EU Green Deal follows a horizontal approach: all EU policies should contribute to achieving the European Green Deal objective, including EU competition law.
The push towards aiding the EU economy to become greener has triggered antitrust initiatives both at national and EU level. Mostly, the debate about implementing a sustainability agenda in competition law has focused on strategies for interpreting open-ended antitrust rules contained in Article 101 and 102 of the Treaty on the Functioning of the European Union (“tfeu”) and national counterparts in a way that allows for more exceptions from antitrust enforcement to accommodate voluntary sustainability efforts by undertakings.
At the same time, the EU is developing a framework to make sustainability efforts mandatory for undertakings. In February 2022, the EU Commission published its Draft Directive on Corporate Sustainability Due Diligence (“csddd”).2 After fragmented development of mandatory human rights due
But what impact should EU legislation that makes sustainability efforts for companies and their supply chains mandatory have on the greening efforts under EU competition law? This is the question this chapter tries to critically assess. It can be considered as a first attempt in trying to reconcile two trends: the sustainability turn in antitrust law and the rise of mandatory human rights and sustainability due diligence. The main focus of this chapter is to assess the impact of mandatory human rights and sustainability due diligence on the availability of sustainability defenses under antitrust law. Conversely, human rights and sustainability obligations could also give room for crafting new offenses under antitrust law,3 thus using the enforcement toolbox of antitrust law to fight serious human rights and environmental violations by corporations. Given that current developments in EU antitrust practice only relate to sustainability defenses, and the verdict is still out on whether antitrust law could become a sword in fighting human rights and environmental violations by private actors, this chapter will only focus on the impact of hrdd legislation on the sustainability defense under antitrust law.
The chapter is structured in the following way: Section 2 starts by discussing the sustainability turn in EU competition law and similar developments at the national level. Section 3 then gives an overview over the structure and obligations imposed by the csddd and comparable national frameworks. Section 4 seeks to answer the question of how much room there is left for taking sustainability exceptions into account under EU competition law. Section 5 concludes.
2 The Sustainability Turn in Antitrust Law
The debate on if and how to introduce a sustainability agenda into EU competition law is not new. It started in the aftermath of the EU Commission’s decision in ceced.4 In ceced, the EU Commission assessed the compatibility of an agreement between washing machine manufacturers to no longer produce and import energy inefficient washing machines into the EU internal market.
Ultimately, the Commission did find a violation of Article 101 (1) tfeu but granted an exemption under Article 101 (3) tfeu. Article 101 (3) exempts otherwise anti-competitive agreements from Article 101 (1) tfeu if four cumulative conditions are met. First, the agreement contributes to improving the production of goods and services or promotes technical or economic progress. According to the Commission, the push for green washing machines contributed to technical progress. Second, consumers receive a fair share of the benefits from the agreement. The Commission saw a benefit for consumers in the form of reduced energy and water bills due to more energy-efficient washing machines. Third, the Commission found that the anti-competitive elements in the agreement were strictly necessary to achieve the objectives of the agreement. Fourth and last, the agreement did not eliminate all competition on the market in washing machines.
The ceced decision clearly pointed to the fact that an agreement that fosters public policy objectives more than it harms competition could be exempted under Article 101 (3) tfeu. With the rise of the more economic approach in the mid-2000s, however, the validity of the ceced decision was cast into doubt.5 Could environmental concerns factor into a consumer welfare analysis? The Guidelines on the application of Article 101 (3) tfeu published in 2004 remained silent on how to deal with agreements that are environmentally efficient.6 Rather, the Guidelines made clear that only pure economic efficiencies from an agreement would be considered in the analysis of the four cumulative criteria under Article 101(3). This approach appeared to exclude any broader, non-economic considerations from its analysis, including environmental and sustainability considerations.
On the other hand, under the EU Commission’s Horizontal Guidelines published in 2011,7 environmental concerns did have a place, albeit a modest one. According to the Commission, standardization agreements on environmental aspects could “facilitate consumer choice and lead to increased product
Still, environmental concerns did not play a very prominent role in the EU’s competition agenda at the beginning of the 2010s, if at all. Industry initiatives allegedly supporting sustainability objectives proved to be anti-competitive greenwashing. In Consumer Detergents,9 participating companies in an industry initiative to reduce non-biodegradable ingredients in detergents ended up not reducing polluting elements in their detergents effectively. Instead, they used this arrangement purely to limit competition between them. The AdBlue decision of the Commission tells a similar story.10 German car manufactures agreed to jointly develop a system to reduce emissions. The system proved to be less emissions-reducing than if each of the companies had implemented such a system independently. As in the case of the Consumer Detergents, the car companies used the joint initiative to not to compete as vigorously against each other rather than striving to develop the most effective system for NOx-cleaning.
Despite its relative irrelevance in practice, the debate on sustainability in competition law did not abate in academic circles. It factored, and continues to factor, into an overall debate on the weight that should be given to non-economic public policy objectives in EU antitrust law. Kingston (2011), for example, argues that environmental concerns form part of the broader understanding of “consumer interest or consumer wellbeing” in EU antitrust law and could legitimately be considered in competition analysis.11 According to her, there are valid legal, governance and economics arguments to attend to environmental concerns under EU antitrust rules. When it comes to the legal argument, EU competition law needs to be considered as an integral part of the EU legal system. Article 11 tfeu states that “Environmental protection
The real sustainability turn in EU competition law can be dated to 2019, when then new Commission President Ursula von der Leyen announced the Green Deal as one of the key policy pillars for her presidency.13 The next section briefly discusses the Green Deal and its competition policy-specific impact.
2.1 The EU Green Deal Agenda for EU Competition Law
2.1.1 The Path towards Greening EU Antitrust Law
In December 2019, under the lead of the then newly elected Commission President von der Leyen, the Commission Published its first Communication on the European Green Deal.14 The Green Deal sets as its main goal transforming the EU to a net zero economy, i.e., cutting greenhouse gas emission close to zero, or finding another way of compensating for emissions (e.g. by re-absorbing CO2 from the atmosphere). It puts out a sweeping policy reform, including transitioning to renewable energies, establishing a circular economy in all industry sectors, fostering green finance, greening public budgets, increasing ecological preservation efforts, as well as providing education on sustainability. At the same time, the Commission also commits in the Green Deal to a just transition that should not disadvantage any part of the population disproportionately.
2.1.2 Horizontal Sustainability Agreements
One of the result of this public debate was a section on sustainability agreements in the new Horizontal Guidelines published by the EU Commission on June 1, 2023.17 The Guidelines recognize that negative externalities from business and consumer conduct that harm sustainability objectives are first and foremost mitigated by regulation, pricing mechanisms like the EU’s emission trading system, and taxation.18 Still, competition law could have a role to play for any residual negative externalities that are not remedied by these mechanisms and could be remedied by collaboration between competitors.
The most interesting part of the Guidelines on sustainability agreements can be found in the analysis of how the efficiency defense under Article 101 (3) tfeu may apply to sustainability agreements. The Commission finds that, in principle, sustainability agreements have the potential of yielding significant efficiencies, e.g. due to improved technologies, innovation, consumer choice, and more resilient infrastructure or supply chains.22 They will thus regularly fulfill the first criterion under Article 101(3) tfeu. When in it comes to the indispensability or necessity prong, it is interesting to note that a sustainability agreement will not be considered indispensable if EU or national laws require the same companies to comply with specific sustainability goals.23 This is a relevant point when it comes to analyzing the impact of mandatory hrdd obligations on EU antitrust law.24
Individual use value benefits include the direct benefits for consumers on the market to which the agreement applies to.27 Consuming eggs from free range chicken that have not received antibiotics as a result of an agreement between competing egg producers to stop using antibiotics in chicken, for example, gives health benefits to the consumers of those eggs.
Individual non-use value benefits are indirect benefits that accrue to consumers in the relevant market because of how others benefit from their consumption choices.28 The Commission gives the example of consumers that prefer to buy detergents that are less water-contaminating. While this detergent might not have a better cleaning action, the consumer in question might still prefer it for its positive impact on the environment. In this sense, consumers in the relevant market value the product for its beneficial effect on others. The Commission considers these benefits as equal to individual use value benefits.
Lastly, collective benefits are those that accrue irrespective of an individual consumers appreciation of the product in question.29 The Commission will only take collective benefits into account if the group of consumers in the relevant market overlaps with the group of beneficiaries. As an example, the Commission gives a situation where drivers (consumer in the relevant market) that purchase less polluting fuel also benefit as citizens (broader group of beneficiaries) from cleaner air.30 As these drivers are also citizens, there is an
The dividing line between individual non-use value benefits and collective benefits is, blurry. It seems to all boil down to the evidence that can be brought as to consumer preferences and willingness to pay for certain products and technologies, and whether it can be shown that users value a certain benefit to others or not. This evidence is to be gathered via consumer surveys according to the Commission.32
2.1.3 Vertical Agreements, Abuse of Dominance, and Merger Control
So far, the EU Commission has only started to position itself towards sustainability competition considerations in the case of horizontal agreements, i.e. agreements between competitors. Antitrust law, however, is also concerned with vertical agreements, abuses of dominance, and merger control.
In terms of vertical agreements, i.e. agreements along the supply chain, the Commission has not found it necessary to provide lengthy elaborations of how to treat vertical restrictions that pursue a sustainability objective. In its Vertical Guidelines,33 the Commission limits itself to highlighting that vertical restraints from sustainability-enhancing agreements will be judged according to the general approach to vertical agreements, which is more lenient compared to its approach towards horizontal agreements. The 2022 Vertical Block Exemption Regulation does not mention sustainability explicitly.34
Lastly, the Commission also does not see much reason to implement any changes to its merger control regime to better account for sustainability effects from mergers. In a Policy Brief from September 2021,38 the Commission stated that its merger analysis framework was sufficiently developed to consider consumer preferences, innovation concerns, and environmental harm, which were also of relevance when factoring sustainability concerns into the merger analysis. Therefore, no fundamental reform was necessary in order go green for merger control.
2.2 National Initiatives
While the sustainability agenda gathered momentum in EU competition law, developments also took place at the national level. The Dutch Competition Authority (“acm”) was a forerunner by publishing Draft Sustainability Guidelines in 2021.39 To date, the acm has followed its Guidelines by issuing several statements as to agreements fostering sustainability objectives that
consumers shall also be deemed to enjoy a fair share of the benefits which result from improvements to the production or distribution of goods or the promotion of technical or economic progress if those benefits contribute substantially to an ecologically sustainable or climate-neutral economy.44
In principle, national and EU antitrust law provisions should be fully harmonized when it comes to the assessment of anti-competitive agreements.45 From the wording of the Austrian provision, it appears, however, that collective benefits would be fully considered when companies claim an exemption for a sustainability agreement.46 It thus appears to point towards a broader
In Germany, there have been no legislative amendments or guidelines introduced so far, but policy changes might likely occur in the future. In March 2023, the German Ministry for the Economy and Climate Protection published a Report on Competition and Sustainability commissioned from a group of law and economics scholars.47 The Report deals with all areas of antitrust law and merger control. Interestingly, the Report also engages with the issue of overlaps between antitrust law and mandatory hrdd legislation, but rather from a state action doctrine perspective: agreements that are formed to comply with the German Supply Chain Law should be immune from competition enforcement.48 Before engaging further with the impact of mandatory hrdd legislation on the greening efforts under EU antitrust law, the next section gives an overview of national hrdd legislation and the EU mandatory hrdd framework in the csddd.
3 Obligations on Undertakings under Mandatory hrdd Legislation
3.1 The ungps as the Origin of Mandatory hrdd Legislation
The origins of hrdd legislation can be traced back to the publication of UN Guiding Principles on Business and Human Rights published in 2011.49 The operational principles under the ungp’s “respect pillar”50 entail that multinational corporations should publish and implement policy commitments to meet their responsibility to respect human rights in their operations.
The focus under the ungps is on protecting human rights, and sustainability considerations are not separately mentioned. Nonetheless human rights risks emanating from the activities of multinational businesses often overlap with environmental and sustainability concerns. This has been the case in the past when businesses failed to live up to their obligations to respect human rights. When Shell, for example, started drilling for oil in Ogoniland (Nigeria), civil unrest ensued, which eventually led to the extrajudicial killing of several tribal leaders that had opposed the drilling.52 This was a grave violation of a variety of human rights. At the same time, the drilling operations also brought about vast environmental degradation to Ogoniland.53 In the mining sector, too, human rights violations and environmental damage have regularly gone hand in hand.54
4 National Initiatives: Mandatory Human Rights Due Diligence
After the UN Human Rights Council endorsed the ungps in 2011, several legislators followed up with making human rights due diligence compulsory through regulation.55 This section briefly focuses on three initiatives by three EU Member States: the 2017 French Vigilance Law,56 the 2019 Dutch Child
All three legal acts impose human rights due diligence obligations on companies incorporated or with an important business presence (in the form of a branch or subsidiary) in their jurisdiction. The German and French laws have set certain thresholds for the size of companies that are subject to mandatory hrdd,59 whereas Dutch law applies to companies irrespective of their size.60 All laws impose hrdd obligations in the form of conducting risk analyses, as well as reporting, transparency, and disclosure duties. Furthermore, all three acts impose these due diligence obligations beyond the companies’ own activities. The duties imposed under the Dutch law apply in respect of the entire supply chain of a company subject to the Dutch Child Labor Act. The obligations under the German Supply Chain law extend to direct and indirect suppliers.61 The French Vigilance law covers companies directly and indirectly controlled by the company subject to the vigilance obligations, as well as sub-contractors and supplies with which the entity has an established commercial relationship.62
The types of human rights and sustainability considerations in respect to which companies must conduct due diligence vary in the different laws. As the title of the Dutch act indicates, it is exclusively concerned with violations of children’s rights in the form of child labor, as defined by international law.63 The French Vigilance law has a broad formulation and applies to serious harms to fundamental rights and liberties, and health and safety of persons and the environment.64 The German Supply Chain Law, in contrast, has a closed list
Lastly, the enforcement of the various mandatory hrdd laws varies. The French Vigilance law establishes civil liability for companies that act in contravention of their obligations under the Vigilance law.66 It also gives standing to victims of human rights violations before French courts to claim damages suffered from human rights violations that could have been prevented if the company in question had fulfilled its due diligence obligations.67 The Dutch Child Labor Act, on the other hand, does not envisage civil liability as an enforcement tool. It only contains administrative68 and, in grave cases, criminal sanctions for non-compliance with its due diligence obligations.69 The German Supply Chain law combines public and private enforcement. It allows victims to task German labor unions or ngos to bring their claims before German civil courts.70 Furthermore, it allows competent authorities to investigate companies as to their compliance with their due diligence obligations71 and to impose fines in cases of non-compliance.72 As Quijano and Lopez (2021) stress, mandatory hrdd will only be effective and able to provide the opportunity to victims to obtain redress if it has both a legal basis for civil liability and a rigorous public enforcement in place.73 As the following section discusses, the EU Directive on Corporate Sustainability Due Diligence tries to follow such an approach.
5
In February 2022, the EU Commission published its Draft Directive on Corporate Sustainability Due Diligence,74 which was adopted by the European Parliament and Council by April 2024 and was published in the Official Journal on 5 July 2024 as Directive (EU) 2024/1760 on corporate sustainability due diligence (csddd). According to the Directive, EU companies with more than 1000 employees on average and a worldwide turnover exceeding eur 450 million will have to comply with the due diligence requirements of the Directive. The same applies to companies that do not reach those thresholds but are the ultimate parent company of a group that reached those thresholds. Furthermore, a company or the ultimate parent of a group that entered into franchise or license agreements in return for royalties in the EU with independent third parties can be subject to the obligations in the Directive if certain royalty and turnover thresholds are met.75 Companies incorporated outside the EU will be subject to the Directive’s obligations if their EU operations meet any of the thresholds just mentioned. Compared to French law, the EU-wide thresholds will be considerably lower, thus covering more companies than those covered under the thresholds of the French due diligence law.
Due diligence obligations will mainly cover the operation of the affected EU companies themselves, their subsidiaries, and “and the operations carried out by their business partners in the chains of activities of those companies.”76 The definition contained in the original proposal of “an established business relationship” has thus been removed. Human rights advocates had feared that it could be too narrow of a concept to catch all relevant actors in the supply chain that contribute to human rights violations.77 Prior experience with the French Vigilance law confirms these concerns, where the term “established commercial relationship” has led to legal uncertainty.78
–
Identifying actual and potential adverse human rights impacts and adverse environmental impacts arising from their own operations by setting up due diligence processes;79 – Preventing and mitigating adverse human rights and environmental impacts;80
– Bringing adverse impacts to an end;81 and
– Implementing a complaints procedure for unions, civil society organizations and victims.82
The EU Directive is similarly broad in its human rights focus as the French and German mandatory hrdd laws. It has a list83 as to the specific human rights violations it applies to, which is more extensive than the list contained in the German Supply Chain Law. The EU list includes, for example, the right to privacy and family life, the people’s right to dispose of a land’s natural resources and to not be deprived of means of subsistence, and the freedom of thought, conscience, and religion, which are not covered by the German list. When it comes to the list of environmental risks, the csddd contains more references to international instruments and areas than the German Supply Chain law.84
The csddd has arguably the farthest-reaching sustainability obligations compared to other hrdd legislation. Article 22 of the csddd requires that Member States oblige the companies subject to the csdd to adopt a plan for a business model and strategy, which “aims to ensure, through best efforts, that the business model and strategy of the company are compatible with the transition to a sustainable economy and with the limiting of global warming to 1,5°C in line with the Paris Agreement and the objective of achieving climate neutrality as established in Regulation (EU) 2021/1119, including its intermediate and 2050 climate neutrality targets, and where relevant, the exposure of the company to coal-, oil- and gas-related activities.”85 Any company that identifies a climate change risk from its operations needs to include an emission reduction objective in its plan. Furthermore, companies should make executive bonuses dependent on a director’s contribution to achieving the sustainability objectives.
6 Delineating the Interface between the csddd and EU Competition Law
So, what impact should mandatory hrdd legislation such as the csddd have on efforts under EU antitrust law to incorporate sustainability considerations? This contribution will answer this question by starting from a very simple hypothesis, to then highlight the actual complexity due to the different scopes of antitrust law and mandatory hrdd legislation.
The hypothesis is the following: if mandatory hrdd legislation already imposes obligations on companies to implement codes of conduct with their business partners and to monitor their supply chains to ensure they operate in a socially and environmentally sustainable way, any sustainability efforts resulting from these obligations should not be a valid justification for otherwise anti-competitive behavior under antitrust law.89
– The characteristics of the companies in question;
– The nature of the agreement (horizontal or vertical); and
– The nature of the sustainability objective.
For the sake of simplicity, the following sections refer to the csddd. Parallel considerations would apply to the national hrddd legislations discussed, but adjusted to their specific provisions.
6.1 The Characteristics of the Companies in Question
– companies that are incorporated in one of the EU Member States, have more than 1000 employees, and a minimum world-wide turnover of 450 million Euro in the last financial year;
– companies that do not meet those thresholds but are the ultimate parent company of a group that reached those thresholds;
– companies or ultimate parent companies of a group that entered into franchise or license agreements in return for in return for royalties in the EU with independent third parties if certain thresholds are met;
– companies incorporated outside the EU whose operations inside the EU meet one of the thresholds listed above.
From this consideration, a de-minimis doctrine could be applied to the invocation of a sustainability defense under EU antitrust law, which would only allow smaller companies that do not meet the thresholds for mandatory hrdd to invoke a sustainability defense under EU law. Yet, this filter is not accurate enough yet to delineate the area of overlap. Furthermore, the nature of the agreement or behavior in question is of relevance.
7
The nature of the agreement or behavior is also relevant to determine the area of overlap. The due diligence obligations under the csddd apply to “actual and potential human rights adverse impacts and environmental adverse impacts, with respect to their own operations, the operations of their subsidiaries, and the operations carried out by their business partners in the chains of activities of those companies”.90
Translating this into antitrust parlance, the obligations regarding social and environmental sustainability under the csddd concern both the companies’ own operations and those of its subsidiaries, i.e. what would be referred to as unilateral conduct, which is scrutinized under Article 102 tfeu.91 The entire sustainability debate has not progressed far under Article 102 tfeu. Yet, the obligations under the csddd would, strongly limit a sustainability defense under Article 102 tfeu, given that a dominant undertaking in the internal market will likely also have the number of employees and turnover to fall into the scope of the csddd.
The obligations under the csddd also apply to “the operations carried out by their business partners in the chains of activities of those companies.” Again, translating to antitrust parlance, the csddd is predominantly concerned with vertical agreements. If companies subject to the csddd are obliged to implement sustainability considerations into their vertical agreements, would there still be room to justify any horizontal agreements between competitors subject to mandatory hrdd? Prima facie, the answer would be probably not. After all, each individual competitor would already be obliged to do so individually under the csdd.
The German Federal Cartel Office has to some extent addressed this question in a decision from November 2021.92 In it, it analyzed an agreement between
The situation for sustainability standardization agreements might be different. However, for companies that are subject to mandatory hrdd obligations, these agreements would, if at all, be justified on the same grounds as any other standardization agreements: for the pure economic efficiencies that they bring, and not their sustainability dimension.
The delineation of the area of overlap is not complete yet, however. It still depends on the specific sustainability objective of an agreement or conduct whether there is a true overlap which disqualifies a specific sustainability defense under antitrust law.
8 The Nature of the Sustainability Objective
Last, but not least, the overlap between hrdd obligations and a sustainability safe harbor under antitrust will depend on the specific sustainability objective of an agreement or conduct. In principle, all pieces of national hrdd
9 Conclusion
The planet is facing a climate crisis of unknown magnitude, and all policy makers should indeed be committed to doing their part to mitigate the climate crisis and all its negative repercussions on biodiversity, animal health, and human health and safety of current and future generations. When it comes to EU antitrust law and policy, however, this chapter tries to caution the enthusiasm with which sustainability has been embraced in antitrust law circles as a justification for otherwise anti-competitive conduct. Existing and future mandatory hrdd instruments at national and EU level will already go far in imposing obligations on companies to factor sustainability considerations into their operations and supply chains. Sustainability objectives should only be accepted as a valid justification for conduct violating antitrust rules if they go beyond the obligations of mandatory hrdd regimes. Otherwise, competition might be restricted to an extent that is not justified by any gains in
Quote from the website of Extinction Rebellion, “This is an Emergency,” Extinction Rebellion, accessed May 20, 2024,
EU Commission Proposal for a Directive of the European Parliament and of the Council on Corporate Sustainability Due Diligence and amending Directive (EU) 2019/1937, com(2022) 71 final, 2022/0051(cod) (“csddd”).
See Julian Nowag, “Competition Law’s Sustainability Gap? Tools for an Examination and a Brief Overview,” Nordic Journal of European Law 5, no. 1 (2022): 149–65; Simon Holmes, “Climate change, sustainability, and competition law,” Journal of Antitrust Enforcement 8, no. 2 (July 2020): 354–405.
2000/475/ec: Commission Decision of 24 January 1999 relating to a proceeding under Article 81 of the ec Treaty and Article 53 of the eea Agreement (Case iv.F.1/36.718. ceced), oj l 187, January 24, 1999 (“ceced”).
Giorgio Monti, “Implementing a Sustainability Agenda in EU Competition Law,” presented at Vienna Competition Law Days – Vienna University of Economics, September 17–18, 2022.
Communication from the Commission – Notice – Guidelines on the application of Article 81(3) of the Treaty (text with eea relevance), oj c 101, 2004/c 101/08.
The Horizontal Guidelines set out the principles that the Commission applies when assessing horizontal cooperation agreements under Article 101 tfeu. Horizontal cooperation agreements refer to agreements between actual or potential competitors. See Communication from the Commission, Guidelines on the applicability of Article 101 of the Treaty on the Functioning of the European Union to horizontal co-operation agreements (Text with eea relevance), oj c 11, 2011/c 11/01 (“2011 Horizontal Guidelines”).
Id. at 308.
at.39579 Consumer detergents (2011) (for more information, see “Competition Policy,” European Commission, April 13, 2011,
at.40178 – Car Emissions (2021) (for more information, see “Competition Policy,” European Commission, July 8, 2021,
Suzanne Kingston, Greening EU Competition Law and Policy (Cambridge: Cambridge University Press, 2011), 39.
For some suggestions about the how, see Monti, “Implementing a Sustainability Agenda,” supra note 5, at footnote 1.
Klaudia Majcher and Viktoria H.S.E. Robertson, “The Twin Transition to a Green and Digital Economy: The Role for EU Competition Law,” in Research Handbook on Sustainability and Competition Law, ed. Julian Nowag (Edward Elgar Publishing, 2024), 192–210.
Communication from the Commission: The European Green Deal, com(2019) 640 final, December 11, 2019 (text available online at Communication from the Commission to the European Parliament, the European Council, the Council, the European Economic and Social Committee and the Committee of the Regions: The European Green Deal, European Commission, December 11, 2019,
Elisabetta Righini, Javier Ruiz-Calzado, David Little, and Pierre Bichet, “The European Green Deal & Competition Policy – Call for Contributions on how EU Competition Rules and Sustainability Policies Can Work Together”, Kluwer Competition Law Blog, October 19, 2020,
Prim Jansen, Sarah J. Beeston, and Liesbet Van Acker, “The sustainability guidelines of the Netherlands Authority for Consumers and Markets: an impetus for a modern EU approach to sustainability and competition policy reflecting the principle that the polluter pays?,” European Competition Journal 18, no. 2 (October 2021): 287–327, 290.
Communication from the Commission: Guidelines on the applicability of Article 101 of the Treaty on the Functioning of the European Union to horizontal co-operation agreements, oj c 259, 2023/C, July 21, 2023 (“2023 Horizontal Guidelines”).
Id. at para. 520.
Id. at para. 534.
Id. at para. 546.
Id. at para. 549.
Id. at para. 558.
Id. at para. 564.
For an extended discussion, see infra Section 4.
Jansen, Beeston, and Van Acker, “The sustainability guidelines,” supra note 16.
2023 Horizontal Guidelines, supra note 17, at para. 569.
Id. at para. 571–74.
Id. at para. 575–81.
Id. at para. 582–89.
Id. at para. 585.
Id.
Id. at para. 597.
Communication from the Commission: Commission notice – Guidelines on Vertical Restraints, oj c 248, 2022/C 248/01, 8.
Commission Regulation (EU) 2022/720 of 10 May 2022 on the application of Article 101(3) of the Treaty on the Functioning of the European Union to categories of vertical agreements and concerted practices (Text with eea relevance), oj l 134, C/2022/3015.
Albeit focusing more on the shield function in this chapter, sustainability concerns could act like a sword under Article 101 tfeu, too. See Nowag, “Competition Law’s Sustainability Gap?,” supra note 3; Holmes, “Climate change,” supra note 3.
To some extent, the cjeu has endorsed such an approach in the Facebook Case. See the Judgment of the Court (Grand Chamber) of 4 July 2023, Meta Platforms Inc and Others v Bundeskartellamt, C-252/21 Facebook v Bundeskartellamt, ecli:eu:c:2023:537.
See Amendments to the Communication from the Commission – Guidance on the Commission’s enforcement priorities in applying Article 82 of the ec Treaty to abusive exclusionary conduct by dominant undertakings (Text with eea relevance), oj c 116, 2023/C 116/01, March 31, 2023, Annex.
Alexandra Badea et al., “Competition Policy in Support of Europe’s Green Ambition,” Competition Policy Brief, September 2021,
“Guidelines regarding Sustainability claims,” Authority for Consumers & Markets, June 13, 2023,
“acm: Shell and TotalEnergies can collaborate in the storage of CO2 in empty North Sea gas fields,” Authority for Consumers & Markets, June 27, 2022,
“acm agrees to arrangements of garden centers to curtail use of illegal pesticides,” Authority for Consumers & Markets, September 2, 2022,
“Competition & Sustainability Law,” Hellenic Competition Commission, March 2023,
Viktoria H.S.E. Robertson, “Sustainability: A World-First Green Exemption in Austrian Competition Law,” Journal of European Competition Law & Practice 13, no. 6 (September 2022): 426–34.
“Die Verbraucher sind auch dann angemessen beteiligt, wenn der Gewinn, der aus der Verbesserung der Warenerzeugung oder -verteilung oder der Förderung des technischen oder wirtschaftlichen Fortschritts entsteht, zu einer ökologisch nachhaltigen oder klimaneutralen Wirtschaft wesentlich beiträgt.”
Council Regulation (ec) No 1/2003 of 16 December 2002 on the implementation of the rules on competition laid down in Articles 81 and 82 of the Treaty (Text with eea relevance), oj l 1, January 4, 2003, Article 3(2).
Robertson, “Sustainability,” supra note 43.
“Wettbewerb und Nachhaltigkeit in Deutschland und der EU,” Heinrich Heine Universität Düsseldorf, March 2023,
Id. at 88. See also Roman Inderst and Stefan Tomas, “Legal Design in Sustainable Antitrust,” Journal of Competition Law & Economics 19, no. 4 (December 2023): 556–79.
“Guiding Principles on Business and Human Rights,” United Nations Human Rights Office of the High Commissioner (“ohchr”), accessed 6 February 2023,
The ungp framework is built on three pillars. The first pillar, entitled “protect,” deals with the obligations of states to create legal frameworks that hold corporations accountable for their human rights obligations, and thus protect their victims. The second pillar, “respect,” imposes an obligation on multinational corporations to respect human rights. The third pillar, “remedy,” stipulates that both states and multinational corporations should implement mechanisms to remedy human rights violations and to give victims access to redress.
ungps, supra note 49, at Principle 18.
John Gerard Ruggie, Just Business: Multinational Corporations and Human Rights (New York: ww Norton & Company, 2013), 10.
Id.
For several examples of such socio-environmental conflicts caused by mining companies, see Rajiv Maher, “De-contextualized Corporate Human Rights Benchmarks: Whose Perspective Counts? See Disclaimer,” Business and Human Rights Journal 5, no. 1 (January 2020): 156–63.
Gabriela Quijano and Carlos Lopez, “Rise of Mandatory Human Rights Due Diligence: A Beacon of Hope or a Double-Edged Sword?,” Business and Human Rights Journal 6, no. 2 (June 2021) : 241–54.
loi n° 2017–399 du 27 mars 2017 relative au devoir de vigilance des sociétés mères et des entreprises donneuses d’ordre (1) (“French Vigilance Law”).
Wet van 24 oktober 2019 houdende de invoering van een zorgplicht ter voorkoming van de levering van goederen en diensten die met behulp van kinderarbeid tot stand zijn gekomen (Wet zorgplicht kinderarbeid) (“Dutch Child Labor Act”).
Gesetz über die unternehmerischen Sorgfaltspflichten in Lieferketten vom 16. Juli 2021, BGBl, 2021 i Nr. 46, Seite 2959 (“German Supply Chain Law”).
The French Vigilance Law, supra note 56, applies to companies with more than 5,000 employees in direct or indirect subsidiaries based in France, and with more than 10,000 employees when including direct and indirect subsidiaries globally. The German Supply Chain Act applies from 1 January 2024 to companies with more than 1,000 employees (from 1 January 2023 to 1 January 2024 it applies to companies with more than 3000 employees).
According to Article 4 of the Dutch Child Labor Act, supra note 57, the due diligence obligations apply to companies incorporated in the Netherlands and foreign companies that sell goods or services to Dutch consumers.
German Supply Chain Law, supra note 58, at para. 1.
Article L225-102-4 of the French Code de Commerce.
Dutch Child Labor Act, supra note 57, at Article 2.
French Code de Commerce, supra note 62.
See German Supply Chain Law, supra note 58, at para. 2(2).
French Code de Commerce, supra note 62.
Id.
Dutch Child Labor Act, supra note 57, at Articles 7 and 8.
Id. at Article 9.
German Supply Chain Law, supra note 58, at para. 11.
Id. at paras 16–18.
Id. at paras. 23 and 24.
Quijano and Lopez, “Rise of Mandatory Human Rights Due Diligence,” supra note 55, at 244.
supra note 2.
Directive 2024/1760, Article 2(1).
Id. at Article 1(1)(a).
C Patz (2022). The EU’s Draft Corporate Sustainability Due Diligence Directive: A First Assessment. Business and Human Rights Journal 7, 291–297, 292.
Elsa Savourey and Stéphane Brabant, “The French Law on the Duty of Vigilance: Theoretical and Practical Challenges Since its Adoption,” Business and Human Rights Journal 6, no. 1 (February 2021): 141–52.
Article 8 Directive 2024/1760.
Id. at Article 8 to 10.
Id. at Article 11.
Id. at Article 14.
See id. at Annex Part i.
See id. at Annex Part ii.
Id. at Article 22.
Id. at Articles 25-27.
Id. at Article 29.
Id. at Article 22(1).
This hypothesis is different from the current text of the csddd, which in several articles suggests that companies should act in a competition law-compliant manner when collaborating with other entities in order to increase the company’s ability to prevent or mitigate the adverse human rights or environmental impact (Article 10(2)(f)) and when coordinating to bring adverse human rights impacts to and end (Article 11(3)(g)). (See id. at Articles 10(2)(f) and 11(3)(g)). This contribution is interested on assessing the impact of the csddd on the scope of a sustainability defense under EU competition law with the stated hypothesis.
Id. at Article 1(1)(a).
Subsidiaries are defined as “a legal person through which the activity of a ‘controlled undertaking’ as defined in Article 2(1), point (f), of Directive 2004/109/ec of the European Parliament and of the Council is exercised” (id. at Article 3(d)), which would thus be considered a single economic entity with the parent under EU antitrust law.
German Federal Cartel Office, Decision from 25 November 2021, B2-90/21 Arbeitsgruppe des deutschen Einzelhandels – Nachhaltigkeitsinitiative zur Förderung existenzsichernder Löhne im Bananensektor (text in English available at “German Retailers Working Group – Sustainability initiative to promote living wages in the bana sector,” Budeskartellamt, March 8, 2022,
At this point, one might question the effectiveness of the agreement to actually deliver better working conditions for banana workers in Ecuador, but this is not the main focus of this chapter.
See, e.g., the collaboration between the UK Competition and Markets Authority and the UK Information Commissioner’s Office at “Competition and data protection in digital markets: a joint statement between the cma and the ico,” Information Commissioner’s Office (“ico”), May 19, 2021,