No C 206/34 Official Journal of the European Communities 6. 8. 84 
Opinion on the draft Commission Regulation concerning the application of 
Article 85 (3) of the Treaty to categories of agreements relating to research and 
development 
(84/C 206/11) 
The text referred to the Committee has been published in Official Journal of the Euro­
pean Communities No C 16 of 21 January 1984, page 3. 
A. LEGAL BASIS FOR THE OPINION 
The Committee's Bureau decided on 22 November 1983, in accordance with Article 20 
(3) of the Rules of Procedure, to deliver an opinion on the abovementioned matter. 
Procedure: 
Asked to prepare work on the matter, the Section for Industry, Commerce, Crafts and 
Services adopted its opinion on 4 April 1984. The rapporteur was Mr Mourgues. 
B. OPINION OF THE ECONOMIC AND SOCIAL COMMITTEE 
At its 217th Plenary Session, meeting of 23 May 1984, the Economic and Social 
Committee adopted the following opinion by 91 votes to one with five abstentions. 
1.1. The ESC has constantly endorsed the efforts 
of the Commission and Council to strengthen the 
capacity of European firms to innovate and carry 
out research ('). The Committee is accordingly sym­
pathetic to the thinking underlying the present draft 
Regulation. 
Nevertheless the Committee has, in addition to 
comments on the form of the document (para­
graph 1.2 below), also more basic criticism regarding 
the proposed restrictions on exemption (para­
graphs 2.1 to 6 below). 
1.2. First a comment of a general nature: the Com­
mission text lacks clarity; non-equivalent terms are 
used in the different language versions; whole sen­
tences are taken from other Regulations without 
using exactly the same words, etc. The Committee 
would take this opportunity to stress the importance 
of accurate drafting since such Regulations are 
directly applicable to, and primarily intended for, 
Community firms. 
1.3. The draft Regulation comes in for so much 
serious criticism from the Committee that the Com­
mission would be well advised to revise it. 
(') For instance in the opinion on the '12th annual report 
on competition policy'(3.3) and the opinion on the 
'Financing of innovation within the Community'(12 
and 1.3) (OJ No C 341, 19. 12. 1983 and OJ No C 358, 
31. 12. 1983; OJ No C 23, 30. 1. 1984). 1.4. The underlying reason for the draft Regulation 
is the need to increase firms' competitive capacity in 
the interests of the European Community. 
In this respect research and development (hereinaf­
ter abbreviated to R & D) is of fundamental import­
ance to industries of the future since its purpose is 
not only to promote technical economic progress 
but also cut costs. 
The benefits derived from R & D in the Community 
(particularly in the field of innovation) will: 
— guarantee the survival and development of the 
Community's industries by increasing their cap­
acity to export outside the Community, and will 
ensure that such industries are able to compete 
with third-country imports, 
— lead to improvements in living standards in the 
European Community. 
Limits to the inapplicability of Article 85 (1) 
2.1. Taking into account the absolute need to 
ensure that Community industry is competitive, 
R&D must be more involved in creating new prod­
ucts, developing design procedures, e.g. computer-
assisted design (CAD), developing production pro-
6.8.84 Official Journal of the European Communities No C 206/35 
cesses and introducing new technologies. The draft 
Regulation lays down two types of measures which 
may occasionally militate against attainment of the 
objectives, namely: 
— those concerning agreements extending cooper­
ation between firms with an aggregate turnover 
of more than 500 million ECU, into the field of 
production, 
— those concerning agreements to which more 
than one of the three actually or potentially 
leading undertakings in the sector to which the 
research and development programme relates 
are party. 
These obligations may, however, be set aside under 
the conditions laid down in Articles 5 and 6 of the 
draft Regulation which state firstly that the agree­
ments must be notified to the Commission and 
secondly that the Commission must not oppose 
them. 
2.2. The Committee considers that these restric­
tions will not ensure protection of undistorted com­
petition in the case of R & D. This is partly because 
the 500 million ECU threshold is felt to be an arbi­
trary figure, and one that will probably be hard to 
monitor, and partly because the definition of 'actu­
ally or potentially leading undertakings' in any 
given area of economic activity could be stretched 
ad infinitum by an excessive fragmentation of sec­
tors of production, thus giving rise to suspect inter­
pretations. The Committee would add that the ceil­
ing of 100 million ECU is no longer to be found in 
the latest version of the proposal for a Commission 
Regulation on the application of Article 85 (3) of 
the Treaty to certain categories of patent licensing 
agreements. 
2.3. Under these circumstances the Committee has 
thought up an alternative solution and proposes that 
Article 1 (3) (a) and (b) be amended to incorporate 
restrictive provisions under which R&D agree­
ments concluded by one or more Community firms 
with non-EEC firms are subject to a notification 
requirement; it goes without saying, however, that 
R&D agreements concluded by Community firms 
with Community subsidiaries of non-EEC firms are 
not subject to this notification requirement. Such 
notification should make it possible to protect the 
positive results of R & D agreements so that they 
'do not find their way to competitors outside the EC 
before the products are ready for marketing'. 
2.4. Strictly speaking, this counter-proposal does 
not fall within the terms of reference of DG IV (competition). It may also create problems in imple­
menting or applying international trade agreements. 
Nevertheless it does take into account current Com­
munity preoccupations and is likely (a) to facilitate 
the task of protecting the EEC's economic area, and 
(b) to advance the legal provisions necessary for the 
implementation of a common industrial policy (cf. 
paragraph 7.2 below). 
The terms of R & D cooperation agreements 
3.1. If there is to be a declaration that Treaty 
Article 85 (1) is inapplicable, agreements must in all 
cases be concluded between firms in conformity 
with the draft Regulation and making express refer­
ence thereto. Such agreements must also lay down 
common R&D objectives and be drawn up in the 
spirit of the eighth recital of the draft Regulation. 
3.2. In the event of complaints by third parties 
about distorted competition, the agreement would 
be laid before the Commission or competent legal 
authorities. The confidentiality of R & D informa­
tion and objectives should under all circumstances 
be safeguarded. 
3.3. With particular reference to the periods of val­
idity of agreements, Article 2.1 (d) and (e) of the 
draft Regulation should be reworded in order to pre­
clude contradictory obligations. The two-year time 
limit laid down in Article 2.1 (d) would in any case 
appear to be too short. 
3.4. At a more general level the Committee won­
ders whether the obligations listed in Article 2 are 
realistic and exhaustive. It also asks whether, from 
the point of view of implementing the Regulation, it 
would not be more effective to list prohibitions 
rather than obligations. 
Agreements subject to the notification requirement 
4.1. Article 5 will at all events have to be amended 
to take account of the alternative proposed above in 
paragraph 2.3. Rules governing the notification or 
accompanying communication could, however, still 
follow the procedure laid down in the draft Regula­
tion. 
4.2. With regard to Article 5 (4) and (5) in parti­
cular, the Commission may oppose the exemption 
either on its own authority or if it receives a rea­
soned request to do so from a Member State. The 
Committee believes here that the Commission 
No C 206/36 Official Journal of the European Communities 6.8.84 
should retain the sole right to withdraw opposition; 
consultations with Member States should be 
optional and of an advisory nature only. 
4.3. With regard to Article 6, the Committee notes 
that the notification procedure for all R&D agree­
ments must be a uniform one, if only to make it eas­
ier to monitor the financial benefits accruing from 
the Community's budget, particularly in the form of 
grants and soft loans. 
Legal certainty regarding the exploitation of results of 
R&D agreements 
5.1. In cases where the results of the R&D pro­
gramme are considered by the parties to the agree­
ment to be satisfactory and capable of exploitation, 
applications for licences or patents are filed. These 
call for the requisite legal guarantees — at least in 
the Community. In this connection the ESC is cur­
rently drawing up an opinion on the draft Commis­
sion Regulation concerning the application of 
Article 85 (3) of the Treaty to categories of patent 
licensing agreements. 
5.2. It is therefore proposed that a chapter on the 
filing of licences or patents be inserted at the end of 
each R&D agreement (see above, 'The terms of 
R&D cooperation agreements') since steps must be 
taken to ensure that there is no uncontrolled transfer 
of joint research findings to third parties. This chap­
ter in the agreement would obviously have to be in 
keeping with the provisions covering exemptions 
from Treaty Article 85 (1). 
Withdrawal of the exemption 
6.1. Article 7, which concerns the withdrawal of 
the exemption, should do no more than establish 
this Commission right by referring to the fact that 
the conditions laid down in Treaty Article 85 (3) 
have not been fulfilled. The conditions set out in 
Article 7 (a), (b) and (c) are pointless. 
6.2. Paragraph (a) is already to be found in the 
Treaty; paragraph (b) has no basis and its imprecise 
Done at Brussels, 23 May 1984. character is likely to make it legally unacceptable; 
paragraph (c) contains a condition which is to be 
found in all Commission Regulations. The introduc­
tion of such a condition should be tied to criteria 
relevant to the objectives of the Regulation in ques­
tion. In this particular case the Commission should 
exercise desirable flexibility. Without it there is no 
chance of implementing a functional competition 
policy, particularly at a time when Community firms 
need a solid legal framework and adequate stimulus 
to stand up to competition from third countries and 
meet the challenge of new technologies. 
Other provisions 
7.1. The Committee welcomes the declaration of 
the Commission representative on the continuing 
validity of the 'communication on agreements, deci­
sions and concerted practices relating to inter-firm 
cooperation ('). Steps should nevertheless be taken 
to ensure that the Regulation and communication 
are consistent. The Committee also notes the confir­
mation that R&D agreements are to be extended to 
cover research findings in agriculture, the agri-food­
stuffs sectors and biotechnology. 
7.2. The Committee notes that the substantial 
increase in the number of exemptions from 
Article 85(1) gives the Commission the necessary 
legal means to further a common industrial policy in 
the absence of a genuine Community strategy (2). 
7.3. The draft Regulation is and must remain 'in 
accord with the spirit' of the Treaty of Rome 
although its 12-year period of validity (Article 10) 
seems to be making a hard-and-fast rule of the 
exemption provided for in Article 85 (3) of the 
Treaty and carries the inherent risk that the key 
provisions of Article 85 (1) might be applied only in 
exceptional circumstances. In other words, if a deci­
sion is taken at a political level to embark on this 
course, an appropriate amendment of the Treaty 
would be preferable. 
(') OJNoC75, 29. 7. 1968. 
(2) Opinion on the '12th report on competition policy' 
(paragraph 6.2). 
The Chairman 
of the Economic and Social Committee 
Francois CEYRAC 
6. 8. 84 Official Journal of the European Communities No C 206/37 
APPENDIX 
to the opinion of the Economic and Social Committee 
Rejected amendments 
The following amendments to the Section opinion, tabled in accordance with the Rules of Proce­
dure, were rejected during the Committee's debate: 
Points 2.3 and 2.4 
Replace paragraphs 2.3 and 2.4 by the following text: 
'The Committee considers that R&D agreements should receive unrestricted exemption on the 
basis of Article 85 (3) of the Treaty. The question of competition only arises when research find­
ings have found practical application with a view to the manufacture and marketing of products. 
Joint production and marketing agreements which make use of research findings should in any 
case be exempted from Article 85 (1) by virtue of one of the block exemptions provided for under 
Article 85 (3) of the Treaty.' 
Reasons: 
If the notification of R & D agreements is considered necessary (as stated in points 2.3 and 2.4 of 
the opinion and something which I dispute) it is not legally possible to restrict notification to 
agreements between one or more Community firms and non-EEC firms. Such agreements are in 
any case valuable for the promotion of research in the EEC, which is lagging behind the United 
States and Japan. If the aim is to reach Japanese and American levels then it is desirable in some 
cases to take advantage of their know-how by cooperating in the field of research. 
The claim that notification would prevent non-EEC firms from taking advantage of the agree­
ments because they are themselves contracting parties is without foundation. 
The reasons for replacing paragraphs 2.3 and 2.4 are therefore basically self-explanatory. 
Voting: 
Votes in favour: 23, votes against: 48, abstentions: 10. 
Points 4.1 to 4.3 
Replace points 4.1 to 4.3 by the following: 
'Agreements subject to the notification requirement 
4.1. When R&D agreements result in agreements on the pooling of research findings for the 
purpose of manufacturing and marketing new products, notification should be required if such 
manufacturing and marketing is likely to make inroads into the market in which these new prod­
ucts will compete.' 
Reasons: 
See the other amendment (to points 2.3 and 2.4 of the opinion). 
Voting: 
Votes in favour: 21, votes against: 62, abstentions: 9.