WRITTEN QUESTION P-0069/01

by Alexander de Roo (Verts/ALE) to the Commission

(18 January 2001)

Subject: Compatibility of collective agreements between producers on the recycling costs of electrical and electronic equipment and scrap motor cars with European competition rules

In its proposal for a directive on waste electrical and electronic equipment of 13 June 2000 (COM/2000/0347)(1) the Commission requires producers and importers to set up a scheme for recycling electrical and electronic equipment, and to meet the full cost of doing so.

The proposal for a directive has nothing to say about how arrangements for the scheme's financing are to be implemented. The choice is between a scheme under which recycling costs would be met from a common fund (collective scheme) or a scheme on an individual basis under which producers would meet only the cost of recycling their own products. The collective scheme offers individual enterprises no financial incentives (such as eco-design or slimmed down organisation) for minimising retrieval costs. The individual scheme does offer financial incentives, and should consequently be preferred on economic as well as environmental grounds.

The Netherlands is the only country to date where any such collective schemes operate. To enable recycling both of electrical and electronic equipment and of scrap motor cars, the consumer pays a uniform contribution per product. The Netherlands competition authority is currently seeking to establish whether or not the scheme for electrical and electronic equipment is compatible with EU competition rules. At all events, under the collective scheme enterprises enter into cost-sharing arrangements with each other. Pricing agreements are in principle prohibited. In the past, the German federal cartels authority had also prohibited the so-called visible fee with the argument that this involved a standard costs factor and that arrangements based on it consequently were tantamount to unlawful pricing agreements. The expectation is that the Netherlands cartels authority will also shortly rule against this collective scheme. Although both cartel authorities cooperate closely with the European Commission's Competition DG, the latter has itself still not issued a ruling on the compatibility of the Netherlands collective scheme with European competition rules.

Does the Commission agree that the Netherlands collective schemes for financing the recycling of electrical and electronic equipment and scrap motor cars are incompatible with European competition rules?

(1) OJ C 365 E, 19.12.2000, p. 184.

Answer given by Mr Monti on behalf of the Commission

(20 February 2001)

The pursuit of environmental objectives, such as proposed in the proposal for a Directive on waste electrical and electronic equipment referred to by the Honourable Member, often leads to the creation of new economic activities and markets. Community competition policy aims primarily at ensuring that these new markets stay open and that competition can take place. In more concrete terms, the Commission seeks to ensure that companies with environmental obligations have a real choice of alternative means of fulfilling those obligations, so that the price paid by consumers is not excessively high. More specific principles concerning the assessment of horizontal environmental co-operation agreements have been recently set out in the Commission's notice Guidelines on the applicability of Article 81 of the EC Treaty to horizontal co-operation agreements(1). It should be stressed that the European competition rules only apply to those restrictions of competition which may affect trade between Member States. In practice, this issue needs to be examined on a case-by-case basis.

With respect to the two Netherlands collective schemes referred to by the Honourable Member, the scheme relating to electrical and electronic equipment has been only notified to the Netherlands competition authority and the Commission therefore is not examining this case. The Netherlands competition authority is competent to apply Article 81(1) and 82 (ex Articles 85 and 86)

of the EC Treaty. As far as the disposal system for scrap cars is concerned, both the Netherlands competition authority and the Commission have received a corresponding notification, which is currently being examined. In its scrutiny of this notification the Commission applies the above-mentioned principles. Since the Commission's investigation in this case is not yet completed it is not possible to indicate the likely outcome. The Commission will not hesitate to inform the Honourable Member when the examination of the case is completed.

(1) OJ C 3, 6.1.2001.