Horizontal guidelines on purchasing agreements : delineation between by object and by effect restrictions : final report.
Date: 2022-03-03
Institutions: Directorate-General for Competition
Subjects: Treaty on the Functioning of the EU, exclusive purchasing agreement, horizontal agreement, invitation to tender, report, restriction on competition

Horizontal Guidelines on

purchasing agreements:

Delineation between

by object and by effect restrictions

Final Report

Competition

EUROPEAN COMMISSION 

Directorate-General for Competition  
E-mail: comp-publications@ec.europa.eu  

European Commission 
B-1049 Brussels 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
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Horizontal Guidelines on  

purchasing agreements:  

Delineation between  
by object and by effect restrictions 

Final report 

 
  
 
 
 
 
 
 
     
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
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Luxembourg: Publications Office of the European Union, 2022 

Catalogue number: KD-07-22-013-EN-N 
ISBN: 978-92-76-46935-3 
DOI: 10.2763/65104 

© European Union, 2022 
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Authors: Richard Whish and David Bailey 

 
Abstract 
This  Report  provides  advice  to  the  European Commission  on  the  delineation  between 
restrictions of competition by object on the one hand and by effect on the other in the 
context  of  joint  purchasing  agreements.  It  examines  judgments,  decisions  and 
guidance  on  buyer  cartels  and  joint  purchasing  and  negotiation  agreements,  both 
within  the  EU  and  in  third  countries  around  the  world.  The  Report  defines  what  is 
meant  by  a  ‘buyer  cartel’  and  by  ‘joint  purchasing’,  and  makes  a  number  of 
suggestions  for  the  framework  of  analysis  for  determining  whether  such  agreements 
restrict competition by object or by effect. 

 
 
Executive summary .......................................................................................... 3 
Chapter 1 Introduction ...................................................................................... 5 
Table of Contents 
Chapter 2 General comments on Article 101 TFEU ............................................... 12 
Chapter 3 Terminology and different structures and activities of buyer groups ........ 30 
Chapter 4 Legal analysis of joint purchasing cases .............................................. 36 
Chapter 5 A suggested framework for analysing joint purchasing agreements as either 
by object or by effect restrictions of Article 101 TFEU .......................................... 51 
Chapter 6 Responses to specific issues raised by the Call for Tenders ..................... 63 
Chapter 7 Conclusions ..................................................................................... 67 
Annexes ........................................................................................................ 68 

 
 
Horizontal Guidelines on purchasing agreements: Delineation between by object and by effect restrictions 

Executive summary 

The  European  Commission  is  reviewing  the  block  exemptions  for  horizontal  co-
operation  agreements and  the  guidance  provided  by  the  Commission’s  Guidelines  on 
the applicability of Article 101 TFEU to horizontal co-operation agreements of 2011. 

This Report provides expert advice commissioned as part of the Commission’s Impact 
Assessment  of  its  review  of chapter  5  of  the  Horizontal  Guidelines  of  2011  on 
purchasing  agreements.  In  particular,  it  provides  advice  on  the  delineation  between 
‘joint purchasing agreements’ that must be assessed as a restriction of competition by 
effect under Article 101 TFEU and those arrangements that qualify as a restriction of 
competition by object, that is to say as a ‘buyer cartel’. This is an important issue, in 
particular because of the perceived lack of clarity on how joint purchasing differs from 
a buyer cartel. 

Chapter  2 of  the  Report  provides  some  general  comments  about  the  application  of 
Article  101  TFEU  and,  more  specifically,  on  the  distinction  between  restrictions  of 
competition by object and restrictions of competition by effect. Annex 1 to the Report 
contains  pages  121  to  145  of  chapter  3  of  the  tenth  edition  of  Whish  and 
Bailey,  Competition  Law,  in  which  we  set  out  our  thoughts  on  the  subject  in  the 
light  of  the  most recent case-law of the EU Courts on this topic. 

Chapter 2 also includes a discussion of whether the pursuit of sustainability objectives 
(using that term broadly to include matters such as environmental protection, animal 
health,  or  social  protection)  by  a  joint  purchasing  agreement  may  influence  its 
characterisation  as  being  restrictive  of  competition  by  object  or  effect.  It 
acknowledges  that,  in  principle,  certain  joint  purchasing  arrangements  can  make  a 
positive  contribution  to  sustainability  objectives.  It  points  out,  however,  that  certain 
agreements  between  competing  purchasers  might  be  regarded  as  restrictions  of 
competition  by  object.  Chapter  2  argues  that  a  distinction  should  be  made  between 
‘anti-competitive horizontal restraints’ that harm competitors at the same level of the 
market  as  the  parties  to  the  agreement,  such  as  a  group  boycott,  and  ‘vertical 
purchasing  restraints’,  where,  for  example,  a  group  of  purchasers  agree  not  to 
purchase from a supplier or suppliers at a different level of the market. An example of 
a  vertical  purchasing  restraint  would  be  what  we  describe  as  a  ‘sustainable  products 
purchasing agreement’, for example where a group of competing purchasers agree to 
buy  timber  only  from  sustainable  sources.  We  consider  that  a  sustainable  products 
purchasing  agreement  should  not  be  considered  to  be  restrictive  of  competition  by 
object, but should instead be analysed on an effects basis. 

Chapter 3 explains the terminology that we use in this Report and discusses different 
structures  and  activities  of  buyer  groups.  In  particular,  it  explains  the  important 
distinction  between  a  buyer  cartel,  on  the  one  hand,  and  joint  purchasing,  on  the 
other. In the case of a buyer cartel, undertakings agree with one another on how they 
will  individually  interact  with  suppliers,  or  they  exchange  commercially  sensitive 
information with one another about how they will do so. By contrast, joint purchasing 
occurs  where  a  common  organisation  acting  on  behalf  of  the  members  of  a  buyer 
group  provides  the  interface  between  suppliers  in  the  upstream  market  and  the 
purchasers in the purchasing market that the organisation represents. The essence of 
joint  purchasing  is  that  the  buyer  group,  by  bargaining  collectively  on  behalf  of  its 
members, seeks to negotiate more favourable terms and conditions than would have 
been obtained if each purchaser had acted alone.   

3 

Horizontal Guidelines – Purchasing agreements: Delineation between by object and by effect restrictions 

Chapter 4 and Annex 2 of the Report contain our research on buyer cartels and joint 
purchasing  cases.  We  have  reviewed  relevant  judgments,  decisions  and  guidance  on 
joint  purchasing  agreements  from  within  the  EU  and  from  third  countries.  Our 
research reveals that fines have been imposed on numerous buyer cartels, both within 
the EU and in third countries; but that there has never been a fine imposed in a case 
of  joint  purchasing  or  joint  negotiation.  Chapter  4  of  the  Report  also  includes  a 
discussion of the reasons given by competition authorities and courts for their findings 
of  an  infringement  of  Article  101  or  its  domestic  equivalent  in  the  law  of  a  Member 
State  in  cases  on  purchasing.  It  describes  the  few  decisions  in  which  benefits  in  the 
terms  of  Article  101(3)  have  been  successfully  invoked  by  the  parties  to  joint 
purchasing agreements.  

Chapter  5  of  the  Report  contains  our  proposal  for  a  general  framework  for  analysing 
purchasing agreements  as  either  by  object  or  by  effect  restrictions  of  competition.  It 
makes  suggestions  on  how  the  authors  consider  that  chapter  5  of  the  Horizontal 
Guidelines of 2011 can be improved. In particular, it explains that buyer cartel cases – 
in  the  EU,  the  Member  States  and  in  third  countries  –  have  never  involved  joint 
purchasing.  It  suggests  that  the  future  Guidelines  should  define  what  is  meant  by 
‘buyer cartel’ and ‘joint purchasing’ and proposes definitions to that end. It also makes 
a  number  of  suggestions  on  the  topics  of  ‘relevant  markets’  ‘theories  of  harm’, 
‘restrictions by object’, ‘restrictions by effect’ and ‘Article 101(3)’. 

Chapter  6  of  the  Report  considers  a  number  of  specific  issues  raised  by  the  Call  for 
Tenders,  including  the  relevance  of  various  market  considerations,  secrecy  and  the 
pursuit  of  sustainability  objectives.  Annex  2  of  the  Report  provides  a  number  of 
concrete  and  relevant,  real-life  examples  of  joint  purchasing  and  buyer  cartels  from 
around the world. 

The report ends with some concluding thoughts in Chapter 7. 

4 

 
 
Chapter 1 
Introduction 

1.1 

In  2019  the  Commission  published  a  Consultation  strategy  document1  for  an 
evaluation of the block exemptions for horizontal co-operation agreements2 (the 
‘HBERs’)  and  the  guidance  provided  by  the  Commission’s  Guidelines  on  the 
applicability  of  Article  101  of  the  Treaty  on  the  Functioning  of  the  European 
Union  to  horizontal  co-operation  agreements  of  2011  (the 
‘Horizontal 
Guidelines’). The procedure was divided into two steps: first an evaluation phase 
followed by an impact assessment phase.3 

The evaluation phase 

1.2  An  evaluation  roadmap  was  published  on  5  September  2019  and  a  public 
consultation  was  launched  on  6  November  2019.4  Responses  to  the  public 
consultation are available on the website cited in footnote 3 above. Following the 
public consultation two documents were published on DG COMP’s website. First, 
on  6  May  2021,  the  European  Commission  published  its  Staff  Working 
Document:  Evaluation  of 
the  Horizontal  Block  Exemption  Regulations, 
SWD(2021)103 final (the ‘SWD’).5 This document summarised the findings of the 
evaluation  of  the  horizontal  block  exemption  regulations  on  research  & 
development  and  specialisation  agreements  and  of  the  Horizontal  Guidelines. 
The  results  of  the  evaluation  showed  that,  while  the  block  exemptions  and 
Horizontal  Guidelines  remain  useful  and  relevant,  they  also  lack  clarity  in  some 
respects.  On  the  same  day  the  Commission  also  published  a  study  by  external 
contractors,  Evaluation  support  study  on  the  EU  competition  rules  applicable  to 
horizontal cooperation agreements in the HBERs and the Guidelines.6 This study 
provided  qualitative  and  quantitative  evidence  on  the  effectiveness,  efficiency 
and relevance of the HBERs and the Horizontal Guidelines. 

1.3  Chapter 5 of the Horizontal Guidelines of 2011 discusses purchasing agreements. 
Paragraph 194 of the Guidelines notes that ‘joint purchasing agreements usually 
aim  at  the  creation  of  buyer  power  which  can  lead  to  lower  prices  or  better 
quality  products  or  services  for  consumers’.  It  is  through  joint  purchasing  that 
buyers  are  able  to  improve  their  bargaining  position  vis-á-vis  sellers,  and  this 
can  lead  to  benefits  for  their  own  customers.  Paragraphs  200  to  204  of  the 
Guidelines  set  out  some  possible  competition  concerns  that  might  arise  from 
joint purchasing agreements; they then consider whether such agreements could 
be  restrictive  of  competition  by  object  (paragraphs  205  to  206);  whether  they 
might be restrictive by effect (paragraphs 207 to 216); and the circumstances in 
which they might satisfy Article 101(3) (paragraphs 217 to 220).  

1.4  The  evidence  gathered  during  the  Commission’s  evaluation  phase  of  the  review 
of the regime for horizontal agreements suggested that overall Chapter 5 of the 

1 
2  

3  

4 

5 
6 

https://ec.europa.eu/competition-policy/system/files/2021-03/consultation_strategy.pdf. 
Commission  Regulation  (EU)  No  1217/2010  for  research  and  development  agreements  and 
Commission Regulation (EU) No 1218/2010 for specialisation agreements. 
The  progress  of  the  review  can  be  followed  at  https://ec.europa.eu/competition-policy/public-
consultations/2019-hbers_en. 
https://ec.europa.eu/info/law/better-regulation/have-your-say/initiatives/11886-Evaluation-of-EU-
competition-rules-on-horizontal-agreements/public-consultation_en. 
https://ec.europa.eu/competition-policy/system/files/2021-05/HBERs_evaluation_SWD_en.pdf. 
https://ec.europa.eu/competition-policy/evaluation-support-study-eu-competition-rules-applicable-
horizontal-cooperation-agreements-hbers_en. 

 
 
 
 
 
 
 
                                          
Horizontal Guidelines – Purchasing agreements: Delineation between by object and by effect restrictions 

Guidelines  was  a  useful  instrument  in  the  assessment  of  joint  purchasing 
agreements.  However  stakeholders  did  note  a  number  of  concerns  about  their 
application. These are conveniently set out in Annex 4 of the SWD: 

4.1.5.  Purchasing  agreements  (Chapter  5  of  the  Horizontal 
Guidelines)  

A  wide  array  of  respondents  covering  individual  companies,  business 
associations (retailers in particular) and law firms consider that the market 
share  thresholds  of  15%  are  too  low  to  exempt  pro-competitive 
purchasing  agreements.  Some  respondents  propose  a  general  increase  of 
the market share threshold to between 20 and 30% in order to align them 
with other EU competition law regulations, such as the R&D BER, the EUMR 
or  the  VBER.  Other  respondents  propose  a  differentiation  of  the  market 
share  threshold  with  different  percentages  applying  to  the  purchasing  and 
selling markets.  

Several  law  firms  and  associations  of  competition  lawyers  and  economists 
consider  that  legal  certainty  is  lacking  due  to  a  perceived  difficulty  to 
distinguish between joint purchasing and buying cartels as both involve 
an  agreement  on  purchase  prices.  In  this  regard  they  point  at  recent 
Commission  decisions  covering  buying  cartels  and  the  need  to  clarify  the 
factors  that  influence  the  distinction  between  legitimate  purchasing 
arrangements  and  by  object  buying  cartels.  [A  few]  respondents  raised 
uncertainty  about  the  importance  of  the  form  of  the  joint  purchasing 
agreement  or  the  degree  of  integration  required  and  about  the  distinction 
between joint purchasing and joint bidding or joint negotiation.  

Several  law  firms  and  associations  of  competition  lawyers  and  economists 
consider  that  the  underlying  economic  approach  to  joint  purchasing 
agreements  and  the  balance  between  efficiencies  created  by  the  joint 
purchasing agreement and greater buyer power 119 is too much focused on 
the impact downstream through the pass-on of efficiencies to consumers, in 
particular, in the form of lower prices. The Horizontal Guidelines would not 
sufficiently  address  harmful  effects  of  buyer  power  on  suppliers  or 
competitors.  

Finally, several respondents indicated that the Horizontal Guidelines do not 
provide  sufficient  guidance  on  retail  alliances  nor  enough  practical 
examples.  Respondents  representing  retailers  complained  about  the 
fragmented, national purchasing markets mainly due to the supply strategy 
of  manufacturers.  This  would  result  in  an  artificial  increase  in  the 
negotiation power of retail alliances compared to such large suppliers and is 
further aggravated by the use of territorial supply constraints by the latter. 
A respondent criticises the fact that joint purchasing agreements by a group 
of retailers are subject to two consecutive tests, namely first an assessment 
of  the  horizontal  agreement  and,  subsequently,  an  assessment  of  the 
vertical  agreements.  According  to  this  respondent,  horizontal  elements 
should  neither  be  viewed  in  isolation  nor  take  precedence  over  vertical 
elements  but  should  instead  be  assessed  together.  Other  respondents, 
mainly  representing  suppliers,  are  lacking  guidance  in  Chapter  5  of  the 
Horizontal Guidelines on certain practices applied by retail alliances, such as 
(i)  collectively  extracting  fees  unrelated  to  any  genuine  service,  (ii) 
collective delisting, and (iii) anti-competitive exchange of information. They 
also  request  a  clarification  about  the  position  of  retailers,  in  particular,  as 

6 

 
 
 
 
 
 
Horizontal Guidelines on purchasing agreements: Delineation between by object and by effect restrictions 

regards  their  dual  role  as  both  customers  of  manufacturers’  products  and 
competitors with their own private label products. 

1.5 

These concerns can be summed up as follows: 

•  are the market share thresholds in the Guidelines too low? 
•  do  the  Guidelines  successfully  distinguish  legitimate  joint  purchasing  from 

buyer cartels?  

•  do the Guidelines successfully distinguish between joint purchasing and joint 

bidding or joint negotiation? 

•  are  the  Guidelines  too  concerned  with  harm  to  downstream  markets  as 

opposed to harm to suppliers and competitors? 

•  do the Guidelines deal adequately with retail alliances? 

The impact assessment phase 

1.6  On 7 June 2021 the Commission published its Inception Impact Assessment (the 
‘IIA’).7 Feedback on the IIA included concerns about the lack of guidance on the 
use of joint purchasing agreements to achieve sustainability goals and about the 
joint negotiation by licensees of licences of standard essential patents subject to 
a  FRAND  commitment.  These  responses  are  available  on  the  website  cited  in 
footnote  3  above.  Following  the  IIA  the  Commission  launched  a  public 
consultation on 13 July 2021, requiring feedback by 5 October 2021. 

1.7  As  part  of  the  Commission’s  ongoing  work  on  the  review  of  horizontal 
agreements, it decided in the summer of 2021 that it would seek targeted expert 
advice  specifically  on  the  delineation  between  joint  purchasing  agreements  that 
have  to  be  assessed  as  a  restriction  of  competition  by  effect  under  Article  101 
TFEU and those types that qualify as a restriction of competition by object, that is 
to  say  as  a  buyer  cartel.8  The  Call  for  Tenders  required  that  the  advice  should 
cover all  economic sectors and indicate whether the current approach laid down 
in  Chapter  5  of  the  Horizontal  Guidelines  needs  clarification  and,  if  so,  how;  if 
necessary  the  advice  would  refer  to  particular  sectors  of  the  economy  and  to 
particular types of joint purchasing agreements.  

1.8  The need for clarity on this topic was prompted in particular by the second of the 
concerns in paragraph 4.1.5 of the SWD set out above, namely the lack of clarity 
over  the  distinction  between  joint  purchasing  arrangements  and  by 
object  buyer  cartels.  This  concern  was  no  doubt  prompted  by  the  fact  that  in 
recent years there have been a number of decisions by the European Commission 
and by national competition authorities within the EU (‘NCAs’) in which significant 
fines have been imposed in cases involving buyer cartels that were considered to 
be restrictive of competition by object. 

1.9  We wish to highlight at this early stage of our Report that our extensive research 
into  cases  in  which  fines  have  been  imposed  on  buyer  cartels  –  both  within  the 
EU  and  in  third  countries  –  has  revealed  that  there  has  never  been  a  fine 
imposed  in  a  case  of  joint  purchasing  or  joint  negotiation.  Fines  have  been 
imposed only in cases where buyers agreed with one another on matters such as 
the  maximum  prices  that  they  individually  would  pay  for  products  or  the  terms 

7 

8  

https://ec.europa.eu/competition-policy/system/files/2021-
06/HBERs_inception_impact_assessment.pdf. 
See 
for 
Commission’s 
https://ec.europa.eu/competition-policy/evaluation-support-study-eu-competition-rules-applicable-
horizontal-cooperation-agreements-hbers_en. 

COMP/2021/009, 

available 

Tenders 

Call 

the 

at 

7 

 
 
 
 
 
 
 
 
 
 
 
                                          
Horizontal Guidelines – Purchasing agreements: Delineation between by object and by effect restrictions 

and  conditions  on  which  they  would  transact  with  suppliers;  or  where  they 
exchanged  commercially  sensitive  information  with  one  another  which  removed 
competitive  uncertainty  that  would  otherwise  have  existed  between  them. 
However  in  none  of  these  cases  was  there  any  joint  or  collective  engagement 
by or on behalf of the buyers with their suppliers.   

1.10  Our  Table  of  Buyer  Cartel  Cases  in  paragraph  4.8  of  this  Report  lists  seven 
decisions  of  the  European  Commission  and  eleven  decisions  of  NCAs  in  which 
fines have been imposed on undertakings operating a buyer cartel. Our research 
into joint purchasing has found only one decision – Eurovision9 – in which there 
was  a  finding  of  a  restriction  of  competition  by  object.  In  that  decision  the 
Commission  found  that  the  joint  negotiation  and  joint  purchasing  of  television 
rights  to  international  sports  events  restricted  competition  by  object  and  effect. 
That was because the joint purchasing both eliminated competition between the 
broadcasters participating in the Eurovision system and gave them a competitive 
advantage  over  their  competitors.    However  the  Commission  granted  an 
exemption  to  the  Eurovision  system  because  it  created  a  number  of  cost 
efficiencies,  such  as  lower  transaction  costs,  which  benefited  consumers  who 
could watch more sports programmes than would otherwise be the case.  

1.11  We  attach  little  significance  to  the  finding  of  a  ‘by  object’  restriction  in  the 
Eurovision case for three reasons. First, the Commission did not consider whether 
the Eurovision system revealed a sufficient degree of harm to competition, which 
is the essential legal criterion for an infringement by object.10 Secondly, it is clear 
from  the  decision  that  the  Commission  was  mainly  concerned  with  the  fact  that 
there would have been appreciably more competition in the absence of the joint 
acquisition of television rights, which is why it also found a restriction by effect. 
Thirdly,  the  Commission  did  not  (and  did  not  need  to)  distinguish  between  its 
findings  of  a  restriction  of  competition  ‘by  object’  and  ‘by  effect’  in  Eurovision, 
since  it  did  not  affect  the  outcome  of  the  case:  the  Eurovision  system  was 
granted an exemption under Article 101(3). The exemption decision was annulled 
on appeal to the General Court because of errors in the Commission’s application 
of  Article  101(3);  however  the  Court  did  not  say  anything  about  the  application 
of Article 101(1) in this case.11 

1.12  We  have  found  several  cases  in  which  joint  purchasing  was  found  to  have 
restricted competition by effect; or where it seems that the Commission or NCA 
considered  that  there  was  a  restriction  by  effect  but  chose  to  close  the  case  on 
the  basis  of  commitments  without  formally  deciding  whether  there  had  been  or 
still was an infringement.  

1.13  The expert advice sought by the Commission is intended to enable it to provide 
certainty  in  any  future  Horizontal  Guidelines  for  firms  involved  in  or  considering 
whether  to  participate  in  joint  purchasing  agreements  as  to  whether  their 
conduct  qualifies  as  a  restriction  of  competition  by  object,  unlikely  to  meet  the 
conditions of Article 101(3) TFEU, or as a restriction of competition by effect that 
must  be  assessed  in  line  with  the  Guidelines.  Paragraphs  1.9  and  1.10  above 
indicate  that  the  crucial  question  is  to  determine  what  is  meant  by  joint 
purchasing  that  distinguishes  it  from  a  buyer  cartel.  It  seems  that  it  is  the 
jointness  of  behaviour  that  determines  whether  an  agreement  should  be 

OJ [1993] L 179/23. 
See e.g. Case C-67/13 P Cartes Bancaires v Commission EU:C:2014:2204, paras 49, 52, 53 and 57. 
Cases  T-528/93  etc  Métropole  Télévision  v  Commission  EU:T:1996:99;  the  exemption  decision  was 
readopted, OJ [2000] L 151/18, but this was also annulled on appeal, Cases T-185/00 etc Métropole 
Télévision v Commission EU:T:2002:242 

9  
10  
11  

8 

 
 
 
 
 
                                          
Horizontal Guidelines on purchasing agreements: Delineation between by object and by effect restrictions 

considered to be restrictive of competition by object on the one hand or by effect 
on  the  other.  We  provide  a  suggested  framework  of  analysis  for  determining 
what is meant by joint purchasing in Chapter 5 of this Report. Since the purpose 
of  this  Report  is  to  illuminate  the  distinction  between  restrictions  of  competition 
by  object  and  by  effect  in  the  case  of  purchasing  agreements,  we  will  not 
consider in depth how the effects of such agreements should be analysed.  

1.14  The Call for Tenders specifically requires that the expert advice should address a 

number of issues, as set out in section 2 of that document: 

− a legal analysis of any competition authority decision and EU or national 
court judgment on joint purchasing agreements, in addition to the expert’s 
own, impartial legal interpretation;  

−  a  proposal  for  a  general  framework  for  analysing  joint  purchasing 
agreements as either by object or by effect restrictions of Article 101 TFEU;  

−  a  proposal  of  relevant  factors  for  making  such  distinction  of  joint 
purchasing  agreements  as  by  object  or  by  effect  restrictions  based  on  the 
expert’s  own  impartial  legal  interpretation  of  decisions  by  competition 
authorities and case law of the EU and national courts. In this context, the 
expert  shall  consider  whether  any  of  the  following  factors,  among  others, 
are  relevant  for  the  purpose  of  this  assessment:  (i)  buyers  are  competing 
downstream, (ii) degree of integration on the buyer side (e.g. whether the 
buyers created or not a separate (joint purchasing) entity or a looser form 
of cooperation in charge of the negotiations with suppliers), (iii) aggregated 
share of the buyers in total demand in the (upstream) purchasing market, 
(iv) degree of concentration of sellers in the (upstream) purchasing market, 
(v)  aggregated  market  share  of  the  buyers  in  the  (downstream)  selling 
markets,  (vi)  the  fact  whether  the  buyer  cooperation  is  secret  towards 
sellers. Particular attention shall also be given to the question whether the 
pursuit  of  sustainability  objectives  (e.g.  environmental  protection,  animal 
health  and/or  welfare,  or  social  protection)  by  the  joint  purchasing 
agreement  may  influence  the  qualification  as  a  by  object  or  by  effect 
restriction.  This  could,  for  example,  be  at  stake  where  buyers,  in  spite  of 
their commercial interests, agree to increase their purchasing price because 
they want to ensure that their suppliers grant fair wages to their workers or 
to jointly purchase environmentally friendly products/inputs;  

−  an  illustration  of  the  application  of  these  distinguishing  factors  through 
concrete  and  relevant,  real-life  examples  of  different  types  of  joint 
purchasing  agreements  falling  in  each  of  the  two  categories,  namely 
restriction by object or by effect;  

−  an  explanation  whether  this  assessment  under  the  proposed  general 
framework  differs  depending  on  the  number  of  aspects  of  the  joint 
purchasing  that  are  negotiated  jointly  with  the  group  of  buyers  and  which 
ones  are  negotiated/decided  separately.  Such  aspects  could  include  (but 
are  not  limited  to)  the  price,  certain  element(s)  of  the  price,  the 
definition/assortment  of  products/services,  the  quantity,  timing,  delivery, 
etc.;  

−  an  explanation  whether  the  general  framework  and  features  analysed 
under  the  previous  indents  applies  to  all  types  of  joint  purchasing 
arrangements in all sectors of the economy and, in particular, whether this 

9 

 
 
 
 
 
 
 
 
 
 
Horizontal Guidelines – Purchasing agreements: Delineation between by object and by effect restrictions 

approach is also valid for assessing licensing negotiation groups that jointly 
bargain with licensors of standards essential patents (SEPs). 

1.15  We were engaged by the Commission to provide the expert advice sought by its 
Call for Tender, and this is our Report. The structure of the Report is as follows. 
In  Chapter  2  we  make  some  general  comments  about  the  application  of  Article 
101 and, more specifically, on the distinction between restrictions of competition 
by  object  and  restrictions  of  competition  by  effect  in  the  light  of  the  recent 
jurisprudence  of  the  Court  of  Justice  on  this  important  topic.  In  Chapter  3  we 
explain  the  terminology  that  we  use  in  this  Report  and  discuss  different 
structures and activities of buyer groups. 

1.16  Chapter 4 and Annex 2 of our Report contains our research on joint purchasing 

cases. We have reviewed: 

• 
• 
• 

• 

• 
• 

the jurisprudence of the Court of Justice 
the decisional practice of the European Commission 
the decisional practice of the NCAs and the jurisprudence of the courts of the 
Member States of the EU 
relevant  decisions  and  judgments  on  joint  purchasing  agreements  in  third 
countries 
relevant guidance on the topic, from within the EU and from third countries 
relevant academic literature. 

1.17  Drawing on our research we identify the following categories of cases: 

• 
• 

• 
• 
• 

buyer cartel cases, where there was no joint purchasing 
one case where there was no restriction of competition because the rules of 
the  joint  purchasing  organisation  were  objectively  necessary  to  support 
legitimate joint purchasing 
cases where any restriction of competition was de minimis 
findings of a restriction of competition by effect 
cases where a restriction of competition was found to satisfy the conditions 
of Article 101(3). 

1.18  Chapter  4  of  our  Report  includes  a  discussion  of  the  reasons  given  by 
competition authorities and courts for their findings of an infringement of Article 
101  or  its  domestic  equivalent  in  the  law  of  a  Member  State  in  cases  on 
purchasing.  It  also  notes  the  few  decisions  in  which  benefits  in  the  terms  of 
Article 101(3) have been successfully invoked by the parties to joint purchasing 
agreements.  

1.19  Chapter  5  of  the  Report  contains  our  proposal  for  a  general  framework  for 
analysing  purchasing  agreements  as  either  by  object  or  by  effect  restrictions  of 
competition, as required by the Commission’s Call for Tenders. Chapter 6 of the 
Report responds to the specific factors set out in section 2 of the Call for Tenders, 
as set out in the final four indents of paragraph 1.14 above. Our conclusions are 
set out in Chapter 7. 

1.20  As  noted  in  paragraph  1.13  above,  we  have  been  asked  to  investigate  the 
distinction  between  restrictions  of  competition  by  object  and  by  effect.  For  this 
reason our Report does not provide an in-depth analysis of how effects analysis 
should  be  conducted  in  the  case  of  joint  purchasing  agreements.  More 
specifically, we address the concerns raised by respondents to the Commission’s 
public consultation set out in paragraphs 1.4 and 1.5 above only in so far as they 

10 

 
 
 
 
 
 
 
 
 
Horizontal Guidelines on purchasing agreements: Delineation between by object and by effect restrictions 

concern  the  object-effect  distinction.  We  should  add  that our  Report  is  intended 
to  shed  light  on  the  analysis  of  buyer  cartels  and  joint  purchasing  across  the 
entire  economy.  It  is  not  limited  to  the  specific  phenomenon  of  retail  alliances 
and  the  relationships  that  they  have  with  sellers  of  branded  goods.  We  are  of 
course  aware  of  the  importance  of  this  topic  and  we  include  some  discussion  of 
the nature of retail alliances in Chapter 3 of this Report. However, subject to one 
qualification,  our  Report  is  concerned  with  the  phenomenon  of  joint  purchasing 
generally.  The  qualification  is  that  we  have  not  considered  the  specific  topic  of 
no-poach  agreements  between  employers,  an  important  and  current  topic  of 
interest but one which merits separate consideration. 

11 

 
 
 
 
 
Horizontal Guidelines – Purchasing agreements: Delineation between by object and by effect restrictions 

Chapter 2 
General comments on Article 101 TFEU 

2.1  The  purpose  of  this  Report  is  to  provide  advice  to  the  Commission  on  the 
delineation between restrictions of competition by object on the one hand and by 
effect on the other in the context of joint purchasing agreements. The distinction 
between  object  and  effect  restrictions  has  always  been,  and  remains, 
controversial.  As  Advocate  General  Bobek  said  in  his  Opinion  in  Gazdasági 
Versenyhivatal v Budapest Bank Nyrt etc.12: 

1. From the early days of EU competition law, much ink has been spilled 
on  the  dichotomy  between  restriction  of  competition  by  object  and 
restriction  by  effect.  It  may  thus  come  as  a  surprise  that  this 
distinction,  stemming  from  the  very  wording  of  the  prohibition  in  (what 
is now) Article 101 TFEU, still requires interpretation by the Court. 

2.  The  distinction  is  relatively  easy  to  make  in  theory.  Its  practical 
operation  is  nonetheless  somewhat  more  complex.  It  is  also  fair  to  say 
that the case-law of the EU Courts has not always been crystal clear on 
the subject. Indeed, a number of decisions given by the EU Courts have 
been  criticised  in  legal  scholarship  for  blurring  the  distinction  between 
the two concepts. 

2.2  We  do  not  propose  in  this  Report  to  provide  a  detailed  analysis  of  the 
jurisprudence  on  the  Court  of  Justice  on  this  difficult  topic.  We  have  recently 
completed the tenth edition of our text book Competition Law13 in which we set 
out  our  thoughts  on  the  subject  in  the  light  of  the  most  recent  case-law  of  the 
Court: pages 121 to 145 of chapter 3 of Whish and Bailey, which are specifically 
on the object-effect dichotomy, will be found as Annex 1 to this Report. 

2.3  We consider that it may be helpful if we make a number of comments about the 
application  of  Article  101  generally,  and  on  the  object-effect  distinction  in 
particular,  in  so  far  as  they  might  facilitate  a  better  understanding  of  our 
discussion of joint purchasing agreements in this Report. 

Why is the object-effect distinction so important? 

2.4  There  are  (at  least)  three  reasons  why  the  distinction  between  restrictions  by 

object and restrictions by effect matters. 

No need for effects analysis 

2.5  The first, which is trite law, is that, where an agreement restricts competition by 
object,  it  infringes  Article  101(1)  without  there  being  any  requirement  to  also 
consider  the  effects  of  the  agreement.  This  was  established  by  the  Court  of 
Justice  in  Société  Technique  Minière  v  Maschinenbau  Ulm14  and  has  been 
repeated on innumerable occasions since, including in paragraphs 33 to 36 of the 
Court’s judgment in Budapest Bank case referred to above.15 

12  
13  
14  
15  

Case C-228/18 EU:C:2019:678. 
Oxford University Press, 10th ed, August 2021. 
Case 56/65 EU:C:1966:38. 
Case C-228/18 EU:C:2020:265. 

12 

 
 
 
 
 
 
 
 
 
 
 
 
 
                                          
Horizontal Guidelines on purchasing agreements: Delineation between by object and by effect restrictions 

Inapplicability of the de minimis doctrine: Expedia 

2.6  The  second  reason  why  the  object-effect  distinction  matters  arises  from  the 
application  of  the  so-called  de  minimis  principle.  Article  101(1)  applies  to  an 
agreement  only  to  the  extent  that  there  is  an  appreciable  restriction  of 
competition:  this  was  established  by  the  Court  of  Justice  in  Völk  v  Vervaecke.16 
However  in  Expedia  Inc  v  Autorité  de  la  Concurrence17  the  Court  introduced  a 
refinement  to  the  doctrine  in  Völk  v  Vervaecke.  It  held  at  paragraph  37  of  its 
judgment  that,  where  an  agreement  restricts  competition  by  object  and  has  an 
appreciable  effect  on  trade  between  Member  States,  it  automatically  violates 
Article  101(1)  without  any  need  to  demonstrate  concrete  effects  on 
competition.  This  clearly  can  have  important  implications  in  the  case  of  joint 
purchasing  agreements.  For  example  suppose  that  a  group  of  buyers  were  to 
decide  not  to  obtain  products  from  an  unsustainable  source  (for  example  from 
suppliers of clothes that make use of sweatshops or from timber companies that 
tolerate the illegal destruction of the rain forest): if this is to be characterised in 
law  as  a  group  boycott  by  buyers  that  has  as  its  object  the  restriction  of 
competition,  it  would  be  ineligible  for  de  minimis  exclusion.  However,  as  we 
explain  in  paragraphs  2.32  to  2.44  of  this  Report,  we  do  not  consider  that  an 
agreement  of  this  type  should  be  regarded  as  a  restriction  of  competition  by 
object. 

Object restrictions and Article 101(3) 

2.7  The  third  reason  why  the  object-effect  distinction  matters  is  that  there  is  a 
perception  that  restrictions  by  object  are  incapable  of  satisfying  Article  101(3). 
We have observed that this perception exists over many years in our discussions 
with  officials  in  competition  authorities,  competition  lawyers  and  economists  in 
private practice and in academic circles. A variant of this perception is that, even 
if it is theoretically possible that an object restriction could satisfy Article 101(3), 
in practice the burden on the parties is so high that it is in effect insurmountable. 
This perception is obviously significant in the case of joint purchasing agreements 
insofar as they might be characterised as restrictive of competition by object. As 
in  the  case  of  the  de  minimis  doctrine,  a  specific  difficulty  would  arise  where 
buyers  wish  to  enter  into  an  arrangement  between  themselves  not  to  purchase 
from certain suppliers in the interest of ‘sustainability’: if such an agreement is to 
be  regarded  as  restrictive  by  object,  the  possibility  arises  that  the  buyers  will 
refrain  from  proceeding  because  of  the  ‘problem’  that  an  object  restriction  in 
practice (even if not in law) is incapable of being defended under Article 101(3).  

2.8  We  explain  in  Whish  and  Bailey,  for  example  on  page  131  of  chapter  3  (see 
Annex  1),  that  it  is  wrong  in  law  to  assert  that  an  object  restriction  cannot  be 
defended  under  Article  101(3).  What  the  law  establishes  is  that  where  an 
agreement  restricts  competition  by  object  this  reverses  the  burden  of  proof,  so 
that the parties to the agreement have to adduce evidence to demonstrate that 
there  will  be  benefits  and  that  the  other  requirements  of  Article  101(3)  are 
satisfied.18 However we acknowledge that many people consider that a finding of 
a  restriction  of  competition  by  object  is  somehow  ‘fatal’  to  a  successful  defence 
under Article 101(3).  

16  
17  
18  

Case 5/69 EU:C:1969:35. 
Case C-226/11 EU:C:2012:795, para 16. 
The same point is also discussed in chapter 4 of Whish and Bailey, pp 158-159. 

13 

 
 
 
 
 
 
 
 
 
                                          
Horizontal Guidelines – Purchasing agreements: Delineation between by object and by effect restrictions 

Object restrictions and fines 

2.9  A finding that an agreement restricts competition by object may also be relevant 
to  the  question  of  whether  the  parties  to  a  joint  purchasing  agreement  may  be 
fined.  It  would  be  regrettable  if  firms  were  to  refrain  from  entering  into 
agreements  that  serve  a  useful  purpose,  for  example  a  sustainability  objective, 
for  fear  that  (a)  the  agreement  might  be  considered  to  be  restrictive  of 
competition by object and that (b) object restrictions always (or nearly always) 
lead to the imposition of a fine. 

2.10  We  have  noted  in  paragraph  1.8  above  that  concerns  were  expressed  to  the 
Commission  during  the  consultation  on  the  review  of  horizontal  cooperation 
agreements  that  legitimate  joint  purchasing  agreements  might  be  incorrectly 
characterised  as  buyer  cartels  and  found  to  be  restrictive  of  competition  by 
object; and that this might lead to the imposition of fines.  

2.11  We  acknowledge  that  there  have  been  cases  where  fines  were  not  imposed 
where an agreement (or a decision by an association of undertakings) was found 
to restrict competition  by object19; however these cases are rare. We also note 
that  it  is  possible,  as  a  matter  of  law,  for  fines  to  be  imposed  in  effects  cases 
under  Article  101:  such  cases  are  also  rare.20  However  we  consider  that  it  is 
reasonable  to  suppose  that  some  undertakings  will  be  deterred  from  entering 
into agreements, even where they consider them to be justifiable on the ground 
of  sustainability,  due  to  the  fear  that  their  agreement  will  be  characterised  as 
restrictive of competition by object and attract a fine. The seriousness with which 
object  restrictions  are  regarded  was  noted  by  Advocate  General  Kokott  in  T-
Mobile when she remarked that:   

  The  prohibition  of  a  practice  simply  by  reason  of  its  anti-competitive 
object  is  justified  by  the  fact  that  certain  forms  of  collusion  between 
undertakings can be regarded, by their very nature, as being injurious to 
the  proper  functioning  of  normal  competition.  The  per  se  prohibition  of 
such  practices  recognised  as  having  harmful  consequences  for  society 
creates  legal  certainty  and  allows  all  market  participants  to  adapt  their 
conduct  accordingly.  Moreover,  it  sensibly  conserves  resources  of 
competition authorities and the justice system.21   

2.12  Our  view  is  that  the  answer  to  this  anxiety  is  to  make  clear  that  the  class  of 
purchasing agreements  that  restrict  competition  by  object  is  extremely  narrow; 
and to point out that the only cases in which fines have been imposed on buyer 
cartels did not involve joint purchasing at all. We also consider that it is possible 
to  argue  that  an  agreement  by  purchasers  not  to  purchase  unsustainable 
products does not restrict competition by object but should be subject to effects 
analysis: we develop this argument in paragraphs 2.32 to 2.44.  

An  example  is  International  Skating  Union,  Commission  decision  of  8  December  2017,  upheld  on 
appeal to the General Court Case T-93/18 EU:T:2020:610. 
See eg Morgan Stanley/Visa International Europe and Visa Europe, Commission decision of 3 October 
2007  (imposing  a  fine  of  €10.2  million),  upheld  on  appeal  Case  T-461/07  Visa  Europe  Ltd  v 
Commission EU:T:2011:181; see also in the UK Compare the Market, CMA decision of 17 November 
2020  (imposing  a  fine  of  €17.9  million),  on  appeal  Case  1380/1/12/21  BGL  (Holdings)  Limited  v 
CMA, not yet decided. 
Case C-8/08 EU:C:2009:110, para 43.  

19  

20  

21  

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Horizontal Guidelines on purchasing agreements: Delineation between by object and by effect restrictions 

When do agreements restrict competition by object? 

2.13  It is obviously important that there should be a clear test of what is meant by a 
restriction of competition by object. This is an issue that has been considered by 
the Court of Justice on numerous occasions; important recent judgments on the 
topic are Generics (UK) Ltd v Competition and Markets Authority22 and Lundbeck 
v Commission.23 We find the judgment of the Court of Justice in Cartes Bancaires 
particularly helpful; on page 129 of Whish and Bailey we discuss the judgment as 
follows: 

(b) Groupement des Cartes Bancaires 

It  was  against  this  backdrop  that  the  Court  of  Justice  handed  down  its 
judgment  in  Groupement  des  Cartes  Bancaires  v  Commission  in 
September 201424. The Commission25 and the General Court26 had held 
that a fee structure established by the nine main members of a payment 
card  system,  Cartes  Bancaires,  had  the  object  and  effect  of  restricting 
competition  by  preventing  the  entry  of  new  banks  into  the  sector.  The 
Court  of  Justice  annulled  the  finding  of  the  General  Court  that  the  fee 
structure  restricted  competition  by  object  on  the  basis that  it  had  erred 
in  law  and  remitted  the  matter  to  it  to  consider  whether  there  was  a 
restriction by effect. The Court of Justice rehearsed well-established law: 

● 
regarded, by  
functioning of  

certain  types  of  coordination  between  undertakings  can  be 
their  very  nature,  as  being  harmful  to  the  proper 
competition27 

some collusive behaviour, such as horizontal price fixing by cartels, 
● 
is so  likely to have negative effects that it is redundant to prove that it 
has actual   effects on the market28 

when  deciding  whether  an  agreement  is  restrictive  of  competition 

● 
by   object: 

‘regard  must  be  had  to  the  content  of  [the  agreement’s] 
provisions,  its  objectives  and  the  economic  and  legal 
context  of  which  it  forms  a  part.  When  determining  that 
context, it is also necessary to take into consideration the 
nature of the goods or services affected, as well as the real 
conditions of the functioning and structure of the market or 
markets in question’29 

● 
between  

the  essential  criterion  for  ascertaining  whether  coordination 
undertakings  involves  a  restriction  by  object  is  the  finding 

22  
23  
24  

25  
26  
27  
28  
29  

Case C-307/18 EU:C 2020:52. 
Case C-591/16 P EU:C:2021:243. 
Case  C-67/13  P  EU:C:2014:2204;  the  Opinion  of  AG  Wahl  contains  a  valuable  discussion  of  the 
meaning  of  ‘object’:  EU:C:2014:1958;  see  also  the  Opinions  of  AG  Wathelet  in  Case  C-373/14  P 
Toshiba  v  Commission  EU:C:2015:427,  paras  40–91  and  of  AG  Saumandsgaard  Øe  in  Case  C-
179/16 F Hoffmann-La Roche v AGCM EU:C:2017:714, paras 145–150. 
Commission decision of 17 October 2007. 
Case T-491/07 EU:T:2012:633. 
Case C-67/13 P Cartes Bancaires v Commission EU:C:2014:2204, para 50.  
Ibid, para 51. 
Ibid, para 53.  

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Horizontal Guidelines – Purchasing agreements: Delineation between by object and by effect restrictions 

that such  
competition.30 

coordination  reveals  in  itself  a  sufficient  degree  of  harm  to 

Importantly, the Court of Justice added that the General Court had erred 
in law when concluding that the concept of a restriction of competition by 
object should not be interpreted restrictively: the Court of Justice’s view 
was  that  the  concept  should  be  limited  to  coordination  which  reveals  a 
sufficient degree of harm to competition with the result that there is no 
need to examine its effects.31 The idea that the concept should be given 
a  restrictive  interpretation  was  picked  up  by  the  EFTA  Court  in  Ski  Taxi 
SA  v  Norwegian  Government32,  which  added  that  the  presumption  of 
innocence  in  Article  6(2)  of  the  European  Convention  on  Human  Rights 
means  that,  in  a  case  of  doubt  as  to  whether  an  agreement  restricts 
competition  by  object,  the  ‘benefit  of  the  doubt’  should  be  given  to  the 
defendants.33 The EFTA Court observed that only conduct whose harmful 
nature  is  ‘easily  identifiable’,  in  the  light  of  experience  and  economics, 
should be regarded as a restriction of competition by object.34 

(c) Comment on the Cartes Bancaires judgment 

The judgment in Cartes Bancaires is an important one, and has regularly 
been  cited  in  judgments  since35:  it  provides  a  useful  template  for 
deciding  whether  agreements  are  restrictive  of  competition  by  object. 
Although  for  the  most  part  Cartes  Bancaires  simply  repeats  the 
consistent jurisprudence of the Court of Justice over many years, there is 
a sense that the judgment ‘resets’ the law; or, at the very least, that the 
Court recognises that there must be some limits to what had seemed like 
the relentless expansion of the object box. The clear statement that the 
concept  of  an  object  restriction  should  be  interpreted  restrictively  is 
significant  in  this  respect.  The  Court  of  Justice  referred  to  this  point  in 
Gazdasági  Versenyhivatal  v  Budapest  Bank  Nyrt36  before  proceeding  to 
hand  down  a  judgment  that  was  highly  sceptical  that  the  agreement 
made  by  banks  that  participated  in  both  the  Visa  and  MasterCard 
schemes  to  fix  uniform  multilateral  interchange  fees  were  restrictive  of 
competition  by  object37.  Cartes  Bancaires  does  not  mean  that  it  is  not 
possible to add new types of agreement to the object box: in Paroxetine 
the Court of Justice explained the circumstances in which a pay for delay 
agreement  could  be  restrictive  by  object38.  However,  it  does  mean  that 
careful analysis is required before allocating cases to the object box.  

2.14  On  page  130  of  Whish  and  Bailey  we  emphasise  that  in  the  Cartes  Bancaires 
judgment  the  Court  of  Justice  says  that  the  concept  of  a  restriction  of 
competition  by  object  is  one  that  should  be  interpreted  restrictively.  We  agree 
with  the  opinion  of  the  EFTA  Court  in  Ski  Taxi  SA  v  Norwegian  Government,39 

Ibid, para 57. 
Ibid, para 58. 
Case E-3/16, judgment of 22 December 2016.  
Ibid, para 62. 
Ibid, para 61. 
See eg Case C-228/18 Gazdasági Versenyhivatal v Budapest Bank Nyrt EU:C:2020: 265, paras 51–
54. 
Case C-228/18 EU:C:2020:265, para 54. 
The  Court  of  Justice  did  not  reach  a  conclusion  on  the  facts  of  this  case  as  it  was  an  Article  267 
reference from the Hungarian Supreme Court; in 2020 that Court remitted the case to the Hungarian 
Competition Authority for further consideration. 
Case C-307/18 Generics UK Ltd v CMA EU:C:2020:52, paras 59–111. 
Case E-3/16, judgment of 22 December 2016. 

30  
31  
32  
33  
34  
35  

36 
37  

38  
39  

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Horizontal Guidelines on purchasing agreements: Delineation between by object and by effect restrictions 

that  in  cases  where  it  is  uncertain  whether  an  agreement  is  restrictive  of 
competition  by  object,  the  benefit  of  the  doubt  should  be  given  to  the 
defendants.40  The  EFTA  Court  said  that  only  conduct  whose  harmful  nature  is 
‘easily identifiable’ should be regarded as a restriction by object.41 We take these 
comments into account in our proposed framework of analysis for the delineation 
between by object and by effect restrictions in chapter 5 of this Report.  

2.15  We also take into account the importance of not introducing effects analysis into 
the assessment of whether an agreement is restrictive by object. We discuss this 
on  pages  130  and  131  of  Whish  and  Bailey,  where  we  note  that  both  Advocate 
General  Kokott  in  T-Mobile42  and  the  EFTA  Court  in  Ski  Taxi  SA  v  Norwegian 
Government43 warned against the risk of ‘mingling’ object and effect analysis. We 
acknowledge  that  the  allocation  of  a  restriction  to  the  object  box  requires 
consideration  of  the  economic  and  legal  context  of  which  an  agreement  forms 
part;  however  this  is  different  from  requiring  that  the  economic  effects  of  the 
agreement should be analysed. This is why we say in our framework of analysis 
for object restrictions that we do not consider that object analysis should involve 
a  consideration  of  market  share  figures, which  are  of  relevance when  predicting 
the likely effects of an agreement. As we have seen, the judgment of the Court of 
Justice  in  Expedia  has  expressly  stated  that  the  de  minimis  doctrine  is 
inapplicable in the case of object restrictions, which means that there is no ‘safe 
harbour’  for  such  agreements  between  horizontal  competitors  with  a  market 
share of less than 10%.  

2.16  The level of detail with which one must examine the economic and legal context 
in an object case depends on the nature of the conduct at issue. However, just as 
it  is  important  not  to  introduce  effects  analysis  into  the  question  of  whether  an 
agreement  restricts  competition  by  object,  so  too  there  should  be  a  limit  to  the 
extent  of  any  investigation  into  the  economic  and  legal  context  in  which  an 
agreement was entered into. In FSL Holdings NV v Commission Advocate General 
Kokott said that:  

In  cases  where  the  anticompetitive  object  is  readily  apparent,  the 
analysis  of  the  economic  and  legal  context  in  which  the  practice  occurs 
may naturally be limited to what is strictly necessary.44  

The  Court  of  Justice  in  the  FSL  case  agreed  with  its  Advocate  General:  it  held 
that the analysis of the economic and legal context may be:  

limited to what is strictly necessary in order to establish the existence of 
a restriction of competition by object in horizontal price-fixing cases.45  

Objective necessity and Article 101 

2.17  The  doctrine  of  ‘objective  necessity’  is  helpful  when  considering  whether  joint 
purchasing  agreements  infringe  Article  101.  An  agreement  does  not  violate 

40  
41  
42  
43  
44 
45  

Ibid, 62. 
Ibid, para 61. 
Case C-8/08 EU:C:2009:110, para 45. 
Case E-3/16, judgment of 22 December 2016, paras 58 and 63. 
Case C-469/15 P EU:C:2016:884, para 100. 
Case  C-469/15  P  EU:C:2017:30,  para  107;  see  similarly  Case  C-373/14  P  Toshiba  Corporation  v 
Commission, C-373/14 P, EU:C:2016:26, para 29. 

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Article  101  when  it  contains  restrictive  clauses  that  are  objectively  necessary  to 
the  achievement  of  a  legitimate  purpose.  The  Court  of  Justice  has  recognised  a 
‘defence’  of  objective  necessity  on  numerous  occasions.  For  example  in  Société 
Technique Minière v Maschinenbau Ulm46 the Court held that an exclusive licence 
granted to a distributor might not infringe Article 101(1) where this seemed to be 
‘really  necessary  for  the  penetration  of  a  new  area  by  an  undertaking’.  We 
provide  further  examples  of  the  doctrine  of  objective  necessity  at  pages  139  to 
141 of Whish and Bailey. 

2.18  In Gøttrup-Klim Grovvareforeninger v Dansk Landbrugs Grovvareselskab AmbA47 
the  Court  of  Justice  held  that  a  provision  in  the  statutes  of  a  cooperative 
purchasing  association,  Dansk  Landbrugs  Grovvareselskab  (‘DLF’)  forbidding  its 
members from participating in other forms of organised cooperation which were 
in  direct  competition  with  it,  did  not  necessarily  restrict  competition,  and  may 
even  have  beneficial  effects  on  competition.  The  Court  recognised  that  joint 
purchasing  might  enable  buyers  to  negotiate  better  prices  with  suppliers,  and 
that  contractual  restrictions  necessary  to  enable  this  to  happen  might  not 
infringe Article 101: 

32  In  a  market  where  product  prices  vary  according  to  the  volume  of 
orders,  the  activities  of  cooperative  purchasing  associations  may, 
depending  on  the  size  of  their  membership,  constitute  a  significant 
counterweight to the contractual power of large producers and make way 
for more effective competition.  

33  Where  some  members  of  two  competing  cooperative  purchasing 
associations belong to both at the same time, the result is to make each 
association  less  capable  of  pursuing  its  objectives  for  the  benefit  of  the 
rest of its members, especially where the members concerned, as in the 
case  in  point,  are  themselves  cooperative  associations  with  a  large 
number of individual members.  

34  It  follows  that  such  dual  membership  would  jeopardize  both  the 
proper  functioning  of  the  cooperative  and  its  contractual  power  in 
relation  to  producers.  Prohibition  of  dual  membership  does  not, 
therefore,  necessarily  constitute  a  restriction  of  competition  within  the 
meaning of Article [101(1)] of the Treaty and may even have beneficial 
effects on competition.  

2.19  We  consider  that  the  judgment  in  Gøttrup-Klim  is  very  helpful  in  that  it 
recognises that joint purchasing may have the pro-competitive effect of enabling 
the  buyer  group  to  countervail  the  power  of  its  suppliers.  However,  the  Court 
goes  on  to  note  that  such  an  agreement  could  have  anti-competitive  effects  in 
certain circumstances: 

35 Nevertheless, a provision in the statutes of a cooperative purchasing 
association,  restricting  the  opportunity  for  members  to  join  other  types 
of  competing  cooperatives  and  thus  discouraging  them  from  obtaining 
supplies  elsewhere,  may  have  adverse  effects  on  competition.  So,  in 
order  to  escape  the  prohibition  laid  down  in  Article  [101(1)]  of  the 
Treaty,  the  restrictions  imposed  on  members  by  the  statutes  of 
cooperative purchasing associations must be limited to what is necessary 

46  
47  

Case 56/65 EU:C:1966:38, p 250. 
Case C-250/92 EU:C:1994:413. 

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to  ensure  that  the  cooperative  functions  properly  and  maintains  its 
contractual power in relation to producers.  

2.20  We  agree  with  the  Court  of  Justice  that  joint  purchasing  could  have  an  anti-
competitive  effect. However,  this will  depend  on  the  circumstances of  the case. 
In Gøttrup-Klim the particular question to be determined was whether the rules 
of  DLF,  which  prevented  its  members  from  belonging  to  a  competing 
organisation  at  the  same  time,  were  objectively  necessary  to  enable  it  to 
exercise  its  contractual  power  as  a  counterweight  to  the  large  producers  with 
which  it  was  dealing.  Gøttrup-Klim  was  not  addressing  the  question  of  whether 
the  creation  of  DLF  itself  was  restrictive  of  competition  under  Article  101.  Had 
this  have  been  the  question,  this  would  have  required  effects  analysis  to  be 
conducted:  nothing  in  this  case  suggests  that  the  formation  of  the  joint 
purchasing group  would  have  constituted  a  restriction  of  competition  by  object. 
A  ‘case-by-case’  approach  is  required  to  the  formation  of  a  joint  purchasing 
agreement; this question is unsuited to ‘object’ analysis.  

Sustainability agreements and Article 101 

joint  purchasing  agreement  may 

2.21  The Call for Tenders has specifically asked us to address the question of whether 
the  pursuit  of  sustainability  objectives  (using  that  term  broadly  to  include 
matters  such  as  environmental  protection,  animal  health  and/or  welfare,  or 
its 
social  protection)  by  a 
characterisation  as  being  restrictive  by  object  or  effect.  This  is  an  important 
question because, if the agreement restricts competition by object, it is ineligible 
for  application  of  the  de  minimis  doctrine  (see  paragraph  2.6  above). 
Furthermore,  there  is  the  (incorrect)  perception,  noted  in  paragraphs  2.7  and 
2.8 above, that object restrictions are incapable of satisfying the terms of Article 
101(3).  A  further  difficulty  is  that,  even  if  object  agreements  can  benefit  from 
Article  101(3),  it  is  not  clear  whether  Article  101(3)(a),  which  refers  to 
agreements that improve ‘the production or distribution of goods or to promoting 
technical or economic progress’, is broad enough to apply to some sustainability 
objectives;  nor  that  such  agreements  satisfy  the  requirement  of  Article 
101(3)(b) that a fair share of any resulting benefit should be passed through to 
consumers.  

influence 

2.22  There  is  no  doubt  that  sustainability  is  a  high  priority  within  the  EU  and 
internationally.  In  December  2019  the  Commission  published  ‘The  European 
Green Deal’ containing a set of proposals for the EU’s climate, energy, transport 
and  taxation  policies.  These  proposals  are  intended  to  transform  the  EU  into  a 
fair  and  prosperous  society,  with  a  modern,  resource-efficient  and  competitive 
economy,  where  there  are  no  net  emissions  of  greenhouse  gases  by  2050  and 
where economic growth is decoupled from resource use.48 The publication of the 
Green  Deal  proposals  was  followed  in  June  2021  by  the Council  and  Parliament 
enacting  Regulation  (EU)  2021/1119,  which  creates  the  legal  framework  for 
reducing  net  greenhouse  gas  emissions  by  at  least  55%  by  2030,  compared  to 
1990  levels.49  In  addition  the  United  Nations’  resolution,  ‘Transforming  our 
world:  the  2030  Agenda  for  Sustainable  Development’  is  a  ‘plan  of  action  for 
people,  planet,  and  prosperity’.50  The  2030  Agenda  seeks  to  achieve  a  wide 
range  of  policies,  such  as  eradicating  poverty  and  inequality,  promoting 

48  

49  
50  

https://ec.europa.eu/info/strategy/priorities-2019-2024/european-green-
deal_en#thebenefitsoftheeuropeangreendeal  
OJ [2021] L 243/1. 
https://sdgs.un.org/2030agenda. 

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sustainable  agriculture,  supporting  affordable  and  clean  energy  and  promoting 
responsible consumption and production. 

2.23  At  the  time  of  writing  this  report,  the  Commission  is  reflecting  on  how  EU 
competition  law,  policy  and  enforcement  can  contribute  to  the  goals  of  the 
European  Green  Deal.  In  September  2021  the  Commission  published  a 
Competition  Policy  Brief  on  ‘Competition  Policy  in  Support  of  Europe’s  Green 
Ambition’,  which  discusses  how  the  competition  rules  might  be  applied  to 
complement environmental and climate policies more effectively.51 

2.24  We  note  at  the  outset  that  sustainability  objectives  can  often  best  be  achieved 
through  EU  or  governmental  action.  For  example  the  EU  or  a  government  can 
promote  legislation  or  a  regulatory  regime  that  makes  it  unlawful  to  import 
timber  that  has  been  obtained  as  a  result  of  irresponsible  depletion  of 
rainforests; indeed we note that the Commission published a draft Regulation on 
deforestation on 17 November 2021.52 Another example would be to prohibit the 
acquisition  of  clothes  that  have  been  produced  in  sweatshops  or  by  using  child 
labour  or  of  foodstuffs  sourced  from  suppliers  who  pay  inadequate  wages.  It  is 
trite  law  that  undertakings  that  act  in  an  identical  manner  pursuant  to 
sustainability  requirements  imposed  by  law  or  regulation  will  not  be  infringing 
competition law.53 

2.25  We  recognise  however  that there may  be  many  desirable  sustainable  goals  that 
are  not  the  subject  of  legislative  or  regulatory  rules,  or  where  it  may  take  a 
considerable  time  for  them  to  be  adopted.  It  is  necessary  therefore  to  consider 
on the one hand to what extent the market and competitive forces can contribute 
to  sustainability  goals;  and  on  the  other  hand  the  extent  to  which  competition 
law might act as an impediment to the achievement of those goals. 

2.26  In assessing joint purchasing arrangements that pursue sustainability objectives, 

we agree with the statement of Executive Vice-President Vestager that:  

The starting point here is that a green competition policy still has to be – 
well,  a  competition  policy.  We  still  need  to  carry  out  our  fundamental 
task,  of  keeping  markets  open  and  competitive  –  not  least,  because 
competition helps to make our economy greener.54 

Competition may promote sustainability goals 

2.27  In principle, it is desirable that firms should compete with one another in order 
to  produce  more  sustainable  products.  The  ‘parameters’  of  competition  include 
not  only  the  obvious  ones  of  lower  prices  and  better  standards  of  service,  but 
also  the  quality  of  the  products  on  offer,  including  their  sustainability.  The 
Commission’s  decision  in  Car  emissions55  is  a  significant  example  of  a  situation 
in which firms that could have competed with one another in the deployment of 

https://ec.europa.eu/competition-policy/index/news/competition-policy-brief-12021-policy-support-
europes-green-ambition-2021-09-10_en 
Proposal for a Regulation of the European Parliament and of the Council on the making available on 
the  Union  market as well as  export from  the Union of  certain commodities and products associated 
with  deforestation  and  forest  degradation  and  repealing  Regulation  (EU)  No  995/2010,  COM(2021) 
706 final. 
See Case C-280//08 P Deutsche Telekom AG v Commission EU:C:2010:603, para 80. 
Executive  Vice-President  Vestager’s  keynote  speech  at  the  25th  IBA  Competition  Conference,  10 
September 2021. 
Decision of 8 July 2021; see Commission Press Release IP/21/3581, 8 July 2021. 

51  

52  

53  
54  

55  

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technology  to  restrict  noxious  emissions  from  diesel  vehicles  instead  chose  to 
restrict this parameter of competition. 

2.28  As  a  general  proposition,  each  firm  should  decide  for  itself  the  way  or  ways  in 
which  it  wants  to  pursue  sustainability  objectives,  and  the  market  will  reward 
those that make good decisions and punish those that make bad ones. The Court 
of  Justice  has  repeatedly  stated  that  the  concept  inherent  in  the  Treaty 
provisions on competition is that:  

each  economic  operator  must  determine  independently  the  policy  which 
it intends to adopt on the common market.56  

This applies just as much to the sustainability initiatives that a firm might decide 
to adopt as to the prices at which, or the markets in which, it chooses to sell its 
products.  As  the  Netherlands  Authority  for  Consumers  and  Markets  has 
observed:  

undertakings  are  often  themselves  able  to  make  their  production 
processes  more  sustainable,  either  because  various  types  of  regulation 
offer  sufficient  incentives  to  do  so,  because  they  are  able  to  gain  a 
competitive advantage with such a move, or because they aim to make 
their production processes more sustainable anyway.57 

2.29  However,  there  may  be  circumstances  in  which  sustainability  objectives  cannot 
be achieved, or at least may only be achieved more slowly, if this is left purely to 
market  forces  and  the  process  of  competition.  For  example  an  individual  firm 
may,  as  a  matter  of  corporate  responsibility,  want  to  switch  from  using 
unsustainable (and cheaper) inputs to sustainable (and more expensive) ones. It 
is easy to imagine such circumstances. Undertaking X might wish to refrain from 
purchasing plastic bottles, illegally-felled timber, clothes produced in sweatshops 
or meat products where animal standards are unacceptably low. In the absence 
of  legislation,  regulation  or  de  jure  or  de  facto  standards  undertaking  X  could 
make  this  decision  unilaterally,  and  make  a  virtue  of  its  policy  in  the  way  in 
which  it  promotes  its  own  ‘sustainable’  products  in  downstream  markets:  in 
other words this could be a parameter of competition. However X’s competitors, 
Y  and  Z,  might  continue  to  purchase  their  inputs  from  unsustainable,  and 
cheaper, sources, and then charge lower prices than X’s in downstream markets. 
In  these  circumstances  X  might  decide  that  the  risk  of  losing  sales  to  its 
‘irresponsible’ competitors, Y and Z, because of their lower prices, is one that is 
not worth taking: X might therefore abandon a policy that, as a matter of public 
policy, seems to be a desirable one. This is consistent with the literature on ‘the 
Prisoner’s  Dilemma’,  which  recognises  that,  when  acting  unilaterally,  firms  may 
rationally pursue strategies that deliver worse overall outcomes for society than 
would  be  achieved  under  cooperative  behaviour.  In  these  circumstances,  some 
form  of  collective  action  might  be  preferable  from  the  perspective  of 
sustainability.  Furthermore  cooperation  might  provide  a  speedier  solution  than 
waiting for legislation, regulation or the setting of appropriate standards. 

2.30  We  have  no  doubt  that,  in  principle,  certain  joint  purchasing  arrangements  can 
make a positive contribution to sustainability objectives. For example, a group of 
buyers  may  use  their  collective  bargaining  position  in  order  to  obtain  more 

56  

57  

See e.g. Case C-209/07 Competition Authority v Beef Industry Development Society EU:C:2008:643, 
para 34. 
Draft ACM Guidelines on Sustainability agreements, 9 July 2020, para 38, available at www.acm.nl.  

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favourable  prices  for  products  that  are  produced  in  a  more  sustainable  manner 
which, in turn, could lead to lower prices for ‘environmentally friendly’ products 
for consumers. 

2.31  However,  it  is  possible  that  certain  agreements  between  competing  purchasers 
would be regarded as restrictions of competition by object as they amount to a 
group  boycott.  For  example  one  of  the  many  restrictive  practices  considered  in 
the Commission’s Pre-Insulated Pipe Cartel58 decision was a collective boycott of 
customers and suppliers that dealt with Powerpipe, a competitor of the firms in 
the  cartel.  It  was Powerpipe  that  complained  to  the  Commission  that  the  cartel 
was  hindering  its  activities  in  the  district  heating  market.59  The  Commission 
concluded  that  the  various  cartel  arrangements,  including  the  ‘common  plan  to 
eliminate  or  damage  Powerpipe’,  had  the  object  and  effect  of  restricting 
competition.60 

Is  an  agreement  to  purchase  only  sustainable  products  restrictive  of 
competition by object? 

2.32  We have given consideration to whether a boycott of the kind condemned in the 
Pre-Insulated Pipe Cartel decision means that an agreement between purchasers 
to  purchase  only  sustainable  products  would  be  found  to  be  restrictive  of 
competition  by  object:  we  will  call  such  an  agreement  a  ‘sustainable  products 
purchasing agreement’ or an ‘SPPA’. An example of an SPPA would arise where a 
group  of  competing  purchasers  agrees  to  buy  timber  only  from  sustainable 
sources  and  not  from  suppliers  that  are  destroying  the  Amazonian  rain  forest. 
Other  examples  would  be  an  agreement  to  purchase  food  products  only  from 
suppliers  that  meet  appropriate  animal  welfare  standards  or  to  purchase 
products  only  from  firms  that  comply  with  minimum  protections  for  workers.  It 
could  be  argued  that  the  objective  aim  or  purpose  of  an  SPPA  is  to  restrict  or 
distort  competition  on  the  part  of  suppliers  of  unsustainable  products,  and  that 
therefore  such  an  agreement  restricts  competition  by  object.  Even  if  an  SPPA 
may  be  intended  to  pursue  desirable  objectives,  it  is  well-established  case-law 
that  an  agreement  may  be  found  to  have  an  anti-competitive  object  even  if  it 
simultaneously  pursues  other  legitimate  objectives.61  If  an  SPPA  amounts  to  a 
restriction  of  competition  by  object,  the  problems  outlined  in  paragraphs  2.4  to 
2.12  above  arise,  in  particular  that  it  would  be  caught  by  Article  101(1)  even 
though it has no appreciable effect on competition and that it would be difficult 
to justify under Article 101(3). These difficulties might lead to the avoidance or 
abandonment  of  initiatives  that  could  be  considered  to  be  desirable  from  the 
perspective of sustainability.   

2.33  We  consider  that  there  are  several  reasons why  an  SPPA  should  not  be  treated 
as  restrictive  of  competition  by  object,  but  should  instead  be  analysed  on  an 
effects basis.   

The distinction between horizontal and vertical purchasing restraints 

2.34  Our first observation is that it is not difficult to distinguish an SPPA from cases in 
the  past  in  which  boycotts  have  been  found  to  be  restrictive  of  competition  by 
object.  In  the  Pre-Insulated  Pipe  Cartel  case  the  producers  of  pipes  were 
operating  a  particularly  ‘hard-core’  cartel  which  involved,  among  other  things, 

OJ [1999] L 24/1. 
Ibid, para 20. 
Ibid, paras 146–147. 
See e.g. Case C-551/03 P General Motors v Commission EU:C:2006:229, para 64 and case-law cited. 

58  
59  
60  
61  

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allocating  market  share  quotas,  market  sharing,  price  fixing,  bid  rigging, 
attempting  to  force  Powerpipe  to  join  the  cartel  and  organising  a  collective 
boycott  of  Powerpipe.62  These  practices  were  found  to  constitute  a  single 
continuing  infringement  of  Article  101(1).63  It  would  be  hard  to  think  of  a  more 
obvious infringement of Article 101 than this, which clearly involved a restriction 
of competition by object. Specifically, the collective boycott was intended by 
the  members  of  the  cartel  to  eliminate  a  competitor  that  was  operating 
at  the  same  level  of  the  market  as  themselves:  the  case  was  one  of 
horizontal foreclosure of market access on the part of Powerpipe. The boycott in 
the  Pre-Insulated Pipe Cartel  can be  described  as  a horizontal boycott,  and  is 
distinguishable  from  an  SPPA  that  involves  purchasers  in  a  downstream  market 
agreeing  among  themselves  not  to  deal  with  certain  suppliers  in  the  upstream 
market: they are not attempting to protect themselves from competition at their 
own  level  of  the  market.  Instead  an  SPPA  involves  a  vertical  purchasing 
restriction  relating  to  firms  in  an  upstream  market,  where  the  detriment  to 
competition is less obvious, and where, therefore, effects analysis would appear 
to be more appropriate than allocating the case to the ‘object box’.  

2.35  Further  examples  of  horizontal  boycotts  being  found  to  restrict  competition  by 
object  are  Protimonopolný  úrad  Slovenskej  republiky  v  Slovenská  sporiteľňa 
a.s.64  and  Ordre  national  des  pharmaciens  (ONP)  and  Others  v  European 
Commission65. We note that the Commission’s Staff Working Document providing 
guidance  on  ‘by  object’  restrictions  of  competition  for  the  purpose  of  the  De 
Minimis  Notice  provides  these  horizontal  boycott  cases  as  examples  of  object 
restrictions; it does not say that vertical purchasing restraints should be treated 
as a restriction by object. 

2.36  There  are  numerous  cases  in  which  the  Commission  and  the  EU  Courts  have 
condemned  collective  exclusive  dealing  agreements,  where  the  purpose  of  the 
parties  was  to  keep  imports  out  of  a  national  market  which  the  participants  in 
the agreement wished to reserve to themselves. As we say at page 579 of Whish 
and Bailey, ‘A more obvious target for the Commission it is hard to imagine’, in 
particular because these cases violated the principle of single market integration. 
We  provide  numerous  examples  of  such  cases  on  pages  579  and  580  of  our 
book,  for  example  a  scheme  designed  to  keep  washing  machines  out  of  the 
Belgian market66 and a marketing system that could prevent imports of fruit into 
the  Netherlands67.  Similarly  the  Court  of  Justice  upheld  the  Commission’s 
decision  to  condemn  rigid  collective  exclusive  dealing  systems  in  two  cigarette 
cases,  affecting  the  Belgian  and  Dutch  markets  respectively68.  The  Commission 
has  dealt  with  many  other  similar  situations,  always  striking  such  agreements 
down69.  

62  
63  
64  
65  
66  

67  

68  

69  

OJ [1999] L 24/1, para 147. 
Ibid, para 148. 
Case C-68/12 EU:C:13:71. 
Case T-90/11 EU:T:2014:1049. 
Cases  96/82  etc  NV  IAZ  International  Belgium  v  Commission  EU:C:1983:310;  note  the  additional 
fine subsequently imposed by the Commission in this case: Re IPTC Belgium SA OJ [1983] L 376/7. 
Case  71/74  FRUBO  v  Commission  EU:C:1975:61;  see  similarly  Irish  Timber  Importers  Association, 
XXth Report on Competition Policy (1990), point 98. 
Cases  209/78  etc  Van  Landewyck  v  Commission  EU:C:1980:248;  Cases  240/82  etc  SSI  v 
Commission EU:C:1985:488 and Case 260/82 NSO v Commission EU:C:1985:489. 
Re Gas Water-Heaters OJ [1973] L 217/34; Re Stoves and Heaters OJ [1975] L 159/22; Re Bomée 
Stichting OJ [1975] L 329/30; Groupement d’Exportation du Leon v Société d’investissements et de 
Cooperation  Agricoles  (Cauliflowers)  OJ  [1978]  L  21/23;  Donck  v  Centraal  Bureau  voor  de 
Rijwielhandel OJ [1978] L 20/18; Re IMA Rules OJ [1980] L 318/1; Re Italian Flat Glass OJ [1981] L 
326/32;  Hudson’s  Bay—Dansk  Pelsdyravlerforening  OJ  [1988]  L  316/43,  upheld  on  appeal  Case  T-
61/89 Dansk Pelsdyravlerforening v Commission EU:T:1992:79. 

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2.37  The  cases  in  paragraph  2.36  are  similar  to  the  horizontal  boycott  in  the  Pre-
Insulated  Pipe  Cartel,  in  that  the  infringing  firms  were  seeking  to  prevent 
competition at their own level of the market. In the case of an SPPA the parties 
to the agreement operate on the downstream market and are not motivated by 
the  intention  of  eliminating  a  competitor  at  their  level  of  the  market.  Their 
intention  would  appear  to  be,  in  the  words  of  a  speech  by  Executive  Vice-
President Vestager in September 2021, ‘to cut dirty products out of their supply 
chains’.70 It seems to us that it can reasonably be argued that an SPPA does not 
reveal in itself a sufficient degree of harm such that it should be allocated to the 
object box. Instead an SPPA should be subject to effects analysis which requires, 
for  example,  an  examination  of  the  market  coverage  of  the  arrangement,  the 
market  position  of  the  parties,  the  market  position  of  competitors  and  other 
factors in order to reach an informed view as to its competitive impact.  

Few  precedents  on  agreements  between  purchasers  to  buy  only 
sustainable products 

2.38  Our second observation concerns the lack of precedents on agreements between 
purchasers to buy only sustainable products. In the event that purchasers were 
to  practice  a  collective  boycott  in  order  to  harm  a  purchaser  or  purchasers  at 
their  own  level  of  the  market,  we  can  see  that  such  a  horizontal  boycott would 
be  a  candidate  case  of  object  analysis  as  an  extension  of  the  reasoning  in  the 
Pre-Insulated Pipe Cartel. Indeed we note that in Bitumen – NL (better known as 
Dutch  Bitumen)71  one  of  the  practices  condemned  by  the  Commission  was  an 
agreement between buyers and suppliers of bitumen that smaller competitors of 
the  buyers  would  be  offered  lower  discounts,  placing  them  at  a  competitive 
disadvantage72. This fell short of a boycott as such, but the theory of harm was 
horizontal  damage  to  firms  at  the  same  level  of  the  market  as  the  buyers,  and 
the  cartel  was  held  to  restrict  competition  by  object.  The  case  differed  from  an 
SPPA which we consider should be subject to effects analysis. 

2.39  We have not found any case in which an actual collective boycott by purchasers 
has  been  found  to  be  restrictive  of  competition  by  object.  We  explained  in 
paragraphs  2.34  to  2.35  above  that  collective  boycott  cases  under  Article  101 
typically  involve  suppliers  of  products  taking  action  to  punish  a  competitor  at 
their level of the market, as in the Pre-Insulated Pipe Cartel, or to keep products 
out of their domestic market, as in paragraph 2.36. In the Budapest Bank case73 
the  Court  of  Justice  agreed  with  the  opinion  of  Advocate  General  Bobek  that 
there must be sufficiently reliable and robust experience for the view to be taken 
that  an  agreement  is,  by  its  very  nature,  harmful  to  the  proper  functioning  of 
competition  in  order  to  classify  it  as  a  restriction  of  competition  ‘by  object’ 
without  an  analysis  of  its  effects.74  Advocate  General  Wahl  observed  in  his 
opinion in Cartes Bancaires v Commission that:  

only  conduct  whose  harmful  nature  is  proven  and  easily  identifiable,  in 
the light of experience and economics, should therefore be regarded as a 
restriction  of  competition  by  object,  and  not  agreements  which,  having 
regard to their context, have ambivalent effects on the market or which 

‘Competition policy in support of the Green Deal’, Speech of 10 September 2021. 
Commission decision of 13 September 2006. 
Ibid, recital 143. 
Case C-228/18 EU:C:2020:265, para 76 
Case  C-228/18  Budapest  Bank  EU:C:2020:265,  para  76,  endorsing  paras  54  and  63–73  of  the  AG 
Opinion: EU:C:2019:678. 

70  
71  
72  
73  
74  

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Horizontal Guidelines on purchasing agreements: Delineation between by object and by effect restrictions 

produce  ancillary  restrictive  effects  necessary  for  the  pursuit  of  a  main 
objective which does not restrict competition.75  

There is no ‘sufficiently reliable and robust experience’ of the nature or effects of 
agreements by purchasers to purchase only sustainable products. 

case 

involved  a 

2.40  We  have  found  only  one  case  in  which  a  court  has  given  consideration  to 
whether  a  collective  boycott  by  purchasers  might  amount  to  a  restriction  of 
competition  by  object,  R  (Cityhook)  v  Office  of  Fair  Trading76.  This  was  a 
decision of the Administrative Court of England and Wales at a time when the UK 
was a member of the EU; the Court was required to apply EU competition law to 
conduct  that  had  an  effect  on  trade  between  Member  States  of  the  EU  and  to 
apply UK competition law consistently with the principles of EU competition law. 
The 
submarine 
telecommunications  cable-landing  technology  by  the  major  manufacturers  of 
submarine cables; they were potential competing purchasers of the technology. 
The Office of Fair Trading (‘the OFT’), which was the competition authority in the 
UK  at  the  time,77  prepared  a  Statement  of  Objections  that  alleged  that  the 
boycott had as its ‘object and/or effect’ the restriction of competition.78 The OFT 
subsequently decided that the case was not an administrative priority and closed 
the file. Cityhook applied for judicial review of the OFT’s decision to close the file 
on the basis that the OFT’s failure to find an infringement by object was an error 
of  law.  The  Administrative  Court  dismissed  the  application  for  reasons  of 
particular interest for present purposes. 

collective  boycott  of  Cityhook’s 

2.41  The  Administrative  Court  was  attracted  by  the  ‘simplicity’  of  characterising  a 
collective  boycott  of  a  supplier  who  offers  an  innovative  and  cost-saving 
alternative  approach  to  an  established  area  of  commercial  activity  as  a 
restriction of competition by object.79 However the Court acknowledged that the 
contrary  view  –  namely,  that  the  effects  of  this  kind  of  boycott  should  be 
examined  –  was  neither  unreasonable  nor  ‘wholly  untenable’.  The  Court 
specifically noted that it was:  

of  some,  though  not  conclusive,  significance  to  note  that  distinguished 
and  experienced  authors  in  the  field  have  not  said  categorically  that  a 
constitutes  an  object-based 
collective  boycott  by  purchasers 
infringement.80  

2.42  In the Cityhook case the Administrative Court also had regard to paragraphs 19 
to  21  of  the  European  Commission’s  Article  101(3)  Guidelines.81  It  considered 
that those paragraphs meant that the characterisation of a collective boycott by 
competing purchasers was ‘not quite as straightforward as at first sight it might 
have seemed’.82  Paragraph 21 of the Guidelines says that restrictions by object 

75  
76  
77  

78  
79  

80  

81  

82  

Case C-67/13 P EU:C:2014:1958, para 56. 
[2009] EWHC 57 (Admin). 
The  OFT  was  abolished  with  effect  from  1  April 2014  and  replaced  by  the  Competition  and  Markets 
Authority: s 25 of the Enterprise and Regulatory Reform Act 2013. 
Ibid, para 15. 
Ibid, para 131; the Court referred to two cases involving a boycott  by suppliers (not  buyers): the 
decision  of  the  European  Commission  in  Video  cassette  recorders,  OJ  [1978]  L  47/42  and  the 
decision  of  the  UK  Competition  Appeal  Tribunal  in  Institute  of  Independent  Insurance  Brokers  v 
Director General of Fair Trading [2001] CAT 4. 
Ibid,  para  133;  the  books  cited  by  the  judge  were  Bellamy  &  Child  European  Community  Law  of 
Competition  (6th  edition,  2008),  paragraphs  5.98-5.100;  Faull  &  Nikpay  The  EC  Law  of  Competition 
(2nd edition, 2007), paragraph 8.89; and Whish Competition Law (6th edition, 2008, pp 113-121. 
OJ [2004] C 101/97. 
[2009] EWHC 57 (Admin), para 133. 

25 

 
 
 
 
 
 
 
 
 
 
                                          
Horizontal Guidelines – Purchasing agreements: Delineation between by object and by effect restrictions 

are those that by their very nature have the potential of restricting competition 
and that:  

this  presumption  is  based  on  the  serious  nature  of  the  restriction  and 
on  experience  showing  that  restrictions  of  competition  by  object  are 
likely  to  produce  negative  effects on  the  market  and  to jeopardise  the 
objectives pursued by the [EU] competition rules.  

The  Administrative  Court  observed  that  the  presumption  can  arise  only  if 
experience has demonstrated the presumption to be justified; this is, of course, 
consistent  with  the  observations  of  the  Court  of  Justice  and  Advocates  General 
set out in paragraph 2.38 above.   

Object restrictions should be interpreted narrowly 

2.43  Our  final  observation  on  SPPAs  is  that,  as  noted  in  paragraph  2.14  above,  the 
Court of Justice emphasised in Cartes Bancaires v Commission that the concept 
of  a  restriction  of  competition  by  object  is  one  that  should  be  interpreted 
restrictively.  It  is  arguable  that  an  agreement  by  purchasers  to  buy  only 
sustainable  products  does  not  reveal  ‘in  itself  a  sufficient  degree  of  harm  to 
competition’, the words used in paragraph 49 of that judgment. Given that there 
is  no  precedent  finding  such  an  agreement  by  purchasers  to  be  restrictive  of 
competition  by  object,  and  that  the  concept  should  be  interpreted  restrictively, 
we consider that there is a good argument for ‘giving the benefit of the doubt’ to 
firms  that  enter  into  an  SPPA,  as  suggested  by  the  EFTA  Court  in  the  Ski  Taxi 
case.  

‘Bargaining tactics’ 

2.44  It might be helpful if we distinguish an SPPA, where the parties to an agreement 
agree  to  purchase  only  sustainable  products,  from  what  could  be  called 
‘bargaining  tactics’,  where  a  buyer  group  is  negotiating  terms  and  conditions 
with  suppliers  and  threatens  to  abandon  negotiations  unless  the  sellers  offer 
better  terms.  This  type  of  behaviour  appears  to  us  to  be  a  manifestation  of 
collective bargaining, and not something that infringes competition law in and of 
itself. The competition law question here would be whether the buyer group itself 
restricts competition, and this is something that requires effects analysis. 

Could an SPPA satisfy the requirements of Article 101(3)? 

2.45  In  the  previous  paragraphs  we  have  argued  that  we  consider  that  there  are 
reasonable  arguments  to  the  effect  that  an  SPPA  should  not  be  regarded  as 
restrictive of competition by object. However we also consider that, even if such 
an agreement is found to restrict competition  by object, it may still  be possible 
that it could be defended under Article 101(3). We explained in paragraphs 2.7 
and  2.8  above  that  object  restrictions  can,  as  a  matter  of  law,  satisfy  Article 
101(3),  although  we  acknowledged  that  there  is  a  widespread  perception  that 
this  is  not possible.  We  consider  it  to  be  regrettable  if  Article  101(3)  can  never 
be invoked in the case of an object restriction. If an SPPA is not a restriction of 
competition  by  object,  then  there  is  no  doubt  that,  if  it  is  found  to  restrict 
competition by effect, it may nevertheless satisfy Article 101(3). 

2.46  We do not think that the scope of Article 101(3) should be broadened to include 
non-economic  benefits;  we  do  not  see  that  provision  as  allowing  broad  ‘public 
interest’  criteria  to  be  brought  into  the  assessment.  As  we  say  on  page  165  of 

26 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Horizontal Guidelines on purchasing agreements: Delineation between by object and by effect restrictions 

Whish  and  Bailey,  there  is  much  to  be  said  for  interpreting  Article  101(3)  in  a 
narrow  rather  than  a  broad  manner,  according  to  clear  legal  standards.  The 
‘narrow’  view  which  we  advocate  is  consistent  with  both  the  wording  of  Article 
101(3)  and  the  recitals  to  the  various  block  exemptions  which  explain  the 
reasons  for  permitting  certain  agreements  under  Article  101(3)  purely  in  terms 
of  economic  efficiency.  We  note  that  respondents  (in  particular  consumer 
associations and NCAs) to the Commission’s consultation on how the competition 
rules and sustainability policies might work together, expressed a concern about 
embracing  a  broader  view  of  Article  101(3).    Having  said  this,  we  think  that 
there is some scope for a greater liberalism (or an approach that is conducive to 
sustainability)  on  the  part  of  the  Commission  when  interpreting  and  applying 
Article 101(3). We find the Commission’s Competition Policy Brief of September 
2021 helpful on this:  

•  Qualitative  efficiencies:  in  certain  circumstances  an  agreement  may 
create  sustainability  benefits  that  amount  to  qualitative  efficiencies  that 
can  be  assessed  under  Article  101(3).  That  might  be  the  case  if  a  joint 
purchasing  agreement  replaced  a  non-sustainable 
input  with  a 
sustainable  one,  which  either  improves  the  quality  or  longevity  of  the 
product83  

•  Fair share for consumers: it may be possible to ‘flexibilise’ the second 
condition  of  Article  101(3)  and  the  way  in  which  consumers  are 
considered to receive a fair share of the benefit that results from an anti-
competitive agreement. The Competition Policy Brief states that:  

As  long  as  the  users  of  the  product  concerned  appreciate  the 
sustainability  benefits  related  to  the  way  the  products  are 
produced or distributed, and are ready to pay a higher price for 
this reason alone, such benefits can be taken into account in the 
assessment. 

•  Out-of-market sustainability benefits: Negative effects on consumers 
in one geographic or product market cannot normally be balanced against 
and compensated by positive effects for consumers in unrelated markets. 
However  it  may  be  possible  for  out-of-market  benefits  to  be  taken  into 
account, provided that the group of consumers affected by the agreement 
and the group of benefiting consumers are substantially the same.84 

2.47  We  consider  that  these  are  useful  proposals  that  would  make  it  easier  to  take 

sustainability objectives into account.   

2.48  A  separate  point  is  that  we  expect  that  undertakings  and  their  professional 
advisers  will  be  more  persuaded  of  the  possible  application  of  Article  101(3)  to 
joint purchasing with sustainability objectives when they have real-life examples 
to  learn  from.  It  is  the  opinion  of  the  authors  of  this  report  that  a  ‘finding  of 
inapplicability’  under  Article  10  of  Regulation  1/2003  and/or  the  informal 
guidance  procedure  on  the  part  of  the Commission  would  be valuable  as  a  way 
of  developing  precedents,  and  would  serve  ‘the  public  interest  of  the  [EU]’,  the 
words  used  in  Recital  14  of  Regulation  1/2003  when  introducing  the  Article  10 

83  
84  

E.g., recycled materials might replace plastic in manufacturing clothing, toys etc. 
See ‘Competition Policy in Support of Europe’s Green Ambition’ Competition Policy Brief No 1/2021, p 
6; see also Guidelines on the application of [Article 101(3)] of the Treaty, OJ [2004] C 101/97, para 
43. 

27 

 
 
 
 
 
 
 
 
 
                                          
Horizontal Guidelines – Purchasing agreements: Delineation between by object and by effect restrictions 

procedure.85  However  we  acknowledge  that  the  Commission  will  be  able  to 
provide  this  service  only  if  firms  and  their  advisers  are  willing  to  submit 
proposals to DG COMP for scrutiny. The Commission cannot provide guidance in 
this area entirely on an abstract basis.  

2.49  The Greek Competition Commission has discussed the possibility of the creation 
of  a  so-called  ‘sustainability  sandbox’,  which  would  enable  firms  to  notify 
business  proposals  for  sustainable  development.  This  might  lead,  in  certain 
cases,  to  a  competition  authority  certifying  that  there  are  no  grounds  for 
proceeding  under  Article  101  or  its  domestic  equivalent  by  issuing  a  ‘no  action 
letter’.86 We wonder whether this might provide a useful basis for increasing the 
guidance available in this difficult but important area. 

2.50  A different solution to the question of how to deal with SPPAs would be the use 
of  standards.  Executive  Vice-President  Vestager  said  in  a  speech  in  Rome  in 
September  2021  that  it  might  be  possible  for  companies  to  set  ‘joint  standards 
for  what  counts  as  a  green  product,  or  pooling  resources  to  speed  up  green 
innovation’,  which,  in  turn,  ‘could  even  mean  companies  agreeing  to  cut  dirty 
products  out  of  their  supply  chains,  without  being  forced  to  do  that  by 
regulation.’87  In  our  view,  the  Horizontal  Guidelines  of  2011  already  provide  a 
useful  framework  for  determining  when  standard-setting  will  normally  not 
restrict  competition:  the  procedure  for  adopting  a  standard  must  be  open  and 
transparent, there must be no obligation to comply with the standard and access 
to  the  standard  must  be  available  on  fair,  reasonable  and  non-discriminatory 
terms.88    The  Netherlands  Authority  for  Consumers  and  Markets  uses  these 
criteria  in  its  draft  Guidelines  on  sustainable  agreements  when  giving  joint 
standards  and  certification  labels  about  the  use  of  sustainable  raw  materials  as 
an example of a permissible agreement. 

trade  unions,  consumer,  human 

2.51  Likewise,  the  US  Department  of  Justice  cleared  a  Workplace  Code  of  Conduct 
created  by  the  Apparel  Industry  Partnership  (‘AIP’)  of  clothing  and  footwear 
religious 
manufacturers, 
organisations.  The  aim  of  the  Workplace  Code  was  (and  is)  to  eradicate  the 
inhumane  working  conditions  in  sweatshops  in  various  parts  of  the  world.  The 
DoJ  decided  that  it  would  not  take  enforcement  action  against  the  AIP’s 
Workplace Code.89 In the DoJ’s view, it was ‘far from clear that adherence to the 
Code  will  have  any  adverse  effect  on  the  prices’.  In  fact,  to  the  contrary, 
participating firms that advertised their compliance with the Code would provide 
‘useful purchasing information to a substantial number of consumers’. 

rights,  and 

2.52  Finally, we have considered whether the Wouters doctrine90 might be applicable 
to  a  case  where  firms  privately  agree  to  restrict  competition  in  order  to  pursue 

See  the  Commission’s  Notice  on  informal  guidance  relating  to  novel  questions  concerning  Articles 
[101 and 102 TFEU] that arise in individual cases, OJ [2004] C 101/78. As at the date of this report 
the  Commission  has  issued  two  guidance  letters:  one  to  Medicines  for  Europe  on  8  April  2020  and 
the  other  to  Ecorys  and  SPI  on  25  March  2021;  both  letters  concerned  supply  arrangements  in 
response  to  the  coronavirus  crisis  and  both  are  available  on  DG  COMP’s  website.  The  Director-
General of DG COMP, Olivier Guersent, has also stated that the Commission is considering whether to 
issue informal guidance in relation to sustainability agreements: see speech of 14 September 2020, 
‘Sustainability  Goals 
at 
www.concurrences.com. 
https://www.epant.gr/en/enimerosi/sandbox.html.  
Executive  Vice-President  Vestager’s  keynote  speech  at  the  25th  IBA  Competition  Conference,  10 
September 2021. 
OJ [2011] C 11/1, para 289. 
www.justice.gov/atr/public/busreview/4513.pdf.  
Case C-309/99 Wouters v Algemene Raad van de Nederlandshce Orde van Advocaten EU:C:2002:98. 

the  Common  Ground’, 

and  Antitrust: 

available 

Finding 

85  

86  
87  

88  
89  
90  

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Horizontal Guidelines on purchasing agreements: Delineation between by object and by effect restrictions 

sustainability objectives. In Wouters the Dutch Government intended that there 
should be a regulatory system in the Netherlands for the legal profession, but it 
was left to the Dutch Bar Council to adopt the relevant rules. A rule that forbade 
multi-disciplinary  partnerships  (for  example  with  the  result  that  a  lawyer  could 
not  become  a  partner  in  a  firm  of  accountants)  was  clearly  restrictive  of 
competition,  but  the  question  for  the  Court  of  Justice  was  whether  it  was  a 
restriction  of  competition  that  infringed  Article  101(1).  The  Court’s  conclusion 
was that the rules would not infringe Article 101(1) when there was a legitimate 
public  interest  (in  that  case  the  regulation  of  the  legal  profession),  where  they 
were  inherent  in  the  pursuit  of  that  objective,  and  where  they  were  no  more 
restrictive than was necessary to achieve that objective.  

2.53 
The  Wouters  doctrine  has  been  applied  in  other  cases  involving 
professional  ethical  rules,  and  it  has  also  been  applied  to  rules  regulating  a 
particular sport.91 However it seems to be the case that the Wouters doctrine is 
of limited application: it has not been applied outside those two situations, where 
regulatory  functions  were  carried  out  by  a  body  that  was  empowered  by  the 
State (as in Wouters) or by an international non-governmental organisation (as 
in Meca-Medina92). Advocate General Mazak’s opinion in Pierre Fabre93 was that 
‘private  voluntary  measures’  may  fall  outside  the  scope  of  Article  101(1) 
pursuant  to  the  Wouters  doctrine,  provided  the  limitations  imposed  are 
appropriate  in  the  light  of  a  legitimate  objective  sought  and  do  not  go  beyond 
what  is  necessary  in  accordance  with  the  principle  of  proportionality.  However 
the  Advocate  General  specifically  added  that  the  legitimate  objective  sought 
must  be  of  a  public  law  nature  and  therefore  be  aimed  at  protecting  a  public 
good.  We  are  sceptical  therefore  that  Wouters  can  provide  a  basis  on  which  to 
scrutinise  sustainability  agreements  under  Article  101  in  the  case  of  a  purely 
private  initiative  on  the  part  of  undertakings,  which  is  neither  required  nor 
authorised by the State; however we do not rule out the possibility that Wouters 
might  be  invoked  where  firms  enter  into  agreements  pursuant  to  a  clearly 
articulated public policy of the Commission or a Member State. 

91  
92  
93  

See most recently Case T-93/18 International Skating Union v Commission EU:T:2020:610, para 77. 
Case C-519/04 P Meca-Medina v Commission EU:C:2006:492. 
Case C-439/09 EU:C:2011:113, para 35 of his opinion. 

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Horizontal Guidelines – Purchasing agreements: Delineation between by object and by effect restrictions 

Chapter 3 
Terminology and different structures and activities of 
buyer groups 

3.1  This  Report  is  focussed  on  the  delineation  between  by  object  and  by  effect 
restrictions of competition in the case of purchasing agreements. In this chapter 
we  begin  by  explaining  the  terminology  that  we  use  in  our  Report  and  then 
discuss different types of joint purchasing agreements.  

Terminology 

3.2 

It is important at the outset to make a distinction between agreements entered 
into between undertakings that relate to their individual purchasing of goods and 
services  –  for  example  as  to  the  prices  (or  an  element  in  the  prices)  that  they 
will pay, the applicable terms and conditions that they will agree to, the suppliers 
from whom they will buy or the information that they will provide to each other - 
and  joint  purchasing  agreements  that  involve  some  collective  activity  on  the 
part  of  the  buyers.  As  will  be  seen  in  Chapter  4  and  Annex  2  to  this  Report, 
cases  in  which  the  European  Commission,  NCAs  or  competition  authorities  in 
third  countries  have  imposed  fines  in  the  case  of  purchasing  agreements  have 
always fallen into the former category: that is to say they have never involved 
any joint or collective behaviour on the part of the buyers, other than the fact 
of  either  agreeing  purchase  prices  and  applicable  terms  and  conditions  or 
exchanging information about those matters.  

3.3  We  have  struggled  to  think  of  an  appropriate  expression  for  agreements  in  the 
former  category.  Since  they  are  cases  in  which  fines  have  been  imposed  we 
hesitate  to  call  them  ‘pure’  purchasing  agreements,  which  would  suggest  moral 
approval. Nor would we describe them as ‘simple’ purchasing agreements, since 
the mechanics of such agreements may be far from simple. To call them ‘naked’ 
agreements would beg the question as to whether such agreements are always 
(or  ‘per  se’)  unlawful.  We  will  refer  to  such  agreements  as  buyer  cartels,  and 
we emphasise that they do not involve any joint behaviour vis-à-vis suppliers in 
the upstream market.  

3.4 

In  the  case  of  a  buyer  cartel  the  members  of  the  cartel  agree  between 
themselves  how  they  will  individually  interact  with  suppliers,  or  they  exchange 
commercially sensitive information with one another about how they will do so. 
In  the  case  of  joint  purchasing  there  will  be  a  common  organisation  of  some 
kind  that  provides  the  interface  between  suppliers  in  the  upstream  market  and 
the purchasers in the downstream market that the organisation represents. It is 
through  joint  behaviour  that  the  buyer  group  can  hope  to  negotiate  more 
favourable terms and conditions than if each buyer had acted alone: this is the 
essence of joint purchasing. It is clear that the extraction of lower prices through 
joint purchasing may lead to beneficial welfare effects where these pass through 
to  customers  in  markets  downstream  from  the  buyers.  This  is  what  caused  the 
Court of Justice in Gøttrup-Klim to say that: 

the  activities  of  cooperative  purchasing  associations  may,  depending  on 
the  size  of  their  membership,  constitute  a  significant  counterweight  to 
the  contractual  power  of  large  producers  and  make  way  for  more 
effective competition. 

30 

 
 
 
 
 
 
 
 
 
 
Horizontal Guidelines on purchasing agreements: Delineation between by object and by effect restrictions 

3.5  We would add that despite the expressions ‘buyer group’ and ‘joint purchasing’, 
it  is  not  necessarily  the  case  that  the  common  organisation  will  actually 
purchase the products that are the subject of its negotiations with suppliers and 
then supply them on to the members. A wide range of arrangements exist, and it 
may be the case that the buyer group will negotiate prices (or elements of prices 
such as discounts), terms and conditions with suppliers on behalf of members of 
the  buyer  group  but  then  leave  it  to  buyers  to  make  their  own  individual 
purchases, albeit against the backdrop of the negotiations that have taken place. 
Although we will continue to use the expression ‘joint purchasing’ in this Report, 
it is important to recognise that ‘buyer’ groups sometimes negotiate rather than 
buy.  It  may  be  advisable  for  future  Guidelines  on  horizontal  co-operation 
agreements  to  deal  with  this  topic  under  the  heading  ‘joint  purchasing  and 
negotiation’ rather than simply ‘joint purchasing’. 

The structure of buyer groups 

3.6  Buyer  groups  that  enter  into  joint  purchasing  agreements  may  take  various 
forms and may have various functions. In this and the following section we will 
discuss firstly different structures of buyer groups and then the various functions 
that they may perform. 

3.7  Buyer groups may take various forms, for example a joint venture company, an 
unincorporated  cooperative  association,  a  retail  alliance,  a  contractual 
arrangement or a more informal form of cooperation, such as the use of a skilful 
negotiator  to  negotiate  on  behalf  of  a  group  of  buyers.  As  to  their  form,  the 
Commission’s Horizontal Guidelines of 2011 noted that: 

Joint  purchasing  can  be  carried  out  by  a  jointly  controlled  company,  by  a 
company in which many other companies hold non-controlling stakes, by a 
contractual arrangement or by even looser forms of co-operation. 

3.8  Two  useful  studies  of  joint  purchasing  agreements  can  be  found  in  The 
competitive effect of buyer groups, a report prepared by RBB Economics for the 
UK  Office  of  Fair  Trading  in  2007,94  (the  ‘RBB  Report’)  and  in  Retail  alliances  in 
the  agricultural  and  food  supply  chain,  a  report  published  in  2020  by  the  Joint 
Research Centre, the European Commission’s science and knowledge service (the 
‘JRC  Report’).95  Each  of  these  reports  contains  a  useful  discussion  of  the  form 
that buyer groups may take. 

The RBB Report 

3.9  Paragraphs  1.6  to  1.11  and  Chapter  2  of  the  RBB  Report  discuss  the  structures 

and activities of buyer groups.  

3.10  Paragraph  2.2  of  the  RBB  Report  notes  that  buyer  groups  typically  use  the 
combined  purchasing  power  of  the  members  to  obtain  discounts  on  goods  or 
services  for  use  or  resale  and/or  to  secure  better  terms  for  their  members  on 
matters  such  as  product  quality,  availability  and  delivery.  It  notes  that  such 
groups can be found across a wide range of industries. 

94  

95 

Economic 
https://www.rbbecon.com/downloads/2012/12/oft863.pdf. 
Available at https://publications.jrc.ec.europa.eu/repository/handle/JRC120271. 

Discussion 

OFT863, 

January 

Paper, 

2007, 

available 

at 

31 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
                                          
 
Horizontal Guidelines – Purchasing agreements: Delineation between by object and by effect restrictions 

3.11  Paragraph  2.3  notes  that  there  are  many  formats  for  buyer  groups,  and  that 
there  is  no  clear  taxonomy  in  the  economics  literature  on  the  subject.  Formats 
include: 

• 
• 

• 
• 
• 

• 

• 

• 

cooperatives of small buyers 
a buying club established by a founder member or founding group which runs 
the club and which other buyers can join 
a buying club which is run by a third party rather than by any of the buyers 
a joint venture established by a group of buyers 
groups of groups, for example where small local firms form a group to enable 
them to join a larger national group that has a minimum turnover threshold 
for membership 
‘super-buying  groups’  which  bring  together  distributors  of  a  wide  range  of 
diverse products 
contract-specific  consortia,  established  for  the  purpose  of  performing  a 
single, high-value contract that may take many years to perform 
symbol groups, where the buyers not only purchase goods or services jointly 
but  then  also  operate  on  downstream  markets  subject  to  the  use  of  a 
common symbol. 

3.12  Paragraph 2.4 of the RBB Report notes that some buyer groups may be open, in 
that the criteria for joining are easily met; others may be more ‘closed’ structures 
where  membership  is  determined  by  strict  rules,  for  example  on  minimum 
turnover or by a vote of members of the group. 

3.13  Paragraphs  1.8  to  1.10  and  2.8  and  2.9  of  the  RBB  Report  make  a  distinction 
between  ‘passive’  and  ‘active’  buyer  groups.  A  passive  buyer  group  simply 
aggregates  the  purchases  of  its  members  so  as  to  enable  higher  volume 
discounts to be obtained against a pre-existing, non-negotiable pricing schedule. 
This is to be distinguished from an ‘active’ buyer group which bargains on behalf 
of  its  members  with  the  intention  of  influencing  the  behaviour  of  suppliers  (for 
example  on  prices  or  terms  and  conditions)  on  behalf  of  the  members.  Active 
groups may have pro-competitive effects in the market, where, for example, this 
leads to cost savings that can be passed on to consumers. However active buyer 
groups  may  also  have  the  scope  to  harm  competition,  depending  on  the 
circumstances  of  the  case,  which  is  why  it  may  be  necessary  to  review  their 
behaviour on an effects basis under competition law.  

The JRC Report 

3.14  Buyer  cartels  and  joint  purchasing  occur  throughout  the  economy:  our  research 
into the cases in this area set out in Annex 2 of this Report demonstrates this to 
be  the  case.  Alliances  between  firms  in  the  retail  sector  have  existed  for  many 
years:  indeed,  the  first  two  cases  investigated  by  the  Commission  both 
concerned  small  buyer  groups  of  retailers,  in  each  of  which  the  Commission 
decided that the alliances were de minimis.96 

3.15  In recent times the number of retail alliances has been increasing in number, and 
they  have  become  more  complex  and  international  in  nature.  In  2019  the 
European Parliament called upon the European Commission to launch an analysis 
of  the  extent  and  the  effects  of  international  buying  alliances  on  the  economic 
functioning of the agricultural and food supply chain. This led to a workshop held 

96  

See SOCEMAS, 1968 and Intergroup Trading (SPAR) 1975 in Annex 2 to this Report. 

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Horizontal Guidelines on purchasing agreements: Delineation between by object and by effect restrictions 

in Brussels in later 2019 attended by a number of relevant stakeholders and the 
publication of the JRC Report in 2020. 

3.16  Section 2.1 of the JRC Report defines a retail alliance as:   

horizontal  alliances  of  retailers,  retail  chains  or  retailer  groups  that 
cooperate  in  pooling  some  of  their  resources  or  activities,  most 
importantly relating to sourcing supplies. 

The  Report  notes  that  these  groups  are  often  referred  to  as  central  purchasing 
organisations or buying groups, but uses the expression ‘retail alliances’ because 
they may have other forms and carry out other activities beyond buying.  

3.17  As  in  the  case  of  the  RBB  Report,  the  JRC  Report  notes  that  there  are  many 
forms of retailer cooperation, from highly informal at one end of the spectrum to 
a  full  merger  at  the  other.  The  existence  of  a  buyer  group  does  not  in  itself 
directly  affect  the  structure  of  the  upstream  market  from  which  buyers  source 
products  nor  the  downstream  market  in  which  they  sell  their  products.  It  does 
however change the structure of the buying market in which they deal with their 
suppliers, by altering their bargaining position.  

3.18  Section 2.3 of the JRC Report sets out a ‘typology’ of retail alliances. It notes that 

retail alliances can be classified into three main types: 

•  groups of independent retailers: these are usually small, independent 
retailers.  The  buyer  group  takes  responsibility  for  group  buying.  The 
members  may  sell  their  private  label  products  under  a  common  name. 
These  groups  typically  operate  in  one  Member  State  only,  and  are 
sometimes referred to as ‘national cooperative buying groups’ or ‘national 
buying clubs’  

•  national  retail  alliances:  these  tend  to  consist  of  larger  retailers  than 
groups of independent retailers. These alliances tend not to be involved in 
joint  buying,  but  perform  other  functions,  explained  in  paragraphs  3.23 
and 3.24 below 

•  European retail alliances: these usually consist of larger retailers, retail 
chains  or  groups  of  independent  retailers  from  different  countries.  These 
alliances tend to have only one member from each Member State, who do 
not  compete  with  one  another  as  they  operate  on  different  geographical 
markets.  As  in  the  case  of  national  retail  alliances  they  are  not  usually 
involved  in  joint  buying,  but  perform  other  functions  on  behalf  of  the 
members.  

3.19  The  JRC  Report  discusses  the  organisational  structure  and  governance  of  retail 
alliances,  which  differs  widely.  Most  alliances  have  a  central  secretariat  with  its 
own legal and commercial identity, separate from the members.  

The functions of buyer groups 

3.20  The most obvious function of a buyer group, as the name suggest, is to purchase 
centrally  on  behalf  of  the  group’s  members;  it  is  through  the  use  of  collective 
bargaining  power  that  it  is  possible  to  obtain  more  favourable  terms  than  if  the 
members  were  to  purchase  individually.  However  it  is  important  to  note  that 
buyer groups may perform other functions as well; and that some retail alliances 
do not purchase at all. 

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Horizontal Guidelines – Purchasing agreements: Delineation between by object and by effect restrictions 

The RBB Report 

3.21  The  RBB  Report  explains  briefly  that  a  buyer group  may simply  exist  to  provide 
information to its members: for example a ‘catalog hub’ may contain information 
about suppliers’ prices, leaving the members to make their own purchases. Some 
buyer groups simply pool the purchases of members in order to obtain discounts, 
where  the discount  schedule  is  unilaterally  determined  by the supplier  and non-
negotiable: this is the ‘passive’ buyer group referred to in paragraph 3.13 above. 
The more normal function of a buyer group will be to negotiate on behalf of the 
members,  using  the  collective  bargaining  power  that  arises  from  group  action; 
this  is  what  is  meant  by  an  active  buyer  group.  Chapter  3  of  the  RBB  Report 
describes  the  various  strategies  that  a  buyer  group  might  deploy  in  order  to 
secure better terms of supply.  

The JRC Report 

3.22  The  JRC  Report  contains  a  more  detailed  discussion  of  the  various  functions  of 
retail  alliances.  Groups  of  independent  retailers  typically  purchase  on  behalf  of 
members; however the members may source some products, for example locally 
or from smaller suppliers, individually. Buyer groups of independent retailers may 
also perform other functions. For example they may develop a common label and 
logo  and  the  members  may  sell  their  private  label  products  under  that  logo. 
These  buyer  groups  may  also  provide  quality  control  services,  IT  infrastructure 
and administrative services. Additionally they may engage in marketing activities, 
provide  support  for  the  organisation  and  optimisation  of  the  supply  chain  and 
offer warehousing facilities.   

3.23  National  retail  alliances  tend  not  to  engage  in  joint  buying  of  branded  products 
from  manufacturers,  although  this  does  sometimes  happen.  Rather  they 
negotiate what are referred to as ‘on-top’ agreements. These agreements relate 
to services that the alliance members may provide to their suppliers, for example 
concerning  the  placement  of  products  on  shelves  in  supermarkets,  promotional 
displays  and  presentation.  On-top  agreements  can  also  concern  data  sharing, 
including rich detail about the sales performance of products, which is obviously 
of great value to brand owners. Of course these are services offered by retailers 
to  suppliers,  but  they  are  negotiated  by  the  retail  alliance  in  the  context  of  the 
overall price that buyers will pay to their suppliers.  

3.24  As  in  the  case  of  national  retail  alliances,  European  retail  alliances  tend  not  to 
engage  in  joint  buying  of  branded  products  but  instead  negotiate  ‘on-top’ 
agreements.  In  some  cases  they  focus  on  the  services  that  can  be  supplied  in 
support  of  the  premium  brands  of  suppliers;  in  other  cases  they  may  be 
concerned with the procurement of retailers’ own-brand products. The JRC Report 
notes  that  one  European  retail  alliance,  between  REWE  and  E.  Leclerc,  does  in 
fact  engage  in  joint  buying  of  products  form  a  selected  list  of  large  brand 
manufacturers.  

3.25  Retail  alliances  provide  an  important  function  in  relation  to  the  procurement  of 
private label products, both as the direct purchaser but also in some cases as the 
negotiator  of  the  framework  agreement  within  which  retailers  will  source  their 
purchases. 

3.26  Our research into purchasing cases will be found in Annex 2. We have indicated 
in relation to each case whether it was an example of a buyer cartel or whether it 
was  a  case  of  joint  purchasing.  In  so  far  as  it  is  possible  to  do  so  from  the 

34 

 
 
 
 
 
 
 
 
 
 
Horizontal Guidelines on purchasing agreements: Delineation between by object and by effect restrictions 

information publicly available about the cases, we have attempted to explain the 
structure of the buyer group and the function or functions that it was established 
to fulfil. 

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Horizontal Guidelines – Purchasing agreements: Delineation between by object and by effect restrictions 

Chapter 4 
Legal analysis of joint purchasing cases 

Introduction 

4.1 

In Chapter 4 we set out the main themes that we have identified in our research 
into joint purchasing cases. The chapter is in two parts. We begin by categorising 
and  commenting  on  the  cases  we  have  reviewed  indicating,  for  example, 
whether  they  concerned  a  buyer  cartel  as  opposed  to  joint  purchasing,  and  in 
the  latter  case  whether  or  not  they  restricted  competition  by  object  on  the  one 
hand  or  by  effect  on  the  other.  We  then  consider  the  reasons  given  by 
competition  authorities  and  courts  for  their  findings  of  infringement  of  Article 
101  or  a  domestic  equivalent  thereof  in  cases  on  purchasing  and  we  note  the 
benefits that have been found to flow from joint purchasing in the few decisions 
to that effect.  

4.2 

In conducting our research we have reviewed: 

• 
• 
• 

• 

• 
• 

the jurisprudence of the Court of Justice 
the decisional practice of the European Commission 
the decisional practice of the NCAs and the jurisprudence of the courts of the 
Member States of the EU 
relevant  decisions  and  judgments  on  buyer  cartels  and  joint  purchasing 
agreements in third countries 
relevant guidance on the topic, from within the EU and from third countries 
relevant academic literature. 

4.3  The  findings  of  our  research  will  be  found  in  Annex  2.  As  will  be  seen,  in  each 
case  we  have  set  out  the  facts  of  the  case;  the  outcome;  whether  there  was  a 
restriction  of  competition  by  object  or  effect  (or  both);  whether  fines  were 
imposed;  the  sector  involved  and  the  products  affected;  the  type  of  joint 
purchasing; the theory of harm in the case; whether any benefits were found to 
flow  from  the  joint  purchasing  or  an  explanation  of  why  there  was  no  harm  to 
competition;  and  whether  the  case  involved  secrecy:  we  discuss  the  relevance 
(or otherwise) of secrecy to the analysis of joint purchasing cases in paragraphs 
6.4  to  6.7  below.  We  have  also  added  commentary  at  the  end  of  some  case-
notes where appropriate. 

4.4  Before  proceeding  to  our  analysis  of  the  cases  in  Annex  2  we  would  make  two 
general points about joint purchasing and the appropriate treatment of it under 
Article 101. The first is that, as noted in Gøttrup-Klim, the RBB Report, the JRC 
Report  and  more  generally  in  the  academic  literature  and  in  the  agency 
guidelines that we have reviewed on the subject, in many situations the exercise 
of  buyer  power  by  a  buyer  group  is  capable  of  leading  to  the  negotiation  of 
better prices, terms and conditions, and, depending on the circumstances of the 
case,  this  can  result  in  lower  prices  for  consumers  in  downstream  markets:  in 
other  words  joint  purchasing  will  often  lead  to  a  desirable  outcome  in  terms  of 
consumer  welfare.  It  is  not  surprising,  therefore,  that  there  are  relatively  few 
cases  on  joint  purchasing,  since  it  is  unlikely  to  represent  an  enforcement 
priority for competition authorities. It is particularly noticeable that we have not 
found  one  case,  anywhere  in  the  world,  in  which  a  competition  authority  has 
imposed a fine in a case of joint purchasing: all of the cases in which fines were 
imposed  involved  buyer  cartels,  where  there  was  no  exercise  of  collective 
bargaining  power.  This  in  itself  is  highly  relevant  to  a  consideration  of  whether 

36 

 
 
 
 
 
 
 
 
Horizontal Guidelines on purchasing agreements: Delineation between by object and by effect restrictions 

joint  purchasing  (as  opposed  to  buyer  cartels)  should  be  characterised  as 
restrictive  of  competition  by  object  or  effect.  We  conclude  that  the  object  box 
should be very narrow in the case of joint purchasing: indeed, if we are correct 
in suggesting that an SPPA should be excluded from the object box, we suggest 
that joint purchasing should always require effects analysis.  

4.5  A  second  general  point  to  make  about  the  cases  on  buyer  cartels  and  joint 
purchasing that we have looked at is that quite often, in the case of a finding of 
an infringement of Article 101(1) by a competition authority or a court, there is 
relatively  little  discussion  of  how  competition  was  restricted  and  sometimes  no 
theory  of  harm  is  articulated  at  all.  In  some  cases  there  is  simply  a  conclusory 
statement  that  Article  101(1)  or  some  analogous  provision  has  been  infringed, 
but  with  little  or  no  analysis.  In  others  there  may  be  a  finding  of  an 
infringement,  but  it  is  unclear  whether  the  restriction  of  competition  was  by 
object  or  effect.  Some  judgments  of  the  Court  of  Justice  were  concerned  only 
with fines or procedural matters, not substance, with the result that there is no 
analysis  of  the  substantive  law  of  joint  purchasing.  Some  of  the  cases  that  we 
have looked at involved Article 267 references from a court of a Member State, 
with the result that the judgment of the Court of Justice is limited to the precise 
questions  that  were  addressed  to  it,  rather  than  the  appropriate  analytical 
standards  for  joint  purchasing  agreements  or  buyer  cartels  generally.  Several 
cases  on  joint  purchasing  were  closed  when  firms  under  investigation  offered 
commitments  to  change  their  behaviour  which  the  competition  authority  was 
prepared  to  accept  without  reaching  a  conclusion  that  competition  law  was 
infringed. The result of this is that there is not a great deal of jurisprudence from 
the  courts  on  this  subject,  and  that  the  decisional  practice  of  competition 
authorities is often fairly uninformative. We therefore can understand why some 
respondents  to  the  Commission’s  consultation  referred  to  a  lack  of  clarity  in 
relation  to  joint  purchasing  agreements.  We  consider  that  a  future  iteration  of 
guidelines  on  the  topic  by  the  Commission  provides  an  excellent  opportunity  to 
achieve  greater  clarity  going  forward.  Our  suggested  framework  for  analysis  of 
purchasing agreements will be found in Chapter 5, where we concentrate on the 
distinction  between  restrictions  of  competition  by  object  and  restrictions  by 
effect. 

Categorisation of and commentary on the cases 

4.6  We have categorised the purchasing cases that we have looked at as follows: 

• 
• 

• 
• 
• 

buyer cartel cases, where there was no joint purchasing 
one case where there was no restriction of competition because the rules of 
the  joint  purchasing  organisation  were  objectively  necessary  to  support 
legitimate joint purchasing 
cases where any restriction of competition was de minimis 
findings of a restriction of competition by effect 
cases where a restriction of competition was found to satisfy the conditions 
of Article 101(3). 

4.7  We  will  explain  which  cases  fell  into  which  of  the  categories  set  out  above  and 

provide commentary in the following paragraphs. 

Buyer cartel cases, where there was no joint purchasing 

4.8  We have discovered a total of 24 buyer cartel cases in which fines were imposed 
on  members  of  the  cartel,  seven  decided  by  the  European  Commission,  eleven 

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Horizontal Guidelines – Purchasing agreements: Delineation between by object and by effect restrictions 

by national competition  authorities  of  the EU and six  by competition  authorities 
in  third  countries.  Details  of  these  cases  will  be  found  in  the  following  Table  of 
Buyer Cartel Cases.  

Table of Buyer Cartel Cases 

Buyer cartel cases: European Commission 

Date 
decision 

of 

Amount of fines 

2 
2003 

April 

€16.7 million, reduced on appeal to €11.97 million 

Case name 

French Beef 

Spanish 
Tobacco 

Raw 

20  October 
2004 

€20 million, reduced on appeal to €13.22 million 

Italian Raw Tobacco  20  October 

€56 million, reduced on appeal to €55 million 

Dutch Bitumen 

Air Freight 

€266.72  million,  reduced  on  appeal  to  €238.52 
million 

NB: the cartel involved suppliers and purchasers  

€799 million, reduced in the readopted decision to 
€776 million 

NB:  this  was  predominantly  a  selling  cartel 
concerning 
fuel  and  security  surcharges  on 
airfreight  services;  however  the  airlines  also 
agreed  not 
those 
surcharges to their freight forwarders 

to  pay  commission  on 

2005 

20 
September 
2006 

9 
November 
2010, 
annulled  by 
General 
Court 
judgment 
16 
December 
2015; 
readopted 
decision  17 
March 2017 

Car 
Recycling 

Battery 

8  February 
2017 

Fines  of  €68  million,  reduced  on  appeal  to  €64.1 
million 

Ethylene 

14 
2020 

July 

€260  million;  there  is  one  undecided  appeal 
against  the  level  of  the  fine,  Case  T-590/20 
Clariant v Commission 

38 

 
 
 
 
 
 
 
 
 
Horizontal Guidelines on purchasing agreements: Delineation between by object and by effect restrictions 

Buyer cartel cases:  
national competition authorities of Member States of the European Union 

Case name 

Date 
decision 

of 

Amount of total fines 

T-Mobile 

2003 

€16.2 million  

The Netherlands 

Billa/Julius Meinl 

2009 

CZK 51 million; fines reduced slightly on appeal 

Czech Republic 

Timber Cartel 

2011  

€51 million 

Finland 

Real 
Auctions 

Estate 

2011 
2013  

and 

€6.1  million  in  2011;  €6.4  million  in  2013;  fines 
reduced slightly on appeal 

Netherlands 

Pork Charcuterie 

2013 

€4.57 million, reduced on appeal to €2.64 million 

France 

Used Batteries 

2018 

€5.37 million 

Spain 

Dairy 

Spain  

2019 

€80.6 million  

Long Steel Cartel 

2020 

€100 million 

Germany 

Saucissons 

2020 

€93 million 

France 

Timber 

Romania 

2021 

RON 129.6 million  

Used Cooking Oil 

2021 

Netherlands 

Netherlands 

€4  million  on  the  two  companies,  and  €190,000 
on the three individuals, involved in the cartel 

39 

 
 
 
 
 
 
 
 
 
 
 
Horizontal Guidelines – Purchasing agreements: Delineation between by object and by effect restrictions 

Buyer cartel cases: competition authorities  
in third countries 

Case name 

Date 
decision 

of 

Amount of total fines 

Dried Figs 

Turkey 

Public  Auctions  of 
Motor Vehicles 

Singapore 

2012 

Fines were imposed 

2013 

$179,071 

Scrap Steel 

2016 

R 1.6 billion Rand 

South Africa 

Residential Property 

2019 

$400,000 

New Zealand 

Agent 

2020 

$3 million 

Estate 
Advertising 
Services 

New Zealand 

Car Insurance 

2020 

RM 130.24 million 

Malaysia 

4.9  A number of observations may be made about these cases. 

4.10  The  first  point  is  that  in  none  of  them  was  there  any  joint  purchasing.  None  of 
them  involved  an  attempt  by  the  purchasers  to  pool  their  purchasing  power  so 
that they would be able to obtain, for example, better prices, terms or conditions. 
They simply concerned agreements and/or concerted practices as to the ways in 
which the cartelists would individually behave towards suppliers.97 

4.11  The second point to make about the buyer cartel cases is that fines were imposed 
in  every  case  that  we  have  discovered,  and  that  in  some  cases  the  fines  were 
considerable;  for  example  €68  million  in  the  case  of  Car  Battery  Recycling  and 
€260  million  in  the  case  of  Ethylene.  We  have  not  found  a  buyer  cartel  case  in 
which the competition authority did not impose a fine. We would add that we are 
unaware of any case in which a fine was imposed in the case of joint purchasing. 
This  should  provide  comfort  to  those  respondents  to  the  Commission’s 
consultation who were concerned that joint purchasing might be mischaracterised 
as a buyer cartel and attract a fine. 

4.12  Our third observation is that in the buyer cartel cases that we have identified that 
were found to infringe Article 101 and/or an equivalent provision of the law of a 
Member  State  of  the  EU  it  is  clear  that  the  agreement  was  found  to  restrict 

97  

In  two  cases,  Car  Insurance  in  Malaysia  and  Live  Poultry  Dealers’  Protective  Association  in  the  US, 
the price fixing was achieved through a trade association rather than by agreement between buyers; 
in neither case was there any joint purchasing. 

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Horizontal Guidelines on purchasing agreements: Delineation between by object and by effect restrictions 

competition  by  object.  Each  of  the  European  Commission’s  decisions  specifically 
concluded  that  there  was  an  object  restriction,  and  the  Court  of  Justice  always 
upheld these findings when it was relevant to the appeal in question. 

4.13  A fourth observation is that many of the buyer cartel cases involved agreements 
or  concerted  practices  on  prices  (or  elements  of  prices)  to  be  paid,  terms  and 
conditions, quantities to be acquired or the choice of suppliers. However it is also 
noticeable  that  in  several  of  the  cases  there  was  also  (and  sometimes  only)  an 
exchange of commercially sensitive information. 

4.14  We also note, as discussed further in paragraph 4.26 below, that in several of the 
buyer  cartel  cases  the  competition  authority  or  court  hearing  an  appeal  relied 
explicitly  on  the  wording  of  the  relevant  legislation  to  conclude  that  an 
agreement  to  fix  buying  prices  was  unlawful.  This  explains  why  some  decisions 
contain little elaboration of a relevant theory of harm: the unlawfulness of buyer 
cartels is usually expressly stated in the applicable law. 

4.15  For the avoidance of doubt, it is helpful to note an important distinction between 
a  buyer  cartel  and  the  joint  purchasing  of  a  product.  In  the  former  case  the 
cartelists may agree the maximum price that they will pay for a product, but then 
deal  individually  with  suppliers:  this  will  be  regarded  as  a  restriction  of 
competition by object. On the other hand a buyer group may purchase products 
on behalf of buyers, or negotiate the price at which the products will be bought; 
in this situation the buyers may have agreed what the maximum acceptable price 
will  be.  This  agreement  on  prices  is  not  regarded  as  a  restriction  by  object: 
rather the lawfulness of the arrangement will depend on the compatibility of the 
joint  purchasing  agreement  itself,  which  requires  effects  analysis.  This  is 
explicitly recognised in paragraph 206 of the Commission’s Horizontal Guidelines: 

Agreements  which  involve  the  fixing  of  purchase  prices  can  have  the 
object of restricting competition within the meaning of Article 101(1) (1). 
However,  this  does  not  apply  where  the  parties  to  a  joint  purchasing 
arrangement  agree  on  the  purchasing  prices  the  joint  purchasing 
arrangement  may  pay  to  its  suppliers  for  the  products  subject  to  the 
supply  contract.  In  that  case  an  assessment  is  required  as  to  whether 
the  agreement  is  likely  to  give  rise  to  restrictive  effects  on  competition 
within the meaning of Article 101(1). In both scenarios the agreement on 
purchase  prices  will  not  be  assessed  separately,  but  in  the  light  of  the 
overall effects of the purchasing agreement on the market. 

Cases where there was no restriction of competition because the joint purchasing 
was objectively necessary to support legitimate collective behaviour 

4.16  There  is  only  one  case  that  was  decided  on  the  basis  of  objective  necessity, 
Gøttrup-Klim  Grovvareforeninger  v  Dansk  Landbrugs  Grovvareselskab  AmbA. 
Although  it  is  the  only  such  case,  we  find  it  very  helpful  as  we  explained  at 
paragraphs  2.19  and  2.20  above.  The  Court  notes  that  joint  purchasing  can  be 
pro-competitive  in  effect,  although  it  acknowledges  that,  depending  on  the 
circumstances  of  any  particular  case,  there  could  be  anti-competitive  effects. 
This  is  important  when  it  comes  to  deciding  on  the  delineation  between 
restrictions  by  object  and  by  effect  in  the  case  of  joint  purchasing:  the  Court’s 
judgment in Gøttrup-Klim strongly supports the proposition that effects analysis 
is a preferable approach. 

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Cases where any restriction of competition was de minimis 

4.17  We found two joint purchasing cases where the decision that Article 101 was not 
infringed was reached on de minimis grounds, SOCEMAS and Intergroup trading 
(SPAR).  These  were  two  early  Commission  decisions,  from  1968  and  1975 
respectively.  The  Commission’s  thinking  on  the  de  minimis  doctrine  has 
developed considerably since those days and is currently expressed in its Notice 
on  Agreements  of  Minor  Importance,  which  provides  safe  harbours  for  certain 
agreements  where  the  parties’  market  shares  are  below  specified  thresholds.98 
We  return  to  the  issue  of  safe  harbours  in  the  analysis  of  joint  purchasing 
agreements in Chapter 5 of this Report.  

Findings of a restriction of competition by object or effect 

4.18  We have reviewed the cases of joint purchasing (as opposed to the buyer cartel 
cases) in order to determine whether any of them were found to be restrictive of 
competition  by  object.  Our  conclusion  is  that  there  has  only  been  one  case, 
Eurovision,  in  which  the  European  Commission  found  joint  purchasing  to  be 
restrictive  of  competition  by  object  as  well  as  by  effect.  In  that  case  the 
European Broadcasting Union (the ‘EBU’) jointly acquired the television rights to 
international  sporting  events  on  behalf  of  its  members.  The  Commission 
considered that this joint acquisition restricted competition by object and effect, 
but  granted  an  individual  exemption  under  Article  101(3).  The  exemption 
decision  was  challenged  successfully  on  two  occasions  by  third  party  appellants 
dissatisfied  with  the  Commission’s  conclusion  on  Article  101(3).  In  the 
judgments  of  the  General  Court  no  comment  was  made  on  the  classification  of 
the restriction of competition as one by object and effect, as this was irrelevant 
to the appeals. 

4.19  We  do  not  consider  that  the  finding  of  a  restriction  by  object  in  the  Eurovision 
decisions  to  be  persuasive.  In  one  sense  it  does  not  matter  whether  any 
restriction  was  by  object  or  effect,  in  that  the  Commission  granted  exemption 
under  Article  101(3)  anyway99.  Furthermore  it  appears  that  what  the 
Commission  was  really  concerned  about  was  the  negative  effects  of  the  joint 
acquisition of the television rights to international sporting events. It found that, 
in  the  absence  of  the  Eurovision  system,  the  members  of  the  EBU  would  have 
competed  with  each  other  for  the  acquisition  of  the  television  rights  in 
question.100  This  type  of  counterfactual  analysis  is  neither  necessary  nor 
desirable  in  an  object  case.  As  the  Court  of  Justice  held  in  Lundbeck  v 
Commission:  

unless the clear distinction between the concept of ‘restriction by object’ 
and the concept of ‘restriction by effect’ arising from the wording itself of 
Article  101(1)  TFEU  is  to  be  held  not  to  exist,  an  examination  of  the 
‘counterfactual  scenario’,  the  purpose  of  which  is  to  make  apparent  the 
effects  of  a  given  concerted  practice,  cannot  be  required  in  order  to 
characterise a concerted practice as a ‘restriction by object’.101   

OJ [2014] C 291/1. 
We  would  however  note  in  passing  that  the  Commission’s  grant  of  an  individual  exemption  to  an 
agreement that it considered to be restrictive of competition by object contradicts the assertion that 
object restrictions cannot be defended under Article 101(3). 
OJ [2000] L 151/18, para 74. 
Case C-591/16 P EU:C:2021:243, para 140. 

98  
99  

100  
101  

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Horizontal Guidelines on purchasing agreements: Delineation between by object and by effect restrictions 

We would add that we are not convinced that the joint acquisition of the rights to 
sporting  events  by  the  EBU  should  be  regarded,  by  its  very  nature,  as  being 
harmful to the proper functioning of normal competition,102 which is the essence 
of an infringement by object. 

4.20  In  National  Sulphuric  Acid  Association  it  is  not  possible  to  tell  whether  the 
Commission considered that the joint buying pool had as its object the restriction 
of  competition,  since  its  decision  considered  its  effects  only.  In  any  event,  the 
practical  importance  of  that  decision  is  that  the  Commission  granted  an 
individual  exemption  under  Article  101(3)  to  the  rules  of  the  buying  pool. 
Similarly in Orphe the Commission closed a case by sending a so-called ‘comfort 
letter’  indicating  that  the  rules  of  a  group  of  wholesalers  of  pharmaceuticals 
satisfied  Article  101(3)  without  even  deciding  whether  Article  101(1)  was 
infringed:  its  Annual  Report  on  Competition  Policy  simply  noted  that  there  may 
have  been  restrictions  of  competition,  without  deciding  on  whether  this  would 
have been by object or effect.  

4.21  When  reviewing  the  decisions  of  national  competition  authorities,  we  have  not 
found any decisions in which joint purchasing was held to restrict competition by 
object. We have cited eleven buyer cartel cases in the Table of Cases above: to 
repeat, none of these cases involved joint purchasing. In the three interventions 
by national competition authorities that were not concerned with buyer cartels – 
Carrefour Belgium and Provera Benelux in Belgium, Centrale Italiana in Italy and 
Glassmatix  System  in  Ireland  -  the  cases  were  closed  on  the  basis  of 
commitments without any formal finding of an infringement of Article 101(1) or 
the domestic equivalent, whether by object or effect. 

4.22  As we discussed in paragraphs 2.32 to 2.44 above, we have found no decision in 
any  jurisdiction  in  which  a  boycott  of  suppliers  by  purchasers  was  found  to  be 
restrictive  of  competition  by  object.  We  have  set  out  reasons  there  why  we 
consider that it would be reasonable to subject vertical purchasing restraints by 
purchasers,  including  what  we  have  described  as  an  SPPA,  to  effects  analysis 
rather than to allocate them to the object box. 

Cases  where  a  restriction  of  competition  (by  object  or  effect)  was  found  to 
satisfy the conditions of Article 101(3) 

4.23  The  Commission  has  concluded  that  Article  101(3)  was  satisfied  in  the  case  of 
joint  purchasing  on  three  occasions,  National  Sulphuric  Acid  Association, 
Eurovision and Orphe. In the first case a formal individual exemption was granted 
in  relation  to  the  Association’s  rules  on  sulphur  pools;  in  Eurovision  the 
exemption was annulled on appeal; and in Orphe the case was disposed of by a 
comfort letter. 

Theories  of  harm:  reasons  given  for  findings  of  an  infringement  of 
Article 101 or its domestic counterpart 

4.24  As  we  noted  in  paragraph  4.5  above,  decisions  in  purchasing  cases  –  by  which 
we mean both buyer cartel cases and cases on joint purchasing – often contain 
relatively little discussion of how or why the relevant legislation was infringed. A 
theory  of  harm  is  rarely  articulated.  There  is  sometimes  little  more  than  a 
conclusory  statement  that  there  has  been  an  infringement  of  Article  101  or  its 
domestic equivalent.  

102  

Case C-67/13 P EU:C:2014:2204, para 50. 

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4.25  In  the  decisions  and  judgments  that  we  have  reviewed  we  detect  the  following 

approaches on the part of competition authorities and courts. 

Buyer cartels are unlawful because the legislation says so 

4.26  There  are  several  cases  in  which  a  competition  authority,  court  or  Advocate 
General has relied specifically on the wording of the legislation to conclude that 
an agreement between buyers to fix prices or to agree on terms and conditions 
is  unlawful.  It  will  be  recalled  that  Article  101(1)(a)  gives  as  an  example  of  a 
prohibited  agreement  those  that  ‘directly  or  indirectly  fix  purchase  or  selling 
prices  or  any  other  trading  conditions’  (emphasis  added).  We  stress  that  the 
following are not cases on joint purchasing: they involve buyer cartels.  

In  AOK  Bundesverband  v  Ichthyol-Gesellschaft  Cordes103  Advocate  General 
Jacobs  considered  that  it  was  clear  that  the  sickness  funds  under  scrutiny  in 
that case were engaged in a fixing of trading conditions within the meaning of 
Article  101(1)(a)  when  they  coordinated,  by  setting  fixed  amounts,  the 
maximum  level  of  contributions  that  they  would  make  towards  the  cost  of 
medicinal  products. The  Court  of  Justice  did not  consider  this  issue  because  it 
held that the sickness funds were not acting as undertakings so that Article 101 
was not engaged.104  

In Spanish Raw Tobacco105 both the Commission and the General Court began 
their  analysis  of  a  cartel  between  competing  purchasers  of  raw  tobacco  by 
noting  that  Article  101(1)(a)  expressly  states  that  agreements  and  concerted 
practices  that  directly  or  indirectly  fix  purchase  or  selling  prices  are 
incompatible with the internal market 

In  Italian  Raw  Tobacco106  the  Commission  adopted  the  same  approach  as  in 
Spanish  Raw  Tobacco.  The  same  is  true  in  one  of  the  appeals  to  the  General 
Court in this case: in Transcatab v Commission107 the Court held that: 

the  infringement  in  issue  related  to  a  secret  cartel  having  as  its 
object,  in  particular,  price  fixing  and  the  allocation  of  suppliers  and 
quantities  to  be  purchased.  Thus  …  that  type  of  cartel  is  expressly 
prohibited  by  Article  [101(1)(a)  and  (b)  TFEU]  and  constitutes  an 
infringement classified in the case-law as ‘particularly serious’, since it 
has a direct impact on the essential parameters of competition on the 
relevant market. 

In  Car  Battery  Recycling108  the  Commission  found  that  four  recycling 
undertakings  had  colluded  to  reduce  the  purchase  price  paid  to  scrap  dealers 
and  collectors  for  used  car  batteries.  The  Commission  referred  to  the 
prohibition  contained  in  Article  101(1)(a)  TFEU  in  relation  to  both  liability  and 
the  seriousness  of  the  infringement  for  the  purpose  of  setting  the  fine.109  On 
appeal the General Court held that the coordination of purchase prices revealed 

Cases C-264/01 etc. EU:C:2003:304, para 68. 
Cases C-264/01 etc. EU:C:2004:150. 
Commission  decision  of  20  October  2004,  para  299,  upheld  on  appeal  Case  T-29/05  Deltafina  v 
Commission EU:T:2010:355, para 239. 
Commission decision of 20 October 2005, para 277 
Case T-39/06 Transcatab v Commission EU:T:2011:562, para 285, upheld on appeal Case C-654/11 
P Transcatab v Commission EU:T:2011:562. 
Commission decision of 8 February 2017. 
Ibid, paras 231 and 324. 

• 

• 

• 

• 

103  
104  
105  

106  
107  

108  
109  

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Horizontal Guidelines on purchasing agreements: Delineation between by object and by effect restrictions 

a  sufficient  degree  of  harm  to  competition.  Having  referred  to  Article 
101(1)(a), it held that:  

the  practice  that  was  the  object  of  the  cartel  is  thus  expressly 
prohibited  by  Article  101(1)  TFEU,  as  it  involves  inherent  restrictions 
on competition in the internal market.110 

• 

In  General  Insurance  Association  of  Malaysia111  the  Malaysia  Competition 
Commission  condemned  an  agreement  between  the  General  Insurance 
Association  of  Malaysia  and  its  insurer  members  to  fix  discounts  for  car  parts 
and hourly rates for car repairers. The Commission specifically relied on section 
4(2)(a)  of  the  Malaysian  Competition  Act  2010,  which  provides  that  a 
horizontal agreement between enterprises that has the object of price fixing is 
deemed  to  have  the  object  significantly  preventing,  restricting,  or  distorting 
competition in any market for goods or services.112 

Buyer cartels are unlawful because they distort the process of competition 

4.27  There are numerous cases in which the competition authority or court expressly 
notes that agreements between buyers on matters such as the prices to be paid 
or  the  terms  and  conditions  to  be  accepted  distort  the  process  of 
competition.  We  note  that  there  is  well-established  jurisprudence  of  the  Court 
of Justice that says that the process of competition should be protected in itself. 
For example in T-Mobile the Court held that Article 101: 

like the other competition rules of the Treaty, is designed to protect not 
only the immediate interests of individual competitors or consumers but 
also  to  protect  the  structure  of  the  market  and  thus  competition  as 
such.113  

The  Court  of  Justice  has  applied  this  basic  principle  on  numerous  occasions, 
including  in  GlaxoSmithKline  Services  Unlimited  v  Commission,114  when  it 
rejected the General Court’s finding that harm to consumers was the touchstone 
for  establishing  a  breach  of  Article  101  TFEU,  and  in  Dole  Food  Co  v 
Commission.115  

4.28  Examples  of  decisions  referring  to  a  distortion  of  the  process  of  competition  in 
buyer  cartel  cases  or  exchanges  of  information  between  buyers  include  the 
following:  

•  As  noted  in  paragraph  4.27,  in  T-Mobile116  the  Court  of  Justice  rejected  the 
argument  that  there  must  be  a  direct  link  between  a  concerted  practice 
between five mobile phone operators and consumer prices in order to find that 
the  practice  had  an  anti-competitive  object,  emphasising  the  importance  of 
protecting  ‘competition  as  such’.  In  the  case  of  a  buyer  cartel,  the  buyers 
should compete with one another in relation to their acquisition of inputs.  

Case T-240/17 Campine v Commission EU:T:2019:778, para 297. 

110  
111   Malaysia Competition Commission decision of 29 October 2020. 
112  
113  
114  
115  
116  

Ibid, para 206. 
Case C-8/08 EU:C:2009:343, para 38. 
Case C-501/06 P EU:C:2009:610, paras 62–64. 
Case C-286/13 P EU:C:2015:184, para 125. 
Case C-8/08 EU:C:2009:343, citing para 58 of AG Kokott’s opinion: EU:C:2009:110. 

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• 

In Spanish Raw Tobacco117 the Commission pointed out that the impact of the 
buyer cartel was significant because it allowed the members of the cartel: 

to  align  as  closely  as  possible  the  final  prices  they  would  pay  to  the 
producers  and  to  reduce  them  for  their  own  benefit  to  a  level  below 
that which would result from the free interplay of competition.118  

• 

In  Italian  Raw  Tobacco119  the  Commission  stated  that  the  buyer  cartel 
sheltered  the  processors  of  raw  tobacco  in  Italy  from  full  exposure  to  market 
forces. Recital 285 of the decision states:  

by  eliminating  the  autonomy  of  strategic  decision-making  and 
competitive conduct, they prevent such undertakings from competing 
on the merits and enhancing their position on the market vis-à-vis the 
less efficient firms.  

The General Court made a similar point in its judgments in two appeals in this 
case, Romana Tabacchi v Commission120 and Transcatab v Commission.121 

• 

In  Car  Battery  Recycling122  the  General  Court  considered  the  coordination  of 
competing recycling companies’ policy on the purchase price of scrap lead-acid 
car  batteries  through  the  fixing  of  target  prices,  maximum  prices  and  fixed-
amount price reductions and held that:  

Such  coordination  of  purchase  prices,  with  the  aim  of  reducing  or 
preventing  their  increase  and  thus,  ultimately,  increasing  the  cartel 
participants’  profit  margins,  reveals  a  sufficient  degree  of  harm  to 
competition that it may be found that there is no need to examine its 
effects.  A  price  cartel  can  be  regarded,  by  its  very  nature,  as  being 
harmful  to  the  proper  functioning  of  normal  competition.  In  that 
regard,  it  must  be  borne  in  mind  that  the  first  example  of  a  cartel 
given in Article 101(1)(a) TFEU, expressly declared incompatible with 
the  internal  market,  is  precisely  one  which  ‘directly  or  indirectly 
[fixes] purchase or selling prices or any other trading conditions’. The 
practice that was the object of the cartel is thus expressly prohibited 
by  Article  101(1)  TFEU,  as  it  involves  inherent  restrictions  on 
competition in the internal market.123 

The  Court  also  held  that  the  exchange  of  information  on  current  and  future 
purchase prices and future volumes of purchases ‘clearly’ had as its object the 
restriction of competition because: 

they clearly run counter to the requirement of independence, which is 
a key feature of the market conduct of undertakings operating within 
a system of effective competition.124 

Commission decision of 20 October 2004. 
Ibid, para 300. 
Commission decision of 20 October 2005. 
Case T-11/06 EU:T:2011:560, para 83. 
Case T-39/06 Transcatab v Commission EU:T:2011:562, para 160. 
Case T-240/17 Campine v Commission EU:T:2019:778. 
Ibid, para 297. 
Ibid, para 305. 

117  
118  
119  
120  
121  
122  
123  
124  

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• 

• 

• 

• 

• 

• 

• 

In the Finnish case of Timber Cartel125 the Market Court held that an exchange 
of  current  and  future  purchase  prices  for  timber  had  the  object  of  restricting 
competition because it reduced uncertainty as to the future pricing behaviour of 
parties  on  the  timber  purchasing  market,  thereby  diminishing  their  incentives 
to compete. 

In  the  French  case  of  Pork  Charcuterie126  the  Autorité  de  la  concurrence 
decided that the coordinated reduction of slaughtering distorted the process of 
competition for the purchase of live pigs, to the detriment of live pig farmers. 

In the German case of Long Steel Cartel127 the Bundeskartellamt decided that 
BMW,  Daimler  and  VW  had  infringed  German  competition  law  by  agreeing 
uniform surcharges for the purchase of long steel products. The theory of harm 
appears  to  have  been  that  the  agreement  between  the  three  motor  vehicle 
manufacturers  meant  that  scrap  and  alloy  surcharges  were  no  longer 
negotiated  individually  which,  in  turn,  distorted  the  process  of  competition  for 
the purchase of long steel products. 

In the Dutch case of Real Estate Auctions128 the competition authority and the 
District  Court  of  Rotterdam  held  that  a  large  group  of  real-estate  traders  had 
infringed  competition  law  by  keeping  property  prices  at  foreclosure  auctions 
artificially  low  in  order  to  make  a  profit  at  secret  after-auctions.  The 
competition  concern  appears  to  have  been  that  the  participating  traders  were 
distorting the normal process of competition at foreclosure auctions. 

In the Dutch case of Used Cooking Oil129 the agreements on the purchase price 
of  used  cooking  oil,  and  related  exchanges  of  competitively-sensitive 
information, distorted the process of competition in the purchasing market. The 
Dutch  competition  authority  considered  that  the  buyer  cartel  harmed  the 
suppliers of used cooking oil, such as restaurants and snack bars. 

In the Singaporean case of Public Auctions of Motor Vehicles130 the Competition 
and  Consumer  Commission  of  Singapore  (the  ‘CCCS’)  held  that  the  object  of 
the  motor  vehicle  traders’  bid-suppression  agreement  was  to  restrict 
competition at public government auctions in Singapore. The essential feature 
of an auction is the expectation on the part of the tenderer that it will receive, 
as  a  response  to  its  tender,  a  number  of  independently  articulated  bids 
formulated  by  contractors  wholly  independent  of  each  other.  An  auction  is 
designed to produce competition in a structured way. The CCCS concluded that 
the parties’ bid-suppression agreement patently conflicted with this competitive 
process.  

In  the  South  African  case  of  Scrap  Steel131  the  Competition  Commission  of 
South  Africa  objected  to  four  purchasers  of  scrap  metal  agreeing  a  common 
approach to setting a pricing formula for scrap metal, which they then agreed 
with  scrap  merchants.  It  is  not  entirely  clear  from  the  publicly  available 
materials,  but  the  theory  of  harm  appears  to  have  been  that  the  purchasers’ 

125  
126  
127  
128  

129  
130  
131  

Case 407/06/KR, judgment of 3 December 2009. 
Decision of 13 February 2013. 
Bundeskartellamt Press Release of 21 November 2019. 
Decisions of 19 December 2011 and 4 February 2013, upheld on liability on appeal but the fines were 
slightly reduced, judgment of 18 December 2014, ECLI:NL:RBROT:2014:10174. 
Decision of 5 October 2021. 
Decision of 28 March 2013. 
Decision of 21 August 2016. 

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agreement restricted or distorted the process of competition in the market for 
buying scrap metal. 

Additional  reasons  for  finding  an  infringement  of  competition  law  in  purchasing 
cases 

4.29  In  some  of  the  decisions  that  we  have  reviewed  the  competition  authority  or 
court  has  provided  more  reasoning  in  support  of  a  finding  that  competition  law 
had been infringed. For example: 

• 

• 

In  Italian  Raw  Tobacco132  the  Commission  found  that  the  agreements 
and/or  concerted  practices  of  the  processors  to  fix  purchase  prices  and 
allocate suppliers had the object to restrict competition. As noted above, 
the  Commission  considered  that  the  buyer  cartel  had  sheltered  its 
members from full exposure to market forces. The Commission went on 
to add that the result: 

could  be  reduced  pressure  to  control  costs,  to  improve  quality 
and  to  innovate,  thereby  limiting  productive  and  dynamic 
efficiencies.133  

In French beef134 the General Court held that an agreement between four 
federations  of  farmers  and  two  federations  of  slaughterers  to  set  a 
minimum  purchase  price  for  beef  had  the  object  of  restricting 
competition  because  it  limited  artificially  the  commercial  negotiating 
margin of farmers and slaughterers and distorting the formation of prices 
in the markets in question.135 

4.30  In  National  Association  of  Sulphuric  Acid,136  which  involved  a  joint  buying  pool 
for  the  purchase  of  sulphur,  the  Commission’s  theory  of  harm  appears  to  have 
been customer foreclosure. The buying pool restricted the amount that suppliers 
could sell to members of the Association which, in turn, might have meant that 
they no longer had access to a sufficient customer base.137 

4.31  Further  insights  into  theories  of  harm  in  joint purchasing cases  can be  found  in 
the  RBB  Report  and  the  JRC  Report.  Chapter  5  of  the  RBB  Report  looks  at  the 
impact  of  buyer  groups  on  competition  among  members  in  the  downstream 
market;  Chapter  6  looks  at  the  possibilities  for  buying  groups  to  behave 
strategically  to  harm  the  terms  of  supply  for  other  buyers;  and  Chapter  7 
considers  whether  buyer  groups  could  harm  competition  in  other  ways,  for 
example  by  leaving  suppliers  with  insufficient  funds  to  invest  and  innovate. 
Chapter  3  of  the  JRC  Report  discusses  the  economic  benefits  associated  with 
buyer  groups,  but  also  considers  the  impact  they  might  have  on  consumers, 
competition between retailers and on upstream supply chain actors. 

4.32  We do not intend to explore these theories of harm further in this Report, which 
is  focussed  on  the  delineation  between  by  object  and  by  effect  cases.  We 
consider that the category of object cases is very small for purchasing cases, and 

Commission decision of 20 October 2005. 
Ibid, para 285. 
Case T-217/03 and T-245/03 Fédération nationale de la coopération bétail and viande v Commission 
EU:T:2006:391. 
Case T-240/17 Campine v Commission EU:T:2019:778. 
OJ [1980] L 260/24. 
Ibid, paras 32–34. 

132  
133  
134  

135  
136  
137  

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Horizontal Guidelines on purchasing agreements: Delineation between by object and by effect restrictions 

that  a  deeper  consideration  of  theories  of  harm  is  unlikely  to  lead  to  either  an 
expansion  or  a  contraction  of  the  size  of  the  ‘object  box’.  Theories  of  harm  are 
obviously important when considering the effects of an agreement; however this 
is beyond the scope of this Report. 

Benefits that might arise from joint purchasing 

4.33  As  noted  throughout  this  Report,  joint  purchasing  may  lead  to  benefits  for 
stakeholders  in  the  market.  This  was  the  reason  why  the  Court  of  Justice 
considered 
judgment  that  the  prohibition  on  the 
simultaneous membership of two competing cooperative purchasing associations 
might  fall  outside  Article  101  altogether  where  it  was  objectively  necessary  to 
enable  the  members  of  the  cooperative  to  obtain  more  favourable  terms  and 
conditions.  

in  the  Gøttrup-Klim 

4.34  Paragraph  217  of  the  Commission’s  Horizontal  Guidelines  of  2011  notes  that 

joint purchasing may give rise to efficiencies: it says that: 

Joint  purchasing  arrangements  can  give  rise  to  significant  efficiency 
gains. In particular, they can lead to cost savings such as lower purchase 
prices or reduced transaction, transportation and storage costs, thereby 
facilitating economies of scale. Moreover, joint purchasing arrangements 
may  give  rise  to  qualitative  efficiency  gains  by  leading  suppliers  to 
innovate and introduce new or improved products on the markets. 

4.35  The  Commission  has  made  a  formal  conclusion  that  joint  purchasing  satisfied 
Article  101(3)  on  two  occasions:  National  Sulphuric  Acid  Association  and 
Eurovision.  In  National  Sulphuric  Acid  Association138  the  Commission  concluded 
that the buying pool would bring about improvements in both the distribution of 
sulphur  and  the  production  of  sulphuric  acid  within  the  meaning  of  Article 
101(3)(a). The Commission also considered that the selling markets for sulphuric 
acid  were  sufficiently  competitive  to  ensure  that  a  fair  share  of  the  pool’s 
benefits would  be  passed  on  to consumers.  Given  that the  pool  members  could 
buy up to 75% of their sulphur requirements from outside the pool, the pool was 
indispensable  to  attain  its  benefits  and  did  not  eliminate  competition  in  respect 
of  a  substantial  part  of  sulphur.  The  Commission  granted  an  individual 
exemption  for  eight  years;  it  renewed  the  exemption  for  a  further  year  in 
1989.139 

4.36  In  Eurovision140  the  European  Broadcasting  Union  had  notified  its  regulations 
governing  the  joint  negotiation,  acquisition  and  sharing  of  television  rights  to 
sports events (the ‘Eurovision system’) to the Commission for negative clearance 
or,  alternatively,  individual  exemption.  The  Commission  found  that  the  joint 
acquisition of these television rights had as its ‘object and effect’ the restriction 
of  competition  between  the  members  of  the  Eurovision  system.  Instead  of 
competing  with  each  other,  members  participated  in  joint  negotiations  and 
agreed  among  themselves  the  financial  and  other  terms  for  the  acquisition  of 
rights. However, the Commission considered that the Eurovision system satisfied 
the  conditions  of  Article  101(3),  subject  to  conditions  designed  to  permit  third 
parties  to  have  access  to  the  television  rights  in  question.  The  Commission 
specifically  found  that  the  joint  acquisition  of  rights  would  lead  to  a  number  of 

138  
139  
140  

OJ [1980] L 260/24, paras 38–50. 
OJ [1989] L 190/22. 
OJ [1993] L 179/23. 

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Horizontal Guidelines – Purchasing agreements: Delineation between by object and by effect restrictions 

improvements,  such  as  a  reduction  of  transaction  costs,  which  would  benefit 
members of the EBU from smaller countries, allowing them to show more sports 
programmes of better quality than would otherwise be the case.141   

4.37  The  Commission’s  first  decision  in  Eurovision  was  annulled  on  appeal  due  to 
errors  of  law  in  the  way  that  it  had  applied  the  indispensability  requirement  in 
Article 101(3)(a).142   The Commission re-adopted its exemption decision,143 but 
that decision was also annulled due to an error of assessment in finding that the 
EBU  rules  did  not  substantially  eliminate  competition.144  For  present  purposes, 
what  matters  is  the  Commission’s  recognition  in  a  formal  decision  that  (in 
principle)  this  type  of  joint  purchasing  could  bring  about  benefits  within  the 
meaning of Article 101(3). 

141  
142  
143  
144  

Ibid, paras 59–62; see similarly OJ [2000] L 151/18, paras 84–87. 
Cases T-528/93 etc Métropole Télévision v Commission EU:T:1996:99. 
Eurovision OJ [2000] L 151/18. 
Cases T-185/00 etc Métropole Télévision v Commission EU:T:2002:242. 

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Horizontal Guidelines on purchasing agreements: Delineation between by object and by effect restrictions 

Chapter 5 
A suggested framework for analysing joint purchasing 
agreements as either by object or by effect restrictions 
of Article 101 TFEU 
5.1  Our Terms of Reference require us to provide a proposal for a general framework 
for analysing whether joint purchasing agreements are restrictive of competition 
by object or by effect for the purposes of Article 101. Our starting point is that 
we  think  that  the  basic  format  of  Chapter  5  of  the  2011  Horizontal  Guidelines 
remains  fit  for  purpose  when  revised  guidelines  are  adopted.  The  sequence 
adopted in the 2011 Guidelines is as follows: 

relevant markets 

•  definition 
• 
•  assessment under Article 101(1) 
o  main competition concerns 
o 
o 

restrictions of competition by object 
restrictive effects on competition 

•  assessment under Article 101(3)  
•  examples.  

We  consider  that  this  template  should  be  retained.  It  may  be  helpful  in  the 
section  on  assessment  under  Article  101(1)  to  include  some  narrative  on  the 
doctrine  of  objective  necessity  and  its  application  to  joint  purchasing,  as 
indicated  by  the  Gøttrup-Klim  case.  We  will  present  our  thoughts  according  to 
the  sequence  of  the  2011  Guidelines,  making  suggestions  on  how  we  consider 
that they can be improved. 

Definition 

5.2  This  Report  is  specifically  concerned  with  the  distinction  between  purchasing 
agreements  that  restrict  competition  by  object  and  those  that  should  be 
subjected to effects analysis. This is an important issue, in particular because of 
the perceived lack of clarity on how joint purchasing differs from a buyer cartel.  

5.3  Our analysis of the cases has shown that buyer cartel cases – in the EU, at the 
level of the NCAs, and in third countries – have never involved joint purchasing. 
Paragraph 205 of the existing Horizontal Guidelines, when discussing restrictions 
of competition by object, simply says that: 

Joint purchasing agreements restrict competition by object if they do not 
truly  concern  joint  purchasing,  but  serve  as  a  tool  to  engage  in  a 
disguised  cartel,  that  is  to  say,  otherwise  prohibited  price  fixing,  output 
limitation or market allocation. 

We  do  not  find  paragraph  205  to  be  very  helpful,  since  it  says  nothing  about 
what  is  meant  by  joint  purchasing  and  how  it  is  distinguishable  from  a  buyer 
cartel.  We  understand  why  respondents  to  the  Commission’s  consultation  said 
that  there  was  a  lack  of  clarity  in  this  area.  Future  guidelines  should  contain 
definitions both of a buyer cartel and of joint purchasing agreements; we suggest 
that  some  examples  should  be  given  that  seek  to  shed  light  on  the  distinction 
between  these  two  types  of  agreement.  We  discuss  definitions  in  the  following 
paragraphs and provide some examples in paragraph 5.42. 

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Definition of a buyer cartel 

5.4 

5.5 

In the case of a buyer cartel undertakings agree with one another on how they 
will  individually  interact  with  suppliers  about  matters  such  as  price,  quantities 
and  terms  and  conditions.  Alternatively  they  agree  to  exchange  commercially 
sensitive information with one another about such matters. A buyer cartel does 
not  involve  any  joint  interaction  between  the  cartelists  and  suppliers  in  the 
upstream market; there is no common organisation that represents the interests 
of  the  members  of  the buyer  group  in  dealings  with  suppliers.  We  suggest  that 
guidance  on  types  of  buyer  cartels  should  be  contained  in  the  section  of  the 
guidelines that discuss restrictions of competition by object under Article 101(1), 
discussed  in  paragraphs  5.24  to  5.30  below.  The  definition  of  a  buyer  cartel 
could say explicitly that such agreements restrict competition by object, whereas 
joint purchasing should be subject to effects analysis. The next paragraph of the 
guidelines would then explain what is meant by joint purchasing. 

Definition of joint purchasing 

In  chapter  3  of  this  Report  we  explained  the  terminology  that  we  use  and 
discussed  the  different  structures  and  activities  of  buyer  groups.  In  paragraphs 
3.2  to  3.5  we  distinguished  between  buyer  cartels  and  joint  purchasing 
agreements,  and  noted  that  all  the  cases  in  which  fines  have  been  imposed 
concerned buyer cartels where there was no joint behaviour. The key expression 
requiring definition in any future Guidelines therefore is joint purchasing, since 
in our view it is joint behaviour that takes an agreement out of the object box 
and  requires  the  application  of  effects  analysis  to  it.  The  2011  Guidelines 
provided  guidance  on  the  different  forms  that  joint  purchasing  organisations 
might have, that is to say their structure. However very little guidance was given 
on  the  activities  of  joint  purchasing  organisations,  and  in  particular  on  what  is 
meant by joint behaviour. 

5.6  We suggest that the section of the future Guidelines containing definitions should 
discuss  three  issues  when  defining  joint  purchasing:  (i)  what  is  meant  by  joint 
purchasing; (ii) what is meant by joint purchasing; and (iii) the different forms 
that buyer groups may take. 

Purchasing 

5.7  The  expression  ‘joint  purchasing’  is  a  slightly  misleading  one  since,  as  we 
explained  in  paragraph  3.5  of  this  Report,  some  buyer  groups  do  not  buy 
products.  Instead  the  buyer  group  negotiates  on  matters  such  as  prices  (or 
elements  thereof  such  as  discounts),  terms  and  conditions  with  suppliers  on 
behalf of members of the group, but then leaves it to buyers to make their own 
individual  purchases,  albeit  against  the  backdrop  of  the  negotiations  that  have 
taken  place.  It  would  be  advisable  for  future  Guidelines  on  horizontal  co-
operation  agreements  to  note  this  point  explicitly;  indeed  this  topic  would 
perhaps  be  better  dealt  with  in  a  chapter  on  ‘joint  purchasing  and  negotiation’ 
rather  than  simply  on  ‘joint  purchasing’.  It  may  be  helpful  to  add  that  a  buyer 
group  may  go  beyond  negotiating  on  price,  terms  and  conditions;  for  example 
where  it  purchases  products  on  behalf  of  members  it  may  also  provide  joint 
warehousing and arrange joint distribution. 

Joint 

52 

 
 
 
 
 
 
 
 
 
 
 
 
 
Horizontal Guidelines on purchasing agreements: Delineation between by object and by effect restrictions 

5.8  Joint purchasing and negotiation occurs where a common organisation acting on 
behalf of the members of a buyer group provides the interface between suppliers 
in  the  upstream  market  and  the  purchasers  in  the  purchasing  market  that  the 
organisation  represents.  The  essence  of  joint  purchasing  is  that  the  common 
organisation  can  hope  to  negotiate  more  favourable  terms  and  conditions  than 
would have been obtained if each buyer had acted alone. Under the New Zealand 
Commerce Act of 1986 there is an exception from the prohibition of price fixing 
for  joint  buying,  and  joint  buying  is  helpfully  defined  in  paragraph  86  of  the 
Commerce  Commission’s  Competition  Collaboration  Guidelines  as  occurring 
when: 

Buyers arrange to purchase goods or services collectively on terms that 
an  individual  buyer  would  be  unlikely  to  be  able  to  negotiate  on  their 
own.145 

5.9 

In the case of a buyer cartel there is no joint behaviour by the cartelists, other 
than  the  agreement  between  them,  for  example  not  to  pay  more  than  a  given 
amount  for  goods  or  services.  This  restricts  competition  by  object.  To  avoid  the 
object box, a buyer group must be involved in collective bargaining on behalf of 
members  of  the  buying  group  that  enhances  the  possibility  of  obtaining  more 
favourable terms than if the buyers were acting unilaterally. Typically this might 
be possible because the group will be purchasing larger volumes, but it could also 
be the result, for example, of more efficient negotiation.  

5.10  The Guidelines should advise buyers who intend to enter into a joint purchasing 
agreement  that,  in  order  to  avoid  the  object  box,  they  should  be  able  to 
demonstrate that their agreement will involve collective bargaining of some kind 
that  may  make  it  possible  for  them  to  acquire  goods  or  services  on  more 
favourable  terms  than  if  each  individual  buyer  were  to  negotiate  on  its  own 
behalf. The buyer group should be able to show why their agreement constitutes 
joint  purchasing  and  should  therefore  be  subject  to  effects  analysis  rather  than 
being  regarded  as  restrictive  of  competition  by  object.  It  is  clear  that 
undertakings  bear  the  evidential  burden  in  support  of  the  assertions  that  they 
make  in  competition  proceedings.  While  the  legal  burden  of  proving  an 
infringement  remains  on  the  person  alleging  the  infringement,  the  parties  to  a 
joint  purchasing  agreement  may  reasonably  be  expected  to  explain  why  their 
agreement  is  not  a  buyer  cartel,  but  is  instead  a  genuine  joint  purchasing 
arrangement that should be subject to effects as opposed to object analysis.146 

5.11  While  conducting  our  research  we  have  reviewed  the  class  exemption  for 
collective  bargaining 
the  Australian 
Competition  &  Consumer  Commission  in  June  2021.147  This  permits  collective 
bargaining  (by  both  sellers  and  buyers)  by  smaller  businesses  that  might 
otherwise  infringe  competition  law  where  this  may  enable  them  to  negotiate 

for  certain  businesses  adopted  by 

145  

146  

147  

Available  at  https://comcom.govt.nz/__data/assets/pdf_file/0036/89856/Competitor-Collaboration-
guidelines.pdf. 
See  eg  AG  Kokott  in  Case  C-195/04  P  FEG  v  Commission  EU:C:2005:751:  ‘Thus,  the  Commission 
naturally bears the burden of proving all the findings which it makes in its decision. However, before 
there  is  any  need  to  allocate  the  burden  of  proof  at  all,  each  party  bears  the  burden  of  adducing 
evidence in support of its respective assertions. A substantiated submission by the Commission can 
be overturned only by an at least equally substantiated submission by the parties’. 

Available 
at 
facilitated-by-class-exemption. 

https://www.accc.gov.au/media-release/collective-bargaining-by-small-business-

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Horizontal Guidelines – Purchasing agreements: Delineation between by object and by effect restrictions 

more  efficiently  with  larger  businesses  than  they  would  be  able  to  do  on  their 
own. We note that where a group seeks to take advantage of the class exemption 
it  must  make  a  simple  notification,  known  as  a  Collective  bargaining  class 
exemption notice form, to the ACCC in which it must set out the following: 148 

1. details of the collective bargaining group  
2. details of the target business(es) with which the group will be dealing  
3. what the group proposes to bargain about  
4. details for a contact person. 

The notification does not require technical or complex information and the ACCC 
considers that it may be contained in a single page. The notification is placed on 
a  public  register  at  the  ACCC;  once  the  form  has  been  sent  to  the  ACCC,  legal 
protection attaches to the collective bargaining, assuming that the participants in 
the group satisfy the eligibility criteria. 

5.12  We do NOT consider that a notification procedure should be introduced for joint 
purchasing agreements. Nor do we propose the adoption of a class exemption of 
the  kind  that  operates  in  Australia,  where  the  competition  law  system  is 
somewhat different from that of the EU. However we do consider that it would be 
sensible  to  suggest  to  buyer  groups  that  it  would  be  advisable  for  them  to 
produce  a  memorandum  for  their  own  purposes  recording  the  contents  of  their 
agreement  and  containing  information  of  the  kind  envisaged  by  the  ACCC 
procedure. In paragraph 5.10 above we noted that the parties to agreements are 
required  to  produce  evidence  in  support  of  their  own  assertions  in  competition 
law proceedings, and we believe that this would be of assistance to them. 

5.13  We  note  that  the  ACCC  requires  that  the  Collective  bargaining  class  exemption 
notice  form  must  be  provided  to  the  target  business(es)  with  which  the  group 
intends  to  bargain.  We  have  not  consulted  with  stakeholders  as  to  whether  this 
would  be  a  desirable  feature  of  the  future  Guidelines  on  joint  purchasing  and 
negotiation. In principle it seems to us to be reasonable that suppliers should be 
made aware that they are dealing with a buyer group rather than with individual 
purchasers.  Suppliers  should  be  made  aware  of  the  nature  of  the  buyer  group 
that they are dealing with; however it does not appear to us that there should be 
a requirement that individual members of the buyer group should be identified.  

5.14  For  the  avoidance  of  doubt  we  consider  that  it  would  be  important  for  future 
Guidelines  on  joint  purchasing  and  negotiation  to  make  clear  that  the  fact  that 
joint  purchasing  is  subject  to  effects  analysis  (as  opposed  to  being  an  object 
restriction, as in the case of a buyer cartel) does not imply that it is unlikely to be 
found  to  be  restrictive  of  competition.  Rather  each  joint  purchasing  agreement 
must  be  considered  on  a  case-by-case  basis  in  order  to  determine  whether  it 
might  have  the  effect  of  restricting  competition  to  an  appreciable  extent.  Of 
course  the  de  minimis  doctrine  would  apply  in  the  case  of  any  effects  analysis. 
Furthermore the Horizontal Guidelines may contain safe harbours for agreements 
below certain market share thresholds (as the existing Horizontal Guidelines do); 
this topic is beyond our terms of reference. However the Guidelines should make 
clear that joint purchasing my, depending on the facts of the case, be restrictive 
of competition by effect. 

the  ACCC’s  Guidelines  on  Collective  bargaining 

See 
https://www.accc.gov.au/system/files/public-
registers/documents/Collective%20bargaining%20class%20exemption%20-
%20Guidelines%20June%202021.pdf 

class  exemption,  available  at 

148  

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5.15  In  paragraph  5.42  we  provide  some  examples  of  buyer  cartels  and  joint 
purchasing  agreements  which  are  intended  to  elucidate  the  distinction  between 
these two categories of case. 

The form of buyer groups 

5.16  The future Guidelines should explain that common purchasing organisations may 
take several forms, as does paragraph 194 of the Horizontal Guidelines of 2011. 
It  may  be  useful  to  draw  upon  paragraphs  3.6  to  3.19  of  this  Report  when 
drafting  this  section  in  order  to  provide  a  fuller  account  of  the  different 
structures that exist. 

Relevant markets  

5.17  The Horizontal Guidelines of 2011 discuss relevant markets in paragraphs 197 to 
199,  distinguishing  between  the  purchasing  market  in  which  buyers  procure 
inputs  and  the  downstream  selling  market  in  which  they  may  sell  their  own 
products. It will obviously be important to retain a discussion of relevant product 
and  geographic  markets  in  a  future  iteration  of  the  Guidelines,  because  this  is 
necessary  in  order  to  be  able  to  conduct  effects  analysis  under  Article  101. 
However  we  will  not  discuss  this  issue  further  in  this  Report  since  we  are 
concerned with the distinction between restrictions of competition by object and 
by  effect.  Where  competition  is  restricted  by  object  the  Court  of  Justice’s 
judgment  in  Expedia  Inc  v  Autorité  de  la  concurrence149  has  established  that, 
provided  that  the  agreement  affects  trade  between  Member  States  to  an 
appreciable extent, it violates Article 101 irrespective of the appreciability of its 
effect  on  competition.150  That  being  so,  there  is  no  need  to  define  the  relevant 
market in the case of an object restriction. 

Assessment under Article 101(1) 

Main competition concerns – theories of harm 

5.18  We  discussed  theories  of  harm  in  buyer  cartel  and  joint  purchasing  cases  in 
paragraphs  4.24  to  4.32  of  this  Report.  The  Horizontal  Guidelines  of  2011 
discuss  ‘main  competition  concerns’  in  paragraphs  200  to  204.  It  is  clear  from 
the  research  that  we  have  conducted  in  producing  this  Report  that  those 
paragraphs could usefully be amplified, not least to explain in greater depth how 
buyer cartels and joint purchasing agreements might be harmful to suppliers in 
upstream  markets.  We  note  that  some  respondents  to  the  Commission’s 
consultation considered that more guidance was needed on this topic.  

5.19  Our  Report  is  specifically  concerned  with  the  distinction  between  restrictions  of 
competition  by  object  and  by  effect  in  the  case  of  purchasing  agreements,  and 
we  consider  that  it  will  be  useful  if  the  future  Guidelines  explain  the  main 
theories  of  harm  that  are  relevant  in  buyer  cartel  cases,  which  clearly  are 
restrictive  of  competition  by  object.  Given  that  the  extraction  of  lower  prices 
from  suppliers,  which  could  follow  from  a  buyer  cartel  as  well  as  from  joint 
purchasing, might result in the charging of lower prices in downstream markets, 
it  would  be  helpful  to  explain  why  a  buyer  cartel  is  nevertheless  regarded  as 
restrictive of competition by object. 

149  
150  

Case C-226/11 EU:C:2012:795. 
Ibid, para 37. 

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Horizontal Guidelines – Purchasing agreements: Delineation between by object and by effect restrictions 

5.20  It  may  be  helpful  to  begin  by  pointing  out  that  Article 101(1)(a)  (and  its 
counterparts  in  the  laws  of  the  Member  States)  specifically  provides  that 
agreements,  decisions  and  concerted  practices  which  ‘directly  or  indirectly  fix 
purchase  or  selling  prices  or  any  other  trading  conditions’  are  prohibited  as 
incompatible  with  the  internal  market.  We  explained  in  paragraph  4.26  of  this 
Report  that  there  have  been  many  cases  on  buyer  cartels  in  which  competition 
authorities  and  courts have  emphasised  the explicit  reference  to  agreements  to 
fix purchase prices in the wording of Article 101(1).  

5.21  In paragraphs 4.27 and 4.28 of this Report we discussed the many occasions on 
which  competition  authorities  and  courts  have  stated  that  the  EU  competition 
rules  are  intended  to  protect  the  structure  of  the  market  and  competition  as 
such.  This  was  the  case  in  the  T-Mobile  case,  which  involved  mobile  telephony 
operators  exchanging  commercially  sensitive  information  as  to  the  terms  on 
which  they  would  procure  the  services  of  sales  agents.151  It  is  because 
competition  law  seeks  to  protect  the  process  of  competition  that  it  was  not 
necessary to prove that the concerted practice in T-Mobile would lead to higher 
prices  for  the  end  consumer;  the  distortion  of  the  competitive  process  caused 
the Court to characterise the practice in question as restrictive of competition by 
object.152 

5.22  The  process  of  competition  requires  that  each  economic  operator  must 
determine  independently  the  policy  which  it  intends  to  adopt  on  the  market, 
including the choice of the persons from whom it decides to buy and the terms 
or conditions that it will accept.153  The requirement that undertakings should act 
independently  was  established  by  the  Court  of  Justice  in  the  Sugar  Cartel 
case.154  In  Car  Battery  Recycling  the  General  Court  had  no  doubt  that  the 
exchanges of  pricing  information between the  members  of  the  buyer  cartel  had 
an anticompetitive object because:  

they clearly run counter to the requirement of independence, which is a 
key  feature  of  the  market  conduct  of  undertakings  operating  within  a 
system of effective competition.155 

5.23  The  process  of  competition  requires  that  competitors  must  not  deliberately 
substitute  practical  cooperation  between  them  for  the  risks  inherent  in 
competition.  This  well-established  principle  has  been  clearly  restated  by  the 
Court of Justice in recent judgments such as Paroxetine156 and Lundbeck.157 This 
principle  applies  just  as  much  to  agreements  between  buyers  in  purchasing 
markets as it does to suppliers’ behaviour in selling markets.  

Restrictions of competition by object 

5.24  We  suggested  in  paragraphs  5.4  to  5.15  above  that  future  Guidelines  on 
horizontal  co-operation  agreements  should  contain  definitions  both  of  a  buyer 
cartel and of a joint purchasing agreement. In the section of the Guidelines that 
discusses restrictions of competition by object we consider that further guidance 

Case C-8/08 EU:C:2009:343, para 38. 
See e.g. Cases C-501/06 P etc. GlaxoSmithKline v Commission EU:C:2009:610, paras 62–64. 
Ibid, para 173. 
Cases 40/73 etc. Suiker Unie v Commission EU:C:1975:174. 
Case T-240/17 Campine v Commission EU:T:2019:778, para 297. 
Case C-307/18 Generics (UK) v CMA EU:C:2020:52, paras 83 and 87. 
Case C-591/16 P Lundbeck A/S v Commission EU:C:2021:243, para 114. 

151  
152  
153  
154  
155  
156  
157  

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should be given on three topics: (i) buyer cartels; (ii) boycotts; and (iii) whether 
a joint purchasing agreement might ever restrict competition by object. 

5.25  Buyer  cartels  fall  into  two  categories.  First,  there  are  cases  where  the  buyers 
agree  between  themselves  on  how  they  will  individually  interact  with  suppliers 
when  purchasing  inputs.  The  second  category  consists  of  agreements  between 
buyers  to  exchange  commercially  sensitive  information  about  their  purchasing 
intentions. Object restrictions would include agreements on, or the exchange of 
information about: 

•  maximum  prices  to  be  paid,  including  agreements  on  elements  of  prices, 

discounts and other aspects of prices 

•  price  negotiation  strategy,  such  as  regular  updates  among  buyers  about  the 

status of their separate negotiations with the supplier(s) 

•  the parties’ joint evaluation of market trends, price developments and factors 

relevant for the purchase price formation 

•  terms and conditions 
•  sources of supply, both as to suppliers and territories 
•  volumes and quantities 
•  quality 
•  other parameters of competition, for example innovation and sustainability. 

It might be useful to add that a specific type of buyer cartel is one in which the 
cartelists  manipulate  the  outcomes  of  auctions:  in  Annex  2  to  this  Report  we 
provide  examples  of  such  cases  that  have  arisen  in  the  Netherlands,  Malaysia, 
Singapore and New Zealand. 

5.26  As we discussed in paragraph 4.15, it will be useful for the future Guidelines to 
explain  the  distinction  between  the  situation  in  which  a  buyer  cartel  fixes  the 
maximum  price  that  each  firm  individually  will  pay  for  products,  which  restricts 
competition  by  object,  and  an  agreement  between  the  members  of  a  buyer 
group  on  the  maximum  price  that  a  joint  purchasing  organisation  will  pay  or 
negotiate  for  them,  in  which  case  effects  analysis  is  required  of  whether  the 
organisation itself is distortive of competition. This point is covered by paragraph 
206 of the existing Guidelines of 2011. 

5.27  We  consider  that  it  would  be  useful  if  the  future  Guidelines  could  explain  the 
circumstances in which a collective boycott by purchasers might be considered to 
be  restrictive  of  competition  by  object.  In  paragraphs  2.32  to  2.44  we  made  a 
distinction  between  horizontal  boycotts,  SPPAs  and  bargaining  tactics  and 
concluded  that  only  horizontal  boycotts,  aimed  at  eliminating  competitors  from 
the level of the market at which the perpetrators of the boycott operate, should 
be  allocated  to  the  object  box.  We  consider  that  a  horizontal  boycott  by 
purchasers  intended  to  eliminate  another  purchaser  either  from  the  upstream 
purchasing  market  or  the  downstream  selling  market  restricts  competition  by 
object.  However  vertical  purchasing  restraints,  directed  towards  suppliers, 
including  what  we  describe  in  this  Report  as  an  SPPA,  should  be  subject  to 
effects analysis on a case-by-case basis.   

5.28  It  would  be  helpful  for  the  future  Guidelines  to  contain  a  discussion  of  whether 
joint purchasing could ever amount to a restriction of competition by object. Our 
view is that joint purchasing should always require effects analysis. We explained 
in paragraphs 4.18 and 4.19 that the only finding of a restriction of competition 
by  object  in  a  joint  purchasing  case  that  we  have  found was  in Eurovision,  and 
that  was  in  a  decision  in  which  the  Commission  found  there  to  be  a  restriction 

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both by object and effect, and in which it granted an individual exemption under 
Article  101(3)  anyway.  Given  that  object  restrictions  should  be  interpreted 
narrowly;  that  there  is  no  judicial  precedent  for  finding  that  joint  purchasing 
restricts competition by object; and that joint purchasing can lead to lower prices 
that  may  be  passed  on  to  consumers,  we  consider  that  there  are  convincing 
reasons  for  subjecting  all  joint  purchasing  to  effects  analysis,  unless  the  joint 
purchasing is actually a disguised cartel.  

5.29  The  Commission’s  Call  for  Tenders  –  Tender  Specifications,  which  led  to  the 
commissioning of this Report, asked us to consider whether any of the following 
factors  are  relevant  to  the  characterisation  of  a  buyer  cartel  as  a  restriction  by 
object: 

•  whether the buyers are competing downstream 
•  the  aggregated  share  of  the  buyers  in  total  demand  in  the  (upstream) 

purchasing market 

•  the  degree  of  concentration  of  sellers  in  the  (upstream)  purchasing 

market; and  

•  the aggregated market share of the buyers in the (downstream) selling 

market. 

5.30  None of these factors is relevant to characterising the object of an agreement. 
However  they  are  important  factors  to  be  taken  into  account  when  deciding 
whether an agreement has the actual or likely effect of restricting competition in 
the internal market.   

Restrictive effects on competition 

5.31  Whilst  this  issue  is  beyond  our  Terms  of  Reference,  we  briefly  summarise  six 

points that are relevant to the assessment of effects upon competition.  

5.32  First, where the analysis of an agreement does not reveal a sufficient degree of 
harm  to  competition,  the  relevant  question  under  Article  101(1)  is whether  the 
agreement has the effect of restricting competition compared to the competition 
conditions that would have occurred in the absence of the agreement. The need 
to  establish  a  ‘counterfactual’  is  to  be  found  in  the  case-law  of  the  Court  of 
Justice.158 

5.33  Secondly,  it  is  necessary  to  take  into  account  the  actual  context  in  which  the 
joint purchasing agreement takes place, and in particular the economic and legal 
context in which the undertakings concerned operate, the nature of the goods or 
services affected, as well as the real conditions of the functioning and structure 
of the market or markets in question.159 

5.34  Thirdly,  the  assessment  of  the  effects  of  a  joint  purchasing  agreement  is  not 
limited to actual effects alone, but must also take account of its likely effects.160  

5.35  Fourthly, we agree with paragraph 207 of the Horizontal Guidelines of 2011 that 
any  analysis  of  the  effects  on  competition  generated  by  a  joint  purchasing 

158  
159  
160  

See eg Case C-382/12 P Mastercard v Commission EU:C:2014:2201, para 161. 
Ibid, para 165. 
Case C-7/95 P John Deere v Commission EU:C:1998:256, para 77. 

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arrangement  must  cover  the  negative  effects  on  both  the  purchasing  and  the 
selling markets. Each of these markets will need to be defined. 

5.36  Fifthly, we consider that all of the factors in the Terms of Reference, set out in 

paragraph 5.29 above, are relevant to an effects analysis.  

5.37  Sixthly,  it  is  necessary  to  examine  whether,  as  a  result  of  the  agreement, 
competition has been restricted or distorted to an appreciable extent.161  

5.38  Whilst  market  shares  are  only  one  of  a  number  of  quantitative  and  qualitative 
criteria  that  may  be  used  for  assessing  whether  a  joint  purchasing  agreement 
appreciably restricts competition, we consider that market share thresholds are 
a  valuable  way  of  identifying  cases  that  are  unlikely  to  give  rise  to  an 
appreciable  restriction  of  competition.  They  also  can  contribute  to  the  legal 
certainty that businesses and their advisers require by providing safe harbours. 
We  agree  with  paragraph  1.84  of  the  RBB  report  that  it  is  for  the  competition 
authority to decide on the appropriate market share thresholds.   

Objective necessity 

5.39  As we said in paragraph 5.1 above, it may be helpful if the future Guidelines on 
Horizontal  co-operation  agreements  were  to  include  some  narrative  on  the 
doctrine  of  objective  necessity  and  its  application  to  joint  purchasing,  as 
indicated  by  the  Gøttrup-Klim  case.  Specifically  the  Commission  might  provide 
examples  of  the  typical  restrictions  in  agreements  on  joint  purchasing  and 
negotiation that can be regarded as ancillary to the function of legitimate buyer 
groups.   

Assessment under Article 101(3) 

5.40  An assessment of the criteria contained in Article 101(3) is beyond the Terms of 
Reference for this Report. However we feel that it would be useful if the future 
Guidelines  were  to  acknowledge  that  it  is  not  legally  impossible  that  an 
agreement that restricts competition by object might nevertheless be capable of 
satisfying Article 101(3). The fact that it is unlikely that an efficiency argument 
in the case of most object restrictions does not mean that it is legally impossible 
for such an argument to prevail in a particular case. 

5.41  We  have  discussed  sustainability,  Article  101(3)  and  the  Wouters  doctrine  in 
paragraphs  2.45  to  2.53  of  this  Report.  Since  this  issue  is  of  relevance  to  all 
aspects  of  the  future  regime  for  horizontal  cooperation  agreements  we  have 
nothing  further  to  say  concerning  the  future  Guidelines  and  joint  purchasing 
agreements specifically. 

161  

Case  5/69  Völk  v  Vervaecke  EU:C:1969:35,  para  7;  Case  C-226/11  Expedia  v  Autorité  de  la 
concurrence  EU:C:2012:795, para 16. 

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Examples 

Example 1 

Situation:  Company  A,  Company  B  and  Company  C  are  brewers  of  beer.  They  sell 
canned  and  bottled  beer  in  retail  outlets  such  as  pubs,  night  clubs,  cafés  and 
restaurants (the on-trade) and in retail outlets such as supermarkets and off licences 
(the off-trade). Company A, Company B and Company C have a 90% share of the on-
trade  market  for  beer  and  a  70%  share  of  the  off-trade  beer  selling  market.  One  of 
the most important inputs for beer is cans. In the relevant purchasing market for cans 
there  are  only  two  major  suppliers,  each  of  which  has  considerable  market  power. 
Company  A, Company B  and  Company  C  are dissatisfied  with their  respective  supply 
arrangements for cans, and in particular the prices that they are being charged. They 
have secretly agreed with one another the maximum prices that they will pay for cans 
and  to  share  with  one  another  information  about  the  prices  that  they  are  currently 
being charged. 

Analysis: This is a buyer cartel. The agreement made by Company A, Company B and 
Company  C  does  not  involve  any  collective  bargaining  by  a  common  organisation 
acting  on  their  behalf  vis-à-vis  the  two  suppliers  of  cans  in  the  upstream  purchasing 
market.  Company  A,  Company  B  and  Company  C  have  simply  agreed  between 
themselves to fix the maximum price that each of them is willing to pay for cans and 
to share commercially sensitive information. There is no joint purchasing of cans, nor 
is  there  any  joint  negotiation.  Company  A,  Company  B  and  Company  C  have 
substituted  practical  cooperation  between  them  for  the  risks  inherent  in  competition. 
This agreement restricts competition by object. The fact that the cartel is secret does 
not  affect  the  legal  characterisation  of  the  agreement,  but  it  may  be  relevant  to  the 
level of the fine. 

Example 2 

Situation: Company A, Company B and Company C produce batteries, specialising in 
supplying  to  manufacturers  of  electric  cars.  Their  technology  is  advanced,  and  most 
car  manufacturers  in  the  EU  purchase  batteries  from  one  or  all  of  them.  Recently 
Company  D  has  entered  the  EU  market  for  car  batteries  and  it  has  succeeded  in 
persuading  many  of  the  car  manufacturers  to  source  batteries  from  it.  Company  A, 
Company  B  and  Company C  are concerned  about the situation  and have  agreed  that 
they  will  approach  the  suppliers  of  ‘rare  earths’  such  as  tantalum  and  niobium  and 
request that they (the suppliers) refuse to supply those products to Company D for as 
long as they have any supply arrangements in place with any of Company A, Company 
B  and  Company  C.  Company  D  now  complains  that  it  is  unable  to  obtain  supplies  of 
rare earths necessary for its production of car batteries. 

Analysis: This is a horizontal boycott by Company A, Company B and Company C, the 
object  of  which  is  to  restrict  the  emerging  competition  presented  by  Company  D  at 
their level of the market. This is not a joint purchasing agreement whereby a common 
organisation collectively negotiates on behalf of a number of buyers in order to obtain 
more  favourable  terms  and  conditions.  The  intention  of  Company  A,  Company  B  and 
Company  C  is  to  foreclose  Company  D’s  access  to  the  market,  harming  Company  D 
both  in  the  purchasing  market  for  rare  earths  and  in  the  selling  market  for  car 
batteries. 

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Example 3 

Situation:  Ruritania,  a  fictional  Member  State  of  the  EU,  has  introduced  new 
standards  on  air  conditioning  systems  in  motor  vehicles  with  the  aim  of  reducing 
harmful emissions and combating global warming. Four motor vehicle manufacturers, 
Company  A,  Company  B,  Company  C  and  Company  D,  agree  to  establish  an  alliance 
that  will  buy  a  new  type  of  refrigerant  used  in  air  conditioning  systems  for  cars  that 
complies  with  the  new  Ruritanian  environmental  standards.  The  alliance  will  be  an 
unincorporated  cooperative  association.  The  bylaws  of  the  association  provide  that 
Company  A,  Company  B,  Company  C  and  Company  D  must  purchase  all  of  their 
requirements  of  refrigerants  through  the  joint  purchasing  arrangements  and  are 
prohibited  from  negotiating  independently  with  suppliers.  On  the  relevant  purchasing 
market  for  refrigerants  used  in  air  conditioning  systems  for  cars  the  parties  have 
combined market shares of between 10% and 20%. On the relevant selling market for 
motor vehicles they have a combined market share of 25%; Company E, a competing 
motor vehicle manufacturer, has a 40% market share.   

Analysis: The proposed alliance is an example of a joint purchasing agreement. The 
unincorporated cooperative association has the requisite element of ‘jointness’: it will 
bargain collectively on behalf of Company A, Company B, Company C and Company D 
in a way that will enhance their buyer power compared to the power that each would 
have  if  it  were  to  negotiate  on  its  own.  The  proposed  alliance  does  not  have  as  its 
object  the  restriction  of  competition.  Rather  the  joint  purchasing  agreement  would 
have  to  be  tested  for  its  effect  on  competition.  On  these  facts  it  seems  unlikely  that 
the  alliance  will  have  appreciable  restrictive  effects:  Company  A,  Company  B, 
Company  C  and  Company  D  have  a  relatively  modest  market  position  on  the 
purchasing and  the  selling  markets;  moreover,  Company E  is  not  participating  in  the 
alliance  and  will  be  an  independent  competitor  with  a  larger  share  of  the  selling 
market.  It  would  have  been  advisable  for  Company  A,  Company  B,  Company  C  and 
Company D to have produced a memorandum recording the basic details of their joint 
purchasing  agreement  and  to  have  informed  their  suppliers  of  the  buyer  group’s 
existence.   

Example 4 

Situation:  Five  steel  manufacturers  account  for  60%  of  the  domestic  purchases  of 
iron  ore  in  Valhalla,  a  fictional  Member  State  of  the  EU.  The  steel  manufacturers  set 
up, own and operate a joint venture, ‘Metalworks’, that will negotiate the purchase of 
iron  ore  on  their  behalf.    Metalworks  demands  and  obtains  from  a  major  iron  ore 
supplier  a  20%  reduction  in  the  purchase  price  of  iron  ore  in  Valhalla.  Instead  of 
competing with each other, the five steel manufacturers buy iron ore at the purchase 
price  negotiated  by  Metalworks.  There  is  no  evidence  that  the  owners  of  Metalworks 
lowered their steel prices as a result of the lower prices that they paid for iron ore.   

Analysis:  This  is  an  example  of  a  buyer  group  (Metalworks)  that  does  not  purchase 
the input (iron ore) in Valhalla. The five steel manufacturers make their purchases of 
iron  ore  on  an  individual  basis,  albeit  on  the  basis  of  the  price  negotiated  by 
Metalworks. It is therefore an example of joint negotiation. Metalworks is the common 
organisation  which  has  negotiated  with  suppliers  on  behalf  of  the  five  steel 
manufacturers, which, in turn, have been able individually to obtain a lower purchase 
price for iron ore. The formation and implementation of Metalworks does not have as 
its  object  the  restriction  of  competition.  Whether  it  has  a  restrictive  effect  on 
competition  will  depend  on,  for  example,  whether  Metalworks  gives  rise  to  a 

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significant  commonality  of  costs  whether  their  agreement  produces  a  real  risk  of 
coordinated behaviour on the selling market for steel. 

Example 5 

Situation:  30  independent  wholesalers  in  the  grocery  sector  that  mainly  supply  to 
smaller  retailers  of  grocery  products,  alcoholic  and  non-alcoholic  drinks  and  other 
household items establish a buyer group, ‘Buyrite’, to make purchases from suppliers 
of  these  products.  The  suppliers  in  question  publish  list  prices,  which  provide  for 
volume  discounts.  The  level  of  discounts  offered  by  the  suppliers  is  non-negotiable: 
they  are  based  purely on  the quantities  purchased.  Buyrite  aggregates  the  combined 
requirements of all its member wholesalers and purchasers at the price determined by 
the  suppliers’  list  prices.  As  a  result  Buyrite  purchases  at  lower  purchase  prices  than 
its members would have obtained if they had purchased individually.  

Analysis:  This  is  an  example  of  a  ‘passive  buyer  group’,  which  we  discussed  in 
paragraph 3.13 of this Report. There is no negotiation of the price at which Buyrite will 
purchase, because the suppliers do not deviate from their list prices. However, Buyrite 
does  purchase  jointly  on  behalf  its  members  and  achieves  lower  prices  as  a  result. 
There is no restriction of competition by object. The agreement would infringe Article 
101 only if it has an appreciable adverse effect on competition; in the event that the 
agreement  is  found  to  be  restrictive  of  competition  consideration  would  have  to  be 
given as to whether it satisfies the conditions of Article 101(3). 

Example 6 

Situation: Company A, Company B, Company C and Company D are all active in the 
processing and distribution of cocoa beans around the world. Each of them also makes 
a series of semi-finished cocoa products, such as cocoa butter and cocoa powder. Each 
of  them  has  unilaterally  committed  to  respect  the  human  rights  of  cocoa  farm 
labourers  in  countries  such  as  Côte  d’Ivoire  and  Ghana.  To  that  end,  in  2020,  they 
formed  a  ‘Cocoa  Fair  Trade  Initiative’, which promises  to  pay  cocoa farm  labourers  a 
‘fair wage’. In 2021 Company A, Company B, Company C and Company D decided to 
go a step further and agreed not to buy cocoa beans from any supplier of cocoa beans 
who does not pay a living wage to the labourers on its cocoa farms. 

Analysis: This is an example of a vertical purchasing restraint rather than a horizontal 
boycott as in Example 2 above; more specifically the agreement entered into between 
Company  A,  Company  B,  Company  C  and  Company  D  is  what  we  have  described  in 
this Report as a sustainable products purchasing agreement. As we have explained at 
paragraphs 2.32 to 2.44 of this Report, we believe that vertical purchasing restraints, 
and in particular SPPAs, should not be treated as restrictive of competition by object. 
This  means  that  the  applicability  of  Article  101(1)  cannot  be  determined  simply  by 
taking  into  account  the  formal  terms  of  the  agreement.  Rather  the  agreement  would 
have to be assessed by taking into consideration the entire factual, legal and economic 
context  in  which  it  operated.  The  effect  of  an  agreement  upon  competition  could  be 
determined only if a market analysis were undertaken, so that it would be relevant to 
consider, for example, the degree of concentration in the relevant purchasing market 
for  cocoa  beans;  the  market  position  of  Company  A,  Company  B,  Company  C  and 
Company  D  and  their  competitors  in  the  relevant  selling  markets  for  semi-finished 
cocoa  products;  and  the  stance  adopted  by  competitors  to  dealing  (or  not)  with 
producers who do not pay a living wage to labourers working on cocoa farms. In the 
event that the agreement is found to be restrictive of competition consideration would 
have to be given as to whether it satisfies the conditions of Article 101(3). 

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Chapter 6 
Responses to specific issues raised by the Call for 
Tenders 

6.1  The  Call  for  Tenders  required  us,  when  giving  our  advice,  to  give  consideration 
to  a  number  of  specific  issues.  This  chapter  contains  our  responses.  We  have 
divided  our  responses  into  five  parts,  dealing  in  turn  with  (i)  market 
considerations;  (ii)  the  sustainability  issue;  (iii)  concrete  and  relevant,  real-life 
examples;  (iv)  joint  and  separate  behaviour;  and  (v)  the  joint  negotiation  of 
licences of standard essential patents. 

Market considerations  

6.2  The Call for Tenders set out six specific factors that we were asked to address: 

legal 

impartial 

[A]  proposal  of  relevant  factors  for  making  such  distinction  of  joint 
purchasing  agreements  as  by  object  or  by  effect  restrictions  based  on 
the  expert’s  own 
interpretation  of  decisions  by 
competition  authorities  and  case  law  of  the  EU  and  national  courts.  In 
this  context,  the  expert  shall  consider  whether  any  of  the  following 
factors, among others, are relevant for the purpose of this assessment: 
(i)  buyers  are  competing  downstream,  (ii)  degree  of  integration  on  the 
buyer  side  (e.g.  whether  the  buyers  created  or  not  a  separate  (joint 
purchasing)  entity  or  a  looser  form  of  cooperation  in  charge  of  the 
negotiations with suppliers), (iii) aggregated share of the buyers in total 
demand 
the  (upstream)  purchasing  market,  (iv)  degree  of 
concentration  of  sellers  in  the  (upstream)  purchasing  market,  (v) 
aggregated  market  share  of  the  buyers  in  the  (downstream)  selling 
markets,  (vi)  the  fact  whether  the  buyer  cooperation  is  secret  towards 
sellers.  

in 

6.3  We  do  not  consider  that  any  of  these  factors  is  relevant  to  the  question  of 
whether  a  purchasing  agreement  restricts  competition  by  object.  As  we 
explained in paragraphs 5.29 and 5.30, most of these are factors of relevance to 
the assessment of the effects of an agreement. However they are not relevant 
in the case of object restrictions.  

Secrecy 

6.4  The Call for Tenders asks us specifically to consider whether it is relevant to the 
assessment of purchasing agreements as restrictive of competition by object or 
effect  that  the  buyer  cooperation  is  secret  towards  the  sellers.  We  have  two 
points to make on this. 

Secrecy is not a requirement for an object restriction 

6.5  The first point is that secrecy is not a requirement for a finding of a restriction of 
competition  by  object.  This  point  emerges  clearly  from  cases  such  as  Beef 
Industry  Development  Society,162  where  the  Court  of  Justice  had  no  doubt  that 
the agreement to reduce the total capacity of the Irish beef processing industry 
had the object of restricting competition, even though the agreement was in the 

162  

Case C-209/07 EU:C:2008:643. 

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Horizontal Guidelines – Purchasing agreements: Delineation between by object and by effect restrictions 

public  domain  and  had  the  support  of  the  Irish  government.  Similarly,  in  Ski 
Taxi163 the EFTA Court held that transparent joint bidding by two competing taxi 
firms was capable of revealing a sufficient degree of harm to competition, a point 
that  was  subsequently  confirmed  by  the  Norwegian  Supreme  Court.  There  are 
other cases to the same effect.164  

Secrecy may be relevant to the imposition and/or level of the fine 

6.6  Our  second  point  is  that  our  review  of  buyer  cartel  cases  reveals  that  secrecy 
may  be  relevant  to  the  level  of  the  fine  in  a  buyer  cartel  case.  In  Spanish  raw 
tobacco the Commission took into account that the secret nature of the tobacco 
processors’  cartel  enabled  it  to  be  fully  implemented165;  this  was  one  of  the 
factors  that  led  it  to  find  that the  infringement was  ‘very  serious’.166 On  appeal 
the General Court agreed with the Commission. In Deltafina v Commission167 the 
Court ruled that ‘there was a secret aspect to the processors’ cartel, which is a 
factor that can accentuate the gravity of the infringement.’168   

6.7  The  converse  can  sometimes  be  true:  the  fact  that  an  arrangement  has  been 
and  is  public  may  influence  the  Commission  not  to  impose  a  fine.  In 
International  Skating  Union’s  Eligibility  rules169  one  of  the  reasons  why  the 
Commission  decided  not  to  impose  a  fine  was  that  the  ISU’s  rules  had  been 
publicly known since their adoption.170  

The sustainability issue 

6.8  The  Call  for  Tenders  asks  us  to  consider  whether  the  pursuit  of  sustainability 
objectives,  such  as  environmental  protection,  animal  health  and/or  welfare,  or 
social  protection,  by  the  joint  purchasing  agreement  may  influence  the 
qualification as a by object or by effect.  

6.9  We  have  addressed  this  issue  in  paragraphs  2.21  to  2.53  of  this  Report.  We 
consider  that,  in  principle,  it  is  desirable  that  firms  should  compete  with  one 
another in order to produce more sustainable products. As a general proposition 
each  firm  should  decide  for  itself  the  way  or  ways  in  which  it  wants  to  pursue 
sustainability  objectives,  and  the  market  will  reward  those  that  make  good 
decisions and punish those that make bad ones.  

6.10  Having said this, we consider that certain joint purchasing arrangements may be 
able  to  make  a  positive  contribution  to  sustainability  objectives.  We  agree  with 
the observation of Executive Vice-President Vestager that:  

  the  rules  shouldn’t  discourage  companies  from  working  together,  to 
make their products more sustainable – especially when that cooperation 
doesn’t  have  much  effect  on  the  way  companies  compete  with  each 
other.  In  practice,  that  could  involve  companies  setting  joint  standards 
for  what  counts  as  a  green  product,  or  pooling  resources  to  speed  up 

Case E-3/16 Ski Taxi Ski SA v Staten v/Konkurransetilsynet, judgment of 22 December 2016, paras 
88–102 and Case 2015/203, judgment of the Norwegian Supreme Court of 22 June 2017. 
See  eg  Alloy  surcharge,  OJ  [1998]  L  100/55  and  the  Commission’s  re-adopted  decision  of  20 
December 2006;. 
Commission decision of 20 October 2004, para 413. 
Ibid, para 414. 
Case  T-12/06  EU:T:2011:441,  upheld  on  appeal  Case  C-578/11  P  Deltafina  v  Commission 
EU:C:2014:1742. 
Case T-12/06 EU:T:2011:441, para 239. 
Commission  decision  of  8  December  2017,  upheld  on  appeal  Case  T-93/18  EU:T:2020:610,  on 
appeal Case C-124/21 P, not yet decided. 
Commission decision of 8 December 2017, para 348(ii). 

163  

164  

165  
166  
167  

168  
169  

170  

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Horizontal Guidelines on purchasing agreements: Delineation between by object and by effect restrictions 

green  innovation.  It  could  even  mean  companies  agreeing  to  cut  dirty 
products  out  of  their  supply  chains,  without  being  forced  to  do  that  by 
regulation.171 

6.11  In paragraphs 2.32 to 2.44 we have identified several arguments that might be 
advanced in support of the proposition that a vertical ‘sustainability boycott’ does 
not  restrict  competition  by  object;  instead  such  cases  should  be  subject  to 
effects analysis. 

Concrete and relevant, real-life examples 

6.12  Annex  2  contains  our  research  into  number  real-life  examples  both  of  buyer 
cartels that have been classified as restrictions by object and of joint purchasing 
agreements that have either been found to fall outside Article 101(1) altogether 
or  to  have  satisfied  Article  101(3).  Paragraph  5.42  provides  hypothetical 
examples  of  the  application  of  Article  101  to  a  range  of  buyer  cartel  and  joint 
purchasing and negotiation agreements. 

Joint and separate behaviour 

[A]n  explanation  whether  this  assessment  under  the  proposed  general 
framework  differs  depending  on  the  number  of  aspects  of  the  joint 
purchasing  that  are  negotiated  jointly  with  the  group  of  buyers  and 
which  ones  are  negotiated/decided  separately.  Such  aspects  could 
include (but are not limited to) the price, certain element(s) of the price, 
the  definition/assortment  of  products/services,  the  quantity,  timing, 
delivery, etc.  

6.13  We  are  required  to  identify  purchasing  cases  that  restrict  competition  by 
object.  Our  conclusion  is  clear:  that  it  is  buyer  cartels  that  restrict 
competition  by  object,  and  that  these  cases  do  not  involve  joint 
purchasing.  We  do  not  consider  that  joint  purchasing  restricts  competition 
by  object,  and  it  follows  that  none  of  these  factors  is  a  relevant 
consideration. 

Whether  the  general  framework  applies  to  all  types  of  joint  purchasing 
in  all  sectors  of  the  economy  and  in  particular  the  joint  negotiation  of 
licences of standard essential patents 

6.14  The  Call  for  Tenders  asks  us  to  consider  whether  the  general  framework  and 
features  analysed  under  the  previous  indents  applies  to  all  types  of  joint 
purchasing  arrangements  in  all  sectors  of  the  economy  and,  in  particular, 
whether this approach is also valid for assessing licensing negotiation groups that 
jointly bargain with licensors of standards essential patents. 

6.15  We  consider  that  the  general  framework  set  out  above  applies  to  all  sectors  of 
the  economy.  We  see  no  reason  why  the  future  Guidelines  on  horizontal  co-
operation  agreements  should  treat  different  sectors  of  the  economy  differently. 
On  the  object-effect  distinction,  we  believe  that  buyer  cartels  should  (continue 

171  

Competition policy in support of the Green Deal, Speech of 10 September 2021. 

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to) be regarded as restrictive of competition by object, and that all cases of joint 
purchasing and negotiation should be subject to effects analysis. 

6.16  It  follows  that  we  believe  that  the  joint  negotiation  of  the  terms  of  licences  of 
standard essential patents by a group of potential licenses should be assessed on 
the  basis  of  the  likely  effects  on  competition  of  such  a  practice;  such  joint 
negotiations are not suitable for allocation to the object box.  

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Chapter 7 
Conclusions 

7.1  This Report concerns the distinction between purchasing agreements that restrict 
competition  by  object  and  those  that  should  be  subjected  to  effects  analysis. 
One of the concerns that led to the commissioning of this report was a perceived 
lack of clarity over the distinction between joint purchasing arrangements and by 
object buyer cartels. Our research into cases in which fines have been imposed 
on buyer cartels – both within the EU and in third countries – has revealed that 
there  has  never  been  a  fine  imposed  in  a  case  of  joint  purchasing  or  joint 
negotiation.  Fines  have  been  imposed  only  in  cases  where  buyers  agreed  with 
one another on matters such as the maximum prices that they individually would 
pay  for  products  or  where  they  exchanged  commercially  sensitive  information 
with one another. 

7.2  Having  said  this,  the  Horizontal  Guidelines  of  2011  say  nothing  about  what  is 
meant by joint purchasing and how it is distinguishable from a buyer cartel. To 
assist  the  Commission  in  writing  any  future  Horizontal  Guidelines,  we  have 
proposed definitions both of a buyer cartel and of joint purchasing agreements: 
these  can  be  found  at  paragraphs  5.4  to  5.9  of  this  Report.    We  suggest  that 
some  examples  should  be  given  that  seek  to  shed  light  on  the  distinction 
between  these  two  types  of  agreement;  we  have  offered  a  few  examples  at 
paragraph  5.42  above.  Annex  2  of  the  Report  provides  a  number  of  real-life 
examples of joint purchasing and buyer cartels from around the world. 

7.3  A  difficult  issue  of  particular  importance  is  whether  the  pursuit  of  sustainability 
objectives by a joint purchasing agreement may influence its characterisation as 
being restrictive of competition by object or effect. We consider that, in principle, 
certain  joint  purchasing  arrangements  can  make  a  positive  contribution  to 
sustainability  objectives.  Certain  agreements  between  competing  purchasers 
might be regarded as restrictions of competition by object as they amount to a 
group  boycott.  We  have  suggested  that  a  distinction  should  be  made  between 
‘horizontal  boycotts’  that  harm  competitors  at  the  same  level  of  the  market  as 
the  perpetrators  of  the  boycott,  on  the  one  hand,  and  ‘vertical  purchasing 
restraints’  where  purchasers  agree  not  to  deal  with  a  supplier  or  suppliers  at  a 
different level of the market, on the other. An example of a vertical purchasing 
restraint  would  be  what  we  describe  as  a  sustainable  products  purchasing 
agreement,  for  example  where  a  group  of  competing  purchasers  agree  to 
purchase timber only from sustainable sources. We consider such an agreement 
should  not  be  considered  to  be  restrictive  of  competition  by  object,  but  should 
instead be analysed on an effects basis. 

7.4  The expert advice sought by the Commission is intended to enable it to provide 
certainty in any future Horizontal Guidelines for firms involved in or considering 
whether  to  participate  in  joint  purchasing  agreements  as  to  whether  their 
conduct  qualifies  as  a  restriction  of  competition  by  object,  unlikely  to  meet  the 
conditions of Article 101(3) TFEU, or as a restriction of competition by effect that 
must  be  assessed  in  line  with  the  Guidelines.  To  that  end,  we  have  made  a 
number  of  suggestions  on  the  topics  of  ‘relevant  markets’  ‘theories  of  harm’, 
‘restrictions  by  object’,  ‘restrictions  by  effect’  and  ‘Article  101(3)’,  which,  we 
hope,  will  be  useful  for  the  Commission,  NCAs,  undertakings  and  their 
professional advisers. 

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Annexes 

Annex 1 

Whish and Bailey, pp 121-145 

Annex 2 

Joint purchasing cases 

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121

4. The Object or Effect of Preventing, Restricting
or Distorting Competition

Article  101(1)  prohibits  agreements  that  have  as  their  object  or  effect  the  prevention, 
restriction or distortion of competition385. It contains an illustrative list of agreements 
that may be caught, such as price fixing and market sharing, but this is insufficient in itself 
to explain the numerous intricacies involved in understanding how this provision works. 
Judgments of the General Court and, at the top of the hierarchy, the Court of Justice con-
tain the most authoritative statements of the law, although some of the best analyses will 
be found in Opinions of the Advocates General; the Commission’s decisions, Notices and 
Guidelines provide important insights into its views on the application of Article 101(1), 
as do its annual Report on Competition Policy and Competition Policy Brief386.

The application of Article 101(1) to agreements, in particular by the Commission, was 
for many years controversial. In essence, the complaint of many commentators was that 
Article 101(1) was applied too broadly, catching many agreements that were not detri-
mental to competition at all387. Agreements that are caught by Article 101(1) are void and 
unenforceable388, and may attract a fine and damages claims, unless they satisfy the cri-
teria set out in Article 101(3). Critics argued that Article 101(1) should be applied to fewer 
agreements in order to avoid the problems of delay, cost and uncertainty associated with 
the old system of notification of agreements to the Commission for ‘negative clearance’ 
under Article 101(1) and/or ‘individual exemption’ under Article 101(3). These procedural 
problems no longer exist following the abolition of notification and individual exemp-
tion by Regulation 1/2003389. Since Regulation 1/2003, the precise sphere of application 
of Article 101(1) on the one hand and Article 101(3) on the other does not have the signifi-
cance that it once did390; today the real question for undertakings and their professional 
advisers is whether their agreements infringe Article 101 as a whole.

The EU Courts have repeatedly made clear that, except in those cases where the object 
of an agreement is anti-competitive, the applicability of Article 101(1) cannot be deter-
mined simply by taking into account its formal terms. Rather:

it is necessary to assess competition within the actual context in which it would occur if that 
agreement had not existed in order to assess the impact of that agreement on the param-
eters of competition, such as the price, quantity and quality of the goods or services391.

385  In the text that follows the term ‘restriction’ of competition is taken to include the prevention and 

distortion of competition.

386  All of these materials are available on DG COMP’s website at www.ec.europa.eu/competition.
387  See eg Bright ‘EU Competition Policy: Rules, Objectives and Deregulation’ (1996) 16 OJLS 535; there 
is a considerable amount of academic literature criticising the ‘over’-application of Article 101(1): see eg 
Joliet The Rule of Reason in Antitrust Law: American, German and Common Market Laws in Comparative 
Perspective (Springer, 1967), pp 77–106, 117 to the end; Korah ‘The Rise and Fall of Provisional Validity’ 
(1981) 3 Northwestern Journal of International Law and Business 320; Forrester and Norall ‘The Laicization 
of Community Law: Self-Help and the Rule of Reason’ (1984) 21 CML Rev 11; Korah ‘EEC Competition 
Policy—Legal  Form  or  Economic  Efficiency’  (1986)  39  Current  Legal  Problems  85;  Venit  ‘Pronuptia: 
Ancillary  Restraints  or  Unholy  Alliances?’  (1986)  11  EL  Rev  213;  Holley  ‘EEC  Competition  Practice:  A 
Thirty-Year Retrospective’ [1992] Fordham Corporate Law Institute (ed Hawk), 669, 689; Nazzini ‘Article 81 
EC Between Time Present and Time Past: A Normative Critique of “Restriction of Competition” in EU Law’ 
(2006) 43 CML Rev 497; Colomo and Lamadrid ‘On the Notion of Restriction of Competition: What We 
Know and What We Don’t Know We Know’ in Gerard, Merola and Meyring (eds) The Notion of Restriction 
of Competition: Revisiting the Foundations of Antitrust Enforcement in Europe (Bruylant, 2017).

388  See further ch 8, ‘Competition law as a defence’, pp 342–347.
389  OJ [2003] L 1/1; see further ch 4, ‘Regulation 1/2003’, pp 172–175.
390  Note however that the burden of proof rests with different persons under Article 101(1) and Article 

101(3): see ch 4, ‘Burden and standard of proof’, pp 156–157.

391  Case C-228/18 Gazdasági Versenyhivatal v Budapest Bank Nyrt EU:C:2020:265, para 55 and the case-

law cited.

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122

Article 101(1)

(A)  Horizontal and vertical agreements

Article 101 is capable of application both to horizontal agreements (between undertak-
ings at the same level of the market) and to vertical agreements (between undertakings 
at  different  levels  of  the  production  chain).  In  Consten  and  Grundig  v  Commission392, 
Grundig and its distributor Consten argued that Article 101 had no application to verti-
cal agreements, which could be caught, if at all, only by Article 102. The Court of Justice 
firmly rejected this:

Neither the wording of Article [101] nor that of Article [102] gives any ground for holding 
that distinct areas of application are to be assigned to each of the two Articles according to 
the level of the economy at which the contracting parties operate.

As  a  general  proposition  vertical  agreements  are  less  damaging  to  competition  than 
horizontal ones, as the Court of Justice expressly acknowledged in Allianz Hungária393. 
However, that is not a reason for excluding vertical agreements entirely from scrutiny 
under Article 101; in Consten and Grundig the Court said that, as a matter of principle, no 
distinction should be made where the Treaty itself does not make one394. The application 
of Article 101 to vertical agreements established in Consten and Grundig was attributable 
to the ‘single market imperative’, which remains as important today as it ever has been395. 
In recent years the Commission has taken action in several cases where vertical restric-
tions  on  cross-border  e-commerce  violated  the  single  market  imperative396.  Vertical 
agreements will be considered in detail in chapter 16.

(B)  Horizontal agreements: actual and potential competition

It is important to be able to characterise an agreement as horizontal on the one hand or 
vertical on the other397. The application of Article 101 may vary depending on whether 
an agreement is horizontal or vertical: for example, Regulation 330/2010 applies only to 
vertical agreements (as defined in that Regulation), and there are separate guidelines for 
horizontal cooperation agreements398 and for vertical agreements399. Deciding whether 
an agreement is horizontal or vertical therefore requires careful consideration.

Assuming that two or more undertakings are already operating on the same relevant 
product or geographic market, it is clear that they are actual competitors and that there-
fore there is a horizontal relationship between them. However, the position is less clear 
where  an  undertaking  not  currently  active  on  the  market  might  at  some  point  in  the 
future enter it. What factors are relevant, and how plausible does entry by that under-
taking have to be, before it can be regarded as a potential, and therefore a horizontal, 
competitor?

392  Cases 56 and 58/64 EU:C:1966:41.
393  Case C-32/11 Allianz Hungária Biztosító EU:C:2013:160, para 43.
394  Cases  56  and  58/64  EU:C:1966:4;  see  similarly  Case  C-194/14  P  AC-Treuhand  v  Commission 

EU:C:2015:717, para 35.

395  See ch 2, ‘The single market imperative’, pp 51–52.
396  See eg Guess, Commission decision of 17 December 2018; Ancillary Sports Merchandise, Commission 
decision of 25 March 2019; Character Merchandise, Commission decision of 9 July 2019; Film Merchandise, 
Commission decision of 30 January 2020; Holiday Pricing, Commission decision of 21 February 2020.

397  For the sake of clarity it should be added that an agreement may be neither horizontal nor vertical 

where the parties have no functional relationship in any market.

398  See ch 15, ‘The Guidelines on Horizontal Cooperation Agreements’, pp 616–620.
399  See  ch  16,  ‘The  methodology  for  the  analysis  of  vertical  agreements  in  the  Commission’s  Vertical 

guidelines’, pp 665–666.

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123

(i)  Paroxetine: the meaning of potential competition
In Generics (UK) Ltd v Competition and Markets Authority400, often referred to as Paroxetine 
after the drug involved in that case, the Court of Justice handed down an important judg-
ment on the meaning of potential competition. This was an Article 267 reference from 
the UK Competition Appeal Tribunal (the ‘CAT’), which was hearing an appeal against 
a decision of the Competition and Markets Authority in which various undertakings had 
been fined for entering into so-called pay for delay agreements in the pharmaceuticals sec-
tor401. The Court of Justice held that, in order to determine whether an undertaking was 
a potential competitor of one or more other undertakings already present on the market:

it must be determined whether there are real and concrete possibilities of the former 
joining that market and competing with one or more of the latter402 (emphasis added).

The Court added that it would be insufficient to establish a potential competitive rela-
tionship from the ‘purely hypothetical possibility’ of entry, but equally that it was not 
necessary to demonstrate with certainty that a manufacturer would actually enter the 
market and that, having entered, it would be capable of retaining its place on the mar-
ket403. Rather, the assessment of potential competition must be carried out:

having regard to the structure of the market and the economic and legal context within 
which it operates404.

It is also relevant to consider the perception of the undertaking already on the market: if 
it perceives an undertaking outside the market to be a potential entrant, that may give rise 
to competitive pressure on the undertaking already established there405.

In a pay-for-delay case the owner of a patent, faced with a challenge to the validity of its 
patent by a producer of generic drugs intending to enter the market, settles the dispute or 
litigation on the basis that the generic company withdraws the challenge, agrees not to enter 
the market independently of the patent owner and receives in return a significant transfer of 
value (in cash or in kind406) from the patent owner. One question in such cases407 is whether 
the existence of the patent means, in itself, that the generic company cannot be considered 
a potential competitor of the patent owner, since it is unlawful to infringe a valid patent. 
The Court of Justice held that it is necessary to determine, first, whether the generic com-
pany has taken sufficient preparatory steps to enable it to enter the market, and, secondly, 
whether any barriers to entry are insurmountable. In the context of the pharmaceutical sec-
tor, where challenges by generic companies to the validity of patents are commonplace and 
where generic entry does occur, the patent did not in itself mean that there was an insur-
mountable barrier to entry by generic companies408. Furthermore, the facts that there was a 
genuine dispute between the parties, the outcome of which was uncertain409, and that they 
had entered into settlement agreements were themselves evidence of a potential competitive 
relationship between them410. In May 2021 the CAT upheld the findings of infringement in 
this case, but reduced the level of fines.

400  Case C-307/18 EU:C:2020:52.
401  Paroxetine, CMA decision of 12 February 2016; pay for delay agreements will be discussed in ch 19, 

‘“Pay for delay’ agreements’, pp 834–835.

402  Case C-307/18 EU:C:2020:52, para 36, citing Case C-234/89 Delimitis EU:C:1991:91, para 21.
403  Case C-307/18 EU:C:2020:52, para 38. 
406  An example of value ‘in kind’ would be the transfer of a restricted volume of the patent owner’s prod-

404  Ibid, para 39. 

405  Ibid, para 42.

uct and associated profit margins; this had happened in the Paroxetine case.

407  As will be seen in chapter 19, there have been several European Commission decisions in which pay 

for delay agreements have been scrutinised.

408  See Case C-307/18 EU:C:2020:52, paras 43–51.
409  Ibid, para 52. 

410  Ibid, para 55.

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Article 101(1)

(ii)  Cases on potential competition

The  issue  of  potential  competition  has  arisen  in  several  contexts  other  than  pay  for 
delay agreements411. In Visa Europe Ltd v Commission412 the question was whether Visa 
had illegally excluded Morgan Stanley from its card system; this depended on whether 
Morgan Stanley was a potential competitor to Visa in the acquiring market for Visa cards. 
The Commission had concluded that Morgan Stanley was a potential competitor because 
it had real and concrete possibilities to enter and that its exclusion was unlawful413; the 
decision was upheld on appeal to the General Court414.

In Telefónica/Portugal Telecom415 Telefónica agreed to acquire sole control of a Brazilian 
mobile telephony operator previously jointly controlled by both of them. The share pur-
chase agreement contained a non-compete clause whereby neither would compete with 
the  other  for  a  stated  period  of  time  in  any  telecommunications  business  in  Spain  or 
Portugal. The Commission considered this to be a horizontal market-sharing agreement 
that restricted competition by object, and imposed fines totalling in excess of €79 million. 
The Commission’s decision was upheld on substance on appeal to the General Court416, 
which was satisfied that the clause was a restriction by object, and that the non-compete 
clause was, in itself, strong evidence of the existence of potential competition between the 
parties417.

In  Toshiba  v  Commission  Toshiba  argued  that  it  was  not  party  to  a  geographical 
 market-sharing cartel whereby European and Japanese undertakings agreed not to enter 
each other’s markets for power transformers, essentially arguing that it was not an eco-
nomically  viable  strategy  for  a  Japanese  company  to  enter  the  European  market.  The 
Commission rejected this argument because there were no insurmountable barriers to 
entry, and its decision was upheld on appeal to the General Court418 and to the Court 
of Justice419. The Court of Justice pointed out that Toshiba was party to a ‘Gentlemen’s 
Agreement’ whereby producers of power transformers had regularly met over a four-year 
period: as in Paroxetine and Telefónica, this agreement in itself was ‘strong evidence’ of a 
competitive relationship between them420.

In European Night Services v Commission421 the General Court rejected a finding of 
the  Commission  that  the  establishment  of  a  joint  venture,  European  Night  Services, 
restricted potential competition between its parents; the Court considered this to be

a hypothesis unsupported by any evidence or any analysis of the structure of the relevant 
market from which it might be concluded that it represented a real, concrete possibility422.

The  issue  of  potential  competition  is  of  importance  in  various  other  situations.  One 
is when considering whether joint bidding in response to an invitation to tender may 
infringe Article 101; this is discussed in chapter 13 on cartels423. It is also an important 
concept when advising on the application of the Commission’s guidelines on horizontal 

411  Apart  from  the  cases  in  the  text,  potential  competition  was  an  important  issue  in  Case  T-360/09 
E.ON Ruhrgas and E.ON v Commission EU:T:2012:332 where the Commission’s finding that undertakings 
supplying gas were potential competitors on the German market was partially annulled: ibid paras 97–116.

412  Case T-461/07 EU:T:2011:181.
413  Morgan Stanley/Visa International and Visa Europe, Commission decision of 3 October 2007.
414  Case T-461/07 EU:T:2011:181, paras 162–197. 
416  Case T-216/13 Telefónica v Commission EU:T:2016:369, upheld on appeal to the Court of Justice Case 

415  Commission decision of 23 January 2013.

C-487/16 P EU:C:2017:961.

417  Case T-216/13 EU:T:2016:369, paras 208–227; see in particular para 218.
418  Case T-519/09 Toshiba v Commission EU:T:2014:263.
419  Case C-373/14 P Toshiba v Commission EU:C:2016:26. 
421  Cases T-374/94 etc EU:T:1998:198. 
423  See ch 13, ‘Collusive tendering’, pp 564–567.

422  Ibid, paras 139–147.

420  Ibid, para 33.

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125

cooperation  agreements  between  undertakings:  a  threshold  question  is  whether  the 
agreement is horizontal or not, and this often requires an assessment of whether the par-
ties are potential, if not actual, competitors424. It may also arise when advising on technol-
ogy transfer agreements425.

(c)  The ‘object or effect’ of preventing, restricting or distorting 
competition

Article 101(1) prohibits agreements ‘which have as their object or effect the prevention, 
restriction or distortion of competition’ (emphasis added). It is important to understand 
the significance of the words ‘object or effect’ in Article 101(1).

(i)  ‘Object or effect’ to be read disjunctively

It is clear that these are alternative, and not cumulative, requirements for a finding of 
an infringement of Article 101(1). In Société Technique Minière v Maschinenbau Ulm426 
the Court of Justice stated that the words object or effect were to be read disjunctively; 
this  means  that  where  an  agreement  has  as  its  object  the  restriction  of  competition  it 
is  unnecessary  to  prove  that  it  will  produce  anti-competitive  effects:  only  if  it  is  not 
clear that the object of an agreement is to restrict competition is it necessary to consider 
whether it might have the effect of doing so. This position has been restated by the Court 
of Justice on innumerable occasions, including in Gazdasági Versenyhivatal v Budapest 
Bank Nyrt427 at paragraphs 33 to 36. However, in that case the Court went on to hold that, 
even though it was possible for a competition authority to omit effects analysis where an 
agreement restricts competition by object, this does not mean that that authority cannot 
also find that an agreement has anti-competitive effects should it consider it appropriate 
to do so428. The Supreme Court of Hungary had asked the Court of Justice whether it was 
possible for the Hungarian Competition Authority to have concluded that multilateral 
interchange fees agreed upon by banks that participated in the Mastercard and Visa pay-
ment card systems restricted competition both by object and effect. The answer was that 
in principle this was permissible429.

(ii)  The ‘object’ and ‘effect’ boxes

The  distinction  between  object  and  effect  restrictions  can  be  depicted  pictorially  by 
thinking in terms of two boxes, as in Figure 3.1.

THE OBJECT BOX

THE EFFECTS BOX

Agreements that have as their object the
restriction of competition 

Agreements that have as their effect  the
restriction of competition  

Fig. 3.1

424  See  the  Commission’s  Guidelines  on  Horizontal  Cooperation  Agreements  OJ  [2011]  C  11/1,  para 
10 and fns 3 and 4; see further ch 15, ‘Purpose and scope of the Guidelines on Horizontal Cooperation 
Agreements’, pp 617–618.

425  See the Commission’s Technology Transfer guidelines OJ [2014] C 89/3; see further ch 19, ‘Horizontal 

agreements’, pp 822–823.

426  Case 56/65 EU:C:1966:38. 
429  There is a useful discussion of this topic in paras 18–36 of Advocate General Bobek’s opinion in this 

427  Case C-228/18 EU:C:2020:265. 

428  Ibid, para 40.

case, EU:C:2019:678.

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The text that follows will explore the still controversial topic of what constitutes a restric-
tion of competition by object, a concept that, after more than 50 years of EU competition 
law, continues to be hotly debated. Advocate General Bobek acknowledged the complex-
ity of this topic in his opinion in Gazdasági Versenyhivatal v Budapest Bank Nyrt430:

1. From the early days of EU competition law, much ink has been spilled on the dichotomy 
between restriction of competition by object and restriction by effect. It may thus come as a 
surprise that this distinction, stemming from the very wording of the prohibition in (what 
is now) Article 101 TFEU, still requires interpretation by the Court.

2. The distinction is relatively easy to make in theory. Its practical operation is nonetheless 
somewhat more complex. It is also fair to say that the case-law of the EU Courts has not 
always been crystal clear on the subject. Indeed, a number of decisions given by the EU 
Courts have been criticised in legal scholarship for blurring the distinction between the 
two concepts.

The Advocate General’s conclusion was stark:

49. . . . It is impossible to (or at least I am unable to) draw, in abstract terms, a bright line 
between (the second step of) an object analysis and an effects analysis431.

In this section, after discussing what is meant by a restriction of competition by object, 
an attempt will be made to describe the content of the object box as the law currently 
stands432.

(iii)  Why does Article 101(1) prohibit object restrictions without proof 
of anti-competitive effects?
Advocate General Kokott’s Opinion in T-Mobile433 includes an interesting discussion of 
why Article 101(1) makes a distinction between object and effect restrictions. First, the 
classification  of  certain  types  of  agreement  as  restrictive  by  object  ‘sensibly  conserves 
resources of competition authorities and the justice system’434. The fact that a competi-
tion authority does not need to demonstrate, for example, that a horizontal price-fixing 
agreement produces adverse economic effects relieves it of some of the burden that would 
otherwise rest upon it. Secondly, the Advocate General pointed out that the existence of 
object restrictions ‘creates legal certainty and allows all market participants to adapt their 
conduct accordingly’435, adding that, although the concept of restriction by object should 
not be given an unduly broad interpretation, nor should it be interpreted so narrowly as 
to deprive it of its practical effectiveness436. Thirdly, she pointed out that, just as a law that 
forbids people from driving cars when under the influence of alcohol does not require, for 
a conviction, that the driver has caused an accident—that is to say, proof of an effect—in 
the same way, Article 101(1) prohibits certain agreements that have the object of restrict-
ing competition, irrespective of whether they produce adverse effects on the market in an 
individual case437. Such agreements will be permitted, therefore, only where the parties 
can demonstrate that they will lead to economic efficiencies of the kind set out in Article 
101(3), and that a fair share of those efficiencies will be passed on to consumers.

430  Ibid.
431  See to similar effect the opinions of Advocate General Wahl in Case C-67/13 P Groupement des Cartes 
Bancaires  v  Commission  EU:C:2014:1958,  paras  44–62;  of  Advocate  General  Wathelet  in  Case  C-373/14 
P  Toshiba  Corp  v  Commission  EU:C:2015:427,  paras  55–91;  and  of  Advocate  General  Kokott  in  Case 
C-469/15 P FSL Holdings NV v Commission EU:C:2016:884, para 103.

432  See ‘The contents of the object box’, pp 132–136, later in this chapter.
433  Case C-8/08 EU:C:2009:110. 
435  Ibid. 
437  Ibid,  para  47;  see  similarly  para  136  of  AG  Geelhoed  in  Case  C-407/04  P  Dalmine  v  Commission 

434  Ibid, para 43. 

436  Ibid, para 44.

EU:C:2006:547 (Seamless steel tubes).

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(d)  Agreements that have as their object the prevention, restriction or 
distortion of competition

Numerous  issues  must  be  considered  when  trying  to  understand  what  is  meant  by  a 
restriction of competition by object and why the object–effect distinction exists438.

(i)  Meaning of ‘object’

The essential legal criterion for ascertaining whether coordination between undertak-
ings restricts competition by object is the finding ‘that such coordination reveals in itself 
a sufficient degree of harm to competition’439. The term ‘object’ in Article 101 means the 
objective meaning and purpose of the agreement considered in the economic context in 
which it is to be applied440. It is not necessary to prove that the parties have the subjective 
intention of restricting competition when entering into the agreement441. However, sub-
jective intention may be a relevant factor in assessing whether the object of an agreement 
is anti-competitive442. Where an agreement has an anti-competitive object, it does not 
cease to be characterised as such because it also has an alternative, lawful, purpose443. 
However, the Court of Justice has said that an object restriction may fall outside Article 
101(1)  where  there  is  an  objective  justification  for  it444,  for  example  the  protection  of 
health or safety.

Given that it is not necessary to demonstrate that an agreement that restricts competi-
tion by object produces adverse effects, it is obviously important to know what categories 
of agreement fall within the object box. One answer is that particular agreements restrict 
by object because the Court of Justice has said that they do: we therefore know, for exam-
ple, that horizontal price fixing or resale price maintenance do so. This, however, is an 
unsatisfying answer to the question, first because it does not explain how those agree-
ments were found to restrict by object in the first place and secondly because this answer 
provides no guidance as to how new types of agreement might be added to the box.

438  The following articles capture much of the writing on this subject: Jones ‘Left Behind by Modernisation? 
Restrictions by Object under Article 101(1)’ (2010) European Competition Journal 649; King ‘The Object 
Box: Law, Policy or Myth?’ (2011) 7 European Competition Journal 269; Bailey ‘Restrictions of Competition 
by Object under Article 101(1) TFEU’ (2012) 49 CML Rev 599; Mahtani ‘Thinking Outside the Object Box: 
An  EU  and  UK  Perspective’  (2012)  8  European  Competition  Journal  1;  King  Agreements  that  Restrict 
Competition by Object under Article 101(1) TFEU: Past, Present and Future (LSE, 2015), available at www.
lse.ac.uk; Colomo ‘The Divide Between Restrictions by Object and Effect’ (2016) 2 Competition Law Review 
173; Peeperkorn ‘Defining “By Object” Restrictions’ Concurrences No 3–2016, 54; Vandenborre and Rupp 
‘Restrictions  by  Object  or  Why  No  Restriction  has  Proven  More  Difficult  to  Define  than Those  that  are 
Obvious’ (2016) 9 Global Competition L Rev 25; MacCulloch ‘The “Public” Wrong of Cartels and the Article 
101 TFEU “Object Box”’ (2020) 65 Antitrust Bulletin 361.

439  Case C-67/13 P Groupement des Cartes Bancaires v Commission EU:C:2014:2204, para 57.
440  Cases 29/83 and 30/83 Compagnie Royale Asturienne des Mines SA and Rheinzinc GmbH v Commission 

EU:C:1984:130, paras 25–26.

441  Ibid; see similarly Case C-277/87 Sandoz Prodotti Farmaceutici v Commission EU:C:1989:363; Case 
T-148/89 Tréfilunion v Commission EU:T:1995:68, para 79 (Polypropylene); Case C-551/03 P General Motors 
BV v Commission EU:C:2006:229, paras 77–78.

442  Case C-32/11 Allianz Hungária Biztosító Zrt EU:C:2013:160, para 37; Case C-67/13 P Groupement des 
Cartes Bancaires EU:C:2014:2204, para 54; see similarly Case C-8/08 T-Mobile EU:C:2009:343, para 27; on 
the relevance of subjective intention see Odudu ‘Interpreting Article 81(1): Object as Subjective Intention’ 
(2001) 26 EL Rev 60 and Odudu ‘Interpreting Article 81(1): The Object Requirement Revisited’ (2001) 26 
EL Rev 379.

443  Case  C-551/03  P  General  Motors  BV  v  Commission  EU:C:2006:229,  para  64;  Case  C-209/07 
Competition Authority v Beef Industry Development Society Ltd EU:C:2008:643, para 21; the same point was 
made by the General Court in Case T-90/11 ONP v Commission EU:T:2014:1049, para 327.

444  Case C-439/09 Pierre Fabre Dermo-Cosmétique EU:C:2011:649, para 39; see also Guidelines on verti-

cal restraints OJ [2010] C 130/1, para 60.

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Article 101(1)

(ii)  The legal test for identifying restrictions by object
(a)  Introduction

As noted earlier, the essential criterion for identifying an object restriction is whether 
the coordination of conduct by undertakings reveals in itself a sufficient degree of harm 
to competition. Cases regularly occur in which the question of whether an agreement 
restricts by object falls to be determined; challenges in the Court of Justice to such a clas-
sification failed, for example, in Beef Industry Development Society445, GlaxoSmithKline 
v  Commission446,  T-Mobile447,  Pierre  Fabre448,  Football  Association  Premier  League449, 
Allianz Hungária Biztosító Zrt450, Lundbeck v Commission451, Philips v Commission452 and 
Hoffmann-La Roche453. The judgment in T-Mobile appeared to lay down a very wide test 
for allocating agreements to the object box: the Court said that, in order to ascribe an 
anti-competitive object to a concerted practice, ‘it is sufficient that it has the potential 
to have a negative impact on competition’, adding that the effects of such a practice are 
relevant only to the level of any fine or the award of damages to victims of the harm454. 
The Court in T-Mobile also said that, in order to find a restriction by object, it is not neces-
sary to demonstrate a direct effect on prices to end users: Article 101 is designed to pro-
tect the structure of the market and competition as such455. In a subsequent case, Allianz 
Hungária Biztosító Zrt456, the Court of Justice repeated the formulation in T-Mobile457 
and went on to hold that certain bilateral vertical agreements, entered into in a complex 
factual matrix, restricted competition by object458.

These judgments and others, including that of the General Court in Groupement des 
Cartes Bancaires459, gave the impression that the object box was steadily expanding, to 
a point where it no longer contained ‘obvious restrictions of competition such as price-
fixing, market-sharing or the control of outlets’: a formulation that had been used by the 
General Court in European Night Services v Commission460. The Commission’s practice 
of identifying ‘new’ object restrictions, for example in the ‘pay for delay’ cases, Lundbeck 
and Servier, in conjunction with its Notice on Agreements of Minor Importance of 2014461, 
in which it states that it regards all ‘hard-core’ restrictions in block exemptions as restric-
tions  by  object462,  added  to  the  impression  that  the  object  box  was  inexorably  getting 
larger.

445  Case  C-209/07  EU:C:2008:643;  for  comment  see  Odudu  ‘Restrictions  of  Competition  by  Object—

What’s the Beef?’ [2009] Comp Law 11.

446  Cases C-501/06 P etc EU:C:2009:610. 
448  Case C-439/09 EU:C:2011:649.
449  Cases C-403/08 and C-429/08 Football Association Premier League Ltd v QC Leisure EU:C:2011:631.
450  Case C-32/11 EU:C:2013:160.
451  Case T-472/13 EU:T:2016:449, upheld on appeal Case C-591/16 P EU:C:2021:243.
452  Case C-98/17 P EU:C:2018:774; see similarly Case C-99/17 P Infineon Technologies AG v Commission 

447  Case C-8/08 EU:C:2009:343.

EU:C:2018:773.

453  Case  C-179/16  F  Hoffmann-La  Roche  Ltd  v  Autorità  Garante  della  Concorrenza  e  del  Mercato 

EU:C:2018:25.

454  Case C-8/08 EU:C:2009:343, para 31; on the scope of this finding see the EFTA Court in Case E-3/16 

Ski Taxi SA v Norwegian Government, judgment of 22 December 2016, paras 52–55.

455  Case C-8/08 EU:C:2009:343, paras 36–39.
456  Case C-32/11 EU:C:2013:160. 
458  The case is discussed at ‘Allianz Hungária Biztosító’, p 135, later in this chapter.
459  Case T-491/07 EU:T:2012:633. 
461  OJ [2014] C 368/13; a Staff Working Document, SWD(2014) 198 final, accompanying the De Minimis 

460  Cases T-374/94 etc EU:T:1998:198.

457  Ibid, para 38.

Notice gives examples of object restrictions.

462  OJ [2014] C 368/13, para 13.

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(b)  groupement des cartes Bancaires

It  was  against  this  backdrop  that  the  Court  of  Justice  handed  down  its   judgment 
in  Groupement  des  Cartes  Bancaires  v  Commission  in  September  2014463.  The 
Commission464 and the General Court465 had held that a fee structure established by 
the nine main members of a payment card system, Cartes Bancaires, had the object and 
effect of restricting competition by preventing the entry of new banks into the sector. 
The Court of Justice annulled the finding of the General Court that the fee structure 
restricted competition by object on the basis that it had erred in law and remitted the 
matter to it to consider whether there was a restriction by effect. The Court of Justice 
rehearsed well-established law:

●  certain types of coordination between undertakings can be regarded, by their very 

nature, as being harmful to the proper functioning of competition466

●  some collusive behaviour, such as horizontal price fixing by cartels, is so likely to 
have negative effects that it is redundant to prove that it has actual effects on the 
market467

●  when deciding whether an agreement is restrictive of competition by object:

regard must be had to the content of [the agreement’s] provisions, its objectives and 
the economic and legal context of which it forms a part. When determining that con-
text, it is also necessary to take into consideration the nature of the goods or services 
affected, as well as the real conditions of the functioning and structure of the market 
or markets in question468

●  the essential criterion for ascertaining whether coordination between undertakings 
involves a restriction by object is the finding that such coordination reveals in itself 
a sufficient degree of harm to competition469.

Importantly, the Court of Justice added that the General Court had erred in law when 
concluding that the concept of a restriction of competition by object should not be inter-
preted restrictively: the Court of Justice’s view was that the concept should be limited 
to coordination which reveals a sufficient degree of harm to competition with the result 
that there is no need to examine its effects470. The idea that the concept should be given a 
restrictive interpretation was picked up by the EFTA Court in Ski Taxi SA v Norwegian 
Government471,  which  added  that  the  presumption  of  innocence  in  Article  6(2)  of  the 
European Convention on Human Rights means that, in a case of doubt as to whether an 
agreement restricts competition by object, the ‘benefit of the doubt’ should be given to 
the defendants472. The EFTA Court observed that only conduct whose harmful nature 
is ‘easily identifiable’, in the light of experience and economics, should be regarded as a 
restriction of competition by object473.

463  Case  C-67/13  P  EU:C:2014:2204;  the  Opinion  of  AG  Wahl  contains  a  valuable  discussion  of  the 
meaning of ‘object’: EU:C:2014:1958; see also the Opinions of AG Wathelet in Case C-373/14 P Toshiba v 
Commission EU:C:2015:427, paras 40–91 and of AG Saumandsgaard Øe in Case C-179/16 F Hoffmann-La 
Roche v AGCM EU:C:2017:714, paras 145–150.

464  Commission decision of 17 October 2007.
465  Case T-491/07 EU:T:2012:633.
466  Case C-67/13 P Cartes Bancaires v Commission EU:C:2014:2204, para 50. 
468  Ibid, para 53. 
471  Case E-3/16, judgment of 22 December 2016. 

472  Ibid, para 62. 

469  Ibid, para 57. 

470  Ibid, para 58.

467  Ibid, para 51.

473  Ibid, para 61.

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(c)  Comment on the cartes Bancaires judgment

The judgment in Cartes Bancaires is an important one, and has regularly been cited in 
judgments  since474:  it  provides  a  useful  template  for  deciding  whether  agreements  are 
restrictive of competition by object. Although for the most part Cartes Bancaires simply 
repeats the consistent jurisprudence of the Court of Justice over many years, there is a 
sense that the judgment ‘resets’ the law; or, at the very least, that the Court recognises that 
there must be some limits to what had seemed like the relentless expansion of the object 
box. The clear statement that the concept of an object restriction should be interpreted 
restrictively is significant in this respect. The Court of Justice referred to this point in 
Gazdasági  Versenyhivatal  v  Budapest  Bank  Nyrt475  before  proceeding  to  hand  down  a 
judgment that was highly sceptical that the agreement made by banks that participated in 
both the Visa and MasterCard schemes to fix uniform multilateral interchange fees were 
restrictive of competition by object476. Cartes Bancaires does not mean that it is not pos-
sible to add new types of agreement to the object box: in Paroxetine the Court of Justice 
explained the circumstances in which a pay for delay agreement could be restrictive by 
object477. However, it does mean that careful analysis is required before allocating cases 
to the object box.

(iii)  How much analysis is required to allocate cases to the object box?

Irrespective of how large or small the object box might be, there remains a riddle: how 
much analysis should be undertaken when determining whether a particular agreement 
belongs to one box or the other? As we have seen, the Court in Cartes Bancaires said that 
in order to decide this regard must be had to the terms of the agreement, its objectives, the 
economic and legal context of which it forms a part, the nature of the goods or services 
affected and the structure of the market or markets in question478. There is a danger that 
if this exercise requires extensive analysis it could undermine the very purpose of the 
object–effect distinction in the first place, which is to eliminate effects analysis in the case 
of object restrictions: a criticism of the Allianz Hungária judgment is that this is what the 
Court of Justice seemed to require, not least when it stated that it was necessary to take 
into account the structure of the market, the existence of alternative distribution chan-
nels and the respective importance and market power of the companies concerned479. In 
her Opinions in T-Mobile480 and FSL Holdings v Commission481 Advocate General Kokott 
warned against the risk of ‘mingling’ object and effects analysis, a point which was also 
made by the EFTA Court in Ski Taxi SA v Norwegian Government482.

The authors of this book agree that there is a risk that an extended review of the eco-
nomic and legal context in an object case might turn into effects analysis, which would 
undermine the object–effect distinction. It is, perhaps, with this risk in mind that the 
Court of Justice indicated in Toshiba v Commission483 and in FSL v Commission484 that 
the analysis of context may be ‘limited to what is strictly necessary in order to estab-
lish the existence of a restriction of competition by object’. In some cases there will be 

474  See eg Case C-228/18 Gazdasági Versenyhivatal v Budapest Bank Nyrt EU:C:2020:265, paras 51–54.
475  Case C-228/18 EU:C:2020:265, para 54.
476  The  Court  of  Justice  did  not  reach  a  conclusion  on  the  facts  of  this  case  as  it  was  an  Article  267 
reference  from  the  Hungarian  Supreme  Court;  in  2020  that  Court  remitted  the  case  to  the  Hungarian 
Competition Authority for further consideration.

477  Case C-307/18 Generics (UK) Ltd v CMA EU:C:2020:52, paras 59–111.
478  Case C-67/13 P EU:C:2014:2204, para 53. 
480  Case C-8/08 EU:C:2009:110, para 45. 
482  Case E-3/16, judgment of 22 December 2016, paras 58 and 63.
483  Case C-373/14 P EU:C:2016:26, para 29. 

479  Case C-32/11 EU:C:2013:160, para 48.
481  Case C-469/15 P EU:C:2016:884, para 103.

484  Case C-469/15 P EU:C:2017:308, para 107.

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a clear decisional practice that a particular type of agreement is restrictive by object—
for  example,  horizontal  price  fixing  or  market  sharing—in  which  case  little  analysis 
would be required; however, some other cases may be quite novel—for example, the pay 
for delay agreements in Paroxetine and the multilateral interchange fees in Gazdasági 
Versenyhivatal v Budapest Bank Nyrt—in which case deeper analysis will be required.

(iv)  Object restrictions and the de minimis doctrine

The treatment of object restrictions under the de minimis doctrine is dealt with separately 
later in this chapter485.

(v)  Is it possible to justify object restrictions under Article 101(3)?
As will be explained in chapter 4486, it is possible to justify an agreement that restricts 
competition by object under Article 101(3). This was stated by the General Court in Matra 
Hachette v Commission487 and was recognised by the Court of Justice in Beef Industry 
Development Society488, GlaxoSmithKline v Commission489 and Pierre Fabre490, although 
no final decision on the application of Article 101(3) was reached by the Court of Justice in 
any of those cases. Similarly, when Ski Taxi SA v Norwegian Government491 was referred 
back to the Supreme Court of Norway492 that Court noted that it was possible for the 
taxi companies to defend their object restriction on the basis of efficiencies under the 
Norwegian equivalent of Article 101(3).

Once it is recognised that object cases can be defended under Article 101(3), the classi-
fication of a particular type of agreement as falling within the ‘object box’ can be seen for 
what it is: a legal presumption, but a rebuttable one493. The presumption shifts the burden 
of proof from the Commission to the parties, and provides a structure within which to 
analyse agreements. Decisions and/or informal guidance finding that object agreements 
satisfy the conditions of Article 101(3) might lead to fewer cases in which undertakings 
challenge the object–effect distinction: this sometimes happens because of the misper-
ception that only restrictions by effect can benefit from Article 101(3)494.

485  See ‘The De Minimis Doctrine’, pp 145–148, later in this chapter.
486  See ch 4, ‘Any type of agreement can be defended under Article 101(3)’, pp 158–160.
487  Case T-17/93 EU:T:1994:89, para 85; see similarly Case C-439/09 Pierre Fabre Dermo-Cosmétique SA 

EU:C:2011:649, paras 49 and 57.

488  Case C-209/07 EU:C:2008:643: the case was remitted to the High Court in Ireland to consider whether 
the criteria of Article 101(3) were satisfied; however, BIDS withdrew its defence before the Court had made a 
decision on the matter: see Irish Competition Authority Press Release, 25 January 2011, available at www.tca.
ie; for comment see Odudu ‘Restrictions of Competition by Object—What’s the Beef?’ [2009] Comp Law 11.

489  Cases C-501/06 P etc EU:C:2009:610.
490  Case C-439/09 Pierre Fabre Dermo-Cosmétique EU:C:2011:649; note the Paris Court of Appeal sub-
sequently  held  that  Pierre  Fabre’s  ban  on  internet  sales  did  not  benefit  from  Article  101(3):  judgment  of 
31 January 2013.

492  Judgment of 22 June 2017, para 52.

491  Case E-3/16, judgment of 22 December 2016. 
493  On the use of presumptions see Bailey ‘Presumptions in EU Competition Law’ (2010) 31 ECLR 20 and 
Ritter ‘Presumptions in EU Competition Law’ (2018) 6 Journal of Antitrust Enforcement 189; see also the 
OECD Roundtable Safe Harbours and Legal Presumptions in Competition Law (December 2017), available at 
www.oecd.org/competition and The Pros and Cons of Presumptions (Swedish Competition Authority, 2020).
494  Note that the Competition Commission of Singapore, applying a provision that is substantially the 
same as Article 101, has on several occasions concluded that agreements that restricted competition by object 
produced  ‘net  economic  benefits’  and  were  therefore  lawful:  see  eg  United  Airlines,  Continental  Airlines 
and All Nippon Airways, 4 July 2011, available at www.ccs.gov.sg; see also the Australian Competition and 
Consumer Commission’s authorisation of minimum retail prices for power tools under the Competition 
and Consumer Act 2010, 5 December 2014, available at www.accc.gov.au.

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(vi)  Object restrictions and per se rules under the Sherman Act

Section 1 of the US Sherman Act 1890 characterises some agreements as per se illegal, 
whereas others are subject to so-called rule of reason analysis: application of the rule of 
reason requires a balancing of the pro-and anti-competitive effects of an agreement495. 
Where there is a per se infringement it is not open to the parties to the agreement to 
argue that it does not restrict competition: it belongs to a category of agreement that has, 
by law, been found to be restrictive of competition. There is an obvious analogy between 
an agreement that is per se illegal under the Sherman Act and one that is restrictive of 
competition by object under Article 101(1). However, there is an important difference 
between section 1 of the Sherman Act and Article 101 TFEU in that, even if an agree-
ment has as its object the restriction of competition, that is to say that it infringes Article 
101(1) per se, the parties can still attempt to justify it under Article 101(3). This possibil-
ity does not exist in US law, since there is no equivalent of Article 101(3) in that system. 
In this sense a judgment such as that of the US Supreme Court in Leegin496, in which it 
determined that minimum resale price maintenance should be analysed under the rule 
of reason rather than being per se illegal, brings US law into alignment with that of the 
EU: it has always been possible to argue that resale price maintenance satisfies Article 
101(3), even though it is classified as having as its object the restriction of competition for 
the purpose of Article 101(1)497.

(vii)  The contents of the object box
The Court of Justice in Competition Authority v Beef Industry Development Society Ltd498 
stated that the notion of restriction of competition by object cannot be reduced to an 
exhaustive list, and that it should not be limited just to the examples of anti- competitive 
agreements  given  in  Article  101(1)  itself499.  Ultimately  it  is  for  the  Court  of  Justice  to 
determine which agreements should be allocated to the object box. The Commission may 
decide  that  a  particular  type  of  agreement  restricts  by  object,  but  only  the  Court  can 
decide that this is the case as a matter of law. The text that follows attempts to state the 
position as it currently stands, and concludes with a summary of what can currently be 
found in the object box.

(a)  Price fixing and exchanges of information about prices

Price fixing is specifically cited as an example of an anti-competitive agreement in Article 
101(1)(a) of the Treaty, and it is unsurprising that it is characterised as having as its object 
the restriction of competition, whether horizontal500 or vertical501. The EFTA Court held 
in Ski Taxi SA v Norwegian Government502 that joint bidding for a contract by actual or 
potential competitors is capable of restricting competition by object as it restricts price 

495  For discussion of the rule of reason under US law see Areeda and Hovenkamp Antitrust Law: An 
Analysis of Antitrust Principles and Their Application (Kluwer, 4th ed, 2020), Vol VII, ch 15; Hovenkamp 
Principles of Antitrust (West Academic Publishing, 2nd ed, 2020), ch 5; Sullivan and Harrison Understanding 
Antitrust and its Economic Implications (Carolina Academic Press, 7th ed, 2021), ch 4.

496  Leegin Creative Leather Products Inc v PSKS Inc 551 US 877 (2007), reversing the earlier judgment of 
the Supreme Court in State Oil Co v Khan 522 US 3 (1997); see similarly Continental TV v GTE Sylvania 
433 US 36 (1977), where the Supreme Court overruled an earlier judgment, US v Arnold Schwinn & Co 388 
US 365 (1967), that had subjected non-price vertical restraints to a per se rule and instead subjected them 
to the rule of reason.

497  See ‘Is it possible to justify object restrictions under Article 101(3)?’, p 31, earlier in this chapter.
498  Case C-209/07 EU:C:2008:643. 
500  See ch 13, ‘Horizontal Price Fixing’, pp 547–558.
501  See ch 16, ‘Article 4(a): resale price maintenance’, pp 697–698.
502  Case E-3/16, judgment of 22 December 2016.

499  Ibid, para 23.

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competition. In T-Mobile503 the Court of Justice said that the exchange of information 
between competitors ‘is tainted with an anti-competitive object if the exchange is capable 
of removing uncertainties concerning the intended conduct of the participating under-
takings’504;  in  that  case  mobile  telephone  operators  exchanged  information  about  the 
remuneration that they intended to pay to their dealers for the services that they pro-
vided and this was found to restrict competition by object. In its Guidelines on Horizontal 
Cooperation Agreements505 the Commission says that it considers the exchange of infor-
mation between competitors of individualised data regarding intended future prices or 
quantities to be restrictive of competition by object506. In Bananas507 the General Court 
held that ‘pre-pricing communications’ in which competitors discussed price-setting fac-
tors relevant to the setting of future quotation prices amounted to object restrictions. In 
Forex508 two Commission decisions imposing fines totalling €1.07 billion on five banks 
concluded that exchanging sensitive information and trading plans and sometimes coor-
dinating strategies for foreign exchange spot trading was restrictive of competition by 
object. Other information exchanges require effects analysis509.

(b)  Market sharing, quotas, collective exclusive dealing

Market-sharing agreements are specifically mentioned in Article 101(1)(c), and again their 
treatment as restrictive by object is to be expected, in particular because they are likely to be 
harmful to the internal market510. There are numerous judgments of the EU Courts in which 
market-sharing agreements were held to restrict competition by object511. Agreements to 
limit output also belong to the object box: they are specifically referred to in Article 101(1)(b).  
In Competition Authority v Beef Industry Development Society Ltd512 the Court of Justice 
held that arrangements to enable several undertakings to implement a common policy of 
encouraging some of them to withdraw from the market in order to reduce overcapacity 
had the object of restricting competition513. The Commission, upheld by the EU Courts, 
has also characterised collective exclusive dealing as restricting competition by object514. 
It is irrelevant that the victim of a boycott is allegedly operating illegally on the market515.

504  Ibid, para 43. 

503  Case C-8/08 EU:C:2009:343. 
506  Ibid, para 74.
507  Case T-587/08 Fresh Del Monte Produce v Commission [2013] EU:T:2013:129, paras 293–585, dismiss-
ing an appeal against Commission decision of 15 October 2008, paras 263–277; the General Court’s judg-
ment was upheld on appeal to the Court of Justice Cases C-293/13 P etc EU:C:2015:416; similarly see Case 
T-240/17 Campine NV v Commission EU:T:2019:778, para 305 (Car battery recycling); Case T-758/14 RENV 
Infineon v Commission EU:T:2020:307, paras 87, 96 and 133 (Smart card chips).

505  OJ [2011] C 11/1.

508  Forex—Three Way Banana Split and Forex—Essex Express, Commission decisions of 16 May 2019; 

both were settlement decisions.

509  See  eg  Case  C-238/05  Asnef-Equifax  v  Asociación  de  Usuarios  de  Servcicios  Bancarios  (Ausbanc) 
EU:C:2006:734 and the Commission’s Guidelines on Horizontal Cooperation Agreements OJ [2011] C 11/1, 
paras 75–94; information agreements are discussed in ch 13, ‘Exchanges of information’, pp 568–576.

510  See ch 13, ‘Horizontal market sharing’, pp 558–562.
511  See  eg  Case  C-172/14  ING  Pensii  v  Consiliul  Concuretnei  EU:C:2015:484;  Case  C-373/14  P  Toshiba 
Corp v Commission EU:C:2016:26; Case T-216/13 Telefónica v Commission EU:T:2016:369, upheld on appeal 
to  the  Court  of  Justice  Case  C-487/16  P  EU:C:2017:961;  for  an  unusual  example  of  an  object  restriction 
to ‘reduce competitive pressure’ of one competing product on another see Case C-179/16 F Hoffmann-La 
Roche v AGCM EU:C:2018:25.

512  Case C-209/07 EU:C:2008:643. 
513  Ibid, paras 33–34.
514  See  eg  Nederlandse  Federative  Vereniging  voor  de  Grootlandel  op  Elektrotechnisch  Gebied  and 
Technische Unie (FEG and TU) OJ [2000] L 39/1, para 105, and the further examples given in fn 120 of that 
decision; the decision was upheld on appeal, Cases T-5/00 and 6/00 EU:T:2003:342 and on further appeal to 
the Court of Justice EU:C:2006:593.

515  Case  C-68/12  Protimonopolný  úrad  Slovenskej  republiky  v  Slovenská  sporiteľňa  a.s.  EU:C:2013:71, 

paras 19–21.

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(c)  Pay for delay agreements
In Paroxetine516 the Court of Justice held that a settlement of patent litigation in the phar-
maceutical sector could be restrictive of competition by object:

when it is plain from the analysis of the settlement agreement concerned that the transfers 
of value provided for by it cannot have any explanation other than the commercial interest 
of both the holder of the patent and the party allegedly infringing the patent not to engage 
in competition on the merits517.

In particular, the agreement must be characterised as a restriction by object if the value 
transferred from the patent owner to the potential competitor is sufficiently beneficial to 
encourage the latter to refrain from entering the market518. The Court added that, where 
the parties to a pay for delay agreement rely on its pro-competitive effects, those effects 
must, as elements of the context of that agreement, be duly taken into account for the 
purpose of its characterisation as a ‘restriction by object’519. The General Court held that 
the pay for delay agreements in Lundbeck v Commission520 and Servier v Commission521 
had as their object the restriction of competition.

(d)  Controlling outlets; export bans

The General Court in European Night Services v Commission referred to agreements to 
control outlets as containing obvious restrictions of competition; the control of outlets 
is not specifically referred to in Article 101(1), but the Court presumably had in mind 
the imposition on distributors of direct and/or indirect export bans from one Member 
State to another, which have consistently been found to have as their object the restric-
tion of competition522: nothing could be more obviously inimical to the goal of market 
integration than restrictions of this kind. In Consten and Grundig v Commission523 the 
Court of Justice held that an agreement conferring absolute territorial protection on a 
distributor had as its object the restriction of competition and did not satisfy the criteria 
of Article 101(3). The judgment of the General Court in GlaxoSmithKline v Commission524 
somewhat muddied this apparently simple point by suggesting that, in the specific and 
unusual conditions in which pharmaceutical products are bought and sold, an indirect 
export ban did not have as its object the restriction of competition525, although it did 
restrict competition by effect526. However, the Court of Justice reversed the judgment of 

516  Case C-307/18 Generics (UK) Ltd v Competition and Markets Authority EU:C:2020:52.
517  Ibid, para 87.
518  Ibid,  para  89;  for  comment  see  Ibáñez  Colomo  ‘The  Legal  Status  of  Pay-for-Delay  Agreements  in 
EU  Competition  Law:  Generics  (Paroxetine)’  (2020)  57  CML  Rev  1933  and  Zelger  ‘By  Object  or  Effect 
Restrictions—Reverse Payment Settlement Agreements in light of Lundbeck, Servier, and Generics’ (2020) 
11 JECLAP 273.

519  Case C-307/18 Generics (UK) Ltd v Competition and Markets Authority EU:C:2020:52, para 103; on 

the relevance of pro-competitive effects to ‘object’ see ibid, paras 104–107.

520  Commission  decision  of  19  June  2013,  upheld  on  appeal  to  the  General  Court  Cases  T-472/13  etc 
Lundbeck A/S v Commission EU:T:2016:449, upheld on further appeal to the Court of Justice Case C-591/16 
P Lundbeck A/S v Commission EU:C:2021:243.

521  Commission  decision  of  9  July  2014,  substantially  upheld  on  appeal  to  the  General  Court  Cases 
T-691/14 etc Servier v Commission EU:T:2018:922, on appeal to the Court of Justice Cases C-176/19 P and 
C-201/19 P, not yet decided.

522  See  eg  Case  19/77  Miller  International  Schallplaten  v  Commission  EU:C:1978:19,  paras  7  and  18; 
Case C-551/03 P General Motors BV v Commission EU:C:2006:229, paras 64–80; Cases T-175/95 etc BASF 
v Commission EU:T:1999:99, para 133; Case T-176/95 Accinauto SA v Commission EU:T:1999:10, para 104.

523  Cases 56 and 58/64 EU:C:1966:41.
524  Case T-168/01 GlaxoSmithKline Services v Commission EU:T:2006:265. 
526  Ibid, paras 148–192.

525  Ibid, paras 114–147.

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the General Court, repeating that an agreement aimed at prohibiting or limiting parallel 
trade has as its object the restriction of competition, and that that principle applies to the 
pharmaceutical sector as it does to any other527; the Court of Justice added that, in order 
to be found to restrict by object, it was not necessary to show that the agreement entailed 
disadvantages for final consumers528. In Mastercard II529 the Commission imposed a fine 
of €570 million on the eponymous card scheme for imposing rules that limited the pos-
sibility for merchants to make use of cross-border acquiring services, which it considered 
to be a restriction by object.

The Court of Justice has also held that the imposition of fixed or minimum resale prices 
on distributors is restrictive of competition by object530. The Court of Justice in AEG-
Telefunken AG v Commission531 regarded a selective distribution system as restrictive of 
competition by object unless it was operated in accordance with the Metro doctrine532. 
The Court did not actually use the expression ‘by object’ in this judgment, but this seems 
to have been what it meant and was the interpretation that it adopted in its judgment in 
Pierre Fabre533.

(e)  Allianz Hungária Biztosító
In  Allianz  Hungária  Biztosító534 the Court of Justice held that bilateral vertical agree-
ments  between  car  insurance  companies  and  car  repair  shops  concerning  the  hourly 
charge for car repairs, which incentivised the repairers to sell more insurance policies on 
behalf of the insurer contrary to Hungarian consumer law, would restrict by object where:

Following a concrete and individual examination of the wording and aim of those agree-
ments and of the economic and legal context of which they form part, it is apparent that 
they are, by their very nature, injurious to the proper functioning of normal competition 
on one of the two markets concerned.

With respect to the Court, it is far from obvious that such agreements are suitable for allo-
cation to the object box, and the analysis suggested by it seems to risk improperly inter-
mingling object and effect analysis. In addition, prior to this judgment the only vertical 
agreements to be allocated to the object box were export bans, resale price maintenance 
and selective distribution agreements; the addition of the agreements in Allianz increases 
the  range  of  vertical  agreements  found  to  restrict  by  object  and  might  be  regarded  as 
contravening the later pronouncement of the Court of Justice in Cartes Bancaires that the 
concept of an object restriction should be interpreted restrictively.

(f)  Benchmark manipulation

There is no doubt that the manipulation of a benchmark such as LIBOR is an egregious 
offence, particularly given that it is supposed to represent an objective fact, the daily bor-
rowing rate of money on wholesale markets. It is however a separate question whether 
such a manipulation infringes Article 101, and more specifically whether it restricts by 

527  Cases  C-501/06  P  etc  GlaxoSmithKline  Services  Unlimited  v  Commission  EU:C:2009:610,  paras  59 

and 60.

529  Commission decision of 22 January 2019, paras 62–80.

528  Ibid, paras 62–64. 
530  Case 161/84 Pronuptia de Paris GmbH v Schillgalis EU:C:1986:41, paras 23 and 25.
531  Case 107/82 EU:C:1983:293, para 34.
532  On the Metro doctrine see ch 16, ‘Selective distribution systems’, pp 674–678.
533  Case C-439/09 Pierre Fabre Dermo-Cosmétique SAS v Président de l’Autorité de la Concurrence and 

Ministre de l’Économie, de l’Industrie et de l’Emploi EU:C:2011:649, para 39.

534  Case  C-32/11  EU:C:2013:160;  for  criticism  of  this  judgment  see  Harrison  ‘The  Court  of  Justice’s 
Judgment in Allianz Hungária is Wrong and Needs Correcting’ [2013] CPI Antitrust Chronicle, May 14 (1); 
Nagy ‘The Distinction Between Anti-Competitive Object and Effect after Allianz: The End of Coherence in 
Competition Analysis?’ (2013) 36 World Competition 541.

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object.  In  Yen  Interest  Rate  Derivatives535,  Euro  Interest  Rate  Derivatives536  and  Swiss 
Franc  Interest  Rate  Derivatives537  the  Commission  characterised  the  manipulation  of 
benchmarks  as  having  as  its  object  the  restriction  of  competition  because  it  aimed  to 
distort the normal course of pricing components for interest rate derivatives. In Icap v 
Commission538 and HSBC v Commission539 the General Court endorsed the Commission’s 
view that the manipulation of a financial benchmark had an anti-competitive object; such 
conduct necessarily restricted competition to the colluding banks’ advantage and to the 
detriment of other operators on the market540.

Following the order of the text earlier, it seems that the contents of the ‘object’ box can 

be depicted as shown in Figure 3.2.541

Horizontal agreements:

•  to ﬁx prices

•  to exchange information that reduces uncertainty about future behaviour

•  to share markets or customers

•  to limit output, including the removal of excess capacity

•  to limit sales

•  for collective exclusive dealing

•  to pay competitors to delay the launch of competing products

•  to manipulate a ﬁnancial benchmark

Vertical agreements:

•  to impose ﬁxed or minimum resale prices

•  to impose export bans

•  selective distribution agreements that do not accord with the Metro

    doctrine

•  agreements of the kind under scrutiny in Allianz Hungária

Fig. 3.2  The object box

535  Commission decision of 4 February 2015.
536  Commission decisions of 4 December 2013 and 7 December 2016; the latter decision is the subject of 
three separate appeals: the decision was mostly upheld on substance but the fine was annulled on appeal 
Case  T-105/17  HSBC  Holdings  plc  v  Commission  EU:T:2019:675,  on  appeal  to  the  Court  of  Justice  Case 
C-883/19 P, not yet decided; the other appeals are Case T-106/17 JPMorgan Chase v Commission, not yet 
decided and Case T-113/17 Crédit agricole v Commission, not yet decided.

537  Commission decision of 21 October 2014.
538  Case T-180/15 EU:T:2017:795, para 72.
539  Case T-105/17 HSBC Holdings plc v Commission EU:T:2019:675, paras 85–113, on appeal to the Court 

of Justice Case C-883/19 P, not yet decided.

540  Case T-105/17 HSBC Holdings plc v Commission EU:T:2019:675, para 97.
541  It will be seen that the contents of the object box correspond to a large extent with the provisions 
that are blacklisted in Articles 4(a) and 4(b) of Regulation 330/2010 on vertical agreements (ch 16, ‘Article 
4(a): resale price maintenance’, pp 697–698, and ch 16, ‘Article 4(b): territorial and customer restrictions’, 
pp 698–702), Article 5 of Regulation 1217/2010 on research and development agreements (ch 15, ‘Article 4: 
duration of exemption and the market share threshold’, pp 625–626) and Article 4 of Regulation 1218/2010 
on specialisation agreements (ch 15, ‘Article 4: hard-core restrictions’, pp 630–631).

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(e)  Agreements that have as their effect the prevention, restriction or 
distortion of competition

(i)  Meaning of ‘effect’

Where it is not possible to say that the object of an agreement is to restrict competition, it 
is necessary to assess its effect on actual and potential competition before it can be found 
to infringe Article 101(1). For an agreement to have the effect of restricting competition, 
the Court of Justice in MasterCard v Commission542 observed that it must be:

liable to have an appreciable adverse impact on the parameters of competition, such as the 
price, the quantity and quality of the goods or services.

The Commission has explained that an agreement can have such an adverse impact ‘by 
appreciably reducing competition between the parties to the agreement or between any 
one of them and third parties’543.

A  restriction  by  effect  can  be  established  by  demonstrating  that  an  agreement  has 
had  actual  effects  on  competition;  however  it  is  also  relevant  to  take  into  considera-
tion any potential effects it might have544. The Court of Justice upheld a decision of the 
Commission in which it concluded that an agreement violated Article 101(1) because of 
potential effects in Deere v Commission545. In Krka v Commission546 an agreement had 
been entered into between Servier and Krka that, in the Commission’s opinion, had the 
object and effect of restricting competition by preventing generic entry into the market by 
Krka as an independent producer of perindopril; the Krka agreement was not a ‘simple’ 
pay for delay agreement of the kind that Servier had entered into with four other generic 
manufacturers. Krka was fined €10 million; Servier was fined €330.9 million for this and 
the four other agreements. In the Krka judgment the General Court annulled the find-
ing of restriction by object547; it also disagreed that the agreement restricted competi-
tion by effect548. In Krka the agreement in question had been implemented, and yet the 
Commission’s analysis turned on its assessment of its potential effects. The General Court 
held that this was wrong in principle, since to ignore the actual effects of the agreement 
was effectively to treat it as restrictive by object549.

(ii)  The need to establish a ‘counterfactual’

In determining whether an agreement has a restrictive effect on competition it is neces-
sary to establish a counterfactual. In MasterCard v Commission550 the Court of Justice 
said that it:

has repeatedly held that in order to determine whether an agreement is to be considered to 
be prohibited by reason of the distortion of competition which is its effect, the competition 
in question should be assessed within the actual context in which it would occur in the 
absence of the agreement in dispute.

542  Case C-382/12 P EU:C:2014:2201, para 93.
543  Guidelines on Horizontal Cooperation Agreements OJ [2011] C 11/1, para 27; on restrictive effects gen-
erally see paras 26–47; for discussion see Witt ‘The Enforcement of Article 101 TFEU: What Has Happened 
to Effects Analysis?’ (2018) 55 CML Rev 417; Ibáñez Colomo ‘Anticompetitive Effects in EU Competition 
Law’ (2021) 17 Journal of Competition Law & Economics, available at www.ssrn.com.

544  See eg Case C-1/12 Ordem dos Técnicos Oficiais de Contas EU:C:2013:127, para 71 and Case C-345/14 

Maxima Latvija EU:C:2015:784, para 30.
545  Case C-7/95 P EU:C:1998:256.
546  Case T-684/14 EU:T:2018:918, on appeal to the Court of Justice Case C-151/19 P Commission v Krka, 

not yet decided.

547  Case T-684/14EU:T:2018:918, paras 50–298. 
550  Case C-382/12 P EU:C:2014:2201, para 161.

548  Ibid, paras 299–470. 

549  Ibid, paras 361–368.

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This jurisprudence can be traced back to the STM judgment in 1966551. The need to exam-
ine the counterfactual was stressed by the General Court in O2 (Germany) GmbH & Co, 
OHG v Commission552, where it annulled a Commission decision553 finding that a roam-
ing agreement in the mobile telephony sector had the effect of restricting competition: 
the Commission had failed to show what the position would have been in the absence of 
the agreement, or that the agreement could have restrictive effects on competition554. In 
Generics (UK) Ltd v Competition and Markets Authority555 the Court of Justice said that 
the purpose of determining the counterfactual was to establish the realistic possibilities 
of the generic manufacturers of pharmaceutical products in the absence of the pay for 
delay agreements in that case.

(iii)  Effects analysis
In Brasserie de Haecht v Wilkin556 the Court of Justice said that:

it would be pointless to consider an agreement, decision or practice by reason of its effect 
if those effects were to be taken distinct from the market in which they are seen to oper-
ate, and could only be examined apart from the body of effects, whether convergent or 
not, surrounding their implementation. Thus in order to examine whether it is caught by 
Article [101(1)] an agreement cannot be examined in isolation from the earlier context, 
that is, from the factual or legal circumstances causing it to prevent, restrict or distort 
competition. The existence of similar contracts may be taken into consideration for this 
objective to the extent to which the general body of contracts of this type is capable of 
restricting the freedom of trade557.

In Maxima Latvija558 the Court of Justice emphasised that an assessment of effects must 
be based on a thorough analysis of the economic and legal context in which the agree-
ments at issue in the main proceedings occur and the specificities of the relevant market.
When deciding whether an agreement falls within the effects box, it is usually neces-

sary to consider five factors559:

●  the agreement and/or clause in the agreement that is said to constitute a restriction 

on competition

●  the relevant market or markets in which the effects should be assessed560
●  a theory of harm, that is to say, a theory as to how and why an agreement and/or 

clause is likely to have negative effects on competition

●  the counterfactual, as discussed above

●  the available evidence on the existence of the alleged effects.

In  some  cases,  effects  analysis  may  be  relatively  straightforward;  in  others  it  may  be 
more complex. A case which demonstrates the depth of analysis that may be required in 

551  See  Case  56/65  Société  Technique  Minière  v  Maschinendau  Ulm  EU:C:1966:38;  see  also  the 

Commission’s Guidelines on Horizontal Cooperation Agreements OJ [2011] C 11/1, para 29.

552  Case T-328/03 EU:T:2006:116.
553  T-Mobile Deutschland/O2 Germany: Network Sharing Rahmenvertrag OJ [2004] L 75/32.
554  Case T-328/03 EU:T:2006:116, paras 65–117. 
556  Case 23/67 EU:C:1967:54.
557  Ibid; see similarly Cases C-7/95 P etc John Deere v Commission EU:C:1998:256, paras 76 and 91 and 
Cases C-215/96 and C-216/96 Carlo Bagnsaco v BPN EU:C:1999:12, para 33; Case C-1/12 Ordem dos Técnicos 
Oficiais de Contas v Autoridade da Concorrencia EU:C:2013:127, para 70.

555  Case C-307/18 EU:C:2020:52, paras 118–121.

558  Case C-345/14 EU:C:2015:784, para 29.
559  Note that in some cases it may be possible to show anti-competitive effects by analysing the conduct 

of the parties to the agreement: Article 101(3) Guidelines (ch 3 n 509 earlier), para 27.

560  Case C-234/89 Delimitis EU:C:1991:91, para 13.

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determining whether an agreement has the effect of restricting competition is Delimitis 
v Henninger Bräu AG561. There the Court of Justice considered a provision in an agree-
ment between a brewery and a licensee of a public house owned by the brewery, whereby 
the licensee was required to purchase a minimum amount of beer each year. The licensee 
claimed that the agreement was void and unenforceable under Article 101. The Court of 
Justice said that beer supply agreements of the type under consideration do not have an 
anti-competitive object562. Instead it stressed that the agreement had to be considered 
in the context in which it occurred563. To begin with, it was necessary to define the rel-
evant product and geographic markets564: these were defined as the sale of beer in licensed 
premises (as opposed to beer sold in retail outlets) in Germany. Having defined the mar-
kets, the Court said that it was necessary to determine whether access to the market was 
impeded: could a new competitor enter the market, for example by buying an existing 
brewery together with its network of sales outlets or by opening new public houses565? If 
the answer was that access to the market was impeded, it was necessary to ask whether 
the agreements entered into by Henninger Bräu contributed to that foreclosure effect, 
for example because of their number and duration566. Only if the answer to both of these 
questions was yes could it be held that Article 101(1) was infringed. The analysis suggested 
in this case was specific to the issues raised by beer supply agreements, and is not neces-
sarily the same as would have to be applied, for example, to restrictive covenants taken 
on the sale of a business or to the rules of a group purchasing association. However, the 
important point about the judgment is its requirement that a full analysis of the agree-
ment in its market context must be carried out before it is possible to determine whether 
its effect is to restrict competition.

(f)  Objective necessity
(i)  Jurisprudence on objective necessity

An  undertaking  or  undertakings  accused  of  participating  in  agreements  that  violate 
Article  101  sometimes  argue  as  a  defence  that  the  agreement,  and/or  the  restrictive 
clauses in it, were objectively necessary to the achievement of a legitimate purpose567. 
The Court of Justice has recognised a defence of objective necessity on numerous occa-
sions. In Société Technique Minière v Maschinenbau Ulm568 the Court of Justice held that 
an exclusive licence granted to a distributor might not infringe Article 101(1) where this 
seemed to be ‘really necessary for the penetration of a new area by an undertaking’569. In 
LC Nungesser KG v Commission570 the Court held that an open exclusive licence of plant 
breeders’ rights would not infringe Article 101(1) where, on the facts of the case, the licen-
see would not have risked investing in the production of maize seeds at all without some 
immunity from intra-brand competition571. In Coditel v Ciné Vog Films SA (No 2)572 the 
Court held that an exclusive copyright licence to exhibit a film in a Member State would 
not necessarily infringe Article 101(1), even where this might prevent transmission of that 

561  Case C-234/89 EU:C:1991:91, para 13; see similarly Case C-214/99 Neste Markkinointi Oy v Yötuuli 

EU:C:2000:679; Case T-65/98 Van den Bergh Foods Ltd v Commission EU:T:2003:281, paras 75–119.

563  Ibid, para 14.

562  Case C-234/89 EU:C:1991:91, para 13. 
564  Ibid, paras 16–18; on market definition see ch 1, ‘Market definition’, pp 22–39.
565  Case C-234/89 EU:C:1991:91, paras 19–23. 
566  Ibid, paras 24–27.
567  On objective necessity in UK cases see ch 9, ‘Objective necessity’, p 367.
568  Case 56/65 EU:C:1966:38, p 250.
569  Cf Cases 56 and 58/64 Consten and Grundig v Commission EU:C:1966:41, on which see ‘Controlling 
outlets, export bans’, pp 134–135, earlier in this chapter; on the single market imperative see ch 2, ‘The 
single market imperative’, pp 51–52.
570  Case 258/78 EU:C:1982:211. 
572  Case 262/81 EU:C:1982:334.

571  See ch 19, ‘Patent licences: territorial exclusivity’, pp 814–815.

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Article 101(1)

film by cable broadcasting from a neighbouring Member State, where this was necessary 
to protect the investment of the licensee. In Pronuptia de Paris v Schillgalis573 the Court 
of Justice held that many restrictive provisions in franchising agreements designed to 
protect the intellectual property rights of the franchisor and to maintain the common 
identity of the franchise system fall outside Article 101(1). In Erauw-Jacquery Sprl v La 
Hesbignonne  Société  Coopérative574  the  Court  of  Justice  held  that  a  provision  prevent-
ing a licensee from exporting basic seeds protected by plant breeders’ rights could fall 
outside Article 101(1) where it was necessary to protect the right of the licensor to select 
his licensees. In Gøttrup-Klim Grovvareforeninger v Dansk Landbrugs Grovvareselskab 
AmbA575 the Court held that a provision in the statutes of a cooperative purchasing asso-
ciation, forbidding its members from participating in other forms of organised coopera-
tion which were in direct competition with it, did not necessarily restrict competition, 
and may even have beneficial effects on competition576.

A  defence  of  objective  necessity  was  unsuccessful  in  MasterCard  v  Commission577, 
where the Court of Justice rejected MasterCard’s argument that the multilateral inter-
change fee charged by an issuing bank to an acquiring bank when making payment to it 
was objectively necessary to the creation of the payment card system. MasterCard argued 
that there had to be a default mechanism in place to determine what fee was payable in the 
absence of agreement between the issuing and acquiring banks; therefore the agreement 
did not restrict competition at all. The Court’s view was that where the agreement in ques-
tion ‘is simply more difficult to implement or even less profitable without the restriction 
concerned’ the test of objective necessity would not be satisfied; in such cases the restric-
tion should be tested under the ‘indispensability’ criterion in Article 101(3)578.

(ii)  The objective necessity defence and the rule of reason

In US law, agreements that are not per se illegal are subject to rule of reason analysis, 
requiring a balancing of the pro- and anti-competitive effects of the agreement to deter-
mine its compatibility with section 1 of the Sherman Act579. Critics of what was perceived 
to be the over-inclusiveness of Article 101 often argued that a rule of reason should be 
applied under Article 101(1)580. The EU Courts have consistently rejected the idea that 
there is a rule of reason within Article 101(1). In Métropole télévision v Commission581 the 
General Court said:

in various judgments the Court of Justice and the [General] Court have been at pains to 
indicate that the existence of a rule of reason in [EU] competition law is doubtful582.

573  Case 161/84 EU:C:1986:41.
574  Case  27/87  EU:C:1988:183;  see  similarly  the  Commission’s  decision  in  Sicasov  OJ  [1999]  L  4/27, 

para 53–61.

575  Case C-250/92 EU:C:1994:413.
576  Ibid,  paras  35–45;  the  Court  of  Justice  subsequently  applied  Gøttrup-Klim  in  Case  C-399/93 
Luttikhuis v Verenigde Coöperatieve Melkindustrie Coberco BA EU:C:1995:434, paras 14 and 18; so did the 
Commission in P&I Clubs OJ [1999] L 125/12, paras 66ff.

577  Case C-382/12 P EU:C:2014:2201; see also Mastercard II, Commission decision of 22 January 2019, 

para 76, rejecting a defence of objective necessity in that case.

578  Case C-382/12 P EU:C:2014:2201, para 91; note that under Article 101(3) the question is whether the 
restriction is indispensable to achieve the economic efficiency claimed, that is to say, an improvement in the 
production or distribution of goods or in technical or economic progress.

579  See ‘Object restrictions and per se rules under the Sherman Act’, pp 132 earlier in this chapter.
580  Many of the authors cited in n 387 above argued to this effect.
581  Case T-112/99 EU:T:2001:215: for comment on this case see Manzini ‘The European Rule of Reason—

Crossing the Sea of Doubt’ (2002) 23 ECLR 392.
582  Case T-112/99 EU:T:2001:215, para 72.

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The Court went on to say that the pro- and anti-competitive aspects of an agreement 
should be considered under Article 101(3)583. In the General Court’s view:

Article [101(3)] would lose much of its effectiveness if such an examination had to be car-
ried out already under Article [101(1)] of the Treaty584.

The same point was made by the Court of Justice in Generics (UK) Ltd v CMA585. To put 
the point another way, the objective necessity defence is not an application of a US-style 
rule of reason; ‘balancing’ is something that is effected through the application of Article 
101(1) and 101(3). Of course the Commission and the EU Courts should be ‘reasonable’ 
when applying Article 101(1), but this is not the same as saying that they should apply a 
US-style rule of reason.

(g)  The Wouters doctrine
In Wouters v Algemene Raad van de Nederlandsche Orde van Advocaten586 Mr Wouters 
challenged  a  rule  adopted  by  the  Dutch  Bar  Council  that  prohibited  lawyers  in  the 
Netherlands from entering into partnership with non-lawyers: Wouters wished to prac-
tise  as  a  lawyer  in  a  firm  of  accountants.  A  number  of  questions  were  referred  to  the 
Court of Justice as to the compatibility of such a rule with EU competition law. In its 
judgment the Court stated that a prohibition of multi-disciplinary partnerships ‘is liable 
to limit production and technical development within the meaning of Article [101(1)(b)] 
of the Treaty’587; it also considered that the rule had an effect on trade between Member 
States588. However, at paragraph 97 of its judgment the Court stated:

However, not every agreement between undertakings or any decision of an association 
of undertakings which restricts the freedom of action of the parties or of one of them 
necessarily falls within the prohibition laid down in Article [101(1)] of the Treaty. For the 
purposes of application of that provision to a particular case, account must first of all be 
taken of the overall context in which the decision of the association of undertakings was 
taken or produces its effects. More particularly, account must be taken of its objectives, 
which are here connected with the need to make rules relating to organisation, qualifica-
tions, professional ethics, supervision and liability, in order to ensure that the ultimate 
consumers of legal services and the sound administration of justice are provided with 
the necessary guarantees in relation to integrity and experience . . . It has then to be con-
sidered whether the consequential effects restrictive of competition are inherent in the 
pursuit of those objectives589.

The early part of the Wouters judgment reads as though the Court would conclude that 
Article 101(1) was infringed, whereas from paragraph 97 onwards it explains why Article 
101(1) would not be infringed if the rule in question could ‘reasonably be considered to 

584  Ibid. 

585  Case C-307/18 EU:C:2020:52, para 104.

583  Ibid, para 74. 
586  Case C-309/99 EU:C:2002:98; for comment see Vossestein (2002) 39 CML Rev 841; Monti ‘Article 81 
EC and Public Policy’ (2002) 39 CML Rev 1057; O’Loughlin ‘EC Competition Rules and Free Movement 
Rules: An Examination of the Parallels and their Furtherance by the Court of Justice Wouters Decision’ 
(2003)  24  ECLR  62;  Loozen  ‘Professional  Ethics  and  Restraints  of  Competition’  (2006)  31  EL  Rev  28; 
Forrester  ‘Where  Law  Meets  Competition:  Is  Wouters  Like  Cassis  de  Dijon’  in  Ehlermann  and  Atansiu 
(eds) European Competition Law Annual 2004: The Relationship Between Competition Law and the (Liberal) 
Professions (Hart, 2006), 271; see also the judgment of the High Court in Ireland that the Medical Council 
of Ireland was not subject to competition law when making and applying professional rules in Hemat v The 
Medical Council [2006] IEHC 187; the case is noted by Ahern at (2007) 28 ECLR 366.

587  Case C-309/99 EU:C:2002:98, para 90; see also paras 86 and 94. 
589  To similar effect see Case T-144/99 Institut des Mandataires Agréés v Commission EU:T:2001:105, para 78.

588  Ibid, para 95.

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Article 101(1)

be necessary in order to ensure the proper practice of the legal profession, as it is organ-
ised in [the Netherlands]’590. The judgment means that, in certain cases, it is possible to 
balance non-competition objectives against a restriction of competition, and to conclude 
that the former outweigh the latter, with the consequence that there is no infringement 
of Article 101(1).

Wouters was concerned with ‘deontological’ (that is to say, professional ethical) rules 
for  the  regulation  of  the  legal  profession;  it  has  since  been  considered  in  other  cases 
involving professional services, such as OTOC591 and Italian Geologists592. The Court 
of Justice applied Wouters in Meca-Medina v Commission593, where it held that sport-
ing rules in principle were subject to competition law scrutiny, but that they would fall 
outside Article 101 where they satisfied the principles in Wouters. In Meca-Medina the 
Court concluded that the anti-doping rules of the International Swimming Federation 
had a legitimate objective: to combat drugs in order for competitive sport to be con-
ducted fairly, including the need to safeguard equal chances for athletes, athletes’ health, 
the integrity and objectivity of competitive sport and ethical values in sport594; the Court 
went on to decide that the restrictions of competition inherent in the rules were propor-
tionate595.  In International  Skating  Union  v  Commission596  the  General  Court  agreed 
with the Commission’s decision597 in which it concluded that the ISU’s eligibility rules 
were manifestly disproportionate to the objective of the protection of the integrity of 
speed skating.

(H)  Article 106(2)

Article 106(2) precludes the application of the competition rules to undertakings in so far 
as compliance with them would obstruct them in the performance of a task entrusted to 
them by a Member State. This subject is dealt with in chapter 6598.

(i)  State compulsion and highly regulated markets

The competition rules do not apply to undertakings in so far as they are compelled by 
law to behave in a particular way: this is sometimes referred to as the ‘state compulsion’ 
defence; nor do they apply where a legal framework leaves no possibility for competitive 
activity on the part of undertakings, that is to say, where they operate on highly regu-
lated markets. These two defences have often been invoked, but they are narrowly applied 

590  Case C-309/99 EU:C:2002:98, para 107.
591  Case C-1/12 Ordem dos Técnicos Oficiais de Contas EU:C:2013:127.
592  Case C-136/12 Consiglio nazionale dei geologi EU:C:2013:489; see further ONP, Commission deci-
sion of 8 December 2010, paras 684–691, upheld on appeal on this point Case T-90/11 ONP v Commission 
EU:T:2014:1049; Cases C-184/13 etc API EU:C:2014:2147, paras 46–57; Cases C-427/16 etc CHEZ Elektro 
Bulgaria AD EU:C:2017:890, paras 54–55.

593  Case C-519/04 P EU:C:2006:492; see Weatherill ‘Anti-Doping Revisited—The Demise of the Rule of 
“Purely Sporting Interest”?’ (2006) 27 ECLR 645; see similarly UEFA, Commission Press Release IP/02/942, 
27 June 2002.

594  Case C-519/04 P EU:C:2006:492, paras 42–45. 
596  Case T-93/18 EU:C:2020:610, paras 90–95, 103 and 110–111, on appeal to the Court of Justice Case 

595  Ibid, paras 47–56.

C-124/21 P, not yet decided.

597  International Skating Union’s Eligibility Rules, Commission decision of 8 December 2017.
598  See ch 6, ‘Article 106(2)’, pp 246–251.

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and almost invariably fail599. Where undertakings genuinely have no room for autono-
mous behaviour they would not be liable for infringing Article 101600; however, the posi-
tion would alter if a decision to disapply the national legislation has been taken and has 
become definitive601. An argument that the Italian sugar market was so highly regulated 
that there was no scope for competition succeeded in Suiker Unie v Commission602.

The law was summarised by the Court of Justice in Deutsche Telekom v Commission603, 
where Deutsche Telekom (‘DT’) argued (in an Article 102 case) that it was not guilty of 
an illegal margin squeeze because its behaviour was approved by the German regula-
tor of the electronic communications sector. The Court rejected the defence because DT 
retained the right to adjust its prices for the retail sale of broadband internet access ser-
vices and thereby bring the margin squeeze to an end: approval by the regulator did not 
deprive DT of its ability to behave autonomously. The Court of Justice summarised the 
law at paragraph 80 of its judgment604:

According to the case-law of the Court of Justice, it is only if anti-competitive conduct is 
required of undertakings by national legislation, or if the latter creates a legal framework 
which itself eliminates any possibility of competitive activity on their part, that Articles 
[101 TFEU and 102 TFEU] do not apply. In such a situation, the restriction of competition 
is not attributable, as those provisions implicitly require, to the autonomous conduct of 
the undertakings. Articles [101 TFEU and 102 TFEU] may apply, however, if it is found 
that the national legislation leaves open the possibility of competition which may be pre-
vented, restricted or distorted by the autonomous conduct of undertakings.

The  Court’s  judgment  cited  several  earlier  judgments,  in  particular  pointing  out  that 
there is no defence where national law merely encourages or makes it easier for undertak-
ings to engage in autonomous anti-competitive conduct605.

(J)  Commission Notices

A number of Commission Notices provide guidance on the application of Article 101(1) 
to various types of agreement; it might be helpful to provide a checklist of these Notices.

599  The  ‘state  compulsion’  defence  was  rejected  in  Wood  Pulp  I  OJ  [1985]  L  85/1;  ENI/Montedison  OJ 
[1987] L 5/13, para 25; Aluminium Products OJ [1985] L 92/1; SSI OJ [1982] L 232/1, upheld on appeal to 
the Court of Justice Cases 240/82 etc SSI v Commission EU:C:1985:488; French-West African Shipowners’ 
Committee OJ [1992] L 134/1, paras 32–38; and in Case T-513/93 CNSD v Commission EU:T:2000:91, paras 
58–59;  see  also  Cases  C-359/95  and  379/95  P  Commission  v  Ladbroke  Racing  EU:C:1997:531,  para  33; 
Case  T-228/97  Irish  Sugar  v  Commission  EU:T:1999:246,  para  130;  Airfreight,  Commission  decision  of  9 
November 2010; the ‘highly regulated markets’ defence was rejected in Cases 209/78 etc Van Landewyck v 
Commission EU:C:1980:248, paras 126–134; Cases 240/82 etc SSI v Commission EU:C:1985:488, paras 13–37 
and Case 260/82 NSO v Commission EU:C:1985:489, paras 18–27; Greek Ferry Services Cartel OJ [1999] L 
109/24, paras 98–108, upheld on appeal Cases T-56/99 etc Marlines SA v Commission EU:T:2003:333; French-
West Africa Shipowners’ Committees OJ [1992] L 134/1; Cases T-202/98 etc Tate & Lyle plc v Commission 
EU:T:2001:185, paras 44–45; Spanish Raw Tobacco, Commission decision of 20 October 2004, paras 349–
356; Raw Tobacco Italy, Commission decision of 20 October 2005, paras 315–324; Bananas, Commission 
decision of 15 October 2008, paras 272, 279, 292, 306, 308, upheld on appeal Cases T-587/08 etc Fresh Del 
Monte  Produce  v  Commission  EU:T:2013:129,  paras  377–418,  and  on  further  appeal  Cases  C-293/13  and 
C-294/13 P EU:C:2015:416; E.ON/GDF Suez, Commission decision of 8 July 2009, paras 293–297.

600  See eg Case T-387/94 Asia Motor France v Commission EU:T:1996:120, paras 78–100.
601  See Case C-198/01 CIF EU:C:2003:430, paras 54ff.
602  Cases 40/73 etc EU:C:1975:174; see also Case T-325/01 Daimler Chrysler v Commission EU:T:2005:322, 

para 156.

603  Case C-280/08 P EU:C:2010:603.
604  See also para 22 of the Commission’s Guidelines on the applicability of Article 101 TFEU to horizontal 

co-operation agreements OJ [2011] C 11/1.

605  The  Court  cites  Cases  40/73  etc  Suiker  Unie  v  Commission  EU:C:1975:174,  paras  36–73  and  Case 

C-198/01 CIF EU:C:2003:430 para 56 for this proposition.

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Article 101(1)

(i)  Notice on sub-contracting agreements
Article 101(1) does not apply to some sub-contracting agreements606.

(ii)  Notice on the application of the competition rules to cross-border credit 
transfers
This Notice has specific application in the banking sector607.

(iii)  Notice on the application of the competition rules to the postal sector
This Notice has specific application in the postal sector608.

(iv)  Notice on the application of the competition rules to access agreements in 
the telecommunications sector
This Notice has specific application in the telecommunications sector609.

(v)  Notice regarding restrictions directly related and necessary to the 
concentration
Article 101(1) does not apply to ancillary restrictions610; this Notice is specifically of rel-
evance to the analysis of concentrations under the EUMR, but it provides useful insights 
into the Commission’s thinking more generally611.

(vi)  Notice on agreements of minor importance
This Notice is concerned with the de minimis doctrine and is examined later612.

(vii)  Guidelines on the effect on trade concept contained in Articles [101 and 102 
TFEU]

These are important in determining the jurisdictional scope of Article 101 and are exam-
ined later613.

(viii)  Guidelines on the application of Article [101(3) TFEU]

These  Guidelines  are  predominantly  concerned  with  the  application  of  Article  101(3); 
however, paragraphs 13 to 37 discuss the principles under Article 101(1)614.

(ix)  Guidelines on the application of Article 101 TFEU to technology transfer 
agreements

These Guidelines deal at length with the application of Article 101(1) and Article 101(3) to 
technology transfer agreements and technology pools615.

(x)  Commission Consolidated Jurisdictional Notice

Article 101 does not apply to full-function joint ventures, which are dealt with under the 
provisions on merger control: this is explained in Chapter 21616. Paragraphs 91 to 109 
examine the concept of full functionality617.

607  OJ [1995] C 251/3. 
  610  OJ [2005] C 56/244.

606  OJ [1979] C 1/2. 
609  OJ [1998] C 265/2. 
611  The Notice is discussed in ch 21, ‘Jurisdiction’, pp 876–900. 
613  OJ [2004] C 101/81. 
615  OJ [2014] C 89/3: see ch 19, ‘Technology transfer agreements: Regulation 316/2014’, pp 820–829.
616  See Ch 21, ‘Joint ventures—the concept of full-functionality’, pp 880–882. 

614  OJ [2004] C 101/97.

  608  OJ [1998] C 39/2.

612  OJ [2014] C 368/13.

617  OJ [2008] C 95/1.

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(xi)  Guidelines on vertical restraints

These Guidelines deal with the application of Article 101(1) and Article 101(3) to vertical 
agreements.  Paragraphs  12  to  21  of  these  Guidelines  provide  specific  guidance  on  the 
application of Article 101(1) to agreements between principal and agent618.

(xii)  Guidelines on horizontal cooperation agreements

These Guidelines deal with the application of Article 101(1) and Article 101(3) to horizon-
tal cooperation agreements619.

5.  The De Minimis Doctrine

(A)  Introduction

The de minimis doctrine was first formulated by the Court of Justice in Völk v Vervaecke620: 
agreements that affect competition within the terms of Article 101(1) will nevertheless not 
be caught where they do not have an appreciable impact either on inter-state trade or on 
competition621. This rule of double appreciability—an appreciable impact both on trade 
between Member States and on competition—has been repeated by the Court many times 
since, most recently in Expedia Inc v Autorité de la Concurrence622. However, the Expedia 
judgment introduced an important refinement: the Court held at paragraph 37 that an 
agreement that restricts competition by object and that has an effect on trade between 
Member  States  automatically  violates  Article  101(1)  without  any  need  to  demonstrate 
concrete effects on competition: in other words, the Court abandoned the test of double 
appreciability for object restrictions623.

The Commission has provided guidance on the issue of appreciability in two docu-
ments:  its  Guidelines  on  the  effect  on  trade  concept  contained  in  Articles  [101  and  102 
TFEU] are discussed in the next section624; and the Commission published a new Notice 
on Agreements of Minor Importance, revised to give expression to the Expedia judgment, 
in June 2014625. The Commission has also published a Staff Working Document626 on 
object restrictions for the purposes of the De Minimis Notice.

(B)  The Commission’s Notice on Agreements of Minor Importance

(i)  Part I of the Notice: introductory paragraphs

Part I of the Notice contains important statements on the application of the de minimis 
doctrine.  Paragraph  1  refers  to  the  case-law  of  the  Court  of  Justice  on  appreciability. 
Paragraph 2 states that the de minimis doctrine does not apply to object restrictions, cit-
ing the Expedia judgment. Paragraph 3 explains that the Notice uses market share thresh-
olds for determining when a restriction of competition is not appreciable. It points out 

618  OJ [2010] C 130/1; see ch 16, ‘Commercial agents’, pp 654–657.
619  OJ [2011] C 11/1; see ch 15, ‘The Guidelines on Horizontal Cooperation Agreements’, pp 616–620.
620  Case 5/69 EU:C:1969:35.
621  Note that an agreement that does not infringe Article 101 may nevertheless infringe the law of one 

(or more) of the Member States.

622  Case C-226/11 EU:C:2012:795, para 16.
623  For comment see González ‘Restrictions by Object and the Appreciability Test: The Expedia Case, 
a Surprising Judgment or a Simple Clarification?’ (2013) 34 ECLR 457; King ‘How Appreciable is Object? 
The De Minimis Doctrine and Case C-226/11 Expedia Inc v Autorité de la concurrence’ (2015) 11 European 
Competition Journal 1.

624  See ‘The effect on trade between Member States’, pp 148–153, later in this chapter.
626  SWD(2014) 198 final, available at www.ec.europa.eu.
625  OJ [2014] C 291/1. 

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ANNEX 2 

A. 

JUDGMENTS OF THE GENERAL COURT AND THE COURT OF JUSTICE 

Gøttrup-Klim e.a. Grovvareforeninger v Dansk Landbrugs Grovvareselskab 

(1994) 

1. 

Facts: Dansk Landbrugs Grovvareselskab AmbA (‘DLG’) was a Danish cooperative 

purchasing association.  DLG made collective purchases on behalf of its members of 

basic  products  for  agriculture,  in  particular  fertilizers  and  pesticides.  DLG  then 

supplied those basic products to its members, together with a wide range of ancillary 

services, such as financial and insurance services. DLG’s market share of the selling 

market  for  fertilizers  was  36%;  its  share  of  the  selling  market  for  pesticides  was 

32%. A provision in the statutes of DLG forbade its members from participating in 

other forms of organised cooperation that were in direct competition with it. Gøttrup-

Klim  was  one  of  37  members  who  were  expelled  for  breaching  the  ban  on  dual 

membership. The expelled members challenged the legality of DLG’s statutes in a 

Danish  court.  The  case  was  referred  to  the  Court  of  Justice  in  a  reference  under 

Article 267 TFEU.1 

2.  Outcome:  The  Court  of  Justice  held  that  the  activities  of  cooperative  purchasing 

associations may, depending on the size of their membership, constitute a significant 

counterweight to the contractual power of large producers and make way for more 

effective competition.2  If some members belonged to two competing cooperatives, 

the result would be to make each association less capable of pursuing its objectives.3  

It  followed  that  DLG’s  ban  on  dual  membership  did  not  necessarily  restrict 

competition,  and  may  even  have  had  beneficial  effects  on  competition.4    It  was 

necessary  to  consider  the  effect  of  the  provision  on  the  market;  it  would  not  be 

caught by Article 101(1) if it was restricted to what was necessary to ensure that the 

cooperative could function properly and maintain its contractual power in relation to 

the suppliers with which it had to deal.5 

1  

2  

3  

4  

5  

Case C-250/94 EU:C:1994:413. 

Ibid, para 32. 

Ibid, para 33. 

Ibid, para 34. 

Ibid, para 35. 

1 

 
 
                                                 
3.  Object and/or effect of restricting competition: Neither: while the application 

of the law to the facts was a matter for the national court to decide when the case 

was referred back to it, the Court of Justice’s judgment is clear that it considered 

that  the  ban  on  dual  membership  was  objectively  necessary  for  the  proper 

functioning of the cooperative and, as such, fell outside Article 101 provided that it 

was no more restrictive than necessary for that purpose. 

4. 

Fines: None.  This case arose from private litigation in the Danish courts. 

5. 

Sector:  The  buying  market  was  the  purchase  of  basic  agricultural  products, 

including, notably, fertilizers and pesticides.  The selling market was the supply of 

those basic agricultural products to members of DLG which, in turn, resold them to 

individual farmers. 

6. 

Type  of  joint  purchasing:  DLG  was  a  cooperative  purchasing  association.    DLG 

provided a range of services to its own members, which included collectively buying 

and  supplying  various  basic  products,  such  as  animal  feeds,  cereals,  fertilizers, 

pesticides,  seeds,  to  its  members  and  a  number  of  ancillary  services,  such  as 

processing and marketing of cereals, financial and insurance services; and research 

concerning animal feeds and the quality and hardiness of vegetable species. 

7. 

Theory of harm/benefit/reason why no harm to competition: The ban on dual 

membership did not result in a restriction of competition because it was objectively 

necessary  to  ensure  that  DLG  functioned  properly  and  maintained  its  bargaining 

strength in relation to suppliers.6 

8.  Was secrecy a relevant consideration? No. 

9. 

Comment:  This  is  the  most  important  judgment  of  the  Court  of  Justice  on  joint 

purchasing.  It  recognises  the  legitimate  and  pro-competitive  purpose  that  joint 

purchasing can have where this is a way of countervailing the market power of large 

suppliers.  The judgment confirms that a ban on dual membership could be defended 

on the basis that it was objectively necessary to the achievement of that legitimate 

purpose, provided that any restrictions are limited to what was necessary. 

6  

Ibid, para 45. 

2 

 
                                                 
AOK Bundesverband v Ichthyol-Gesellschaft Cordes (2004) 

10.  Facts:  Most  employees  in  Germany  are  required  to  belong  to  a  statutory  health 

insurance system.  Statutory health insurance is provided by sickness funds.  The 

funds  buy  medical  services  and  products  directly  and  supply  them  in  kind  to  the 

insured  persons  who  need  them.    German  law  provides  for  the  funds  jointly  to 

determine  the  maximum  price  (‘fixed  amounts’)  they  pay  for  certain  medicinal 

products.    In  theory  pharmaceutical  companies  could  set  a  price  above  the  fixed 

amounts, with the result that the insured person pays the excess.  In practice only 

7%  of  medicinal  products  to  which  a  fixed  amount  applies  are  sold  at  a  price 

exceeding  the  fixed  amount.    Several  pharmaceutical  companies  challenged  the 

compatibility  of  the  fixed  amounts  with  Article  101  TFEU.  The  Bundesgerichtshof 

referred several questions to the Court under Article 267 TFEU. 

11.  Outcome: Having concluded that the sickness funds were organised on the basis of 

a  principle  of  solidarity,  and  were  therefore  not  economic  in  nature,  the  Court  of 

Justice  held  that  they  were  not  acting  as  undertakings  or  associations  of 

undertakings  when  setting  the  fixed  amounts.7    This  was despite  the  existence  of 

some  degree  of  competition  between  the  funds,  deliberately  introduced  by  the 

national legislature.  It is interesting to note, however, that Advocate General Jacobs 

reached  a  different  conclusion.8    In  his  opinion,  the  funds  were  associations  of 

undertakings decisions and that their decisions to fix maximum purchase prices for 

medicinal  products  was  a  restriction  by  object.9    He  also  considered  that  these 

decisions had anti-competitive effects by coordinating a large part of demand and 

having a very clear impact on the prices charged by pharmaceutical companies in 

Germany.10 

12.  Object and/or effect  of  restricting  competition:  Neither:  the  Court  of  Justice 

held  that  the  sickness  funds  were  not  acting  as  undertakings  or  associations  of 

undertakings and therefore their activities fell outside the scope of Articles 101 and 

102 TFEU. 

13.  Fines: None: this case arose from private litigation in the German courts. 

7  

8  

9  

Cases C-264/01 etc EU:C:2004:150. 

Cases C-264/01 etc EU:C:2003:304. 

Ibid, para 70. 

10  

Ibid, para 71. 

3 

 
 
                                                 
14.  Sector:  The  buying  market  was  the  purchase  of  medicinal  products  in  Germany.  

The selling market was the supply of those products to the insured persons who need 

them. 

15.  Type of joint purchasing: The German social security code laid down a two-step 

procedure  for  determining  the  fixed  amounts.    First,  the  Federal  Committee  of 

Doctors and Sickness Funds (the Bundesausschuss) chose the medicinal products to 

which  fixed  amounts  were  to  apply.    Secondly,  the  associations  of  sickness  funds 

jointly determined uniform fixed amounts for each category of medicinal products.   

16.  Theory  of  harm/benefit/reason  why  no  harm  to  competition:  Advocate 

General Jacobs considered that the fixed amounts should be prohibited ‘in the light 

of  their  potential  to  suppress  the  price  of  purchased  products  to  below  the 

competitive  level,  with  negative  consequences  for  the  supply  side  of  the  relevant 

market’.11   

17.  Was secrecy a relevant consideration? No. 

18.  Comment: The Court of Justice decided that Article 101 TFEU had no application in 

this case because the sickness funds were not undertakings. However the case is of 

interest  in  that  Advocate  General  Jacobs,  who  considered  that  the  sickness  funds 

were undertakings, was of the opinion that their decisions to fix maximum purchase 

prices for medicinal products were restrictive of competition by object.  In reaching 

this conclusion he relied on the explicit wording of Article 101(1)(a) which refers to 

the fixing of buying prices; he also referred to economic theory that says that the 

fixing  of  purchase  prices  would  take  them  below  the  competitive  level.    He  also 

considered that the setting of fixed amounts introduced a ‘type of anti-competitive 

effect  not  previously  seen  on  the  German  market  for  medicinal  products,  by 

coordinating a large part of demand on that market’.12   

T-Mobile v Raad van bestuur van de Nederlandse Mededingingsautoriteit 

(2009) 

19.  Facts:  Five  mobile  phone  operators  in  the  Netherlands  –  T-Mobile,  Orange,  KPN, 

Vodafone  and  O2  –  held  a  meeting  on  13  June  2001  at  which  they  discussed  a 

proposed reduction of standard dealer remunerations for post-paid subscriptions for 

mobile phones.  The matter came to the attention of the Dutch competition authority, 

11  

12  

Ibid, para 70. 

Ibid, para 71. 

4 

 
 
                                                 
which decided that the discussions amounted to an agreement or concerted practice 

that had as its object the restriction of competition and imposed fines.13  There were 

appeals  that  culminated  in  an  reference  by  a  Dutch  court  to  the  Court  of  Justice 

under Article 267 TFEU. 

20.  Outcome: The Court of Justice held that the exchange of price information between 

competitors at a single meeting could give rise to a concerted practice that had as 

its  object  the  restriction  of  competition.14    It  was  for  the  national  court  to  decide 

whether the information exchanged at the meeting removed uncertainties about ‘the 

timing, extent and details of the modifications’ to be adopted by the mobile phone 

companies and therefore had an anti-competitive object.15 

21.  Object and/or effect of restricting competition: This was an object case.  

22.  Fines: Yes, after the preliminary reference, the total fines were €16.2 million. 

23.  Sector: The buying market was the purchase of mobile phone dealers’ services. The 

selling market was for retail supply of post-paid subscriptions to end-consumers of 

mobile telephony services. 

24.  Type of joint purchasing: There was not a case of joint purchasing. T-Mobile was 

concerned  with  the  unlawful  exchange  of  information,  in  this  case  about  the 

possibility of reducing the standard commissions paid by mobile phone companies to 

dealers. 

25.  Theory of harm/benefit/reason why no harm to competition: The theory of 

harm  appears  to  have  been  that  the  exchange  of  purchase  price  information  was 

capable of removing uncertainties between the mobile phone operators as regards a 

reduction in the standard commission paid to dealers.  As Advocate General Kokott 

said in her opinion ‘such exchange of confidential commercial information between 

competitors concerning their intended market behaviour is capable, in principle, of 

generating an anti-competitive impact because it reduces or removes the degree of 

uncertainty  as  to  the  operation  of  the  market  in  question  with  the  result  that 

competition between undertakings is restricted’.16 

13  

14  

15  

16  

Case C-8/08 EU:C:2009:343, para 13. 

Ibid, paras 43 and 61. 

Ibid, para 42. 

Case C-8/08 EU:C:2009:110, para 51. 

5 

 
                                                 
26.  Was secrecy a relevant consideration? No. 

27.  Comment:  This  was  a  reference  for  a  preliminary  ruling  pursuant  to  Article  267 

TFEU, in which the Court of Justice’s role is to rule on the interpretation of the law, 

while leaving its application to the facts to the national court.  That said, the Court 

of Justice was clear that an exchange of information between competitors is tainted 

with an anti-competitive object if the exchange is capable of removing uncertainties 

concerning the intended conduct of the participating undertakings.17  It is interesting 

to note in passing that the likely effect of the information exchanged would appear 

to  have  been  to  reduce  prices  paid  by  end-consumers  (since  the  mobile  phone 

operators were discussing a reduction in the remuneration that they paid to dealers).  

However, the Court clearly stated that there does not need to be a direct link between 

a  concerted  practice  and  consumer  prices  in  order  for  that  practice  to  pursue  an 

anti

competitive object.18  In the Court’s view, Article 101 is designed to protect not 

only  the  immediate  interests  of  individual  competitors  or  consumers  but  also  to 

‑

protect the structure of the market and thus competition as such.19 

FNCBV v Commission (‘French Beef’) (2003) 

28.  Facts: In October 2000 cases of ‘mad cow disease’ were discovered in the United 

Kingdom and subsequently in other Member States.  This created a crisis in the beef 

sector:  consumption  declined,  prices  fell  and  there  was  a  sharp  drop  in  French 

imports  and  exports.   In  October  2001,  after  several  weeks  of violent  protests by 

farmers and pressure from the French Minister for Agriculture, six French federations 

entered into an agreement in the beef sector. Four of the federations represented 

farmers  and  the  two  others  represented  slaughterers.  The  six  federations  agreed 

jointly  to  set  a  minimum  purchase  price  for  beef  and  to  suspend  or  at  least  limit 

imports  of  all  types  of  beef.    The  agreement  continued  beyond  the  end  of 

November 2001, the date on which it was supposed to end, despite the fact that the 

Commission had warned the federations on 25 November 2001 that the agreement 

was unlawful. 

29.  Outcome:  In  April  2003  the  Commission  decided  that  there  was  an  agreement 

between  associations  of  undertakings  that  had  as  its  object  the  restriction  of 

17  

18  

19  

Case C-8/08 EU:C:2009:343, para 43. 

Ibid, para 39. 

Ibid, para 38. 

6 

 
 
                                                 
competition.20  The agreement between farmers’ and slaughterers’ representatives 

was aimed at setting minimum prices for the purchase of culled cows in France and, 

as  such,  contravened  Article  101(1)(a).21    The  agreement  by  which  the  parties 

promised  not  to  import  beef  products  originating  in  the  other  Member  States 

partitioned the single market, which was incompatible with Article 101(1).  On appeal 

the General Court upheld the Commission’s finding of an infringement by object, but 

reduced the fines imposed on the federations.  According to the General Court, the 

agreement of 24 October 2001, by its very nature, restricted competition ‘by limiting 

artificially  the  commercial  negotiating  margin  of  farmers  and  slaughterers  and 

distorting the formation of prices in the markets in question.’22  The General Court’s 

judgment was upheld by the Court of Justice.23 

30.  Object and/or effect of restricting competition: This was an object case. 

31.  Fines: The Commission imposed fines totalling €16.7 million on the six federations 

of farmers and slaughterers in the French beef industry. The fines were reduced on 

appeal to €11.97 million.24   

32.  Sector:  The  buying  market  was  the  purchase  of  certain  categories  of  cattle  in 

France.    The  selling  market  was  the  sale  of  beef  products  to  final  consumers  in 

France. 

33.  Type of joint purchasing: This was not a case of joint purchasing. French Beef was 

a cartel.   

34.  Theory of harm/benefit/reason why no harm to competition: The theory of 

harm appears to have been that the agreement eliminated the process of competition 

that ought to have determined prices for, and imports of, beef in France. 

35.  Was secrecy a relevant consideration? The agreement was continued in secret 

after the Commission had warned the federations that it was unlawful. This was not 

20  

21  

22  

23  

Commission Decision of 2 April 2003, paras 102–130. 

Ibid, paras 124–125. 

Case  T-217/03  and  T-245/03  Fédération  nationale  de  la  coopération  bétail  and  viande  v 
Commission EU:T:2006:391, para 85. 

Cases  C-101/07  P  and  C-110/07  P  Coop  de  France  bétail  et  viande  v  Commission 
EU:C:2008:741. 

24  

Case T-217/03 and T-245/03 FNCBV v Commission EU:T:2006:391, para 364. 

7 

 
                                                 
relevant to the finding that the agreement restricted competition by object; however 

it was treated as an aggravating factor leading to an increase in the level of the fine. 

36.  Comment:  The  Commission  and  the  EU  Courts  had  no  doubt  that  the  minimum 

purchase  prices  and  suspension  of  imports  of  beef  into  France  had  the  object  of 

restricting competition.  What made the case unusual were the circumstances that 

precipitated  these  agreements,  namely  the  collapse  in  the  demand  for  beef  as  a 

result of the ‘mad-cow’ crisis in the UK and elsewhere, the plight of French farmers 

who were faced with falling slaughterhouse prices and the ensuing violent protests 

carried out by farmers.25 A further mitigating circumstance was the intervention of 

the  French  Minister  for  Agriculture  who  had  cajoled  some  of  the  slaughterers  into 

signing the unlawful agreement and who subsequently described that agreement as 

‘an act of good citizenship’.26 

Deltafina v Commission (‘Spanish Raw Tobacco’) (2004) 

37.  Facts:  All  of  the  major  processors  of  tobacco  in  Spain  –  Cetarsa,  Agroexpansión, 

WWTE, Taes – and Deltafina, an Italian processor, which was also the main purchaser 

of Spanish raw tobacco, agreed (a) to fix the maximum prices to be paid to growers 

for each variety and grade of raw tobacco; (b) to share the quantities of raw tobacco 

that each of them would buy; and (c) to exchange information on purchase prices 

and quantities.27  These secret cartel arrangements were in place from 1996 to 2001.  

During the same period unions representing domestic tobacco growers engaged in 

their own collective price setting when negotiating with the processors in Spain.28 

38.  Outcome: In October 2004 the Commission decided that the processors had entered 

into a buyer cartel to fix prices, share quantities and exchange sensitive information 

that had  as  its  object  the  restriction  of  competition.29    The  Commission’s  decision 

was  substantially  upheld  on  appeal,  although,  as  noted  below,  the  General  Court 

reduced some of the fines.30  The judgments of the General Court were all upheld on 

25  

26  

27  

28  

29  

30  

Ibid, para 356–361. 

Ibid, para 33. 

Commission decision of 20 October 2004, paras 1 and 278–295. 

Ibid, paras 2 and 318–325. 

Ibid, paras 299–314. 

Case  T-24/05  Alliance  One  v  Commission  EU:T:2010:453;  Case  T-29/05  Deltafina  v 
Commission  EU:T:2010:355;  Case  T-33/05  Cetarsa  v  Commission  EU:T:2011:24;  Case  T-
38/05  Agroexpansión  v  Commission  EU:T:2011:585;  Case  T-37/05  World  Wide  Tobacco 
España v Commission EU:T:2011:76. 

8 

 
 
                                                 
appeal to the Court of Justice.  31  The judgments deal with issues such as duration 

of participation in the cartel, parental liability, and the size of the fines; they do not 

address the substantive law on purchasing agreements and Article 101.  The General 

Court  agreed  with  the  Commission  that  this  case  involved  a  ‘very  serious’ 

infringement.32 

39.  Object and/or effect of restricting competition: This was an object case. 

40.  Fines:  The  Commission  imposed  fines  of  €20  million  on  the  five  raw  tobacco 

processors;  the  relatively  small  size  of  the  fines  reflected  the  small  size  of  the 

Spanish raw tobacco market.  On appeal the General Court these were reduced to 

€13.22 million.  

41.  Sector: The buying market was the purchase of raw tobacco in Spain.  The selling 

market was the sale of processed tobacco in Spain and elsewhere. 

42.  Type of joint purchasing: This was not a case of joint purchasing. Spanish Raw 

Tobacco was a buyer cartel. The agreements and concerted practices related to the 

maximum prices that the processors would pay for raw tobacco and the quantities 

that  they  would  buy.  There  were  also  extensive  and  recurrent  exchanges  of 

information. 

43.  Theory  of  harm/benefit/reason  why  no  harm  to  competition:  Aside  from 

noting  that  the  cartel  had  fixed  purchase  prices  and  shared  quantities  within  the 

meaning of Article 101(1)(a) and (b), the Commission found that the raw tobacco 

processors ‘managed to align as closely as possible the final prices they would pay 

to the producers and to reduce them for their own benefit to a level below that which 

would result from the free interplay of competition’.33 This suggests that the theory 

of harm was the distortion of the competitive process. 

31  

32  

33  

Case  C-537/10  P  Deltafina  v  Commission  EU:C:2011:475;  Case  C-181/11  P  Cetarsa  v 
Commission EU:C:2012:455; Case C-668/11 P Alliance One v Commission EU:C:2013:614; 
Case C-240/11 P World Wide Tobacco España v Commission EU:C:2012:269; Cases C-628/10 
P and C-14/11 P Alliance One (formerly Standard Commercial Corp) and Standard Commercial 
Tobacco v Commission EU:C:2012:479. 

Case T-29/05 Deltafina v Commission EU:T:2010:355, para 239. 

Commission decision of 20 October 2004, para 301. 

9 

 
                                                 
44.  Was secrecy a relevant consideration? This was not relevant to the finding that 

the agreement restricted competition by object; however secrecy contributed to the 

finding that the infringement was ‘very serious’, which affected the level of the fine.34 

Airfreight (2010) and (2017) 

45.  Facts: 11 airlines providing airfreight services coordinated their fuel surcharges and 

security surcharges on airfreight services from, to and, in the case of some carriers, 

within the EEA.  The airlines initially contacted each other in order to impose a flat 

rate  ‘fuel  surcharge’  per  kilo  for  all  shipments  worldwide.    Thereafter  their  illicit 

cooperation extended to introducing a ‘security surcharge’ and agreeing not to pay 

commission  on  those  surcharges  to  their  freight  forwarders,  who  were  their 

customers.35   

46.  Outcome: In November 2010 the Commission found a single cartel, constituting a 

single  and  continuous  infringement  of  Article  101  TFEU,  of  Article  53  EEA  and  of 

Article 8 of the Swiss Agreement.  In particular, the Commission decided that the air 

cargo  carriers  had  coordinated  their  pricing  behaviour  and  that  this  amounted  to 

price fixing prohibited by Article 101(1)(a) TFEU.36  In the Commission’s view, the 

‘cartel  arrangements  permeated  the  whole 

industry 

for  airfreight.  Senior 

management in the head offices of a 

47.  number of airlines conceived, directed and encouraged them. They operated to the 

benefit of the participating airfreight service providers and to the detriment of their 

customers and ultimately the general public.’37  The Commission’s 2010 decision was 

annulled by the General Court on procedural grounds;38 however, the Commission 

readopted its decision in relation to 11 air cargo carriers in 2017.39  The 2017 decision 

has also been appealed to the General Court and judgments are awaited.40 

34  

35  

36  

37  

38  

39  

40  

Ibid, paras 406–414. 

Commission decision of 9 November 2010, paras 97–98, 715, 725, 748, 753, 766, 777, 875 
and 940. 

Ibid, para 899. 

Ibid, para 1175. 

Cases T-9/11 etc Air Canada v Commission EU:T:2015:994. 

Decision of 17 March 2017; a non-confidential version of this decision has not been published. 

Case T-326/17 etc Air Canada v Commission, not yet decided. 

10 

 
 
                                                 
48.  Object and/or effect of restricting competition: This was an object case.41 

49.  Fines: The Commission imposed fines totalling €799 million on 11 air cargo carriers.  

In December 2015 the General Court annulled the 2010 decision in 11 appeals; the 

Commission readopted its decision in 2017 and imposed total fines of €776 million.42  

50.  Sector: The buying market appears to have been the purchase of freight forwarding 

services.  The selling market was the market for air cargo, which was European-wide 

for 

intra-European  cargo  and  on  a  continent-to-continent  basis 

for  the 

intercontinental transport of cargo. 

51.  Type of joint purchasing: This was not a case of joint purchasing. Airfreight was 

a cartel, which included an element of purchaser price-fixing. 

52.  Theory  of  harm/benefit/reason  why  no  harm  to  competition:  The 

Commission  noted  (i)  horizontal  price-fixing  of  any  kind  is  prohibited  by 

Article 101(1)(a)  TFEU;  (ii)  price  is  the  main  instrument  of  competition,  and  so 

arrangements  between  competitors  that  coordinate  their  behaviour  in  order  to 

remove uncertainty in respect of pricing matters are, by their very nature, restrictive 

of competition;43 and (iii) ‘by refusing to pay commission the carriers ensured that 

surcharges  did  not  become  subject  to  competition  through  the  negotiation  of 

discounts with customers.’44 

53.  Was  secrecy  a  relevant  consideration?  The  cartel  was  secret,  but  this  did  not 

affect either the finding of restriction by object or the level of the fines. 

Transcatab v Commission (‘Italian Raw Tobacco’) (2005) 

54.  Facts:  Four  major  Italian  tobacco  processors  –  Deltafina,  Mindo,  Transcatab  and 

Romana Tabacchi – agreed their overall strategy for purchasing raw tobacco between 

1995 and 2002.  In particular, they agreed maximum purchase prices to be paid to 

tobacco growers; they allocated suppliers on a preferential or exclusive basis; and 

they engaged in bid-rigging of auctions held by public authorities.45  Separately, the 

41  

42  

43  

44  

45  

Decision of 9 November 2010, para 894. 

The fine was lower because the turnover of one airline (Martinair) was lower in 2016 than it 
was in 2009. 

Decision of 9 November 2010, para 900. 

See Summary of Commission Decision of 9 November 2010, OJ [2014] C 371/11, para 11. 

Commission decision of 20 October 2005, paras 1 and 240–242. 

11 

 
 
                                                 
Italian trade associations of respectively processors and tobacco growers – APTI and 

UNITAB – negotiated minimum prices to be inserted into ‘cultivation contracts’ at the 

beginning of each season between 1999 and 2001.46 

55.  Outcome: In October 2005 the Commission found that Deltafina, Mindo, Transcatab 

and Romana Tabacchi had entered into agreements and/or concerted practices that 

aimed  at  fixing  the  trading  conditions  for  the  purchase  of  raw  tobacco  in  Italy  in 

respect of both direct purchases from producers and purchases from third packers.  

The setting of common purchase prices, the allocation of suppliers and quantities, 

and  the  exchange  of  information  to  co-ordinate  their  competitive  purchasing 

behaviour all had as their object the restriction of competition.47  The General Court 

dismissed the appeals against the Commission’s finding of infringement,48 although 

it reduced one of the fines slightly.  The judgments of the General Court were upheld 

on appeal to the Court of Justice,49 except for one that was annulled for procedural 

reasons.50    In  Transcatab  v  Commission51  the  General  Court  held  that  purchase 

price-fixing and the allocation of suppliers and quantities of raw tobacco ‘constitute 

horizontal restrictions of the ‘price cartel’ type within the meaning of the Guidelines 

and are therefore by nature ‘very serious’ infringements. Agreements of that type 

are classified by the case-law as clear-cut infringements of the competition rules’.52 

56.  Object and/or effect of restricting competition: This was an object case. 

57.  Fines:  The  Commission  imposed  fines  totalling  €56  million  on  the  four  tobacco 

processors for participating in a buyer cartel.53  On appeal the General Court reduced 

46  

47  

48  

49  

50  

51  

52  

53  

Ibid, para 2 and 253–255. 

Ibid, paras 277–292. 

Case  T-12/06  Deltafina  v  Commission  EU:T:2011:441;  Case  T-25/06  Alliance  One  v 
Commission EU:T:2011:442; Case T-11/06 Romana Tabacchi v Commission EU:T:2011:560; 
Case T-39/06 Transcatab v Commission EU:T:2011:562; note that the appeal in Case T-19/06 
Mindo v Commission EU:T:2011:561 was held to be inadmissible. 

Case C-578/11 P Deltafina v Commission EU:C:2014:1742; Case C-593/11 P Alliance One v 
Commission EU:C:2012:804 and Case C-654/11 P Transcatab v Commission EU:T:2011:562; 
Case C-654/11 P Romana Tabacchi v Commission EU:C:2012:806. 

Case C-652/11 P Mindo v Commission EU:C:2013:229; Mindo discontinued its appeal when it 
was remitted to the General Court: Case T-19/06 RENV EU:T:2013:485. 

Case T-39/06 Transcatab v Commission EU:T:2011:562, upheld on appeal Case C-654/11 P 
Transcatab v Commission EU:T:2011:562. 

Case T-39/06 Transcatab v Commission EU:T:2011:562, para 160. 

It also imposed symbolic fines of €1,000 on the two associations that had engaged in collective 
price negotiations. 

12 

 
                                                 
one fine, imposed on Romana Tabacchi, from €2.05 million to €1 million because the 

Commission had exaggerated the duration of its participation in the cartel.54  

58.  Sector: The buying market was the purchase of raw tobacco in Italy.  The selling 

market was the sale of processed tobacco in Italy and elsewhere. 

59.  Type  of  joint  purchasing:  This  was  not  a  case  of  joint  purchasing.  Italian  Raw 

Tobacco was a buyer cartel. The agreements and concerted practices related to the 

common purchase prices which processors would pay to suppliers and the allocation 

of  suppliers  and  quantities.    There  was  also  the  exchange  of  information  to  co-

ordinate their competitive purchasing behaviour and bid-rigging. 

60.  Theory of harm/benefit/reason why no harm to competition: The theory of 

harm was the distortion of the process of competition on the buying market.  The 

Commission  found  that  the  cartel  had  sheltered  ‘processors  and  producers  of  raw 

tobacco in Italy from full exposure to market forces’, thereby preventing them from 

competing on the merits.  As a result, there was reduced competitive pressure on 

the  members  of  the  cartel  to  control  costs,  to  improve  quality  and  to  innovate, 

thereby limiting productive and dynamic efficiencies.55 

61.  Was  secrecy  a  relevant  consideration?  Yes,  the  Commission  noted  that  the 

processors of raw tobacco had ‘secretly agreed on several aspects relating to price 

and quantities to be transacted’ when setting the fines.56 

Koninklijke Wegenbouw Stevin v Commission (‘Dutch Bitumen’) (2006) 

62.  Facts: Bitumen is used to make asphalt and is used in road construction.  An unusual 

feature of this case is that the cartel involved not only eight out of nine suppliers of 

road pavement bitumen in the Netherlands but also the six largest road construction 

companies there (they were the purchasers of bitumen).  Between 1994 and 2002 

these suppliers and purchasers regularly met to fix jointly the gross price for road 

pavement  bitumen.    They  also  agreed  a  uniform  rebate  on  the  gross  price  for 

participating  road  builders  and  a  smaller  rebate  on  the  gross  price  for  other  road 

54  

55  

Case T-11/06 Romana Tabacchi v Commission EU:T:2011:560. 

Commission decision of 20 October 2005, para 285; see also para 280 on the significance of 
fixing purchase prices given raw tobacco was a substantial input of the downstream sale of 
processed tobacco. 

56  

Ibid, para 363. 

13 

 
 
                                                 
builders.    Prior  to  these  meetings,  the  suppliers  and  road  builders  held  separate 

preparatory meetings between themselves.   

63.  Outcome: In September 2006 the Commission found that the various agreements 

between  the  bitumen  suppliers  and  the  road  builders  on  gross  prices  and  rebates 

constituted  a  single  and  continuous  infringement  of  Article  101(1)  TFEU.57    The 

infringement consisted of fixing, directly and indirectly, both sale and purchase prices 

and  of  applying  unequal  conditions  to  equivalent  transactions,  placing  other  road 

construction  companies  at  a  competitive  disadvantage.58  The  General  Court 

dismissed 14 out of 16 appeals against the Commission’s decision in their entirety.59  

As  noted  below,  it  reduced  the  fines  in  the  other  two  cases.    In  Koninkliijke 

Wegenbouw Stevin v Commission60 the General Court disagreed with KWS that the 

Commission had mischaracterised the object of the agreements. The Court held that 

the  agreements  were  intended,  on  the  one  hand,  to  fix  the  purchase  and  selling 

prices of bitumen and, on the other, to grant a preferential rebate to the participating 

road  builders.  The  nature  of  the  agreements  was  therefore  sufficient  for  them  to 

have as their object the restriction of competition.61 The Court of Justice upheld the 

General Court’s judgment in this case.62 

64.  Object and/or effect of restricting competition: This was an object case. 

65.  Fines: The Commission imposed fines totalling €266.717 million on 14 companies; 

of this amount Shell was fined €108 million.  However, the General Court reduced 

the fine imposed on Shell to €81 million because the Commission failed to prove that 

Shell had played the role of instigator and leader in the infringement.63 The Court of 

57  

58  

59  

60  

61  

62  

63  

Commission decision of 13 September 2006. 

Ibid, para 156. 

See  e.g.;  Case  T-344/06  Total  SA  v  Commission  EU:T:2012:479;  Case  T-347/06  Nynäs 
Petroleum  v  Commission  EU:T:2012:480;  Case  T-348/06  Total  Nederland  v  Commission 
EU:T:2012:481; Case T-351/06 Dura Vermeer Groep v Commission EU:T:2012:482; Case T-
352/06  Dura  Vermeer  Infra  v  Commission  :EU:T:2012:483;  Case  T-353/06  Vermeer 
Infrastructuur  v  Commission  EU:T:2012:484;  Case  T-354/06  BAM  NBM  Wegenbouw  v 
Commission  EU:T:2012:485;  Case  T-355/06  Koninkliijke  BAM  Groep  v  Commission 
EU:T:2012:486;  Case  T-356/06  Koninkliijke  Volker  Wessels  Stevin  v  Commission 
EU:T:2012:487;  Case  T-357/06  Koninkliijke  Wegenbouw  Stevin  (KWS)  v  Commission 
EU:T:2012:488; Case T-359/06 Heijmans Infrastructuur v Commission EU:T:2012:489; Case 
T-360/06 Heijmans NV v Commission EU:T:2012:490; Case T-362/06 Ballast Nedam Infra v 
Commission  EU:T:2012:492  and  Case  T-370/06  Kuwait  Petroleum  Corp  v  Commission 
EU:T:2012:493, upheld on appeal Case C-581/12 P EU:C:2013:772. 

Case T-357/06 EU:T:2012:488. 

Ibid, para 113. 

Case C-586/12 P EU:C:2013:863. 

Case T

343/06 Shell Petroleum NV v Commission EU:T:2012:478. 

‑

14 

 
                                                 
Justice  reduced  Ballast  Nedam’s  fine  from  €4.65  million  to  €3.45  million  due  to  a 

procedural error.64   

66.  Sector: The purchasing market was the purchase of road pavement bitumen in the 

Netherlands.  The selling market was the construction of roads in the Netherlands. 

67.  Type  of  joint  purchasing:  This  was  not  a  joint  purchasing  case.  Dutch  Bitumen 

was a seller and buyer cartel.  The Commission and the General Court specifically 

rejected the argument that the road builders’ participation in the cartel arrangements 

amounted to joint purchasing.65  The arrangements were intended only to fix prices 

and rebates, which is why the Commission and the General Court regarded them as 

a price-fixing cartel.  

68.  Theory of harm/benefit/reason why no harm to competition: The theory of 

harm appears to have been that the major buyers and sellers of road bitumen had 

‘stitched up’ the market and so eliminated virtually all competition on both sides of 

the market.  The buyers and sellers jointly fixed the price of road pavement bitumen 

in  the  Netherlands.    Moreover,  they  agreed  on  lower  rebates  to  road  construction 

companies  that  did  not  participate  in  the  cartel,  thereby  placing  them  at  a 

competitive  disadvantage.    The  General  Court  did  not  articulate  a  theory  of  harm 

and instead relied on Article 101(1)(a) TFEU. 

69.  Was  secrecy  a  relevant  consideration?  The  cartel  did  operate  in  secret,  but 

secrecy does not appear to have played a role in the decision-making. 

70.  Comment: The Commission and the General Court drew attention to the fact that 

the  cartel  agreements  did  not  constitute  joint  purchasing  because  the  only 

agreement between the participating purchasers of road bitumen was to fix prices 

and discounts. 

Campine v Commission (‘Car Battery Recycling’) (2017) 

71.  Facts: Used car batteries are the most recycled consumer product in the EU: more 

than 50 million are recycled every year.66  Four recycling undertakings – Campine of 

64  

65  

Case  T-361/06  Ballast  Nedam  v  Commission  EU:T:2012:491,  set  aside  on  appeal  Case  C-
612/12 P EU:C:2014:193. 

Commission decision of 20 September 2016, paras 162–168, upheld on appeal Case T-357/06 
EU:T:2012:488, para 123. 

66  

Commission Press Release IP/17/245 of 8 February 2017. 

15 

 
 
                                                 
Belgium, Eco-Bat Technologies of the UK, Johnson Controls of the US and Recylex of 

France – agreed to reduce the purchase price paid to suppliers of used car batteries 

(i.e.,  scrap  dealers  and  scrap  battery  collectors)  between  2009  and  2012.67    This 

was  buttressed  by  various  exchanges  of  information  on  current  prices  offered  to 

specific suppliers, on expected volumes of purchases and on purchasing intentions 

in  Germany,  Belgium,  France  and  the  Netherlands  (where  the  main  third-party 

suppliers  of  scrap  batteries  were  located).  The  majority  of  the  anti-competitive 

contacts took place on a bilateral (and sometimes trilateral) basis, mainly through 

telephone calls, emails, or text messages.68 Some of the individuals involved used 

coded language in some of their communications.69 

72.  Outcome:  In  February  2017  the  Commission  found  that  the  four  recycling 

companies had participated in a cartel to fix the purchase prices of scrap lead-acid 

automotive  batteries  in  Belgium,  France,  Germany,  and  the  Netherlands.    The 

Commission’s  decision  was  substantially  upheld  on  appeal  to  the  General  Court.  

Campine  was  partially  successful  in  challenging  its  participation  in  the  single  and 

continuous  infringement.70    However,  the  General  Court  confirmed  that  the 

Commission  had  correctly  characterised  the  arrangements  as  restrictive  of 

competition by object.  Referring to Article 101(1)(a) TFEU, the General Court held 

that  ‘A  price  cartel  can  be  regarded,  by  its  very  nature,  as  being  harmful  to  the 

proper functioning of normal competition’.71   

73.  Object and/or effect of restricting competition: This was an object case. 

74.  Fines: The Commission imposed fines totalling €68 million on Campine, Eco-Bat and 

Recylex;  Johnson  was  granted  immunity  from  a  fine  under  the  Commission’s 

Leniency  Notice.    On  appeal  the  General  Court  reduced  the  fine  on Campine  from 

€8.2  million  to  €4.3  million  because  it  had  committed  a  single,  but  repeated, 

infringement rather than a single and continuous infringement (as the Commission 

had found).72 

67  

68  

69  

70  

71  

72  

Commission decision of 8 February 2017, paras 40–44 and Article 1. 

Ibid, para 50. 

Ibid, paras 56 and 74. 

Case T-240/17 Campine v Commission EU:T:2019:778. 

Ibid, para 297. 

Ibid, para 425. 

16 

 
                                                 
75.  Sector: The buying market was the purchase of scrap lead-acid batteries from scrap 

collectors or scrap dealers located in Germany, Belgium, France and the Netherlands.  

The selling market was the sale of recycled lead to battery manufacturers (which, in 

turn,  sell  batteries  to  motor  vehicle  manufacturers).    Some  of  the  recycling 

companies were active on both sides of the buying and selling markets, that is to 

say, they were also scrap battery collectors (i.e., suppliers on the purchasing market) 

and/or battery manufacturers (i.e., customers on the selling market).73 

76.  Type  of  joint  purchasing:  This  was  not  a  case  of  joint  purchasing.  Car  Battery 

Recycling  was  a  buyer  cartel.  The  parties  agreed  on  target  prices  or  maximum 

prices to pay to their suppliers. They also agreed to exchange information on prices 

to be paid for scrap batteries, on the quantities they intended to purchase and future 

business intentions more generally. 

77.  Theory of harm/benefit/reason why no harm to competition: The theory of 

harm was the distortion of the process of competition on the buying market.  The 

Commission  contrasted  the  actual world  in  which  the  buyer  cartel  had  operated  – 

where the infringing recycling companies had coordinated their pricing behaviour and 

agreed volumes of purchases – with the counterfactual world in which they would 

have  sought  to  offer  sufficiently  high  (competitive)  prices  to  attract  the  required 

supply of scrap batteries.74 

78.  Was  secrecy  a  relevant  consideration?  Yes,  the  fact  that  the  parties  took 

precautions  to  conceal  their  cartel  arrangements  and  to  avoid  their  detection  was 

relevant to the intentional nature of their infringement, which is a requirement for 

imposing a fine.75  

B.  DECISIONS OF THE EUROPEAN COMMISSION  

SOCEMAS (1968) 

79.  Facts:  The  Société  commerciale  et  d’Études  des  Maisons  d’Alimentation  et 

d’Approvisionnement a Succursales (SOCEMAS) was a French trading and research 

company  set  up  to  facilitate  cooperation  between  about  60  food-retailing  chain 

stores.    One  of  its  aims  was  to  purchase  grocery  products  on  behalf  of  the  chain 

73  

74  

75  

Commission decision of 18 February 2017, para 18. 

Ibid, para 233. 

Ibid, para 293. 

17 

 
 
                                                 
stores  from  other  members  of  the  former  European  Economic  Community  (‘EEC’) 

and import them into France.  Members were not obliged to buy exclusively through 

the SOCEMAS.  The foodstuffs purchased by SOCEMAS accounted for just 0.1% of 

member stores’ total turnover.76  

80.  Outcome: The Commission decided that the formation and operation of SOCEMAS 

fell outside Article 101(1) because it had a de minimis effect on inter-state trade and 

competition.  The activity of SOCEMAS in EEC countries other than France was not 

on a sufficiently large scale to bring about an appreciable restriction of competition 

or an effect on trade between Member States of the EEC.   

81.  Object  and/or  effect  of  restricting  competition:  There  was  no  appreciable 

restriction of competition in this case. 

82.  Fines: None. 

83.  Sector: the buying market appears to have been the purchase of grocery products 

within the EEC other than France.  The selling market seems to have been the retail 

of grocery products in France. 

84.  Type  of  joint  purchasing:  SOCEMAS  was  a  company  that  engaged  in  joint 

purchasing abroad on behalf of grocery retailers in France. 

85.  Theory of harm/benefit/reason why no harm to competition: This decision is 

an application of the de minimis doctrine. 

86.  Was secrecy a relevant consideration? No. 

Intergroup trading (SPAR) (1975) 

87.  Facts:  Intergroup  was  a  buyer  group  that  imported  goods  for  SPAR  chains  in  the 

EEC.  Intergroup sought to buy and import goods on more favourable terms than if 

each SPAR chain had imported them separately.77  The goods imported by Intergroup 

accounted for 0.06–0.89% of the participating chains’ turnover.  The participating 

chains accounted for less than 4% of total turnover for grocery retailing in the EEC.  

76  

77  

OJ [1968] L 4/7; see the Commission’s First Report on Competition Policy (1972), point 41. 

OJ [1975] L 212/23. 

18 

 
 
                                                 
The  participating  chains  were  free  not  to  use  Intergroup’s  services  when  making 

purchases. 

88.  Outcome:  The  Commission  found  that  Intergroup  and  its  company  statutes  fell 

outside what is now Article 101(1) because they did not have an appreciable impact 

on competition.  Given the weak position of the participating SPAR chains and the 

very small proportion of their products imported by Intergroup, Intergroup had ‘no 

substantial implications for the market position of suppliers  of the relevant goods’ 

within the EEC.   

89.  Object  and/or  effect  of  restricting  competition:  There  was  no  appreciable 

restriction of competition in this case. 

90.  Fines: None. 

91.  Sector:  the  buying  market  appears  to  have  been  the  cross-border  purchase  of 

grocery products in the EEC.  The selling market seems to have been the retail of 

grocery products in various national or local markets in the EEC. 

92.  Type of joint purchasing: Intergroup was a limited liability company incorporated 

under Dutch law, which was founded by Internationale SPAR Centrale BV Amsterdam 

and a number of SPAR chains.  Intergroup negotiated prices and conditions of sale 

with  suppliers  and  coordinated  orders  and  consignments;  it  drew  up  supply 

contracts, obtained customs clearance and dealt with complaints and disputes with 

suppliers. 

93.  Theory of harm/benefit/reason why no harm to competition: This decision is 

an application of the de minimis doctrine. 

94.  Was secrecy a relevant consideration? No. 

National Sulphuric Acid Association (1980) and (1989) 

95.  Facts: The members of the National Sulphuric Acid Association were manufacturers 

of sulphuric acid in the United Kingdom and Ireland.  Most of them created a joint 

buying pool for the purchase of elemental sulphur to countervail the strength of US 

producers.  The management committee of the buying pool was given the power to 

negotiate and buy the amount of sulphur specified by each member, provided that 

the amount was no less than 25 per cent of the member’s annual total requirements.  

There were 19 members of the buying pool, which together accounted for around 80 

19 

 
 
per  cent  of  production  of  sulphuric  acid  in  the  United  Kingdom.    The  rules  of  the 

buying pool were notified to the Commission under the old system of notification for 

individual exemption.  

96.  Outcome:  The  buying  pool  was  given  an  individual  exemption  under  Article 

101(3).78 The Commission found that the buying pool had anti-competitive effects 

because it prevented each member of the pool from negotiating and buying 25% to 

100% of their sulphur needs from suppliers other than those obtained by the pool.79  

The  Commission  also  found  that  the  buying  pool  had  a  knock-on  effect  on 

downstream competition for sulphuric acid, since sulphur accounts for 80 per cent of 

the cost of sulphuric acid.80  However, the Commission found that the buying pool 

improved the distribution of sulphur and the production of sulphuric acid by bringing 

about cheaper sulphur, flexibility in distribution and greater security of supply.81  The 

downstream selling markets for sulphuric acid and products incorporating acid (e.g. 

fertilizers, paint, detergents) were sufficiently competitive to ensure that a fair share 

of these benefits would be passed on to consumers.82  The pool members’ minimum 

purchasing requirement was limited to 25% and indispensable to attain its benefits.83  

Finally, the buying pool did not eliminate competition in respect of a substantial part 

of the sulphur market, since at least one producer with 11% of the market remained 

outside the pool.84 

97.  Object and/or effect of restricting competition: The Commission’s decision is 

silent on the object of the buying pool; it simply finds that the Rules of the buying 

pool have the effect of restricting competition between the members of the Pool. 

98.  Fines: None.  

99.  Sector: the buying market was the purchase of sulphur in the UK.  The main selling 

market was the sale of sulphuric acid in the UK. 

78  

79  

80  

81  

82  

83  

84  

OJ [1980] L 260/24, renewed OJ [1989] L 190/22.   

OJ [1980] L 260/24, paras 31–34. 

Ibid, para 35. 

Ibid, paras 39–46. 

Ibid, para 47. 

Ibid, paras 48–49. 

Ibid,  para 50. 

20 

 
                                                 
100.  Type of joint purchasing: The joint purchasing of elemental sulphur was carried 

out by a joint buying pool, which was created by the rules of the National Sulphuric 

Acid Association.  The pool was run by a management committee, which fixed the 

price  paid  by  members  for  sulphur  purchased through  the  pool.    The  sulphur was 

resold to the members on a no-profit, no-loss basis. 

101.  Theory of harm/benefit/reason why no harm to competition: The theory of 

harm appears to have been input foreclosure. The Commission was concerned that 

the joint buying pool would make it harder for members to obtain supplies of sulphur 

from suppliers other than those obtained by the pool.   

102.  Was secrecy a relevant consideration? No. 

Orphe (1990) 

103.  Facts: Seven wholesalers of pharmaceutical products, each from a different Member 

State, formed an European Economic Interest Grouping (‘EEIG’). Orphe’s members 

were  SMEs,  most  of  them  cooperatives.    The  by-laws  of  Orphe  required  that  its 

members  should  give  each  other  priority  for  commercial  transactions.    It  also 

provided for joint purchasing on behalf of members and the creation of a common 

trade mark that would appear beside the trade mark of each member on the labelling 

of products distributed by the members.  However members continued to set their 

own prices and terms of sale, including for those which they obtained through the 

Orphe.   

104.  Outcome: The Commission sent a comfort letter indicating that the by-laws of Orphe 

satisfied the requirements of Article 101(3) TFEU.85 In the Commission’s view Orphe 

would  enable  its  members  to  compete  more  effectively  with  larger  wholesale 

companies across Europe.   

105.  Object and/or effect of restricting competition: The Commission’s XX Annual 

Report  on  Competition  Policy  says  that  the  EEIG  agreement  contained  some 

restrictions  of  competition,  but  does  not  say  whether  they  were  restrictions  of 

competition by object and/or by effect. 

106.  Fines: None. 

85  

Commission’s XXth Report on Competition Policy (1990), point 102. 

21 

 
 
                                                 
107.  Sector: the  buying  market  was the  purchase of  various pharmaceutical  products.  

The selling market was the wholesale supply of pharmaceutical products. 

108.  Type  of  joint  purchasing:  Orphe  undertook  joint  purchasing  on  behalf  of  its 

members, but also provided for other types of cooperation, such as a common trade 

mark.   

109.  Theory of harm/benefit/reason why no harm to competition: The benefit of 

Orphe  was  that  it  improved  the  ability  of  its  members  to  compete  with  larger 

wholesalers.  The Commission considered that the EEIG arrangements would ‘allow 

diversification of distribution in this sector and will give consumers wider choice while 

maintaining prices at a reasonable level.’86 

110.  Was secrecy a relevant consideration? No. 

Eurovision (1993) and (2000) 

111.  Facts: The European Broadcasting Union (‘EBU’) was and is an association of public 

service media organisations.  In 1989 the EBU notified to the Commission its internal 

rules  and  regulations  governing  the  joint  acquisition  of  television  rights  to  sports 

events, the sharing of those rights and the access scheme for non-EBU members to 

Eurovision sports rights (the so-called ‘Eurovision system’).  The Eurovision system 

applied to joint acquisition of television rights for international sporting events and 

not domestic events.  The Eurovision system provided for collective negotiation of 

exclusive  television  rights.    All  interested  members  then  shared  those  rights, 

regardless  of  the  territorial  scope  of  their  activity  and  regardless  of  the  technical 

means  of  broadcasting.    In  addition,  the  EBU  and  its  members  promised  the 

Commission  that  they  would  grant  non-member  broadcasters  extensive  access  to 

Eurovision sports rights. 

112.  Outcome:  The  Commission  found  that  the  joint  acquisition  of  television  rights  to 

sporting events had as their ‘object and effect’ the restriction of competition between 

the  members  of  the  Eurovision  system.87  Instead  of  competing  with  each  other, 

members  participated  in  joint  negotiations  and  agreed  among  themselves  the 

financial and other terms for the acquisition of rights.88  However, the Commission 

86  

87  

88  

Ibid. 

OJ [1993] L 179/23, para 73. 

Ibid,  para  74;  the  obligation  on  the  members  to  acquire  jointly  could  have  a  particularly 
harmful effect in the market given the rights were sold on an exclusive basis: ibid, para 75. 

22 

 
 
                                                 
granted  an  individual  exemption  to  the  Eurovision  system  under  Article  101(3) 

because  it  improved  the  access  of  smaller  EBU  members  to  certain  major 

international  sports  events  and  reduced  transactions  costs  associated  with  a 

multitude  of  licensing  negotiations.89  The  Commission’s  decision  was  annulled  on 

appeal  due  to  errors  of  law  in  the  way  that  it  had  applied  the  indispensability 

requirement in Article 101(3)(a) TFEU.90  The Commission re-adopted its exemption 

decision,91  but  that  decision  was  also  annulled  due  to  an  error  of  assessment  in 

finding  that  the  EBU  rules  did  not  substantially  eliminate  competition  within  the 

meaning of Article 101(3)(b) TFEU.92  

113.  Object and/or effect of restricting competition: Both.  

114.  Fines: None. 

115.  Sector: The buying market was the acquisition of the television rights to important 

sporting events in all disciplines of sport.  The selling markets were the markets for 

free-to-air and pay TV broadcasting, in which sporting events were broadcast as part 

of the broadcasters’ offer to viewers and/or subscribers. 

116.  Type of joint purchasing: The joint purchasing arrangements were enshrined in 

the EBU’s internal rules and regulations governing the Eurovision system. The EBU 

not only engaged in the joint acquisition of television rights to international sporting 

events but also shared those rights between its members and granted sub-licences 

of those rights to non-members. 

117.  Theory  of  harm/benefit/reason  why  no  harm  to  competition:  The 

Commission seems to have applied two theories of harm in this case.  The first was 

that  the  Eurovision  system  restricted  or  distorted  the  competitive  process  for  the 

acquisition of television rights to international sports events.93  In the absence of the 

Eurovision system, the EBU members would have bid against each other to acquire 

those rights.  The second theory of harm was that the joint acquisition of television 

rights might foreclose non-EBU members (i.e. commercial broadcasters) insofar as 

they could not match the EBU’s access to major international sports events or the 

89  

90  

91  

92  

93  

Ibid, paras 85 and 86. 

Cases T-528/93 etc Métropole Télévision v Commission EU:T:1996:99. 

OJ [2000] L 151/18. 

Cases T-185/00 etc Métropole Télévision v Commission EU:T:2002:242. 

Ibid, paras 73–74. 

23 

 
                                                 
terms on which they acquired the rights to broadcast such events.94  Against this, 

however,  the  Eurovision  system  created  a  net  benefit  to  consumers,  since  EBU 

members could show more, and higher quality, international sports programmes to 

European television viewers.95 

118.  Was secrecy a relevant consideration? No. 

Ethylene (2020) 

119.  Facts: Four ethylene purchasers – Westlake of the US, Orbia of Mexico, Clariant of 

Switzerland and Celanese of the US – coordinated their price negotiation strategies 

in  Belgium,  France,  Germany  and  the  Netherlands  between  2011  and  2017.    The 

price  of  ethylene  is  volatile.    Ethylene  supply  agreements  use  a  standard  pricing 

formula in order to reduce the risk of price volatility, which is known as the ‘Monthly 

Contract Price’ (‘MCP’).  The ethylene purchasers coordinated their price negotiation 

strategies  before  and  during  the  bilateral  negotiations  with  ethylene  suppliers  in 

order to push the MCP down to their advantage.  They also exchanged price-related 

information.96  

120.  Outcome:  The  Commission  found  that  the  buyers’  conduct  had  the  object  of 

restricting competition because they ‘refrained from determining independently the 

commercial policy that they intended to adopt for MCP but instead coordinated their 

behaviour  related  to  MCP  and  MCP  settlement  negotiations.’97  All  four  companies 

acknowledged  their  involvement  in  the  cartel  and  agreed  to  settle  the  case  in 

accordance with the Commission’s settlement procedure.98  Clariant has, however, 

brought an appeal contesting the level of the fine imposed upon it.99   

121.  Object and/or effect of restricting competition: This was an object case. 

94  

95  

96  

97  

98  

99  

Ibid, para 75; this theory can also be seen when the Commission considers whether there is 
a substantial elimination of competition under Article 101(3)(b): ibid, paras 102–103. 

Ibid, paras 87 and 91. 

Commission decision of 14 July 2020, para 1. 

Ibid, paras 69–70. 

See the Commission’s Notice on the conduct of settlement procedures, OJ [2008] C 256/2. 

Case T–590/20 Clariant v Commission, not yet decided. 

24 

 
 
                                                 
122.  Fines: The Commission imposed fines totalling €260 million on Orbia, Clariant and 

Celanese;  Westlake  blew  the  whistle  and  was  therefore  granted  immunity  from 

paying a fine.   

123.  Sector: The buying market was the merchant market for the purchase of ethylene 

in  Belgium,  Germany,  France  and  the  Netherlands.    The  selling  markets  were  the 

production and sale of various chemical products.  

124.  Type of joint purchasing: This case did not involve joint purchasing. Ethylene was 

a buyer cartel. 

125.  Theory of harm/benefit/reason why no harm to competition: The theory of 

harm was that the colluding purchasers of ethylene sought to disrupt the competitive 

process by coordinating their price negotiation strategy vis-à-vis suppliers in order 

to influence MCP negotiations in their favour.   

126.  Was secrecy a relevant consideration? The settlement decision does not mention 

secrecy other than in support of making a direction to bring the infringement to an 

end.100 

127.  Ethylene  and  Car  Battery  Recycling  (paragraphs  71  to  78  above)  are  two  recent 

Commission  decisions  on  buyer  cartels  that  have  contributed  to  the  concern 

expressed  by  respondents  to  the  Commission’s  consultation  on  horizontal  co-

operation agreements that there is uncertainty as to the dividing line between buyer 

cartels and joint purchasing agreements. 

C.  MEMBER STATES OF THE EU 

Belgium – Carrefour Belgium and Provera Belux (2021) 

128.  Facts:  In  November  2018  Carrefour  Belgium  (a  supermarket  chain)  and  Provera 

Belux (the Louis Delhaize group’s purchasing unit for brands such as Cora and Match) 

entered into a joint purchasing alliance in Belgium and Luxembourg.101  The alliance 

provided for Carrefour to negotiate and buy ‘fast-moving consumer goods’ from 140 

suppliers on behalf of both Provera and itself. 

100  

Ibid, para 106. 

101   www.carrefour.com/en/newsroom/carrefour-belgium-and-provera-belux-enter-purchasing-

alliance.  

25 

 
 
                                                 
129.  Outcome: In April 2021 the Belgian Competition Authority (‘BCA’) accepted legally-

binding  commitments  from  the  parties  to  transfer  the  Carrefour  purchasing 

department to a separate legal entity.  The BCA’s preliminary assessment was that 

the alliance created the risk that buyers at Carrefour and Provera could exchange 

information  about  their  commercial  strategies.    These  exchanges  might  affect  the 

parties’ incentive to compete in both the purchasing and selling markets.  To address 

these concerns Carrefour offered commitments to sell its purchasing department to 

Interdis, a separate company; to limit exchanges of information to details that were 

essential for the proper functioning of the alliance; and to limit joint negotiations to 

negotiations on discounts from suppliers.  The BCA closed its file without making a 

finding as to whether there had been or continued to be an infringement of EU or 

Belgian competition law.102 

130.  Object and/or effect of restricting competition: This was an effects case. 

131.  Fines: None. 

132.  Sector:  The  buying  markets  were  the  purchase  of  various  fast-moving  consumer 

goods in Belgium and Luxembourg.  The selling markets were the retailing of those 

goods to end-consumers in Belgium and Luxembourg. 

133.  Type  of  joint  purchasing:  This  case  involved  one  of  the  parties  (Carrefour) 

purchasing jointly on behalf of the other party (Provera) and itself. 

134.  Theory of harm/benefit/reason why no harm to competition: The theory of 

harm  was  that  the  alliance  could  have  spillover  effects  in  the  downstream  sales 

market through the sharing of commercially sensitive information between Carrefour 

and Provera.   

135.  Was secrecy a relevant consideration? No. 

Czech Republic – Billa/Julius Meinl (2003) 

136.  Facts:  Two  grocery  retail  chains,  Billa  and  Julius  Meinl,  agreed  to  coordinate  and 

unify their purchase prices for goods and the terms they applied in relation to their 

suppliers  from  2001  to  2002.    To  that  end  they  exchanged  information  on  their 

purchase prices, bonus and discount systems.  They also agreed to require suppliers 

both  to  compensate  them  for  any  differences  in  prices  paid  by  them  to  the  same 

102   Case CONC-I/O-19/0013, BCA decision of 28 April 2021. 

26 

 
 
                                                 
supplier and to pay a so-called ‘alliance bonus’, which was paid if suppliers supplied 

the  same  range  of  products  to  both  Billa  and  Meinl.    If  the  suppliers  declined  to 

accept these terms, Billa and Meinl were entitled (under certain supply agreements) 

to terminate their agreements with them. 

137.  Outcome:  The  Czech  competition  authority  found  that  the  practices  of  Billa  and 

Meinl  constituted  ‘cartel  conduct’  that  infringed  domestic  competition  law.103    The 

purpose  of  the  parties’  cooperation  was  to  enforce  uniform  purchase  prices  and 

maximise their profit, to the detriment of their suppliers.  The finding of infringement 

was upheld by the Regional Court in Brno.104   

138.  Object and/or effect of restricting competition: This was an object case. 

139.  Fines: The parties were originally fined a total of CZK 51 million, but the fines were 

annulled on appeal.  The Czech competition authority re-adopted its penalty decision, 

albeit imposing slightly lower fines; this decision was upheld on appeal.105 

140.  Sector:  It  is  not  entirely  clear  from  publicly  available  materials,  but  the  buying 

markets appear to have been the purchase of various grocery products.  The selling 

market was the retailing of grocery products in the Czech Republic. 

141.  Type of joint purchasing: This case did not involve joint purchasing. Billa/Julius 

Meinl was an agreement between two grocery retailers to exchange purchase pricing 

information and to coordinate their behaviour vis-à-vis common suppliers. 

142.  Theory of harm/benefit/reason why no harm to competition: The theory of 

harm in this case is not readily apparent from the materials in the public domain. It 

is not unreasonable to suppose, however, that the Czech competition authority was 

concerned that the grocery retailers’ coordinated conduct amounted to a distortion 

of the process of competition in the purchasing market. 

143.  Was secrecy a relevant consideration? No. 

103   Decision of 13 October 2003. 

104  

105  

Judgment of 31 May 2006. 

Judgment of Supreme Administrative Court of 29 March 2012. 

27 

 
                                                 
Finland – Timber Cartel (2009) 

144.  Facts:  Metsäliitto  Co-operative,  Stora  Enso  and  UPM-Kymmene  collectively  held 

nearly  80  per  cent  of  the  timber  purchase  market  in  Finland.    Between  1997  and 

2004 they exchanged information on current and future purchase prices for timber, 

quantities  and  costs.    While  the  companies  did  not  fix  purchase  prices,  their 

exchanges were intended to reduce (or stabilise) the price level of timber.  Moreover, 

if  their  discussions  revealed  that  one  company  had  paid  an  above-average  price 

when buying timber, the other two would put pressure on that company to lower its 

purchase prices. 

145.  Outcome: The Finnish Market Court held that the information exchange constituted 

an infringement by object of Article 101 TFEU and domestic competition law.106  In 

setting the fines the Market Court took into account the facts that the cartel lasted 

for  seven  years,  covered  the  whole  of  Finland  and  involved  large  companies  that 

were  well  aware  of  competition  law.    Moreover,  the  companies  were  recidivists, 

having been fined for colluding on the purchase of timber in the 1990s.  There was 

no appeal to the Supreme Administrative Court.  

146.  Object and/or effect of restricting competition: This was an object case. 

147.  Fines: The Market Court imposed fines totalling €51 million. 

148.  Sector:  The  buying  market  was  the  purchase  of  timber  in  Finland.    The  selling 

market appears to have been the supply of wood and paper products. 

149.  Type of joint purchasing: This case did not involve joint purchasing. Timber Cartel 

was an exchange of information agreement between buyers. 

150.  Theory of harm/benefit/reason why no harm to competition:  The theory of 

harm appears to have been that the information exchanges reduced uncertainty as 

to the future pricing behaviour of parties on the timber purchasing market, thereby 

diminishing incentives to compete. 

151.  Was secrecy a relevant consideration? No. 

106  

Judgment of Market Court of 3 December 2009. 

28 

 
 
                                                 
France – Pork Charcuterie (2013) 

152.  Facts: Following a complaint from four pig farmers, the Autorité de la concurrence 

discovered that five Breton pork slaughterers agreed for several months in 2009 on 

their volumes of pork purchases, with the aim to lower the prices paid to pig farmers.  

They did so by coordinating a reduction in the level of their respective slaughtering, 

which was designed to push down the price of pigs in the so-called Marché du porc 

breton (‘MPB’), which was a national price index for the sale of pigs.107 Separately, 

some of the slaughterers fixed the price of their purchases from farmers on a couple 

of  days  when  the  normal  auctions  were  inoperative.    In  addition  to  these  buyer-

related  restrictions,  a  couple  of  slaughterhouses  engaged  in  RPM  with  the  Auchan 

retail chain. 

153.  Outcome:  In  2013  the  Autorité  de  la  concurrence  decided  that  each  of  the 

slaughterers’ practices had as its object the restriction of competition, a conclusion 

that was not disputed by those involved.  

154.  Object and/or effect of restricting competition: This was an object case. 

155.  Fines:  The  Autorité  imposed  fines  totalling  €4.57  million  for  the  various  collusive 

practices just described;108 they were reduced on appeal to €2.64 million.109 

156.  Sector: The buying market was the purchase of live pigs for slaughtering in certain 

parts of France.  The selling market was the retailing of pig meat products in France.  

157.  Type  of  joint  purchasing:  This  case  did  not  involve  joint  purchasing.    Pork 

Charcuterie was a buyer cartel that sought to reduce demand and purchase prices 

for live pigs. 

158.  Theory of harm/benefit/reason why no harm to competition:  The theory of 

harm  was  that  the  artificial  reduction  of  slaughtering  distorted  the  process  of 

competition for the purchase of live pigs, to the detriment of live pig farmers. 

159.  Was secrecy a relevant consideration? The Autorité noted that the arrangements 

in question had been secret. 

107   Decision of 13 February 2013, paras 230–231. 

108   Decision of 13 February 2013. 

109  

Judgment of 25 September 2014, Case RG n° 2013/10559. 

29 

 
 
                                                 
France – Auchan, Casino, Metro, and Schiever (2020) 

160.  Facts:  In  November  2018  a  ‘partnership  agreement’  between  four  well-known 

French retailers – Casino, Auchan, Metro and Schiever – was notified to the Autorité 

de la concurrence under the domestic Law for Growth, Activity and Equal Economic 

Opportunities  (which  is  described  below).    The  four  retailers  proposed  to  create  a 

jointly-owned company that would organise tenders for the procurement of a wide 

range of own-brand label grocery products, such as milk, eggs, cooked cold meats, 

canned fish, canned meats, breaded fish, aperitifs, digestifs.   

161.  Outcome:  The  Autorité  de  la  concurrence  identified  two  potential  competition 

concerns. The first was that the joint purchasing partnership agreement could harm 

suppliers, many of whom are SMEs. The second was that the agreement could distort 

competition in the selling market by limiting the level of differentiation between the 

parties’  own-brand  labels  products  ranges.  Auchan,  Casino,  Metro,  and  Schiever 

responded to these concerns by offering commitments to modify their partnership 

agreement. In October 2020 the Autorité accepted these commitments under Article 

L464-1  of  the  Commercial  Code.110      The  commitments  reduced  the  scope  of  the 

parties’ cooperation in order to remove products from sectors that had experienced 

economic difficulties.  The parties also limited their cooperation to 15% of the market 

volume for a number of grocery products. 

162.  Object and/or effect of restricting competition: It is not clear, but it appears 

to have been a suspected effects case. 

163.  Fines: None. 

164.  Sector: The buying market was the purchase of a wide range of own-brand label 

grocery products in France.  The selling market was the retailing of those own-label 

grocery products in France.  

165.  Type of joint purchasing: This was a case of joint purchasing, whereby a jointly-

owned company provided the interface between suppliers and the purchasers that 

the company represented.  It was through this joint behaviour that the partnership 

aimed to negotiate more favourable terms and conditions than if each retailer had 

acted alone. 

110   Decision of 22 October 2020. 

30 

 
 
                                                 
166.  Theory of harm/benefit/reason why no harm to competition:  There were two 

theories  of  harm.    The  first  was  that  the  joint  purchasing  partnership  agreement 

could  harm  suppliers,  many  of  whom  are  SMEs.    The  Autorité  de  la  concurrence 

found  that  the  purchasing  market  was  characterised  by  short-term,  low-margin 

supply  contracts  that  were  unfavourable  to  suppliers.    In  these  circumstances, 

suppliers were vulnerable to the price reductions sought by the alliance, which might 

hinder  their  ability  to  invest  in  the  production  and  development  of  own-label 

products.  The second theory of harm was that the joint purchasing agreement might 

distort  competition  in  the  selling  market  by  limiting  the  level  of  differentiation 

between  the  parties’  own-brand  labels  products.    Auchan,  Casino,  Metro  and 

Schiever would jointly select and negotiate with their own-brand label suppliers and 

then sell own-brand label products with identical characteristics.  In the Autorité’s 

view,  this  could  reduce  the  variety  of  own-label  products  available  in  the  parties’ 

stores and therefore restrict an important parameter of competition.   

167.  Was secrecy a relevant consideration? No. 

168.  Comment: In 2014 the French government asked the Autorité de la concurrence for 

an opinion on the impact of these arrangements on competition.  In 2015 the Autorité 

found that, following a series of mergers, there were four buyer groups – ITM/Casino 

group, Carrefour/Cora, Auchan/Système U/E. Leclerc – which collectively accounted 

for  more  than  90%  of  the  grocery  retail  market  in  France.    The  Autorité 

acknowledged that these buyer groups or retail alliances could be beneficial insofar 

as they secured lower prices for consumers.  The Autorité noted, however, a number 

of  risks  for  competition  in  the  purchasing  and  selling  markets,  including  spillover 

effects,  waterbed  effects  and  customer  foreclosure  concerns.      The  Autorité 

recommended the introduction of a system of notification which would enable it to 

review purchasing agreements in the retail sector that meet a turnover threshold.  

The French Law for Growth, Activity and Equal Economic Opportunities of 6 August 

2015 (‘Egalim Law’) required the retailers to notify their respective alliances to the 

Autorité.    

France – Carrefour and Tesco (2020) 

169.  Facts:  In  August  2018  Carrefour  and  Tesco,  a  leading  retailer  in  the  UK  with  no 

stores in France, entered into a cooperation agreement relating to the supply of own-

brand label products.  The agreement provided for Carrefour or Tesco to hold tenders 

on  behalf  of  both  distributors with  the goal  of  joint  production  of  own-brand  label 

goods.  The agreement covered more than 130 food and non-food grocery products.  

31 

 
 
The agreement was notified to the Autorité de la concurrence pursuant to the Egalim 

Law. 

170.  Outcome: In May 2019 the Autorité de la concurrence opened an investigation into 

whether  the  cooperation  agreement  had  the  object  and/or  effect  of  restricting 

competition.    In  particular,  the  Autorité  was  concerned  that  the  agreement  could 

reduce the ability of suppliers of own-brand label goods (many of whom are SMEs) 

to invest and innovate, and even reduce their incentive to remain on the market.  As 

in the case of Auchan/Casino/Metro/Schiever, summarised above, the Autorité found 

that  suppliers  were  vulnerable  to  adverse  changes  in  the  terms  of  supply  such  as 

lower  prices  or  volumes.    In  December  2020  the  Autorité  accepted  commitments 

from Carrefour and Tesco to reduce the scope of their cooperation: they excluded 

from the agreement certain agricultural products; limited their cooperation for eight 

product categories to a volume corresponding to 15% of Carrefour’s purchases for 

each category; and they promised not to exclude any supplier from responding to 

calls for tenders.111 

171.  Object and/or effect of restricting competition: This appears to have been a 

suspected effects case. 

172.  Fines: None. 

173.  Sector:  The  buying  market  was  the  purchase  of  wide  range  of  own-label  grocery 

products in France.  The selling market was the retailing of those products in France.  

174.  Type of joint purchasing: This was joint purchasing in the form of a contractual 

arrangement.  It is worth noting that the agreement also covers the supply of non-

market  products,  that  is  to  say,  products  or  services  necessary  for  the  parties’ 

business and not intended for resale, and the provision of international services. 

175.  Theory of harm/benefit/reason why no harm to competition:  The theories of 

harm were the same as those in Auchan/Casino/Metro/Schiever.112 

176.  Was secrecy a relevant consideration? No. 

111   Decision of 17 December 2020. 

112   See para 165 above. 

32 

 
                                                 
France – Saucissons (2020) 

177.  Facts:  Between  2011  and  2013  12  manufacturers  of  cold  meats  coordinated  the 

weekly price variation of jambon de mouille (ham, flank removed) in an attempt to 

resist price increases or obtain price reductions from pig slaughterhouses.  They held 

bilateral phone calls in order to reach and implement a common negotiating position 

with the slaughterhouses.  The outcome of those negotiations affected a weekly price 

index  for  jambon  de  mouille,  which  was  a  benchmark  for  other  cold  meat 

manufacturers,  and  for  the  negotiation  of  contracts  for  branded  products.  

Separately,  the  cold  meat  manufacturers  held  phone  calls  and  secret  meetings  at 

hotels  in  Paris  and  Lyon,  during  which  they  agreed  price  increases  for  cold  meat 

products that they intended to sell to ‘mass-market’ retailers for their own-brand or 

economy cold meat products. 

178.  Outcome:  In  July  2020  the  Autorité  de  la  concurrence  considered  the  parties’ 

behaviour  had  as  its  object  the  restriction  of  competition.113    By  exchanging 

information on variations in the weekly purchase price of the jambon de mouille and 

by agreeing to defend a common position in the negotiations with the slaughterers, 

the  companies  knowingly  substituted  cooperation  between  them  for  the  risks  of 

competition, to use the language of the Court of Justice’s Dyestuffs judgment.  In 

the Autorité’s view, this behaviour conflicted with the principle that each firm should 

determine  independently  the  policy  that  it  intends  to  adopt  on  the  market.    Put 

simply, practices that tend to distort the formation of purchase prices are, by their 

nature, anti-competitive. 

179.  Object and/or effect of restricting competition: This was an object case. 

180.  Fines: The Autorité imposed fines totalling €93 million on the offending cold meat 

manufacturers.   

181.  Sector: The buying market was the purchase of ham, flank removed in France. The 

selling markets were the retail of cold meat products, such as raw ham, cooked ham, 

sausage, rosette and chorizo in France. 

182.  Type  of  joint  purchasing:  This  case  did  not  involve  any  joint  purchasing 

arrangements. Saucissons was an exchange of information about purchase prices. 

113   Decision of 16 July 2020, paras 505–509. 

33 

 
 
                                                 
183.  Theory of harm/benefit/reason why no harm to competition:  The theory of 

harm  was  that,  through  their  phone  calls,  the  cold  meat  manufacturers  reduced 

strategic  uncertainty  between  themselves  and  distorted  their  negotiations  with 

slaughterhouses.  As a result, the cold meat manufacturers were able to impose ‘a 

mode of organisation that replaced effective competition’ on the purchasing market. 

184.  Was secrecy a relevant consideration? No. 

Germany – Long Steel Cartel (2019) 

185.  Facts: Three  

motor vehicle manufacturers – BMW, Daimler and Volkswagen – were members of 

the  Wirtschaftsverband  Stahl-und  Metallverarbeitung  (the  German  association  for 

steel  and  metal  processing).  Between  2004  and  2013  representatives  of  the  car 

companies met twice a year with steel manufacturers and other companies in the 

supply  chain  through  the  medium  of  this  trade  association.  They  exchanged 

information on uniform surcharges for the purchase of long steel products.  The scrap 

and alloy surcharges were a significant proportion (about one-third) of the purchase 

price for long steel.   

186.  Outcome: In November 2019 the Bundeskartellamt found that BMW, Daimler and 

VW had breached German competition law by agreeing uniform surcharges for the 

purchase  of  long  steel  products.114  The  car  manufacturers  admitted  to  their 

involvement in the cartel and settled the case.   

187.  Object and/or effect of restricting competition: This was an object case. 

188.  Fines: The Bundeskartellamt imposed fines totalling around €100 million. 

189.  Sector: The buying market appears to have been the market for the purchase of 

long  steel  products,  such  as  scrap  and  alloy,  in  Germany.    The  motor  vehicle 

manufacturers then used long steel products to make car parts, such as crankshafts, 

connecting rods, camshafts, gear wheels and steering rods. 

190.  Type of joint purchasing: This case did not involve joint purchasing. Long steel 

cartel was a buyer cartel. 

114   Bundeskartellamt Press Release of 21 November 2019.   

34 

 
 
                                                 
191.  Theory of harm/benefit/reason why no harm to competition:  The theory of 

harm  was  that  the  three  motor  vehicle  manufacturers  distorted  the  process  of 

competition  by  ceasing  to  negotiate  surcharges  individually  with  their  respective 

suppliers.  

192.  Was secrecy a relevant consideration? It is not apparent from publicly available 

materials whether secrecy played a role in the Bundeskartellamt’s reasoning. 

Italy – Centrale Italiana (2014) 

193.  Facts: Centrale Italiana was a buying alliance between four major retail chains in 

Italy: Coop Italia, Despar Servizi, Il Gigante, Disco Verde and Sigma.115 The aim of 

the  alliance  was to negotiate  ‘framework  agreements’  on  behalf  of the chains and 

seek lower purchase prices for daily consumer goods.   

194.  Outcome: In 2013 the L’Autorità Garante della Concorrenza e del Mercato (‘AGCM’) 

suspected that the parties were using Centrale Italiana as a way of coordinating their 

behaviour beyond joint negotiations. The AGCM was concerned that Centrale Italiana 

facilitated  collusion  on  prices  in  the  purchasing  and  selling  markets.  In  2014  the 

AGCM closed the file because the parties gave commitments to terminate Centrale 

Italiana. The Coop, Disco Verde and Sigma would continue to negotiate jointly some 

of  their  purchases  but  only  from  suppliers  that  have  a  turnover  of  more  than  €2 

million and do not supply private label products. 

195.  Object  and/or  effect  of  restricting  competition:  It  is  not  clear  from  publicly 

available materials whether the AGCM considered this was an object and/or effect 

case. 

196.  Fines: None. 

197.  Sector: The buying market was the procurement of various daily consumer goods 

in Italy.  The selling markets were the retail markets for consumer goods in regions 

of Italy. 

198.  Type of joint purchasing: This case involved a buying alliance that was designed 

to improve its members’ bargaining power vis-à-vis suppliers. 

115   AGCM Press Release of 26 September 2014, Centrale d’acquisto per la Grande Distribuzione 

Organizzata. 

35 

 
 
                                                 
199.  Theory  of  harm/benefit/reason  why  no  harm  to  competition:  The  AGCM 

examined two theories of harm.  The first was that the bargaining strength of the 

alliance  might  harm  upstream  suppliers  and  thereby  threaten  their  viability  and 

ability  to  remain  in  the  market.  The  second  was  that  the  alliance  would  facilitate 

collusion in the downstream selling markets, because the members made most of 

their purchases through the alliance and held market shares of between 40–50% in 

over 30 regional selling markets.   

200.  Was secrecy a relevant consideration? No. 

Ireland – Glassmatix system (2003) 

201.  Facts:  Four  major  insurers  –  Allianz  Ireland,  AXA  Insurance,  Hibernian  General 

Insurance, and Royal & Sun Alliance – created a consortium to launch the ‘Glassmatix 

system’ in Ireland.116 Glassmatix was and is a vehicle repair estimation system used 

for motor vehicle repairs, which provides information on labour times for repairs and 

up-to-date manufacturer parts prices. A complaint was made to the Irish competition 

authority that the four insurers had used the Glassmatix system as a means to fix 

the purchase prices of motor vehicle repair services. The insurers collectively held 

65–70 % share of the Irish private motor vehicle insurance market at the time.   

202.  Outcome:  The  Irish  competition  authority  was  concerned  that  the  four  insurers 

could use the Glassmatix system to fix the price of motor vehicle repair services by, 

for  example,  jointly  setting  the  hourly  rate  paid  to  repairers.  The  authority 

considered  that this  might  distort competition  in  the  purchasing  market  for  motor 

vehicle repairs. In the authority’s view, the arrangements ‘could create a climate in 

which  the  members  of  the  consortium  agree  to  fix  at  least  some  of  the  costs  of 

providing motor vehicle insurance thereby facilitating cooperation in the market for 

motor  vehicle  insurance’.117  Each  of  the  insurers  denied  breaching  the  domestic 

equivalent  of  Article  101.  However,  they  gave  binding  undertakings  that  modified 

their  use  of  the  Glassmatix  system.  In  particular  the  insurers  undertook  not  to 

coordinate  labour  rates  or  other  costs  with  other  participants  or  any  other  motor 

vehicle insurance undertaking.118   

116   Decision No. E/03/001 of 26 August 2003.   

117  

118  

Ibid, para 2.42. 

Ibid, para 3.5. 

36 

 
 
                                                 
203.  Object  and/or  effect  of  restricting  competition:  The  authority’s  preliminary 

assessment was that the Glassmatix arrangements could give rise to a restriction of 

competition by object. 

204.  Fines: None. 

205.  Sector:  The  buying  market  was  the  purchase  of  motor  vehicle  repair  services  in 

Ireland.    The  selling  market  was  the  sale  of  private  motor  vehicle  insurance  in 

Ireland. 

206.  Type  of  joint  purchasing:  The  insurers  created  a  consortium  to  introduce, 

implement  and  operate  the  Glassmatix  motor  vehicle  repair  estimation  system  in 

Ireland. The arrangements did not provide for joint purchasing as such; rather they 

created  the  opportunity  for  the  insurers  to  coordinate  their  behaviour  on  the 

purchasing market, for example by agreeing a fixed rate of increase of the labour 

rate for repairers in implementing the Glassmatix system. 

207.  Theory of harm/benefit/reason why no harm to competition:  The theory of 

harm was that the Glassmatix system enabled the insurers to fix the price of motor 

vehicle  repair  costs  and  thereby  eliminate  competition  between  them,  on  the  one 

hand, and vehicle repairers on the other, in the purchasing market for the purchase 

of vehicle repair services. 

208.  Was secrecy a relevant consideration? No. 

Netherlands – Real Estate Auctions (2011) and (2013) 

209.  Facts: When individuals fail to repay the mortgage on his or her house, they may 

fall into default and end up in foreclosure. When this happens the lender may require 

the homeowner to leave and put the house up for auction. Individuals and real-estate 

traders can bid to buy houses at ‘foreclosure auctions’.  This case concerned 65 real-

estate traders that manipulated the foreclosure auctions between 2000 and 2009 to 

their  advantage  and  to  the  detriment  of  the  ultimate  vendors  of  houses.  The 

participating real-estate traders manipulated official auctions in order to drive down 

home prices and then re-auctioned homes at separate secret after-auctions (known 

as naveilingen in Dutch), often at a higher price. The difference between the price at 

the official auction and at the after-auction (the profit) was then shared among the 

participating traders. 

37 

 
 
210.  Outcome:  In  2011,  and  again  in  2013,  the  Netherlands  Competition  Authority 

decided that real-estate traders had infringed competition law by keeping property 

prices at foreclosure auctions artificially low in order to make a profit at secret after-

auctions.119    Homeowners  sold  homes  for  less  than  would  have  been  the  case  in 

auctions  that  were  unaffected  by  the  traders’  manipulative  behaviour.    The 

Competition Authority subsequently published ‘Guidelines for foreclosure auctions of 

real  estate’  in  order  to  provide  guidance  on what  is,  and  is  not,  lawful  conduct  at 

foreclosure auctions.120 

211.  Object and/or effect of restricting competition: This was an object case. 

212.  Fines:  The  total  fines  imposed  in  2011  amounted  to  €6.3  million  on  the  14  most 

active real-estate traders. The total fines imposed in 2013 amounted to €6.4 million 

on  65  real-estate  traders.  Both  decisions  were  appealed.  The  District  Court  of 

Rotterdam upheld the Authority’s findings of an infringement, but reduced the fines 

marginally.121 

213.  Sector: The buying market was the purchase of foreclosed houses from banks and 

other  lenders  at  auction  in  the  Netherlands.  The  selling  market  was  the  resale  of 

houses to individuals in the Netherlands. 

214.  Type of joint purchasing: This case did not involve joint purchasing. Real Estate 

Auctions was a buyer cartel. 

215.  Theory of harm/benefit/reason why no harm to competition:  There appear 

to have been two theories of harm that were relevant in this case. The first was that 

the real-estate traders distorted the process of competition at foreclosure auctions. 

The second was that the traders’ manipulative behaviour was harmful to suppliers 

as a wrong in itself: the necessary consequence of the traders’ bid-rigging was that 

artificially lower prices were paid to the owners of foreclosed homes. 

119   Decisions of 19 December 2011 and 4 February 2013. 

120   www.acm.nl/en/publications/publication/11093/NMa-fines-more-real-estate-traders-for-

manipulation-of-foreclosure-auctions.  

121  

Judgment of 18 December 2014, ECLI:NL:RBROT:2014:10174 (10% reduction on the ground 
of financial hardship). 

38 

 
                                                 
216.  Was  secrecy  a  relevant  consideration?  It  is  not  clear  from  publicly  available 

materials in English whether secrecy played a role in the reasoning of the Authority 

or the Court. 

Netherlands – Used Cooking Oil (2021) 

217.  Facts: Used cooking oil is an important and sustainable raw material for biodiesel 

fuel.   ‘Collectors’  buy used  cooking  oil  primarily from  businesses  in  the hospitality 

and food industry. A major collector of cooking oil, Rotie, discussed purchase prices 

and suppliers with two of its competitors, Nieuwcom and another company (that filed 

for bankruptcy). The discussions took place in private, often by email and WhatsApp. 

They concerned confidential and sensitive information such as purchase prices and 

who visited which supplier. The parties also monitored each other’s behaviour and 

challenged the other if they offered too high a price to a supplier. 

218.  Outcome:  The  Dutch  Authority  for  Consumers  and  Markets  found  that  Rotie  and 

Nieuwcom  had  made  ‘cartel  agreements  regarding  the  purchase  of  used  cooking 

oil’.122 The Authority considered that the two companies colluded in order to keep 

purchase prices as low as possible, which, in turn, improved their margins. They also 

shared  suppliers  among  each  other,  and  exchanged  competitively-sensitive 

information between 2012 and 2018. In the ACM’s view small hospitality businesses, 

such as restaurants and snack bars, were harmed by the buyer cartel agreements.  

219.  Object and/or effect of restricting competition: This was an object case. 

220.  Fines: The total fines imposed on the two companies amounted to €4 million; the 

total fines imposed on the three individuals involved in the cartel was €190,000. 

221.  Sector: The buying market was the purchase of used cooking oil in the Netherlands.  

The selling market appears to have been the sale of biodiesel fuel in the Netherlands. 

222.  Type of joint purchasing: Used Cooking Oil was a buyer cartel. 

223.  Theory of harm/benefit/reason why no harm to competition:  The theory of 

harm appears to have been that the agreements and information exchanges between 

the collectors distorted the process of competition for used cooking oil.  The ACM’s 

122   Decision of 5 October 2021. 

39 

 
 
                                                 
press release specifically states that small hospitality businesses, such as restaurants 

and snack bars, were harmed by the buyer cartel agreements. 

224.  Was  secrecy  a  relevant  consideration?  It  is  not  clear  from  publicly  available 

materials in English whether secrecy played a role in the reasoning of the Authority. 

Romania – Timber (2020) 

225.  Facts: The Competition Council carried out an ex officio investigation into tenders 

held by the state forest management company. 31 companies agreed not to compete 

against each other in tenders for wood exploitation to keep prices as low as possible. 

They  buttressed  their  arrangements  by  exchanging  commercially  sensitive 

information  regarding  the  raw  materials,  the  timber  procurement  policy  and  the 

commercial strategy of participation within certain tenders for timber lots. 

226.  Outcome: The Competition Council found that 31 companies had infringed EU and 

Romanian  competition  law  from  2011  to  2016;  13  of  them  admitted  the 

infringement.123 Following this investigation the RCC submitted recommendations for 

improving the competitive environment in the sector. 

227.  Object  and/or  effect  of  restricting  competition:  Romanian  Timber  was  an 

object case. 

228.  Fines: The total fines imposed in this case were RON 129.6 million (approximately, 

€26.6 million).  

229.  Sector:  The  buying  market  was  the  purchase  of  timber  in  Romania.    The  selling 

market was (presumably) the sale of wood products in Romania. 

230.  Type  of  joint  purchasing:  This  case  did  not  involve  joint  purchasing.  Romanian 

Timber was a buyer cartel. 

231.  Theory of harm/benefit/reason why no harm to competition:  The theory of 

harm appears to have been that the collusive tendering and exchanges of information 

distorted the process of competition for the procurement of timber. 

123   Decision no. 71/2020 

40 

 
 
                                                 
232.  Was  secrecy  a  relevant  consideration?  It  is  not  clear  from  publicly  available 

materials in English whether secrecy played a role in the reasoning of the CNMC. 

Spain – Dairy (2015) and (2019) 

233.  Facts: Between 2000 and 2013 ten of the largest Spanish and international dairy 

companies,  including  Danone  and  Nestlé,  exchanged  information  on  current  and 

future purchase prices, the volumes of raw milk purchased from particular farmers 

and the level of surplus unprocessed cow’s milk. This information was of a kind that 

would normally be regarded as commercially sensitive and confidential. The objective 

of the exchanges was to enable the parties to control the market for raw cow’s milk 

to their advantage.   

234.  Outcome: The Comisión Nacional de Mercados y Competencia (‘CNMC’) condemned 

the dairy companies’ behaviour in a decision in 2015, but that decision was set aside 

on appeal. In 2019 the CNMC adopted a second infringement decision.124 The CNMC 

considered  that  the  information  exchange  was  an  infringement  by  object.  In 

particular, the exchange of information on raw milk purchase prices allowed the dairy 

companies  to  stop  competing  with  each  other  in  the  purchasing  market,  allowing 

them  to  avoid  price  rises  at  times  of  scarcity.  The  exchange  of  information  on 

surpluses of raw milk and a proposal to withdraw milk from the market in a concerted 

manner was intended to raise the final price of the milk. Cartel damage claims has 

announced  that  it  is  intending  to  bring  an  action  for  damages  on  behalf  of  dairy 

farmers in Spain.125 

235.  Object and/or effect of restricting competition: This was an object case. 

236.  Fines: The CNMC’s second decision imposed fines totalling €80.6 million.  

237.  Sector: The buying market was the purchase of supply of unprocessed cow’s milk 

in Spain.  The selling market was the sale of processed cow’s milk and other dairy 

products in Spain. 

238.  Type of joint purchasing: This case did not involve joint purchasing. Spanish Dairy 

was  an  exchange  of  confidential  and  commercially  sensitive  information  among 

competitors. 

124   Decision of 18 July 2019. 

125   https://carteldamageclaims.com/our-cases/milk-cartel/.  

41 

 
 
                                                 
239.  Theory of harm/benefit/reason why no harm to competition:  The theory of 

harm  was  that  the  information  exchanges  reduced  uncertainty  as  to  the  risks  of 

competition  in  the  market  for  the  supply  of  unprocessed  cow’s  milk.    The  CNMC 

expressly  found  that  the  parries  had  managed  to  reduce  raw  milk  prices  by 

approximately 10–12%. 

240.  Was  secrecy  a  relevant  consideration?  It  is  not  clear  from  publicly  available 

materials in English whether secrecy played a role in the reasoning of the CNMC. 

Spain – Used Batteries (2018) 

241.  Facts:  Azor  Ambiental,  Exide  Technologies,  SLU  and  Recuperación  Ecológica  de 

Baterías SL were and are purchasers of used batteries for second-hand vehicles in 

Spain.    Between  2008  and  2012  the  three  companies  exchanged  commercially 

sensitive information regarding the purchasing prices for used batteries. The parties 

regularly contacted each other by email, phone, face-to-face meetings and indirect 

communications through common suppliers and collectors of used batteries. These 

contacts enabled each party to identify the current and future purchase prices of its 

two  main  rivals  on  a  regular  basis,  thereby  removing  an  important  element  of 

uncertainty on the part of each as to the activities of the others. 

242.  Outcome: The CNMC concluded that information exchange breached Article 101 and 

Article 1 of the Spanish Competition Act.126 In the CNMC’s view the exchange enabled 

the  parties  to  coordinate  the  setting  of  purchase  prices.  The  exchange  of  such 

confidential information undermined the principle that every trader must determine 

its market strategy independently.  

243.  Object and/or effect of restricting competition: This was an object case. 

244.  Fines: Recobat was fined €3.37 million and Exide Technologies was fined €2 million. 

245.  Sector: The buying market was the purchase of used batteries for motor vehicles.  

The  selling  market  was  (presumably)  the  resale  of  used  car  batteries  for  motor 

vehicles. 

126   Decision of 12 July 2018. 

42 

 
 
                                                 
246.  Type of joint purchasing: This case did not involve joint purchasing. Spanish Used 

Batteries  was  a  case  involving  an  exchange  of  confidential  and  commercially 

sensitive information among competitors. 

247.  Theory of harm/benefit/reason why no harm to competition:  The theory of 

harm  was  that  the  information  exchanges  reduced  uncertainty  about  the  future 

competitive conduct of rivals and, in particular, the purchase prices that they were 

likely to pay to suppliers.   

248.  Was  secrecy  a  relevant  consideration?  It  is  not  clear  from  publicly  available 

materials in English whether secrecy played a role in the reasoning of the CNMC. 

D.  THIRD COUNTRIES 

Malaysia – Car Insurance (2020) 

249.  Facts: The General Insurance Association of Malaysia (‘PIAM’) is the national trade 

association of general insurance companies in Malaysia. If a driver has an accident, 

their insurer is responsible for paying the costs of the motor vehicle repairs.127 The 

repairs  are  carried  out  by  car  repair  workshops  (known  as  ‘PARS  workshops’).  A 

complaint  was  made  to  the  Malaysia  Competition  Commission  (‘MyCC’)  that  PIAM 

and its 22 member insurers had collectively fixed both the discount for car parts used 

to  repair  certain  vehicles  and  the  labour  hourly  rate  for  PIAM-approved  repairer 

workshops. 

250.  Outcome: The MyCC condemned PIAM and its members for fixing both the discount 

rate for certain car parts and the hourly labour rates. The MyCC rejected the parties’ 

argument that this conduct did not pursue an anti-competitive object. The MyCC’s 

view  was  clear:  ‘the  conduct  in  question,  by  its  nature,  is  injurious  to  the  proper 

functioning  of  competition  as  it  is  artificially  limiting  the  commercial  negotiations 

between  the  individual  insurers  and  repairers  from  independently  determining  the 

parts trade discounts and labour rates for motor repair services.’128 The MyCC stated 

that,  in  future,  the  discount  rate  for  parts  and  the  repairer’s  labour  rate  per  hour 

should be determined independently by the insurers. 

251.  Object and/or effect of restricting competition: This was an object case. 

127   Decision of 29 October 2020, para 78. 

128  

Ibid, para 194. 

43 

 
 
                                                 
252.  Fines:  The  MyCC  fined  22  general  insurance  companies,  including  well-known 

insurers such as AIG and Allianz, a total of RM 130.24 million (approximately, €35.7 

million). 

253.  Sector:  The  buying  market was the  purchase  of  car  repair  services,  including car 

parts, from insurer approved repairers in Malaysia. The selling market was for the 

supply of private motor insurance to individual drivers in Malaysia. 

254.  Type  of  joint  purchasing:  This  case  did  not  involve  joint  purchasing;  the  PIAM 

fixed the car part discounts and repairer hourly rates. 

255.  Theory  of  harm/benefit/reason  why  no  harm  to  competition:  The  MyCC’s 

theory of harm was that PIAM’s conduct allowed its members to ‘eliminate in advance 

any uncertainty about the future conduct of the Parties and to take into account the 

information disclosed in determining the policy which they intended to follow on the 

market.’129 

256.  Was secrecy a relevant consideration? No. 

New Zealand – Residential Property (2019) 

257.  Facts: Ronovation was a family-owned company that offered advisory services to 

clients who wanted to buy residential property in the Auckland area for investment 

purposes. Ronovation’s services included the provision of information about what to 

look for in a property; how to negotiate with the vendor or bid at auction; how to 

renovate  the  property  after  acquisition;  and  how  to  find  and  manage  tenants. 

Ronovations developed a set of rules to make sure that its clients did not compete 

to buy the same properties. The rules required the clients to notify one another of 

their intention to purchase a property, following which they were given priority to 

purchase  that  property.  The  rules  were  posted  on  Ronovation’s  Facebook  page  in 

2011 and remained there until 2018.   

258.  Outcome:  The  rules  came  to  the  attention  of  the  Commerce  Commission  of  New 

Zealand  which  brought  proceedings  against  Ronovation  in  the  High  Court. 

Ronovation  promptly  admitted  liability,  but  contested  the  level  of  the  proposed 

penalty. As explained below, the High Court imposed a fine and rejected Ronovations’ 

argument that a buyer cartel is intrinsically less harmful than a seller cartel.130 The 

129  

130  

Ibid, paras 180 and 194. 

Ibid, para 38. 

44 

 
 
                                                 
High Court also agreed with the Commission that buyer-side conduct can result in 

material harm even where there is no clear reduction in supply or capacity.131 

259.  Object and/or effect of restricting competition: This was an object case. 

260.  Fines: The High Court imposed a penalty of $400,000 on Ronovation for price fixing 

in Auckland’s residential property market.132 

261.  Sector:  The  buying  market  was  the  purchase  of  advisory  services  for  buying 

residential property in the Auckland area for investment purposes.  The downstream 

market appears to have been the purchase of residential property in the Auckland 

area. 

262.  Type of joint purchasing: This case did not involve joint purchasing. Residential 

Property  was  an  exchange  of  confidential  and  commercially  sensitive  information 

among competitors. 

263.  Theory of harm/benefit/reason why no harm to competition:  The theory of 

harm was that Ronovation’s rules suppressed competition between its clients in order 

to avoid driving up prices for the properties they were seeking to acquire. In the High 

Court’s  view  the  ‘conduct  was  therefore  designed  to  suppress  the  normal  rivalry 

between members that would arise in a competitive sale process, in a manner that 

was to the detriment of any vendors who were directly impacted by the operation of 

the Agreement.’133 As a consequence, clients may have paid less for their individual 

property purchases than they otherwise would have.134 

264.  Was secrecy a relevant consideration? No. 

New Zealand – Trade Me Property (2020) 

265.  Facts: Trademe.co.nz is New Zealand’s largest online residential listings platform. 

Until 2013, Trade Me charged a fixed monthly subscription fee to estate agents that 

wished to advertise properties for sale. In 2013, however, Trade Me changed its fee 

structure so that it would charge for each residential listing placed on its website. 13 

real estate agencies in the Hamilton area subsequently met to discuss Trade Me’s 

131  

132  

133  

134  

Ibid, para 39. 

[2019] NWHC 2303. 

Ibid, para 40. 

Ibid, para 55. 

45 

 
 
                                                 
new  pricing  policy.  The  Commerce  Commission  of  New  Zealand  alleged  that  the 

estate agencies had entered into an arrangement or reached an understanding that 

had the purpose or effect of fixing, controlling or maintaining the price of services 

provided by the estate agencies in competition with each other, i.e. the promotion 

and marketing of property for sale.135 In other words, the agencies agreed to pass 

on the new listing fee to the relevant vendor. 

266.  Outcome: A number of agencies admitted their involvement in an unlawful price-

fixing arrangement. Two agencies, however, disputed the Commission’s allegations.  

Accordingly,  the  Commission  brought  proceedings  against  them  and  their  owner 

before the New Zealand High Court. The High Court held that the Commission had 

failed to prove that the arrangement had either the purpose or the effect of fixing 

the prices of the agencies’ own services since the agencies remained free to absorb 

the Trade Me listing fee if they wanted to do so.136 The Court of Appeal reversed this 

judgment  because  the  purpose  of  the  arrangement  was  to  fix  the  price  of  the 

agencies’ services. It was sufficient that the agencies had agreed a default position 

that the Trade Me listing fee would not be absorbed and instead would be paid by 

their  customers  (i.e.  the  vendors  of  properties).137  The  Supreme  Court  of  New 

Zealand upheld the Court of Appeal’s judgment.138 The Supreme Court had no doubt 

that a substantial purpose of the arrangement was to pass on the Trade Me listing 

fee and, as such, control the price the estate agents charged for their services. 

267.  Object and/or effect of restricting competition: This was an object case. 

268.  Fines:  Those  agencies  that  admitted  their  involvement  in  the  cartel  arrangement 

paid fines totalling $3 million. The question of pecuniary penalties was remitted to 

the High Court in the contested proceedings. 

269.  Sector:  The  buying  market  was  the  purchase  by  estate  agents  of  advertising 

services through the medium of an online property portal. The selling market was 

the provision of estate agency services, in which estate agents compete with each 

other to offer services to potential vendors and lessors of property. 

135   This reflected the wording of the relevant provision of the Competition Act in New Zealand. 

136   Commerce Commission v Lodge Real Estate Limited [2017] NZHC 1497. 

137  

138  

[2018] NZCA 523. 

[2020] NZSC 25. 

46 

 
                                                 
270.  Type  of  joint  purchasing:  This  case  did  not  involve  joint  purchasing.  Trade  Me 

Property was an arrangement between estate agents to pass on a significant input 

cost to vendors of residential property. 

271.  Theory of harm/benefit/reason why no harm to competition: The theory of 

harm was that, by agreeing to pass on Trade Me’s new listing fees, the estate agents 

eliminated the risk that one of them would ‘steal a march’ on the others by offering 

to  absorb  the  listing  fee,  which  would  otherwise  have  pressurised  the  others  to 

respond or risk losing listings.139 

272.  Was secrecy a relevant consideration? No. 

Singapore – Public Auctions of Motor Vehicles (2013) 

273.  Facts: Motor vehicle traders participate in auctions held by public authorities to sell 

decommissioned public transport, police, defence and similar motor vehicles. From 

at least 2008 12 motor vehicle traders (the ‘parties’) agreed to refrain from bidding 

against  each  other  at  these  public  auctions.  Instead,  Pang’s  Motor  Trading  Ltd 

(‘Pang’) was chosen to bid for the vehicles at the public auctions most of the time. 

Pang  would  hold  a  second,  private  auction  in  which  the  parties  would  bid  among 

themselves for the vehicles bought by Pang. The difference in the price paid by Pang 

at the public auction and the price paid at the private auction would then be shared 

between the parties. The parties’ agreement to suppress bids at public auctions of 

motor vehicles lasted until 2011.  

274.  Outcome:  After  receiving  information  from  other  government  agencies,  the 

Competition Commission of Singapore (‘CCCS’) decided that the object of the parties’ 

bid-suppression  agreement  was  to  restrict  competition  at  public  government 

auctions  in  Singapore.  The  CCCS  found  that  competitive  bidding  is  an  essential 

element of auction sales.140 The parties’ bid-suppression agreement conflicted with 

that process of rivalry.  Pang appealed against the CCCS’s decision, but the decision 

was upheld in its entirety by the Singaporean Competition Appeal Board.141 

275.  Object and/or effect of restricting competition: This was an object case. 

139  

Ibid, para 178. 

140   Decision of 28 March 2013, para 41. 

141  

Judgment of 14 January 2015. 

47 

 
 
                                                 
276.  Fines: The CCCS imposes fines totalling $179,071.   

277.  Sector: The buying market was the purchase of motor vehicles acquired by way of 

public  auctions  held  by  government  agencies  in  Singapore.    The  selling  markets 

appear to have been the sale of the used motor vehicles won at the public auctions 

and the sale of scrap metal. 

278.  Type  of  joint  purchasing:  This  case  did  not  involve  joint  purchasing.  Public 

auctions of Motor Vehicles; it was a buyers’ bid suppression arrangement. 

279.  Theory of harm/benefit/reason why no harm to competition: Auctions consist 

of a sale of an asset to the highest bidder. The theory of harm in this case was that 

the parties’ bid-suppression arrangement distorted the process of competition to buy 

motor vehicles at public government auctions. It did so by removing the uncertainty 

(and  thus  the  risks)  as  to  the  bidding  conduct  of  one  another  at  the  public 

auctions.142 It might be added that the arrangement was clearly designed to keep 

auction  prices  artificially  low  and  thereby  deprives  public  authorities  of  their 

expectancy of the highest price in a competitive market.143 

280.  Was  secrecy  a  relevant  consideration?  In  setting  the  fines  the  Commission 

specifically noted that the parties’ private arrangement ‘created the false impression 

that  the  winning  bids  were  actually  the  result  of  a  fair  and  competitive  bidding 

process’,144 which supported its view that it was a serious infringement of section 34 

of the Competition Act (the domestic equivalent of Article 101 TFEU).  

South Africa – Scrap Steel (2016) 

281.  Facts: Between 1998 and 2008 four manufacturers of steel products – ArcelorMittal, 

Columbus  Steel,  Cape  Gate  and  Scaw  Metals  –  fixed  the  purchase  price  of  scrap 

metal in South Africa. They did so by agreeing a common approach to a standard 

pricing formula for scrap metal and then meeting with scrap merchants (the suppliers 

of  scrap  steel)  to  agree  the  formula.  The  four  steel  manufacturers  subsequently 

coordinated their approach to discounts and to annual negotiations of changes to the 

pricing formula. 

142  

143  

Ibid, para 243. 

Ibid, para 256. 

144  

Ibid. 

48 

 
 
                                                 
282.  Outcome: ArcelorMittal, Columbus and Cape Gate admitted their involvement in the 

scrap metal buyer cartel, and agreed to pay fines. Scaw had voluntarily blown the 

whistle  and  provided  the  Commission  with  decisive  evidence  of  the  cartel;  it  was 

given 100% immunity from a fine. 

283.  Object and/or effect of restricting competition: This was an object case. 

284.  Fines: ArcelorMittal agreed to pay a fine of 1.5 billion Rand.145  Columbus Stainless 

agreed to pay a penalty of 32.6 million Rand.   

285.  Sector: The  buying  market  was the  purchase  of  scrap metal  in  South  Africa. The 

selling market was the sale of various steel products in South Africa and elsewhere. 

286.  Type  of  joint  purchasing:  This  was  not  a  case  of  joint  purchasing.  Scrap  Steel 

involved a buyer cartel. 

287.  Theory of harm/benefit/reason why no harm to competition: The theory of 

harm  appears  to  have  been  that  the  agreement  between  the  steel  manufacturers 

restricted  or  distorted  the  process  of  competition  in  the  market  for  buying  scrap 

metal.   

288.  Was secrecy a relevant consideration?  

Turkey – Dried Figs (2012) 

289.  Facts: According to the OECD’s summary of competition developments in Turkey,146 

10 undertakings active in the purchasing of dried figs in the Aydın province agreed 

to fix the purchase price that they paid to suppliers. 

290.  Outcome:  In  March  2012  the  Turkish  Competition  Authority  decided  that 

agreements  aimed  at fixing  maximum  purchase  prices  violate  Turkish  competition 

law.  The  Authority  imposed  fines  and  recommended  that  the  Government  should 

promote awareness of the competition rules in the agricultural sector. 

145   ArcelorMittal was also fined for its participation in a separate cartel in relation to long steel. 

146   See OECD Annual Report on Competition Policy Developments in Turkey – 2012. 

49 

 
 
                                                 
291.  Sector: The buying market was for the purchase of dried figs in Turkey. The selling 

market  seems  to  have  been  the  resale  of  dried  figs  in  Turkey  and  potentially 

elsewhere. 

292.  Object and/or effect of restricting competition: This was an object case. 

293.  Type of joint purchasing: This was not a joint purchasing case. Dried Figs was a 

buyer cartel. 

294.  Theory of harm/benefit/reason why no harm to competition: The theory of 

harm  was,  presumably,  that  the  agreement  fixed  purchases  prices  and  therefore 

eliminated  competition  on  price  between  purchasers  for  dry  figs  in  the  Aydın 

province. 

295.  Was  secrecy  a  relevant  consideration?  It  is  not  clear  from  publicly  available 

materials in English whether secrecy played a role in the reasoning of the Authority. 

UK – Makro-Self Service/Palmer & Harvey (2010) 

296.  Facts: Makro-Self Service and Palmer & Harvey, two grocery wholesalers, proposed 

to create a jointly-owned company, PalMak, which would jointly negotiate the terms 

and conditions of purchases from certain suppliers for food and other products. The 

parties’ combined share of the market for purchase of daily consumer goods was less 

than 15%. The parties’ combined share of the market for the supply by independent 

wholesalers  to  independent  retailers  was  15–20%.  Each  party  remained  free  to 

negotiate  outside  the  joint  purchasing  agreement,  with  the  outcomes  of  those 

negotiations kept secret. 

297.  Outcome: In a short-form opinion the former UK Office of Fair Trading (‘OFT’) said 

that  a  joint  purchasing  agreement  would  be  ‘unlikely’  to  have  as  its  object  the 

restriction  of  competition.147    It  also  expressed  the  view  that,  in  the  absence  of 

parallel networks of similar agreements, the joint purchasing agreement was unlikely 

to cause harm to competition where, as here, the parties did not have market power 

in  the  selling  market.148    Nor  (for  the  same  reason)  did  the  commonality  of  the 

parties’ input costs – the agreement covered 45–55% of the parties’ variable costs 

– give rise to anti-competitive effects.149 The OFT also made certain comments that 

147   Short-form opinion of 27 April 2010, para 6.1.  

148  

149  

Ibid, para 6.3. 

Ibid, paras 1.6 and 6.13–6.16. 

50 

 
 
                                                 
led to the amendment of the joint purchasing agreement relating to the exclusion of 

certain suppliers (on the basis of a specified market share threshold) and prevented 

exchanges  of  information  that  were  unrelated  to  (and  unnecessary  for)  the  joint 

purchasing. 

298.  Object and/or effect of restricting competition: Neither. 

299.  Fines: None. 

300.  Sector: The buying market was the purchase of daily consumer goods in the UK. 

The  selling  market  was  the  supply  of  those  goods  by  independent  wholesalers  to 

independent and convenience retailers in the UK. 

301.  Type  of  joint  purchasing:  A  jointly-owned  company  (PalMak)  was  set  up  to 

negotiate  with  selected  suppliers  on  behalf  of  its  parent  companies.  The  parent 

companies then bought products from those suppliers on the terms negotiated by 

PalMak. 

302.  Theory  of  harm/benefit/reason  why  no  harm  to  competition:  The  OFT’s 

theory of harm appears to have been that a joint purchasing agreement will cause 

anti-competitive  effects  where  the  parties  have  sufficient  market  power  in  the 

downstream selling markets.  The parties did not have such power on the facts of 

this case. 

303.  Was secrecy a relevant consideration? No. 

304.  Comment: The OFT’s short-form opinion in this case did not conclude whether or 

not there had been or still was an infringement of EU or UK competition law.  It is 

interesting to note that the OFT emphasised the importance of the parties’ market 

position on the selling market. The OFT went as far as to say that, in the absence of 

parallel networks of similar agreements, joint purchasing agreements are unlikely to 

cause harm where the parties have no market power in the relevant selling market 

(without  seemingly  considering  the  possible  effects  in  the  relevant  purchasing 

market). 

US – Live Poultry Dealers’ Protective Association (1924) 

305.  Facts: In 1914 300 wholesale buyers of live poultry in the city of New York formed 

the Live Poultry Dealers’ Protective Association (‘Protective Association’). Before the 

defendants  adopted  the  conduct  complained  about,  the  prices  for  live  poultry  had 

51 

 
 
been determined without any rule and according to the negotiations of the buyers 

and sellers.  The members of the Protective Association considered the market was 

in a ‘demoralised condition’ and that prices were being affected by ‘fake sales’, which 

resulted  in  higher  prices  to  end-consumers.  It  was  the  purpose  of  the  Protective 

Association to eliminate opportunities for bad trade practices and to give both the 

buyers  and  sellers  a  reliable  guide  upon  which  to  deal.  To  that  end,  in  1923  a 

committee of seven members began to fix the daily price for all purchases made by 

any members of the association. It was also agreed that members would cease to 

deal with any suppliers that failed to adhere to the prices fixed by the committee. 

306.  Outcome: In 1924 the Second Circuit Court of Appeals upheld the injunction granted 

by the District Court which forbade members of the Protective Association from fixing 

poultry  purchase  prices  and  from  boycotting  suppliers  that  did  not  observe  those 

prices.150 The Court rejected the defendants’ arguments about a lack of an effect on 

inter-state commerce and that an agreement to fix purchase prices was desirable. 

Judge  Learned  Hand’s  conclusion  was  unequivocal:  ‘if  one  thing  were  definitely 

settled, it was that the Sherman Act forbade all agreements preventing competition 

in  price  among  a  group  of  buyers,  otherwise  competitive,  if  they  are  numerous 

enough to affect the market.’ 

307.  Object and/or effect of restricting competition: The buyer cartel was a per se 

violation of section 1 of the US Sherman Act 1890. 

308.  Fines: None. 

309.  Sector: The buying market was for the purchase of live poultry at the Washington 

Market in New York.  The selling market was (presumably) the sale of poultry to end-

consumers. 

310.  Type of joint purchasing: This case did not involve joint purchasing. Live Poultry 

Dealers’ Protective Association was a buyer cartel in that the Protective Association 

fixed the price that members would pay to live poultry. 

311.  Theory of harm/benefit/reason why no harm to competition: The Court did 

not  articulate  a  theory  of  harm,  but  it  appears  that  it  was  concerned  about  the 

suppression  of  the  competitive  process  in  the  purchasing  market.  Judge  Learned 

Hand  held  that  ‘Congress  deliberately  prefers  unorganized  individualism  in 

150   4 F.2d 840 (2d Cir. 1924). 

52 

 
                                                 
bargaining to the danger, real or fancied, which may attend any efforts to control it 

by concerted efforts.’   

312.  Was secrecy a relevant consideration? No. 

US – Topco v US (1972) 

313.  Facts:  Topco  was  a  cooperative  association  that  was  founded  in  the  1940s  by  a 

group  of  small,  local  grocery  chains.  Topco  purchased  and  distributed  to  its  25 

members more than 1,000 different grocery items, most of which had brand names 

owned by Topco. Topco’s bylaws provided that no member could sell Topco brand 

products outside the territory in which it was ‘licensed’ by Topco. This meant that 

expansion into another member's territory was, in practice, possible only with the 

other members’ consent.  Topco defended these territorial divisions on the basis that 

they were necessary for to compete with larger national and regional grocery chains. 

The  United  States  government  brought  an  injunction  action  alleging  a  violation  of 

section 1 of the Sherman Act. 

314.  Outcome: The Supreme Court held that Topco’s arrangements to allocate territories 

between its members were a per se violation of section 1 of the Sherman Act.151 The 

Supreme  Court  rejected  the  argument  that  the  arrangements  were  necessary  to 

enable Topco’s members to compete with larger supermarkets. Instead, the Court 

held that ‘Topco has no authority under the Sherman Act to determine the respective 

values  of  competition  in  various  sectors  of  the  economy.  On  the  contrary,  the 

Sherman Act gives to each Topco member and to each prospective member the right 

to ascertain for itself whether or not competition with other supermarket chains is 

more desirable than competition in the sale of Topco brand products.’152 

315.  Object and/or effect of restricting competition: The buyer cartel was a per se 

violation of section 1 of the US Sherman Act 1890. 

316.  Fines: None. 

317.  Sector: The buying markets were the purchase of more than 1,000 different items, 

most  of which have  brand names  owned  by  Topco. The  selling  markets  appear to 

have been local markets for the supply of groceries by grocery retailers. 

151   405 US 596, at 608–609 (1972). 

152   405 US 596, at 611 (1972). 

53 

 
 
                                                 
318.  Type  of  joint  purchasing:  Topco’s  basic  function  was  to  serve  as  a  purchasing 

agent for its members, all of whom were SMEs. Topco procured and distributed to 

the members more than 1,000 different food and related non-food items. Topco did 

not own any manufacturing, processing, or warehousing facilities, and the items that 

it  purchased  for  members  were  usually  shipped  directly  from  the  supplier  to  the 

members. Payment was made either to Topco or directly to the supplier at a cost 

that was virtually the same for the members as for Topco itself. 

319.  Theory of harm/benefit/reason why no harm to competition:  This  case did 

not  call  into  question  Topco’s  joint  purchasing  arrangements.  The  Supreme  Court 

condemned horizontal market-sharing in the downstream selling markets, which, by 

its  nature,  eliminated  competition  between  Topco’s  members.  This  had  the  same 

adverse  effect  upon  consumer  welfare  that  other  horizontal  restrictions  may 

produce: a reduction in output and an increase in price. 

320.  Was secrecy a relevant consideration? No. 

US – Northwest Wholesale Stationers (1985) 

321.  Facts: Northwest was a wholesale purchasing cooperative that acted on behalf of 

office supply retailers in the Pacific Northwest States. Pacific became a member of 

Northwest  in  1958,  but  was  expelled  in  1978.  Pacific  was  expelled  because  it  had 

failed to notify Northwest of a change in its ownership (contrary to the cooperative’s 

bylaws). Pacific sued Northwest alleging a violation of section 1 of the Sherman Act. 

Pacific’s case was that Northwest’s expulsion of Pacific from the cooperative without 

a fair hearing was a group boycott that limited Pacific’s ability to compete.   

322.  Outcome: The US Supreme Court held that Pacific’s expulsion from Northwest did 

not imply ‘anti-competitive animus’ and was not so likely to result in anti-competitive 

effects that it should be condemned as illegal per se.153 Rather, the Court recognised 

that wholesale purchasing cooperatives have to establish and enforce rules in order 

to function effectively. Disclosure rules, such as the one on which Northwest relied 

to  expel  Pacific,  provide  a  cooperative  with  a legitimate  means  for monitoring  the 

creditworthiness of its members. The Court did not consider that such rules harmed 

153   The  Court  held  that  the  category  of  restraints  classed  as  group  boycotts  was  not  to  be 
expanded  indiscriminately,  and  the  per  se  approach  has  generally  been  limited  to  cases  in 
which firms with market power boycott suppliers or customers in order to discourage them 
from doing business with a competitor: ibid, at 294. 

54 

 
 
                                                 
competition  unless  the  purchasing  cooperative  had  market  power,  which  was  not 

something that Pacific had alleged.154   

323.  Object and/or effect of restricting competition: The US Supreme Court did not 

reach a final conclusion on the substance, but it held that it would be necessary to 

consider the effects of the impugned rule as part of the rule of reason standard. 

324.  Fines: None. 

325.  Sector:  The  buying  market  was  the  purchase  of  office  supplies  in  the  Pacific 

Northwest States. The selling market was the wholesale supply of office supplies to 

retailers in the Pacific Northwest States. 

326.  Type of joint purchasing: This case did not involve a challenge to the lawfulness 

of  joint  purchasing.  It  concerned  the  lawfulness  of  the  way  in  which  a  purchasing 

cooperative had enforced its by-laws. 

327.  Theory  of  harm/benefit/reason  why  no  harm  to  competition:  The  US 

Supreme Court emphasised the benefits of wholesale purchasing cooperatives such 

as  Northwest.  Such  cooperatives  were  ‘not  a  form  of  concerted  activity 

characteristically  likely  to  result  in  predominantly  anticompetitive  effects.  Rather, 

such  cooperative  arrangements  would  seem  to  be  designed  to  increase  economic 

efficiency and render markets more, rather than less, competitive. The arrangement 

permits the participating retailers to achieve economies of scale in both the purchase 

and warehousing of wholesale supplies, and also ensures ready access to a stock of 

goods  that  might  otherwise  be  unavailable  on  short  notice.  The  cost  savings  and 

order-filling guarantees enable smaller retailers to reduce prices and maintain their 

retail stock so as to compete more effectively with larger retailers.’155 

328.  Was secrecy a relevant consideration? No. 

154   472 US 284, at 298 (1985). 

155   472 US 284, at 295 (1985). 

55 

 
                                                 
efficiency and render markets more, rather than less, competitive. The arrangement 

permits the participating retailers to achieve economies of scale in both the purchase 

and warehousing of wholesale supplies, and also ensures ready access to a stock of 

goods  that  might  otherwise  be  unavailable  on  short  notice.  The  cost  savings  and 

order-filling guarantees enable smaller retailers to reduce prices and maintain their 

retail stock so as to compete more effectively with larger retailers.’155 

328.  Was secrecy a relevant consideration? No. 

155  

472 US 284, at 295 (1985). 

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ISBN: 978-92-76-46935-3