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EU Competition Law and Environmental Protection - Integrate or Isolate?

Sand Holmberg, Victor LU (2014) LAGM01 20142
Department of Law
Abstract
The European Commission has, in recent years, adopted an economic, consumer welfare-driven approach in its competition policy. Since the “modernisation” of the European competition law in 2004, the Commission has stated that “objective economic benefits” are necessary for the exemption in Article 101(3) TFEU to apply. While the Commission in the past may have taken environmental consideration into account in its competitive assessments, economic efficiency has become the paramount goal of EU competition policy. It may seem like decision-makers no longer are able to consider non-economic concerns when assessing anti-competitive agreements. Meanwhile, environmental law academics stress the importance of “market-based instruments” and the... (More)
The European Commission has, in recent years, adopted an economic, consumer welfare-driven approach in its competition policy. Since the “modernisation” of the European competition law in 2004, the Commission has stated that “objective economic benefits” are necessary for the exemption in Article 101(3) TFEU to apply. While the Commission in the past may have taken environmental consideration into account in its competitive assessments, economic efficiency has become the paramount goal of EU competition policy. It may seem like decision-makers no longer are able to consider non-economic concerns when assessing anti-competitive agreements. Meanwhile, environmental law academics stress the importance of “market-based instruments” and the need for private cooperation to combat environmental decay. An increasing number of firms seek to do business in a way that minimises their environmental impact. Often, such initiatives require a certain degree of collaboration. The scope of Article 101(3) TFEU becomes highly relevant when companies enter into voluntary environmental agreements, which are restrictive of competition, but also carries great environmental benefits. Companies that cooperate to reduce their environmental pressure run the risk of violating Article 101 TFEU. However, the case law of the EU courts, as well as the decisional practice of the Commission, does not fully support the Commission’s new approach. The Treaties demand that the Union strive towards a sustainable development and a high level of environmental protection. Traditionally, the EU courts have used a teleological interpretation method when analysing the provisions in the Treaties. It can be argued that the founding Treaties should be viewed as forming a coherent system. When the wording of Treaty statutes is vague enough to be open to interpretation, they should be interpreted as to help EU’s overarching policy objectives. Article 101 TFEU is open to interpretation and allows for the Treaties’ environmental goals to be taken into account. It can also be argued that it is economically rational to integrate environmental concerns into the competitive assessment. According to neoclassic economic theory, competition gives rise to “external effects” that must be internalised if society’s resources are to be efficiently allocated. Even if we accept the notion that only “objective economic benefits” may satisfy Article 101(3) TFEU, neoclassic environmental economic theory suggests that environmental benefits can constitute just that. This thesis concludes that the constitutional structure of the Treaties demands that environmental concerns are to be taken into account under Article 101 TFEU. This thesis further argues that Article 101(1) TFEU should entail a consumer welfare test on the relevant market. Environmental benefits should be taken fully into account under Article 101(3) TFEU. The aggregated positive and negative effects to society as a whole are considered in this assessment. Environmental benefits should be relevant in Article 101(3) TFEU even if they cannot be calculated into “objective economic benefits”. (Less)
Abstract (Swedish)
EU-kommissionens tillämpning av den europeiska konkurrenslagstiftningen har på senare år genomgått en förändring. EU-kommissionen kräver, sedan konkurrenslagstiftningens modernisering 2004, att ett konkurrensbegränsande avtal leder till ”objektiva ekonomiska fördelar” för att det ska undantas enligt Artikel 101(3) FEUT. Även om EU-kommissionen förr tog hänsyn till miljön i sin konkurrensrättsliga analys, är nu ekonomisk effektivitet det främsta målet för konkurrenslagstiftningen. Enligt nya riktlinjer utgivna av EU-kommissionen kan inte längre verkställande myndigheter ta hänsyn till icke-ekonomiska värden, såsom miljön, när de utvärderar konkurrensbegränsande avtal. Samtidigt framhåller sakkunniga inom miljörätten vikten av... (More)
EU-kommissionens tillämpning av den europeiska konkurrenslagstiftningen har på senare år genomgått en förändring. EU-kommissionen kräver, sedan konkurrenslagstiftningens modernisering 2004, att ett konkurrensbegränsande avtal leder till ”objektiva ekonomiska fördelar” för att det ska undantas enligt Artikel 101(3) FEUT. Även om EU-kommissionen förr tog hänsyn till miljön i sin konkurrensrättsliga analys, är nu ekonomisk effektivitet det främsta målet för konkurrenslagstiftningen. Enligt nya riktlinjer utgivna av EU-kommissionen kan inte längre verkställande myndigheter ta hänsyn till icke-ekonomiska värden, såsom miljön, när de utvärderar konkurrensbegränsande avtal. Samtidigt framhåller sakkunniga inom miljörätten vikten av ”marknadsbaserade instrument” och privata initiativ för att värna om miljön. Det blir allt vanligare att företag själva försöker utforma sin verksamhet på ett sätt som minimerar deras miljöpåverkan. Inte sällan kräver detta att företagen inom en bransch samarbetar. Även om dessa samarbeten kan medföra stora miljömässiga fördelar, riskerar de att falla under förbudet i Artikel 101(1) FEUT, då de ofta är konkurrensbegränsande. Vilka värden som kan inkorporeras i det generella undantaget i Artikel 101(3) FEUT blir då högst relevant. Det förefaller som om EU-kommissionen inte anser att miljöfördelar kan rättfärdiga konkurrensbegränsande samarbeten. Detta synsätt är dock varken förenligt med EU-domstolarnas praxis eller EU-kommissions tidigare beslutspraxis. Fördragen kräver att Unionen strävar mot en hållbar utveckling och ett utbrett miljöskydd. Traditionellt har EU-domstolen använt sig av en teleologisk tolkningsmetod i förhållande till fördragen. Det kan argumenteras för att fördragen ska ses som en enhet; när bestämmelser i fördragen är öppet formulerade ska dessa tolkas så att Unionens övergripande mål uppnås. Det kan också argumenteras för att det är ekonomiskt rationellt att ta hänsyn till miljön i den konkurrensrättsliga analysen. Enligt nationalekonomisk teori ger konkurrens upphov till ”externa effekter”. Dessa externa effekter måste internaliseras om samhället ska allokera sina resurser effektivt. Då miljön kan beräknas till ett instrumentellt värde, bör miljöfördelar vara relevanta i Artikel 101(3) FEUT även om vi accepterar att det krävs ”objektiva ekonomiska effekter”. Denna uppsats drar slutsatsen att fördragen kräver att miljön ska spela roll i den konkurrensrättsliga analysen. Författaren anser att analysen under Artikel 101(1) FEUT ska fortsätta vara en snäv analys som enbart tar hänsyn till de negativa konkurrensrättsliga effekterna på den relevanta marknaden. Däremot bör analysen i Artikel 101(3) FEUT innefatta samtliga för- och nackdelar för samhället i stort. Miljöförbättringar bör tas hänsyn till oavsett om de kan beräknas till ”objektiva ekonomiska fördelar”. (Less)
Please use this url to cite or link to this publication:
author
Sand Holmberg, Victor LU
supervisor
organization
course
LAGM01 20142
year
type
H3 - Professional qualifications (4 Years - )
subject
keywords
EU law, Competition law, Environmental law, Article 101 TFEU
language
English
id
4905155
date added to LUP
2015-02-17 14:46:34
date last changed
2015-02-17 14:46:34
@misc{4905155,
  abstract     = {The European Commission has, in recent years, adopted an economic, consumer welfare-driven approach in its competition policy. Since the “modernisation” of the European competition law in 2004, the Commission has stated that “objective economic benefits” are necessary for the exemption in Article 101(3) TFEU to apply. While the Commission in the past may have taken environmental consideration into account in its competitive assessments, economic efficiency has become the paramount goal of EU competition policy. It may seem like decision-makers no longer are able to consider non-economic concerns when assessing anti-competitive agreements. Meanwhile, environmental law academics stress the importance of “market-based instruments” and the need for private cooperation to combat environmental decay. An increasing number of firms seek to do business in a way that minimises their environmental impact. Often, such initiatives require a certain degree of collaboration. The scope of Article 101(3) TFEU becomes highly relevant when companies enter into voluntary environmental agreements, which are restrictive of competition, but also carries great environmental benefits. Companies that cooperate to reduce their environmental pressure run the risk of violating Article 101 TFEU. However, the case law of the EU courts, as well as the decisional practice of the Commission, does not fully support the Commission’s new approach. The Treaties demand that the Union strive towards a sustainable development and a high level of environmental protection. Traditionally, the EU courts have used a teleological interpretation method when analysing the provisions in the Treaties. It can be argued that the founding Treaties should be viewed as forming a coherent system. When the wording of Treaty statutes is vague enough to be open to interpretation, they should be interpreted as to help EU’s overarching policy objectives. Article 101 TFEU is open to interpretation and allows for the Treaties’ environmental goals to be taken into account. It can also be argued that it is economically rational to integrate environmental concerns into the competitive assessment. According to neoclassic economic theory, competition gives rise to “external effects” that must be internalised if society’s resources are to be efficiently allocated. Even if we accept the notion that only “objective economic benefits” may satisfy Article 101(3) TFEU, neoclassic environmental economic theory suggests that environmental benefits can constitute just that. This thesis concludes that the constitutional structure of the Treaties demands that environmental concerns are to be taken into account under Article 101 TFEU. This thesis further argues that Article 101(1) TFEU should entail a consumer welfare test on the relevant market. Environmental benefits should be taken fully into account under Article 101(3) TFEU. The aggregated positive and negative effects to society as a whole are considered in this assessment. Environmental benefits should be relevant in Article 101(3) TFEU even if they cannot be calculated into “objective economic benefits”.},
  author       = {Sand Holmberg, Victor},
  keyword      = {EU law,Competition law,Environmental law,Article 101 TFEU},
  language     = {eng},
  note         = {Student Paper},
  title        = {EU Competition Law and Environmental Protection - Integrate or Isolate?},
  year         = {2014},
}