Sustainable development and competition, a growing combination

Sustainable development issues are now playing an increasingly important role in litigation and advisory proceedings and in the context of merger control, particularly in the examination of new markets. They are also emerging in the support offered by the Autorité under its “open door” policy, which enables players involved in the transition to consult the Autorité on their projects at an early stage.

A clarified legal framework

When it comes to sustainable development, companies have started to take part in the change. While, at first glance, competition policy would not appear to be at the forefront of sustainability issues, competition law and sustainable development nevertheless find a meeting point to the extent that, by safeguarding the competitive process, competition law protects and promotes not only consumer welfare, which is increasingly expressed towards sustainable products, but also sustainable innovations. Even more directly, competition law provides a framework for the initiatives envisaged by economic actors in the area of sustainable development. Nevertheless, in some cases, these initiatives may potentially contradict competition law. The examination of these initiatives by competition authorities thus makes it possible to secure cooperation agreements that are favourable to sustainable development and that generate positive effects in terms of public interest that offset the negative effects on competition while sufficiently benefiting consumers.

At the European level, the new rules on vertical and horizontal agreements largely take account of the need to clarify the legal framework and adapt it to the economic and societal changes that have taken place over the last ten years in terms of digital and green transitions. As a result, the guidelines on agreements between competitors now include a chapter on the assessment of agreements that pursue sustainability objectives. They clarify when companies can lawfully cooperate with competitors, including, as the case may be, through individual exemption in the most complex situations. In particular, the guidelines give special attention to agreements that set sustainability standards, as, in practice, this is expected to be the most common form of cooperation for achieving sustainability objectives.