Colluding to Go Green: Global Antitrust Institute Comments on the Austrian Federal Competition Authority’s Draft Guidelines to Exempt “Sustainability Agreements”

ABSTRACT:

The Austrian Federal Competition Authority (AFCA) invited comment on its draft guidelines for the exemption of otherwise anticompetitive “sustainability agreements” from condemnation under Austrian competition law. This comment argues that out-of-market efficiencies which are only tenuously related to the relevant market or accrue to “the general public” rather than to participants in the relevant market should not be weighted as much as are direct in-market harms to consumers. The comment then argues that the AFCA should take into account the unilateral incentive effects of tax policy, such as the Austrian Parliament's recent passage of a carbon tax, in assessing whether the claimed environmental gains from a collusive sustainability agreement are specific to the agreement (“indispensable” to achieving those gains). A broad-based tax is a more efficient way to internalize the externalities conceived in the “European Green Deal” than is a collusive agreement whose anticompetitive effects in a relevant market are akin to an excise tax imposed narrowly on consumers in that market.