Sustainability meets antitrust again: EC greenlights collective action in wine and ports

It is often said that things slow down in Brussels in the summer months. Still, the European Commission issued two decisions in July that could bring back a topic in the spotlight which was a bit overshadowed by other (geopolitical) issues in recent months – the interaction between sustainability and antitrust law in Europe.

A couple of years ago, the former Executive Vice-President Margrethe Vestager announced that EU competition policy should support the European Green Deal and the efforts to make the EU climate-neutral by 2050. In the following, the Commission not only published a call for contributions covering state aid, antitrust enforcement and merger control and also updated its informal guidance notice (see here) but also introduced an exemption for certain sustainability agreements in the field of agriculture from antitrust scrutiny (see here).

Now the Commission made use of those tools and greenlighted two agreements between competitors for sustainability reasons. The first decision concerns French wine producers seeking price stability for eco-certified vintages. The other involves European port operators coordinating to electrify container-handling equipment.

French wine: Indicative pricing for sustainable vintages

Only one day after France’s national day, the Commission issued its first opinion concerning an exemption from antitrust scrutiny for a sustainability agreement in the agricultural sector.

Wine producers in the French Occitanie region who meet the organic and Haute Valeur Environnementale (HVE) standards approached the European Commission with a proposed agreement involving buyers of their sustainably produced wine. Their aim was twofold: (i) to establish indicative pricing to guide bulk transactions of wine certified under these standards, and (ii) to encourage continued sustainable production by ensuring that these prices reflect the actual costs of organic and HVE-compliant methods, plus a profit margin of up to 20%. The agreement would set annual orientation prices for six grape varieties over a two-year period.

At first glance, this sounds like a hard-to-defend agreement under antitrust rules. And the Commission also made clear that Art. 101 generally prohibits agreements between competitors which could lead to higher prices. However, the Commission made use of Article 210a of Regulation (EU) No 1308/2013 establishing a common organisation of markets in agricultural products (CMO Regulation) which allows agreements aimed at achieving a set of sustainability objectives, by applying standards higher than what is mandatory under EU or national law, provided that any restrictions of competition that result from such agreements are indispensable for the achievement of those objectives.

In the end, the Commission found that the agreement met all conditions under Article 210a: it involved agricultural producers, related to trade in agricultural products, pursued sustainability goals beyond legal mandates, and any restriction of competition was indispensable to achieving those goals.

The political subtext is also interesting: The Commission stressed that this positive guidance letter would “enable an initiative incentivising wine producers in Occitanie to keep producing sustainably, under the two prevalent sustainability labels, which they may not otherwise do in current market conditions.”

Ports: joint purchasing for electric equipment

Meanwhile, in a separate informal guidance letter, the Commission gave a cautious green light to a joint purchasing agreement among port terminal operators, led by APM Terminals. The goal? To accelerate the shift from diesel to battery-electric straddle and shuttle carriers, reducing CO₂ emissions in European ports.

The Commission’s guidance hinges on safeguards: operators must retain the ability to purchase independently, pooled demand must be capped, and sensitive information exchanges must be strictly limited. Provided these conditions are met, the agreement does not raise concerns under Article 101 TFEU.

This is the first guidance issued under the 2022 Notice on Informal Guidance (together with a decision on the creation of a licensing negotiation group from the same day), and it sets a precedent: collective decarbonisation efforts can be compatible with competition law, if carefully designed. Similar to the wine case, the Commission emphasizes that it generally supports initiatives helping the transition to a net-zero economy: “By issuing this guidance letter, we are providing clarity on the application of competition law to arrangements facilitating the switch to green container handling equipment at European ports, thereby contributing to the clean transition of infrastructures crucial to the Single Market and to EU trade.”

All about policy?

One should always be cautious and not read too much into an individual decision (who does not like French wine?). But it is nonetheless noteworthy that the Commission publishes two sustainability decisions within a short time frame at a time when one could have the impression that other topics are higher on the regulator’s radar these days.

But especially the accompanying statements to the two decisions are clear: Whilst the Commission is obviously not abandoning competition principles – it is willing to somewhat reinterpret them in light of the Green Deal. Agreements must be transparent, limited in scope, and demonstrably necessary. The bar is high, but not insurmountable. Perhaps, competition law can be a tool for transformation after all, not just a constraint.

Photo from Kym Ellis on Unsplash