Cooperation between companies from the standpoint of competition law and the FEDIL competition conference of October 23, 2018…

The boundaries between the legal and the illegal can be very tight, which can be observed in the context of business cooperation agreements. On the Luxembourg market, companies may want to collaborate to better meet certain customer requirements or to face international competition. However, agreements between companies may also have anticompetitive effects and thus be contrary to competition law, which may result in penalties of up to 10% of turnover. Recently, the Luxembourg Competition Council has decided on agreements between companies.

In its decision of 7 June 2018 concerning an agreement between a taxi booking centre and participating taxi drivers (Webtaxi case), the Competition Council exempted, for the first time, an agreement on horizontal pricing by estimating that the agreement has positive effects on competition and meets the four exemption criteria.  Under certain conditions, an agreement on pricing may be allowed under competition law.

In its decision of 13 June 2018 relating to a label created by four companies in order to disseminate flyers on common promotional prices (Épiceries du Luxembourg case ), the Competition Council considered that the companies concerned were not, from a geographical point of view, direct competitors and that the anti-competitive effect of the agreement in question was limited. Due to the insignificant restriction of competition, the Council did not impose a fine.

Cooperation between competitors may be allowed if its pro-competitive effects outweigh its anti-competitive effects. In this context, it should be noted that the market share of the companies concerned also plays a role in assessing the anti-competitive effect. Thus, it seems unlikely that a dominant enterprise fulfils all the conditions in order to benefit from an individual exemption.