Antitrust: Commission invites comments on draft revised rules on horizontal cooperation agreements between companies

The European Commission has launched today a public consultation inviting all interested parties to comment on two draft revised Horizontal Block Exemption Regulations on Research & Development (“R&D”) and Specialisation agreements (“R&D BER” and “Specialisation BER” respectively, together “HBERs”) and the draft revised Horizontal Guidelines.

The draft revised HBERs and Horizontal Guidelines follow a review and evaluation process launched in September 2019. This aims at adapting the current rules in specific areas where the evaluation found that they were not fully adjusted to the economic and societal developments that occurred over the last ten years, such as the digital and green transition. Moreover, some of the provisions in the HBERs were considered rigid and complex, and the level of legal certainty provided by the Horizontal Guidelines was deemed uneven for the different types of horizontal cooperation agreements covered.

Executive Vice-President Margrethe Vestager, in charge of competition policy, said: “The revision of the Horizontal Block Exemption Regulations and Guidelines is an important policy project as it clarifies for businesses when they can cooperate with rivals. Horizontal cooperation may lead to substantial economic and sustainability benefits, including support for the digital and green transition. The proposed revised rules aim to keep up with developments so that beneficial cooperation can take place, for example when it comes to sustainability or data sharing. We now invite interested parties to provide comments on our draft revised rules, which will help us finalise the new rules to enter into force on 1 January 2023”.

The proposed changes

As set out in more detail in the explanatory note accompanying the draft revised HBERs and Horizontal Guidelines, the proposed changes aim to:

• Make it easier for companies to cooperate in areas such as R&D and production by: (i) clarifying the text of the HBERs and Horizontal Guidelines; (ii) adding new guidance on the application of the HBERs; and (iii) slightly expanding the scope of the Specialisation BER to cover, for example, unilateral specialisation agreements concluded by more than two parties.
• Ensure a continued effective protection of competition by exempting (i) R&D agreements concerning entirely new products, technologies and processes and (ii) R&D efforts directed towards a specific objective but not yet specific in terms of the product or technology from EU competition rules only if there are sufficient comparable competing R&D efforts.
• Include a new chapter on the assessment of horizontal agreements pursuing sustainability objectives as well as new guidance on data sharing, mobile infrastructure sharing agreements and bidding consortia.
• Simplify the administrative supervision by the European Commission and National Competition Authorities (“NCAs”) by streamlining and updating the general framework of assessment of horizontal cooperation agreements.

Next steps

Interested parties are invited to submit their comments on the draft rules by 26 April 2022.

Background on the review process

In May 2021, the Commission published a Staff Working Documentsetting out the results of the evaluation of the current HBERs and Horizontal Guidelines. The evaluation showed that the HBERs, together with the Horizontal Guidelines, are useful instruments and remain relevant for interested parties. The evaluation, however, identified areas for possible improvement in terms of effectiveness, relevance and coherence. The evaluation also identified a number of areas where the texts of the HBERs and Horizontal Guidelines are considered insufficiently clear, overly strict or difficult to interpret.

Following this evaluation, in June 2021, the Commission launched the impact assessment, during which it gathered further evidence on the areas for improvement, including through an open public consultation, several targeted questionnaires and workshops and a consultation of the NCAs. In addition, the Commission requested five experts to provide support studies on specific topics regarding the HBERs, joint purchasing and sustainability agreements.

Today, the Commission also publishes the expert support studies.

Background on the HBERs

Horizontal cooperation agreements between two or more competitors operating at the same level in the market can lead to substantial economic and sustainability benefits in particular if companies combine complementary activities, skills or assets. Horizontal cooperation can be a means to share risk, save costs, increase investments, pool know-how, enhance product quality and variety and speed up innovation. Similarly, horizontal cooperation can be a mean to address shortages and disruptions in supply chains or to reduce dependencies on certain products, services and technologies.

Pro-competitive horizontal cooperation in areas like R&D and specialisation agreements covered by the HBERs is essential for the digital and green transition and can contribute to the well-functioning of the internal market. The HBERs establish that R&D and specialisation agreements fulfilling certain conditions are exempted from the application of Article 101(1) of the Treaty on the Functioning of the European Union (“TFEU”) because they are presumed to meet the requirements of Article 101(3) TFEU. Under Article 101(3) TFEU, such agreements can be declared compatible with the single market provided they contribute to improving the production or distribution of goods or to promoting technical or economic progress, while allowing consumers a fair share of the resulting benefits without eliminating competition.

The HBERs therefore create a safe harbour for those categories of agreements. The Horizontal Guidelines provide guidance on how to interpret and apply the HBERs and how to self-assess compliance with Article 101(1) and Article 101(3) TFEU for R&D and specialisation but also for other types of horizontal cooperation agreements not covered by the HBERs. These include purchasing, commercialisation, standardisation and standard terms agreements but also more generally exchanges of information.

For more information

See the dedicated webpage of DG Competition, which contains all interested parties’ contributions submitted in the context of the evaluation and the impact assessment, summaries of the different consultation activities, the Staff Working Document of the evaluation and the expert reports prepared for the impact assessment.