ACM: thrift stores can collaborate to strengthen their position in the circular textile chain
BKN, the trade association for thrift stores in the Netherlands (in Dutch: Branchevereniging Kringloop Nederland), is allowed to negotiate on behalf of its members with businesses and organizations in the textile sector about standard conditions concerning the collection and sorting of textile. The Netherlands Authority for Consumers and Markets (ACM) sees no objections: these arrangements fit within the competition rules. BKN’s knowledge and experience can help thrift stores in the negotiations with larger third parties. In that way, the arrangements contribute to a well-functioning thrift-store sector and, by extension, to a more sustainable textile sector.
What do the arrangements entail?
At the moment, thrift stores hold individual contract negotiations with businesses and organizations in the textile sector, particularly with organizations that represent producers. Individual thrift stores usually are small organizations, which do not always have the means to get assistance (including legal assistance) or to obtain proper guidance. As a result, there is a risk of imbalanced information and power relationships between individual thrift stores and larger businesses and organizations.
That is why BKN wishes to negotiate on behalf of its members with market participants in the textile sector about contractual conditions. Think of liability provisions, reporting obligations, specifications, and early-termination periods. The standard conditions that BKN agrees on can subsequently be used by members in their individual contracts with businesses and organizations in the textile sector. As a result, they will have a stronger position vis-à-vis larger market participants.
Informal assessment: the collaboration is allowed
ACM has informally assessed the Initiative in accordance with the Policy Rule regarding ACM’s oversight of sustainability agreements, and does not see any objections. On the basis of the information submitted by BKN, ACM has concluded that the initiative contributes to sustainability, and does not have any anticompetitive effects on the sector.
Thrift stores play a key role in the circular textile chain by facilitating the reuse of textiles, as well as by performing activities regarding collecting and sorting textiles. BKN’s negotiations with third parties about contractual conditions contribute to a well-functioning thrift-store sector. A well-functioning thrift-store sector, in turn, contributes to the realization of environmental gains in the textile sector. ACM can follow the argument that the topics on which BKN wishes to negotiate are not factors (or not important factors) on which thrift stores compete. Moreover, BKN will not impose any mandatory standard conditions. Members and market participants in the textile sector continue to be free to deviate from those standard conditions and to negotiate their own conditions. BKN makes the standard conditions available to all members in an accessible manner. There are no indications that third parties require access to the standard conditions in order to be able to enter the market.
In addition, it is important that the performances or quantities of individual members are not discussed. ACM emphasizes that it remains important to prevent competition-sensitive information (such as quantities sold or future prices) from being exchanged between competitors, both in the joint negotiations and in practice
ACM: collaboration opportunities when recycling textile
With approximately 4 percent of the global emissions from greenhouse gases, and having a significant impact on soil and water use, the textile industry is a sector where much can be gained in terms of reducing environmental harm. By focusing on reusing, repairing, and high-quality recycling, reductions can be achieved in CO2 emissions, water pollution, and microplastics. Under the Extended Producer Responsibility for textiles (in Dutch: ‘de uitgebreide producentenverantwoordelijkheid voor textiel’ or UPV Textiel), producers are responsible for the collection, reusing, and recycling of textile that they bring to market (see also: UPV textiel | Afval Circulair (external website) , in Dutch). The UPV Textiel was introduced to reduce the environmental harm, and to encourage the sector towards a circular economy.
ACM is familiar with reports about imbalanced information and power relationships between competitors within the UPV system. These differences may stand in the way of a proper implementation of the UPV Textiel. All market participants face this task together. The entire chain needs to function properly in order to further promote textile circularity. That calls for cooperation and a dialog between all relevant stakeholders up and down the chain that are involved in the implementation of the UPV Textiel, including producers, importers, thrift stores, collection companies, sorting companies, and recycling companies. ACM therefore calls on all stakeholders in the chain to seek out collaborations within the boundaries set by the competition rules, and to work on durable and future-ready solutions when reusing and recycling textile.
If you seek more information about collaborations and sustainability, read more about arrangements between businesses regarding sustainability (in Dutch).
The infographic is a schematic and simplified illustration of the life cycle of textile.
In the textile sector, producers and importers are responsible for the collection and processing of discarded textiles under their Extended Producer Responsibility for textiles (or UPV for textiles). Producers have textiles produced, often outside of Europe, and they subsequently import them to Europe. Producers and importers bear responsibility for the entire life cycle of textile products, even if consumers discard those products. The purpose of the UPV for textiles is to stimulate reusing and recycling, as well as to reduce the amount of textile waste.
For meeting the requirements in the Decision on the UPV for textiles, producers can also decide to work together, for example in the form of producer organizations (or PROs). Businesses can, for a waste management fee, order a PRO to meet, on their behalf, the joint objectives laid down in the Decision on the UPV for textiles regarding reusing and recycling.
Consumers wear clothes, and hand them in when they wish to discard them. Consumers can, for example, give away clothes to a thrift store, give them to collection companies, or drop them off at a clothing bin.
Collection companies, sorting companies, and recycling companies are organizations that focus on collecting, sorting, reusing, and recycling discarded textiles.
The infographic gives examples of collaborations that are permissible. These forms of collaboration are permitted under certain conditions. The list of examples is not an exhaustive list. Market participants face this task together, and can have discussions with each other in order to ensure a proper functioning of the UPV for textiles. In that context, the basic principle is that businesses set their own business strategies, independently from one another. That means that businesses cannot eliminate the normal uncertainty among competitors surrounding their business strategies (planned or otherwise), for example by discussing or making arrangements about topics that touch upon competition parameters such as prices or volumes. If competitors wish to collaborate with regard to sustainability, the competition rules offer more scope.
If you seek more information about collaborations and sustainability, read more about arrangements between businesses regarding sustainability (in Dutch).