The Netherlands Authority for Consumers and Markets (ACM) sees no need for collective price-fixing agreements among supermarkets regarding disposable plastic packaging. That has been ACM’s conclusion after conducting an informal assessment of an initiative of the Dutch Food Retail Association (CBL).
On July 1, 2023, new rules regarding plastic packaging will come into effect. Supermarkets (but also other retailers) will no longer be allowed to give their customers disposable cups or disposable food containers for free. Customers will need to pay a separate fee for these types of plastic packaging. CBL would like its members to agree on a collective fixed surcharge. ACM sees no reason for introducing one, because such a price-fixing agreement does not seem necessary for promoting sustainability.
What is this case about?
Starting July 1, 2023, consumers will pay separately for disposable cups and containers that are made (partially) from plastic. Businesses, such as supermarkets and convenience stores, will no longer be able to offer these for free. In addition, they are required to offer a re-usable option starting July 1, 2023. The idea is to transition from disposables to re-usables.
The Dutch Ministry of Infrastructure and Water Management (I&W) has issued recommended prices for the surcharge:
- €0.25 for cups
- €0.50 for meals (one or multiple containers)
- €0.05 for pre-packaged, small portions of vegetables, fruit, nuts, and single-serve packages, for example for sauces and sliced deli meats or cheeses.
These are non-binding recommended prices. Businesses can set the prices for disposable plastic themselves. The revenues from these surcharges go to the individual businesses. Businesses are encouraged to use these revenues towards adding sustainable and re-usable alternatives for their customers.
Joint fixed surcharge
On behalf of its members, CBL had asked ACM whether they would be allowed to decide collectively on fixed surcharges. The rationale behind this request was to prevent a situation where each supermarket charges a different fee for disposable plastic. According to CBL, such a situation carries the risk that the separate fee is too low for having any effect on consumer behavior. By paying a separate fee, consumers should be stimulated to opt for a sustainable alternative. If that incentive is missing, the surcharge loses its potency. And that could jeopardize the sustainability objective of the rules, according to CBL.
ACM’s informal assessment
A collective price-fixing agreement restricts competition. At the same time, ACM does see the risk of the measure’s sustainability goal becoming jeopardized if each business is able to set its own fee. At the moment, ACM believes it is still unclear what the reaction of businesses will be when they can set their own fees. That is why ACM is currently not able to make an exception to the competition rules, which will allow a collective price-fixing agreement. ACM has asked CBL to adopt a wait-and-see approach first. Furthermore, the Ministry of I&W in 2024 will conduct an evaluation of the rules, and assess whether the sustainability objectives are realized under the current rules. The ministry can then still decide to introduce statutory minimum prices for plastic packaging instead of non-binding recommended prices. Furthermore, should it turn out in practice that arrangements regarding a collective fixed surcharge are necessary, ACM may reassess such a proposal.
ACM and sustainability
Sustainability agreements must fit within the competition rules. In many cases, businesses are able to work together effectively while also contributing towards sustainability objectives without violating the competition rules, for example because the agreement does not restrict competition at all. If it turns out that the agreement does restrict competition, but is necessary for realizing sustainability objectives, the pros of the agreement may outweigh its cons. ACM can offer certainty regarding the question of under what circumstances competitors are allowed to work together in order to realize sustainable objectives. If you have questions or if you and/or your advisor(s) wish to have more information about the applicability of competition rules on sustainability agreements, please send an email to info [at] acm [punt] nl (info[at]acm[dot]nl).
More information about collaborations and sustainability can be found here (in Dutch).