New study on competition and sustainability in Germany and the EU

The German Federal Ministry of Economics and Climate Protection (BMWK) had commissioned a study on the relationship between competition and sustainability. The study was conducted by researchers at Heinrich Heine University in Düsseldorf, Germany, led by Professors Justus Haucap and Rupprecht Podszun, and published on 22 March 2023. The study reviewed 34 options to see how competition protection can be better dovetailed with sustainable business. These options include the recognition of a general exemption from competition law for certain sustainability cooperation agreements or the recognition of sustainability effects as a justification for anti-competitive agreements.

The experts conclude that from an economic perspective, there is in principle no tension between competition and sustainability. According to the experts, market economy as a system still is indispensable, i.e. there is a chance for sustainability even without a radical renunciation of consumption. Without the incentive of competition, the new technologies that are needed e.g. for climate protection will not emerge. Nevertheless, the experts see a need for reform: The fact that companies which produce in a way that is harmful to the environment have cost advantages in competition must be corrected.

The BMWK will examine the proposals. They could be taken into account in a future amendment to the German Act against Restraints of Competition Act. As part of a public consultation, the BMWK is now asking for comments on the proposals, which can be submitted until 6 April 2023.

For more information on the Sustainability claims and greenwashing in Germany please see here.

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