Margrethe Vestager, Commissioner in charge of competition policy said: “The waste management sector is an important part of the circular economy. Effective competition is vital for making recycling affordable for consumers. ARA was preventing competitors from accessing essential infrastructure and blocking them from entering the waste management market. "
In Austria, producers of goods are obliged to take back packaging waste that results from the use of their products. They may transfer this task to a company that takes care of the collection and recycling for them against a licence fee paid by goods' producers. ARA has been the dominant provider of these services for household packaging waste in Austria since at least 2008, the beginning of the infringement.
The Commission found that the nationwide collection infrastructure, partly controlled and partly owned by ARA, could not be duplicated. Competitors who wanted to enter or expand in the market were dependent on receiving access to this existing infrastructure. The investigation also found that between March 2008 and April 2012 ARA refused to give access to this infrastructure, so that competitors were excluded from the market and competition eliminated. Such behaviour is in breach of Article 102 of the Treaty on the Functioning of the European Union (TFEU) which prohibits the abuse of a dominant market position.
As well as finding an infringement and fining ARA, the Commission has imposed a structural remedy to address the issue of foreclosure of the Austrian market for the management of household packaging waste. This structural remedy was suggested by ARA, which cooperated with the Commission.
Furthermore, after the Commission started its investigation, Austria adopted a new waste law in September 2013 and ARA began granting access to its household waste collection infrastructure. Several competitors have entered the market since then.
Cooperation with ARA
ARA has cooperated with the Commission by acknowledging the infringement and ensuring that the decision could benefit from administrative efficiencies, as well as by proposing a structural remedy. More specifically, ARA offered to divest the part of the household collection infrastructure that it owns. The company will therefore no longer be in a position to exclude competitors from access to that infrastructure. This will ensure that such an infringement cannot be repeated in the future. The Commission took account of this comprehensive cooperation by ARA in calculating the fine, which was reduced by 30%.
Further information on the cooperation procedure can be found on the Competition website.
The fines were set on the basis of the Commission's 2006 Guidelines on fines (see press release and MEMO). In setting the level of the fine the Commission took into account the duration of the infringement (from 2008 to 2012) and its gravity. Furthermore, under the Guidelines, the Commission may reward cooperation by reducing the fine imposed on a company. In this case, in recognition for its cooperation in the investigation, ARA's fine was reduced by 30% to €6 015 000.
In 2010, prompted by information from operators on this market, the Commission started an own-initiative investigation into ARA's conduct.
The Commission formally opened proceedings in July 2011 and sent ARA a statement of objections in July 2013. This gave ARA the opportunity to view the Commission's investigation file and to reply to the Commission's objections. If, after a company has exercised its rights of defence, the Commission concludes that there is sufficient evidence of a competition infringement, it can prohibit the conduct and impose a fine of up to 10% of a company's annual worldwide turnover.
More information is available on the Commission's Competition website, in the public case register under the case number 39759. New decisions on competition policy are listed in the electronic newsletter Competition weekly news summary.