COMPETITION • EUROPEAN LAW • RESTRICTIVE AGREEMENTS
As well as dealing with anticompetitive agreements and decisions of associations of undertakings, Article 101 TFEU also specifically targets concerted practices although it does not define what they are. The origin of the term “concerted practice” comes from the observation of like behavior on the market. By making the concept of concerted practice distinct from an agreement, the TFEU was able to prevent undertakings from circumventing Article 101(1) by resorting to a form of anticompetitive coordination which could not be properly defined as an agreement, the objective being that all economic operators autonomously determine the policies they wish to pursue on the market.
Concerted practices are the result of the coming together of two constituent factors joined by a link of causality, i.e. a generating factor – coordination between the parties realized through contact between them, and an outcome – the cooperation resulting from the coordination and consisting in a modification of the normal conditions of the market. It is both necessary and sufficient that there be, “direct or indirect contact between such operators, the object or effect whereof is either to influence the conduct on the market of an actual or potential competitor or to disclose to such a competitor the course of conduct which they themselves have decided to adopt or contemplate adopting on the market”, which is not the same as adapting one’s behavior to market conditions in an intelligent manner. A concerted practice is constituted where “the parties have not agreed or decided in advance among themselves what each will do in the market but knowingly adopt or adhere to some collusive device which encourages or facilitates the coordination of their commercial behavior”.
A concerted action neither implies a conclusive or premeditated agreement nor necessarily the proof of parallel behavior. It must be distinguished from simple parallel behavior devoid of any element of concertation, even though it constitutes a strong indication thereof. In contrast to the more structured nature of an agreement, the concept of a concerted practice does not require the working out of a “plan” but includes varied forms of “contact” made, – even mere conversations or negotiations – the anticompetitive purpose of which is sufficient to characterize the practice regardless of its concrete effects.
Although parallel conduct is not enough in itself to characterize a concerted practice, it does constitute a strong indication enabling a restrictive agreement to be established when it can be corroborated by other factors such as contacts or exchanges of information. The European authorities can also find the existence of concertation by establishing the absence of any other possible explanations for the parallel conduct, such as oligopolistic interdependence, the fact that it is not a result of the structure of the market or that it is not in the individual interest of the undertakings. However, proof of the agreement is not provided when the explanation of the parallelism of behavior by concerted action is not the only plausible one. Finally, a concerted practice can be found independently of the observation of parallel behavior on the market.