ACM's unfavourable view of the power companies' intended coordinated shutdown of five coal-fired power plants has met with a vehement response from environmental organisations. The intention is part of the SER Energy Agreement and could potentially restrict competition. This is where the ACM came in.
ACM believes that the plan could harm buyers (of energy), for which they would receive inadequate compensation. Henk Don, chairman of ACM's board, defended this controversial view in an opinion piece in het Financieele Dagblad of 25 October 2013.
The criticism of ACM's view targets two points: ACM should not have reviewed the intended shutdown of the coal-fired power plants in isolation but in the context of the Energy Agreement as a whole, and ACM did not assess the (environmental) benefits to their full extent.
ACM underlined that the conditions for exceptions to the cartel ban should be applied strictly, in particular where the necessity and proportionality of the arrangement are at issue. This prevents companies from making anti-competitive arrangements that harm their buyers under the guise of 'public interest'.
This strict test means, among other things, that in its analysis ACM considers only advantages that benefit buyers and could not be realized without the anti-competitive arrangement concerned.
The signatories still intend executing the Energy Agreement in full. They have instituted a technical committee that will explore the options of redesigning the arrangement to avoid conflict with the anti-competition rules. Talks are being held with ACM and the European Committee. This process is expected to take several months.
For more information, please contact our European & Competition Law team.