Synergies between the CSDDD and EU competition law: a toxic relationship?

Abstract

Corporate sustainability due diligence (CSDD) is needed in order to achieve a transition towards a green economy and deliver the UN Sustainable Development Goals. Therefore, the Commission proposed the Corporate Sustainability Due Diligence Directive (CSDDD) in 2019. In March 2024, the Council and the European Parliament finally reached an agreement on the CSDDD. This Directive obliges companies, if need be, to “collaborate” within the supply chain in order to reach the goals of the act, as long as such collaboration is in compliance with “Union law, including competition law”. This begs the question how much room these companies will have under EU competition law to collaborate with other companies in the value chain. In this article, a discussion will take place on the different aspects at stake. Companies should collaborate with subsidiaries and business partners. These companies will, from a competition law perspective, sometimes be seen as part of one undertaking. In instances where we have different undertakings, Article 101 will play a role. This article will then further delve into the question of how much room undertakings will have in light of the cartel prohibition to create agreements with the aim of achieving the CSDDD goals. Therefore, the article will also discuss whether such agreements do infringe the cartel prohibition.

Keywords

• Corporate sustainability due diligence
• Cartel prohibition
• Sustainability agreements
• Object/effect restriction
• Concept of an undertaking