Antitrust Law in the Corona Crisis (1): Cooperations

Antitrust law also applies in times of crisis. But: Antitrust law allows companies the necessary flexibility to react to the challenges of the corona crisis. One such reaction is cooperating with competitors.

The coronacrisis does neither justify "crisis cartels" nor does it justify other hardcore restrictions of competition. The effects and risks of the corona crisis can, however, legitimise some forms of cooperation with competitors:

• Formation of bidding and supplier consortia if the companies concerned are not (any longer) able to meet a specific market demand on their own, e.g. because personnel or financial risks are no longer calculable due to the corona crisis.
• Joint purchasing to reduce and distribute risks in the supply chain.
• Purchases from competitors to compensate for production losses and legal restrictions on production as a result of the coronavirus.
• Joint production to save costs or generate efficiencies in the use of personnel and production resources, or through mutual specialisation.
• Joint research and development which may also involve joint commercialization.
• Exchange of information on stocks, cooperation in transport and storage logistics, in so far as they are aimed at counteracting coronavirus-induced threats to the supply chain.
• Cooperation in personnel planning in order to mitigate the effects of the coronavirus on the health of the workforce.

Antitrust law provides companies with sufficient leeway for crisis-related cooperation, including with competitors. It recognises necessary restrictions of competition in situations in which market mechanisms no longer function properly as a result of the crisis without such measures. For example, restrictions of competition can be justified by demonstrating that they are necessary to maintain the security of supply. In many parts of the world, the antitrust authorities are currently willing to talk to companies about restrictions of competition that are necessary to deal with the effects of the coronavirus on the economy.

However, the corona crisis does not give a "carte blanche" for any restriction of competition. Even in times of crisis, companies must therefore conduct a self-assessment that reviews and documents the facts and objectives underlying the cooperation with the competitor.

BEITEN BURKHARDT's antitrust lawyers also provide support for your company in the corona crisis. Please contact Dr Christian Heinichen or Christoph Heinrich.

Further support for your company is available here "Corona Informationscenter" in the BEITEN BURKHARDT Information Centre.