ARA, EU settle antitrust proceedings

The European Commission (EC) and the Austrian nonprofit group Alstoff Recycling Austria (ARA) have reached a settlement over the EC’s charge that ARA used its position to restrict competition in the collection of metal and packaging materials from households in the country.

The settlement includes a fine of €6 million ($6.7 million) for ARA's efforts from 2008 to 2012 to prevent competitors from accessing the Austrian market for the disposal of household packaging waste, the EC says.

In its ruling, the EC found that these efforts violated EU antitrust rules. Because ARA cooperated with the EC, the commission says it reduced the fine by 30%.

In a statement announcing the fine, the EC’s Competition Policy Commissioner Margrethe Vestager says, "The waste sector is an important part of circular economy. Effective competition is a crucial prerequisite for the recycling of waste for the consumer to remain affordable. ARA prevented competitors from having access to basic infrastructure and the entry into the market for waste management."

The EC says it found that the nationwide collection infrastructure, partly controlled and partly owned by ARA, could not be duplicated. Competitors that 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.

According to the EC, 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.

In a news release from ARA, the group says the settlement represents the final chapter in a 10-year-old conflict that ARA inherited in 2008 resulting from its merger with ARGEV Verpackungsverwertungs GmbH. In the statement, the ARA says that the central bone of contention had been whether the establishment of a parallel collection infrastructure for lightweight and metal packaging in addition to the existing ARA collection scheme was technically, legally and economically feasible. Such duplication expressly has been prohibited under the 2013 amendment to the Austrian Waste Management Act, so that the outcome of the EC proceedings is of mainly "historical" interest.

ARA says it decided to settle the case out of a sense of responsibility to businesses, customers and employees and to protect its highly successful recycling scheme.

After detailed consideration, the General Assembly concluded that the settlement of proceedings would be much better for their customers and the company itself than continuing the conflict. The decision was based on several factors: incomplete legal review and long duration of the proceedings if ARA brought an action for the annulment of a Commission's decision before the General Court of the European Union; considerable maximum amount of the fine that the Commission might have imposed. ARA still maintains that ARGEV's conduct was not the reason why its competitors entered the market only after the amendment to the Waste Management Act had taken effect. The EU Commission's decision leaves this question open.

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