Lobbying through trade associations is an ordinary and legitimate part of the EU policy-making process. But where competitors discuss the consequences of planned or adopted regulation on their commercial activities while developing a common advocacy position, the line between legitimate lobbying and anti-competitive co-ordination can get blurred.

Two pending preliminary references before the European Court of Justice (ECJ) – namely Kedrion (C-793/25) and CSL Behring (C-995/26) – will provide important guidance on where to draw the line between legitimate lobbying and illegal co-ordination. The cases stem from a challenge against a €71 million fine imposed by the Romanian Competition Council on five pharmaceutical companies and their trade association in connection with lobbying against Romania's clawback tax and alleged illegal co-ordination of the supply of immunoglobulins. 

Key takeaways

• Lobbying through a trade association is not in itself anti-competitive. The critical issue is whether discussions aimed at influencing public policy spill over into co-ordination of the members' commercial conduct.  
• Discussing the commercial impact of regulation may create competition risks. The ECJ has been asked, among other things, whether discussions between competitors about the economic impact of a regulatory measure can amount to a concerted practice. 
• Information exchanges may presume the co-ordination of parallel conduct. The cases raise the question whether exchanges of commercially sensitive information within a trade association can support a de facto presumption that subsequent parallel conduct was co-ordinated. 
• A red line must be drawn between collective advocacy and individual commercial decisions. In particular, discussions regarding advocacy positions should not extend to members' individual pricing, supply decisions or market strategies. 

Background

The cases originate from an investigation by the Romanian Competition Council concerning five pharmaceutical companies and their trade association, PPTA. The companies allegedly used a working group, the PPTA Romania Task Force (ROTF), to co-ordinate their response to Romania's clawback tax applicable to medicines derived from human blood or plasma. 

The authority did not rule on the illegality of lobbying itself. Rather, it found that contacts and communications within the ROTF went beyond advocacy and enabled the companies to co-ordinate their commercial conduct in pursuit of a collective advocacy objective. The participating companies allegedly conditioned their continued presence on the immunoglobulin market on the removal of the clawback tax and co-ordinated limitations or interruptions of supply to pressure the Romanian authorities. 

Most importantly, the authority considered that discussions within the ROTF reduced the uncertainty that would otherwise have existed between competitors: companies allegedly limited or interrupted supplies only once they were confident that competitors remaining on the Romanian market would not take their market share by committing to engage in the same conduct. 

On appeal, the Bucharest Court of Appeal found that the ROTF had alerted members that the lobbying objective could not be achieved without concrete supply discontinuations. 

The companies dispute the authority’s and the Court of Appeal’s findings. They argue that their decisions to withdraw or limit supply were independently and individually motivated by the economic impact of the clawback tax on their respective activities, which allegedly rendered sales unprofitable, while their contacts within the trade association constituted legitimate advocacy aimed at informing public authorities of the adverse consequences of the tax. 

The questions before the ECJ

The references to the ECJ raise a number of important questions concerning how Article 101 TFEU applies to collective lobbying:

• Can discussions among competitors within a trade association about the known economic impact of a regulatory measure constitute a "concerted practice" under Article 101 TFEU?
• Does freedom of association under the EU Charter protect co-ordinated lobbying through a trade association, or can it fall within EU cartel rules?
• Do exchanges of commercially sensitive information within a trade association create a presumption that subsequent parallel market withdrawals were co-ordinated?
• Can staggered product withdrawals amount to a "collective boycott"?  

Where is the line between legitimate advocacy and co-ordination?

The European Commission (EC) has previously recognised that competitors may legitimately co-operate in developing positions on proposed legislation.

In its Car Emissions decision (AT.40178), the EC stated that the "discussion and preparation of a common position […] concerning future legislative proposals" may be permissible where it remains "limited to influencing future legislative measures and must not be used to co-ordinate market conduct". The EC similarly regarded information sharing as permissible in that context where the relevant information was anonymized and aggregated. 

Trade associations may legitimately inform policymakers that proposed regulation could significantly affect their members’ commercial activities. However, indications that members intend to collectively reduce supplies, withdraw products, or otherwise modify their market behaviour in response to a given policy or regulation may be viewed differently when such statements are made in the context of discussions among competitors regarding their future planned conduct.

Practical implications for companies and trade associations

Pending the ECJ's rulings, the cases are a crucial reminder that companies should maintain a clear boundary between agreeing what to say to policymakers and agreeing what to do on the market. Trade associations’ working groups should remain focused on developing and communicating advocacy positions. Particular care should also be exercised when substantiating lobbying positions through statements about the expected market response to regulation: a collective statement that legislation will cause members to adopt a particular course of commercial conduct may attract scrutiny where it could facilitate co-ordination of the members' future behaviour.