Taiwan’s Fair Trade Commission Announces “Guidelines on Concerted Actions in Response to Environmental Sustainability for Enterprisesâ€
To assist enterprises in better understanding whether their operations or actions in response to environmental sustainability may constitute concerted actions under Taiwan’s Fair Trade Act ("TFTA"), and to ensure fair and free market competition, the Taiwan’s Fair Trade Commission ("TFTC") promulgated the Guidelines on Concerted Actions in Response to Environmental Sustainability for Enterprises ("Guidelines") on 19 February, 2025.
Aligned with key strategies for achieving the 2050 net-zero emissions goal, the Guidelines outline the following three example scenarios to help enterprises mitigate legal risks:
Activities that do not impose mutual restrictions on competition and do not raise concerns of concerted actions.
(1)Sharing environmental sustainability information by disseminating content unrelated to business operations or competition, such as exchanging updates on government policies and industry regulators’ subsidies for environmental sustainability transitions.
(2)Advocating environmental sustainability achievements through joint training or awareness programs for employees on topics such as energy conservation and greenhouse gas reduction.
(3)Conducting research on environmental sustainability issues and jointly establishing databases for the related products or services.
(4)Issuing joint statements in support of government environmental sustainability policies.
Activities that are likely to constitute concerted actions but may qualify for an exemption if the enterprises involved believe their activities are beneficial to environmental sustainability and apply for an exemption in accordance with the law.
(1)Jointly procuring equipment to improve energy efficiency and enhance operational effectiveness.
(2)Standardizing product or component specifications to improve resource recycling rates and reduce costs.
(3)Conducting joint R&D and innovating technologies to enhance resource recycling and improve the quality of energy-efficient products.
(4)Jointly procuring environmentally less harmful raw materials or reducing the use of non-eco-friendly materials in product manufacturing to minimize environmental pollution.
(5)Engaging in other activities that impose mutual competition restraints but contribute to environmental sustainability.
The TFTC further states that when reviewing applications for concerted action exemptions related to environmental sustainability, the key focus is on balancing market competition impacts with sustainability benefits. Accordingly, enterprises are encouraged to provide the following information to support the review process:
(1)If competition restrictions are a concern, enterprises must justify the necessity of the concerted action for environmental sustainability development and demonstrate that no alternative measures with a lesser impact on competition are available.
(2)Enterprises must explain how the concerted action enhances environmental sustainability in terms of production, sales, quality, and technological advancements while also demonstrating efforts to minimize adverse competition impacts.
(3)Enterprises must outline the expected sustainability outcomes, along with the specific benefits and potential adverse effects on the overall economy, public interest, and upstream and downstream businesses and their markets.
Activities that are likely to constitute unlawful concerted actions and pose a significant threat to market competition.
(1)Price-fixing: Jointly determining the price for goods or services under the pretext of offering environmentally sustainable goods or services.
(2)Allocation of trading counterparties: Jointly agreeing to divide sales territories, restrict cooperation to specific trading counterparties, or avoid competition for them in order to reduce environmental sustainability costs.
(3)Quantity-fixing: Jointly determining production and sales volumes, or capacity levels under the justification of achieving environmental sustainability goals.
(4)Joint procurement or sales strategies: Jointly agreeing to purchase or sell only specific products or services under the premise of promoting environmentally sustainable goods or services.
(5)Joint Foreclosure: Excluding other enterprises from entering the market under the pretext of promoting environmental sustainability.
However, the TFTC emphasizes that the Guidelines merely illustrate possible scenarios where business practices related to environmental sustainability may constitute concerted actions. The determination of whether a specific business practice constitutes a violation will still require an assessment of the specific facts of each case.
In addition, the TFTC has also issued the Enterprise Self-Assessment Checklist to assist enterprises in conducting self-assessments to quickly determine whether their environmental sustainability-related activities comply with the TFTA or require an exemption for concerted actions.
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