On 17th July 2014, the Italian Competition Authority (“ICA”) opened an in-depth investigation on the Italian consortium CONAI entrusted with the plastics packaging recycling in Italy for violating Article 102 TFEU, the provision against the abuse of a dominant position. In application of the European “extended producer responsibility” principle, Italian law establishes that plastics packaging producers must be responsible for the recycling of the waste generated. Thus such producers are obliged to become member of CONAI and pay the membership fee unless they are able to set up an alternative recycling system approved by the Ministry of the Environment (“ME”). In order to get this approval, producers must file an application with the ME which shall control whether the alternative recycling system meets the legislative requirements.
The Italian company Aliplast S.p.A. (“Aliplast” or the “Complainant”) filed an application to have its own recycling system (named “P.A.R.I.”) authorised by the ME but, during the relevant administrative procedure, CONAI raised several legal challenges.
All the exceptions raised by CONAI were held groundless by the ME and the Italian administrative courts so that the ICA found that the above behaviour may be deemed as a general exclusionary strategy aimed at delaying or preventing the approval of the P.A.R.I.
The ICA held that CONAI enjoys a dominant position in the plastics packaging recycling market as the majority of the relevant undertakings do not have an alternative recycling system. The ICA held that CONAI was attempting to maintain its economic strength by impeding the entry of a new system.
Further, the ICA found that the alleged exclusionary strategy could also cause damage to the intraCommunity market as: (i) the plastics packaging recycling regards all the Italian territory, and (ii) the alleged anti-competitive conduct may negatively influence foreign undertakings willing to set up an alternative recycling system in Italy.
In our view, the ICA’s decision is welcome in so far as it can help make the overall recycling sector more competitive and provides the consumer and the relevant undertakings with high cost savings.