The OECD issues note on co-operation between competitors in the time of COVID-19

In the extraordinary circumstances of the COVID-19 crisis, there are a number of reasons that may push competing companies to collaborate with one another and a number of ways in which consumers and the economy may benefit from these collaborations. This note examines some typical situations where co-operation between competitors may be lawful or pro-competitive and discusses the main challenges that competition authorities face in analysing or dealing with them. The note also raises some open questions that will be explored on a webinar meeting between competition authorities on 28 May 2020. This publication is part of a series of COVID-19 related pieces prepared by the OECD Competition Division to assist governments and competition authorities in the challenging times of this epidemic.

In times of a severe crisis such as the one provoked by COVID-19, co-operation between competing firms may benefit consumers in many ways, for example, by assuring an essential service (e.g. transport) or by distributing scarce but essential goods (e.g. maintaining the food chain). Co-operation may be necessary to R&D projects related to the development of vaccines and medicines, activities which can entail substantial investments and risks for a single firm. While co-operation between firms, particularly during the immediate and urgent phase of the crisis, may be beneficial for specific purposes, competition authorities are required to strike the right balance between allowing such private initiatives to address market failures in the short-run and avoiding distortion of competition in the long-run.

This note analyses a number of examples of co-operation agreements from different jurisdictions and identifies some common criteria of lawful co-operation. It also identifies some emerging challenges and solutions that competition authorities have developed during the crisis, as well as open issues that may require further research and discussion.

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Author

  • OECD - Competition Division (Paris)

Quotation

OECD, The OECD issues note on co-operation between competitors in the time of COVID-19, 26 May 2020, e-Competitions June 2020, Art. N° 95264

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