Lithuania: The no-poaching law meets Article 101: Where is the line?

Executive Vice-President Margrethe Vestager announced a new era of cartel enforcement in October 2021. One of the new focuses is no-poaching agreements, e.g., when “no-poach” agreements are used as an indirect way to keep wages down, restricting talent from moving where it serves the economy best. This is predated by the joint guidance of October 2016 by the US Department of Justice and the Federal Trade Commission. The joint guidance states that naked wage-fixing or no-poaching agreements among employers, whether entered directly or through a third-party intermediary, are per se illegal under the antitrust laws. In light of this new trend, a question arises whether the prohibition of poaching competitors’ employees established in Article 15(1)(4) of the Law on Competition of the Republic of Lithuania still can be relied on by entities in Lithuania. This article will study whether poaching is prohibited or encouraged in Lithuania and whether balance could be found whilst applying Article 101 TFEU at the EU level.

I. What does Article 15(1)(4) of the Lithuanian Law on Competition establish? 1. Lithuanian competition law prohibits not only concerted practices and abuse of dominant position, but also unfair competition. Unfair competition consists of various elements, one of which is poaching of competitors’ employees. This article gives an overview of how EU national competition authorities (NCAs) address no-poaching agreements and how Lithuanian courts deal with private enforcement of poaching prohibition cases. To fully understand how the Lithuanian competition law addresses poaching of competitors’ employees, below is a brief review of how the prohibition emerged and what is precisely prohibited in the context of employee poaching. 2. The Lithuanian Law on Competition (hereinafter “Law on

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Henrikas Stelmokaitis, Lithuania: The no-poaching law meets Article 101: Where is the line?, May 2022, Concurrences N° 2-2022, Art. N° 106140, pp. 236-242

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