CCCS Consults On Guidance Note For Environmental Sustainability Collaborations

20 July 2023

1. The Competition and Consumer Commission of Singapore (“CCCS”) is seeking public feedback on a proposed Guidance Note on Business Collaborations Pursuing Environmental Sustainability Objectives (“Environmental Sustainability Collaboration GN”).

2. Amidst the existential threat of climate change, Singapore has embarked on a whole- of-nation sustainability movement to achieve net zero emissions by 2050 under the Singapore Green Plan 2030.^[1] CCCS recognises that efforts to realise Singapore’s climate change goals may involve businesses, including competitors, engaging in collaborations in existing, emerging or even new markets. Such collaborations may be necessary under some circumstances, for example, where none of the parties could independently carry out the activity, or where collaboration may be required to overcome a “first mover disadvantage” in creating a new product or a new market.

3. The Environmental Sustainability Collaboration GN aims to clarify how CCCS will assess such business collaborations in the context of section 34 of the Competition Act 2004 (the “Competition Act”),^[2] to address any concerns of compliance with competition law. The Environmental Sustainability Collaboration GN should be read with CCCS’s Business Collaboration Guidance Note^{^[3]}. Businesses are encouraged to undertake a self-assessment of their collaborations. Those that wish to seek more legal certainty may also choose to notify their agreement to CCCS for guidance or a decision as to whether their collaboration complies with the Competition Act. A streamlined notification process has been proposed for the assessment by CCCS of such collaborations in support of Singapore’s whole-of-nation efforts to realise our climate change goals.

4. The guidance in the proposed Environmental Sustainability Collaboration GN includes:

a) clarification on what are considered environmental sustainability objectives;

b) examples of collaborations pursuing environmental sustainability objectives that would typically not be harmful to competition;

c) conditions under which competition concerns are less likely to arise from such collaborations;

d) how CCCS would assess the economic benefits of collaborations and whether such collaborations may nevertheless qualify for the Net Economic Benefit exclusion even if there are competition concerns;^[4] and

e) a proposed streamlined notification process in relation to assessments of collaborations pursuing environmental sustainability objectives, for businesses who notify their agreements to CCCS.

Public Consultation

5. CCCS is now seeking public feedback in relation to the Environmental Sustainability Collaboration GN. The closing date for submissions is 4 September 2023. More information on the Environmental Sustainability Collaboration GN and the public consultation can be accessed and downloaded from the CCCS website at www.cccs.gov.sg under the section “Public Consultation".

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About the Competition and Consumer Commission of Singapore

The Competition and Consumer Commission of Singapore (“CCCS”) is a statutory board of the Ministry of Trade and Industry. CCCS administers and enforces the Competition Act 2004 which empowers CCCS to investigate and adjudicate anti-competitive activities, issue directions to stop and/or prevent anti-competitive activities and impose financial penalties. CCCS is also the administering agency of the Consumer Protection (Fair Trading) Act 2003 or CPFTA which protects consumers against unfair trade practices in Singapore. Our mission is to make markets work well to create opportunities and choices for businesses and consumers in Singapore.

For more information, please visit www.cccs.gov.sg.

^[1] https://www.greenplan.gov.sg

^[2] Section 34 of the Competition Act prohibits agreements between businesses, decisions by associations, or concerted practices that are anti-competitive, unless they are excluded or exempted.

^[3] CCCS’s Business Collaboration Guidance Note was issued in 2021 and provides general guidance on seven common types of business collaborations.

^[4] The Net Economic Benefit exclusion provides that agreements where the efficiency gains outweigh the harm done to competition would still be in compliance with Section 34 of the Competition Act.