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Austrian Federal Competition Authority submits „Guidance for good conduct in business (Code of Conduct)” for public consultation

The Austrian Federal Competition Authority submits „Guidance for good conduct in business (Code of Conduct)” for public consultation

Comments on the draft can be submitted now to konsultation[at]bwb.gv.at until 27. August 2018.
The draft is only available in German. The final version will also be provided in English.

Why is a Guidance for good conduct in business (Code of Conduct)” necessary?

The Federal Chamber of Commerce published in 1977 a Code of Conduct. This guidance presented already circumstances, that contradicted good business behaviour, which were suitable to jeopardise competition in the markets. The Competition Commission, which acts as a consultative body in Austria, recommended to develop a guidance for good conduct in business (Code of Conduct) on the basis of the published “guidance on vertical price fixing”.

Director General of the AFCA, Theodor. Thanner: „The Code of Conduct should be a support, to identify which business practices can be viewed as fair and which do not. Thus, it shall be also a support for the implementation of compliance programs in businesses.

AFCA receives regularly complaints about unfair business practices. These unfair practices are related particularly to an economic imbalance in the supply chain. Small suppliers have generally no adequate possibilities to defend against bigger negotiating partners due to dependency.

Unfair business practices are intensively discussed in the agriculture sector. Thus, the AFCA works closely with the Federal Ministry for Sustainability and Tourism. It is a focus of the Austrian EU Council Presidency at European level. The European Commission has already presented a proposal for a directive. The Aim of the Federal Ministry of Sustainability and Tourism is to build a consensus between the Member States, the European Commission and the European Parliament until the end of the Austrian EU Council Presidency.

AFCA can initiate an investigation due to a suspected infringement of Austrian or European Cartel Law. However, unfair business practices are regularly not covered by Cartel Law but it can constitute a disruptive factor for a positive market development.

The final Code of Conduct will be applicable for all industries in Austria.

What are the objectives of the „Guidance for good conduct in business (Code of Conduct)”?

The Code of Conduct should provide clarification, how business conduct is assessed at what should be understood as good conduct. This guidance provides a catalogue of business conduct that is falling within unfair practices. Additionally an overview of the legal possibilities is given.

What is meant by unfair business practices?

Unfair business practices are especially:

  • Obstructive practices (boycott/request for refusal to deal, discrimination etc.)
  • Exploitation practices (demand for inappropriate low purchase prices, exploitation of monopoly position etc.)
  • Other practices (unfair terms, harassment, coercion etc.)

Guidance for good conduct in business (Code of Conduct) - (only available in German)