New Guidance From UK Competition & Markets Authority On Environmental Sustainability Agreements

This Alert provides a brief summary of the UK Competition & Markets Authority ("CMA") October 12 guidance concerning the application of UK competition/antitrust law to environmental sustainability ("ESG") agreements, including climate change agreements. The CMA's guidance establishes a framework under which certain ESG agreements can expect to be exempt from enforcement under Chapter I of the Competition Act 1998 (which prohibits anticompetitive agreements).

The CMA's guidance also establishes the CMA's "open-door policy" – a mechanism through which parties that are drafting ESG agreements, or that already have an ESG agreement, can seek informal guidance from the CMA. The CMA indicates that it will provide "light touch" feedback on such agreements, including any changes that it believes are required by law. If parties implement those changes, the CMA suggests that it will not pursue fines against such parties.