Companies should beware that membership of trade associations does not lead them to breach competition law, according to recent guidance published by the Competition Authority.

While trade associations can be productive, the Authority warns that it has increasingly encountered situations where trade associations have coordinated activities of member firms, restricting competition in the process. The guidance notice provides trade associations with an insight into the enforcement priorities of the Authority and identifies various activities which could be deemed anti-competitive.

Trade associations may raise competition concerns where they give directions to members which may be anti-competitive. Members may also use trade association meetings as a forum for collusion.

The Authority has been quick to act where trade associations have been used to facilitate anti-competitive agreements. It notes that criminal convictions have recently been secured in cases relating to price fixing involving Connaught Oil Promotion Federation, Irish Ford Dealers Association and the Citroën Dealers Association.

Areas of particular concern such as coordination on pricing, collective boycotts and participation in anti-competitive meetings are discussed in detail. Guidance is also given on how competition law applies to practices such as collective negotiation and group purchasing. The guidance notice uses detailed examples of practices such as information exchanges to highlight which activities may conflict with competition law and are likely to lead to an investigation by the Authority.

The Competition Authority’s guidance is a timely reminder to trade associations and their members are advised to seek legal advice on the compatibility of their activities with competition law, particularly in the sensitive areas highlighted by the Authority.