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Waste management

The waste management sector was characterised by severe restraints of competition until just a few years ago. Meanwhile, the situation has improved but numerous problems still remain.

Waste Management Waste ManagementRolf van Melis /

Under competition aspects, waste management markets can be viewed as regional or local markets. Many of these markets are served by a small number of providers holding large market shares, meaning that oligopolistic structures exist in these markets. There is thus an increased risk that concentrations could create or strengthen dominant positions in the market.

What does the Bundeskartellamt control?

The Bundeskartellamt has made it a priority to ensure that firms planning concentrations subject to merger control fulfil their obligation to notify such projects. Furthermore, oligopolistic market structures increase the risk of firms concluding anti-competitive agreements. Cooperations between waste management companies are thus closely monitored by the Bundeskartellamt, with special focus on joint ventures and consortiums in which large waste management providers are involved.

The Bundeskartellamt is devoting particular attention to competition between providers of compliance schemes for packaging disposal. Until 2003 there was only one provider in Germany which took back packaging material from private households and recycled it. The competitive situation was gradually improved by action undertaken by the competition authority and also by legislative measures. As a consequence, numerous competitors entered the market.

Sector inquiry into compliance schemes

In 2012, the Bundeskartellamt conducted a sector inquiry into waste management compliance schemes. This inquiry concludes that the competition between providers has led to considerable cost reductions and, due to an improved sorting technology, also to improvements in recycling quality. Overall costs of packaging waste management, i.e. costs which ultimately have to be borne by the consumers, have decreased from previously approx. two billion Euros to less than one billion Euros per year today. The Bundeskartellamt's aim is to have all remaining restraints of competition in this sector removed. It furthermore strives to at least maintain the established trend towards competition in the event of modifications to the legal framework conditions (amendment of the Packaging Ordinance, Law on Recycable Materials).

In the area of household waste disposal, the German Closed Cycle and Waste Management Act (Kreislaufwirtschaftsgesetz (KrWG)), which entered into force on 1 June 2012, granted waste management authorities a monopoly on the collection of mixed refuse from private households (“residual waste”). In respect of other types of waste (for example waste paper and used clothing) the law also contains provisions hindering private waste management companies from entering into competition with municipal waste management utilities. The Bundeskartellamt assumes that the legal issues connected with these regulations will be the subject of judicial clarification in the near future. This would be particularly desirable in view of compatibility with the competition rules under European law.