Crisis management in the automotive industry

Crisis management in the automotive industry

The German Association of the Automotive Industry (VDA) has given the "green light" to the shutdown of the automotive industry by June 2020, arguing that the loss of individual suppliers could significantly delay the restart of production at many suppliers and manufacturers and thus further increase the economic damage. To solve such problems, coordinated action in an industry could be justified, he says. However, the measures must comply with applicable antitrust laws and be limited in time.

Publication of framework for the resumption of production

First, the VDA wants to establish framework conditions for the resumption of automotive production (z. B. Reopening times of car manufacturers and supplier companies), as well as publish a best practice guide showing ways to avoid misallocation of resources when capacity is tight.

A prerequisite for the admissibility of these publications under antitrust law is that the suppliers concerned are free to decide when and in what way they wish to resume their activities and whether they wish to inform the public about it. In addition, the VDA's Best Practice Guide may not include any company-specific information (e.G. B. Scope of goods or contracts of individual companies). Existing contractual obligations are (of course) not affected by this guide.

Prerequisites of "Corona restructuring process

Next, the VDA has a sog. "Corona restructuring procedure" presented. This is intended to enable companies (primarily suppliers) that find themselves in a crisis during the Corona pandemic, according to their own assessment, to restructure quickly. This should apply to companies headquartered in Germany as well as to foreign companies with subsidiaries or operations in Germany. Concerned enterprises can sog. Form stakeholder groups. Within and between these groups, a time-limited exchange of information is to be made possible so that owners, employees, customers, lenders and government bodies can exchange information about a company's liquidity, credit, aid measures or even operational problems and jointly develop effective restructuring measures within a short period of time.

No company-specific data for stakeholders

Compliance with the antitrust framework is to be ensured by the fact that the restructuring procedure is only available to companies that have held their first stakeholder meeting no later than 31. Schedule December 2020. Invite to this meeting before the end of the year. In addition, the amount of information shared between stakeholders must be limited to data that is essential for restructuring purposes. This data must be shared in aggregate form (z. B. Quantities or parts prices), so that stakeholders do not receive company-specific data on their competitors. Finally, the exchange of information must be subject to special confidentiality rules. Be restricted to clearly defined groups of persons within the companies. These persons must be subject to confidentiality obligations. To no longer be allowed to participate in purchasing negotiations with the respective supplier for a certain period of time.

Conclusion of the restructuring process through a framework agreement

The Corona restructuring process should be concluded through a framework agreement that describes stakeholder input in general terms. The individual performance of the contractual partners, on the other hand, must be negotiated exclusively bilaterally between the supplier and the respective stakeholder concerned. In general, stakeholders must be free not to participate in the restructuring negotiations or to refuse to conclude the framework agreement. The restructuring negotiations should not last longer than the end of 2021.

Increasing legal certainty also for other industries?

Even though the Federal Cartel Office emphasizes that it wants to support coordinated initiatives to overcome the crisis, the authority also makes it clear that such initiatives are only permissible within the framework of the applicable antitrust regulations. For this reason, the authority also reserves the right to conduct an in-depth review in the event of complaints or other new findings. Nevertheless, the Bundeskartellamt's assessment significantly increases legal certainty for companies in the automotive sector when implementing possible crisis management measures. Whether these principles can also be applied to other industries must be examined on a case-by-case basis. Regardless of the sector involved, the following applies in any case: as clear as these principles may be in theory, the concrete implementation harbors considerable potential for conflict.

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