Industry organisations have a duty to ascertain the compliance of standard terms and conditions with competition law
Industry associations are generally composed of companies competing with each other. Standard conditions established by an industry association are assessed as a form of cooperation between competitors. In practice, the antitrust assessment of standard terms and conditions involves weighing up their anti and pro-competitive aspects on a case-by-case basis.
Upon request, the Competition Division of the Finnish Competition and Consumer Authority may provide advice on both the content and application of competition law and, where appropriate, comment in general terms on the antitrust self-assessments presented by industry associations. The Competition Division does not perform prior appraisals of the legal compliance of terms and conditions. Responsibility for compliance with the Competition Act lies with the industry organisation and each company involved in drafting standard terms and conditions.
The FCCA’s Consumer Division and Consumer Ombudsman comment on the standard terms and conditions drawn up by industry organisations from the perspective of consumer protection legislation. The Consumer Ombudsman’s approval of standard terms and conditions does not exempt the companies drawing up and applying them from the obligation to independently ascertain the terms’ compliance with competition law.
When may standard terms and conditions limit competition?
The Competition Act presupposes that every company decides independently on its competitive behaviour. Standard terms and conditions are viewed as anti-competitive if they are conducive to standardising the competitive behaviour of companies engaged in mutual competition. 
Standard terms and conditions, which eliminate uncertainty between competing undertakings about the competitive means used, may restrict competition. The more significant the competitive means to which standard terms and conditions apply, the more likely it is that the terms and conditions will lead to concerted business activities in a manner that restricts competition on the market.
Competition over price is a key competitive measure. Standard terms and conditions for pricing, pricing criteria and pricing structures are highly likely to restrict competition. The more closely standard terms and conditions are related to pricing, the more likely they are to restrict competition and the more significant the potential restriction. However, price fixing is not the only means of restricting competition. Other key means of competition may relate to the quality of a product or service, as well as payment, booking, cancellation and delivery terms.
Adopting joint standard terms and conditions may increase companies´ market dominance compared with a situation in which each company decides independently on the content and application of terms and conditions. Standard terms and conditions restrict competition if they are intended to improve companies´ profitability at the expense of consumers or other enterprises, for example by jointly transferring the risk inherent in business to customers.
Restriction of competition may be permitted when the efficiency gains outweigh the impediments to competition
Standard terms and conditions applied by competing undertakings are not necessarily unlawful, even when they may restrict competition. In accordance with the exemption included in the Competition Act, restrictions of competition are permissible that result in efficiency gains greater than their restrictive effects on competition.
Standard terms and conditions established by an industry organisation can increase efficiency on the market. They can reduce switching and search costs, improve the comparability of products or services, and guarantee certain minimum conditions for trade in a consumer commodity. Standard terms and conditions favouring the comparability of complex products and services can be regarded as generating efficiencies. Increased efficiency should be assessed on a case-by-case basis.
The exemption provision of the Competition Act is applicable where (i) the arrangement generates efficiency gains, (ii) the implementation of the arrangement is indispensable to the achievement of efficiency gains (comparable efficiency gains cannot be achieved by means less restrictive to competition) (iii) the efficiency gains from the arrangement also benefit customers and (iv) the arrangement does not lead to the elimination of competition from the market. All of the criteria must be met simultaneously.
At the very least, efficiency gains passed onto customers must compensate for the negative effects of a restriction on competition. The exemption provision is seldom applicable to standard terms and conditions applicable to pricing or pricing criteria. The more directly the term or condition relates to pricing, the less likely it is that the exemption provision will apply. The exemption provision is also unlikely to apply to terms and conditions aimed at improving the profitability of companies operating in the sector by way of transferring risk or costs from companies to customers, for example.
 Under competition law, standard terms and conditions are assessed in accordance with Section 5 of the Competition Act (948/2011). The section in question states that agreements between undertakings, decisions by associations of undertakings, and concerted practices by undertakings which have as their object the significant prevention, restriction or distortion of competition or which result in the significant prevention, restriction or distortion of competition, shall be prohibited. In particular, agreements, decisions, or practices are prohibited which: (1) directly or indirectly fix purchase or selling prices or any other trading conditions; (2) limit or control production, markets, technical development, or investment; (3) divide up markets or sources of supply; (4) apply dissimilar conditions to equivalent transactions with other trading parties, thereby placing them at a competitive disadvantage; or 5) make the conclusion of a contract subject to acceptance, by the other party, of supplementary obligations which, by their nature or according to commercial usage, have no connection with the subject of such a contract.
Article 101 (1) of the Treaty on the Functioning of the European Union corresponds to Section 5 of the Competition Act and applies to restrictions of competition which are likely to affect trade between Member States.
 Further information on the antitrust assessment of standard terms and conditions includes the Commission’s guidelines on horizontal cooperation agreements. Guidelines on the application of Article 101 of the Treaty on the Functioning of the European Union to horizontal cooperation agreements (OJ C 11, 14/1/2011).
 Section 6 of the Competition Act.