The European Commission (EC) has disclosed that the bloc’s competition enforcer, DG COMP, has been screening more than 350,000 transcripts of quarterly earnings calls conducted by almost 15,000 companies from around the world between 2004 and 2022. Using an automated natural language processing tool, the enforcer assessed whether statements made in those calls on a company’s strategic commercial behaviour, albeit in public, have served as a means of anticompetitive collusion between competitors running afoul of EU antitrust rules. While DG COMP stated that there was no systemic problem, the enforcer’s exercise resulted at least in an antitrust investigation into the world’s largest tyre makers for suspicion of anticompetitive price coordination, which is still ongoing.
Why do statements in earnings calls alert competition enforcers?
DG COMP’s scrutiny of earnings calls must be seen in context with the broad concept of when an exchange of commercially sensitive information between competitors constitutes anticompetitive ‘concerted practices’ under EU competition rules. While historically, the exchange of information was enforced only as an ancillary component of cartel agreements, the European Court of Justice confirmed that the stand-alone exchange of commercially sensitive information between competitors, in and of itself, constitutes a concerted practice with the object of restricting competition violating the EU’s prohibition on the ban of cartels.1
The court held that when an exchange of information removed the uncertainty among competitors about their intended conduct in the market, it would constitute a form of coordination which was harmful to the proper functioning of competition. There was a presumption that exchanged information influences a company’s conduct on the market even without the need for repeated exchanges.
How does the screening function and what is the EC looking for?
Against the background of that case law, DG COMP implemented its screening tool to monitor if market players signal details on their envisaged or preferred strategic behaviour in earnings calls. The authority assessed whether this could be read as a unilateral invitation to competitors to collude.
The regulator’s automated screening tool is sophisticated. In simple terms, it searches for statements about key elements of competition, such as price, output, capacity, margins, or R&D. The machine then combines those terms with terms expressing a company’s intent or its desired actions by other market players, such as ‘we have price increases planned’, ‘the industry needs to apply a consistent approach on managing capacity’, ‘the industry should achieve a reduction in capacity’, or the ‘industry should be disciplined.’ Statements on how a company operates strategically on the market, such as ‘we are not increasing market shares by lowering price’, trigger the screening tool as well. The tool also triangulates earnings calls of a defined set of competitors to locate subtle communication patterns and actual collusive behaviour in the market.
What does this mean for companies?
The remarkable sophistication of DG COMP’s market monitoring and the deployment of a high-tech tool show that the regulator is no longer waiting for leniency applicants to knock on their door to report anticompetitive conduct. The enforcer has clearly upped their game and is taking a more proactive approach to antitrust enforcement. Other enforcers around the world are expected follow that example.
The EU’s General Court has confirmed that statements in earnings calls are generally a plausible basis for a cartel, implying that DG COMP’s screening measures can serve as basis to open a formal antitrust investigation, such as by conducting dawn raids.2
The challenge for companies extends beyond Europe. Plaintiffs and claimants in other jurisdictions may be quick to file class and collective action claims when public acknowledgment of an investigation occurs. In 2024, within weeks of the announcement of dawn raids against producers of car tyres, multiple class actions were filed in U.S. courts, eventually consolidated as In re Passenger Vehicle Replacement Tires Antitrust Litigation, No. 5:24-md-03107 (N.D. Ohio).
It is safe to say that earnings calls and other investor relations communications have become a new antitrust minefield. Companies should add to their antitrust compliance playbook a review of the statements they make on that communication channel, finding the right balance between investor relations, disclosure requirements under corporate law, and antitrust compliance.
Endnotes
- ECJ of 4 June 2009, C-8/08 – T-Mobile Netherlands, ECLI:EU:C:2009:343; ECJ of 29 July 2024, C‑298/22 – Banco Português, ECLI:EU:C:2024:638.
- General Court of 9 July 2025, T-188/24, Compagnie générale des établissements Michelin v European Commission, ECLI:EU:T:2025:686.
If you have any questions, or would like additional information, please contact one of the attorneys on our Antitrust team.
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