I thought this was an interesting case: the Dutch anti-trust regulator decided that an attempt by Dutch chicken companies to raise animal welfare was illegal, because it raised prices for consumers. The benefits to the chickens was apparently quite small, but as far as I can see they would have reached the same decision regardless of the size of the welfare improvement:
Sustainably produced poultry meat has enjoyed vastly increased sales in the Netherlands during the last five years due to schemes introduced by the Dutch Society for the Protection of Animals. The Chicken of Tomorrow is a recent initiative by a group of poultry producers and processors providing for higher animal welfare standards including additional space for the chickens and additional poultry litter as well as a longer lifetime of one to two days.
Market participants at varying levels of the poultry meat supply chain – including supermarkets, farmers, and meat processors – entered into agreements providing that only chicken meat that achieves certain animal-welfare requirements, such as those put in place as a part of the Chicken of Tomorrow initiative, should be available to consumers. These agreements led to Dutch supermarkets de-listing regular chicken meat and removing it from their shelves.
Following its review of the agreements and the requirements of Chicken of Tomorrow, the ACM found that the improvements offered by Chicken of Tomorrow were only limited: the birds only benefited from slightly more space and generally only lived a couple of days longer than conventional chickens. The ACM’s consumer research also found that these improvements came at a cost higher than consumers were generally willing to pay.
Therefore, the ACM concluded that agreements to remove regular chicken meat from supermarket shelves went too far and did not satisfy the efficiency arguments necessary for exemption.