Hi friend!
A BGP confederation is an alternative method to route reflectors, used to reduce the number of BGP peerings within a single AS. Furthermore, it is a single AS that has been subdivided into a number of internal sub-AS's, yet still, advertise as a single AS to external peers.
If route reflectors peer with an EBGP peer, only AS number is passed. If a member of the confederation is peering with a BGP peer located in another AS, the sub-AS numbers located in the AS-Path are suppressed and only the confederation number is passed within the AS Path attribute.
So in conclusion BGP Confederation vs Route-Reflector – these are two different methods for solving the same problem.
Thanks!