Background

Economic theory of vertical restraints

Economic theory and competition law

Should distributors have more protection?

Vertical restraints put to the test of economic analysis

Structure of distribution law - Book plan

General bibliography

Introduction

Localizing the anticompetitive effects

Effect on trade between Member States

Scope ratione loci

Concept of an undertaking

Intra-group agreements

Scope ratione personae

Applicability of competition law to vertical agreements

Definition of the relevant market

Anticompetitive object or effect

Appreciability threshold

Concept of agreement and concerted practice

Prohibition of vertical restraints

Block exemptions

Individual exemptions and rule of reason

Exemption of vertical restraints

Control of vertical restraints

Prohibition

Exoneration

Restrictive agreements

Principle

Applications

Abuse of dominant position

Exclusive purchase/Exclusive supply

Resale outside network

International agreement

Exclusive distribution agreements

Manufacturer's guarantee

Protection of the brand

Protecting the network against third parties

Relations between the parties

Selective distribution

Hardcore restrictions

Individual exemptions

Rule of reason

Prohibition of restrictive agreements and individual exemptions

Distribution of new motor vehicles : Regulation No 330/2010

After-sales : Regulation No 461/2010

Block exemption

Motor vehicle distribution agreements

Merger control

Franchising

Commercial agency and competition

EU harmonization

International agency

Commercial agents

This book provides a wide-ranging review of the European rules relating to distribution: exclusive purchase and exclusive supply, exclusive and selective distribution, motor vehicle distribution, franchises, commercial agents.

European Distribution Law

Internet is the second distribution channel after traditional retail trade  and makes it possible to engage in advertising or general promotion activities which sometimes reach a great number and variety of customers likely to be established on a distributor's exclusive territory or be part of an exclusive customer-group. Therefore internet abolishes the concept of territory, which is considered a …

Prohibition of internet selling

Internet is the second distribution channel after traditional retail trade  and makes it possible to engage in advertising or general promotion activities which sometimes reach a great number and variety of customers likely to be established on a distributor's exclusive territory or be part of an exclusive customer-group. Therefore internet abolishes the concept of territory, which is considered as pro-competitive insofar as it makes it more difficult to partition the markets. This may nevertheless raise some difficulties in the context of an exclusive distribution network which, by definition, relies on the granting of territories or exclusive customers to the distributors of the network.

The Commission very quickly considered that every distributor must be allowed to use the internet to sell products. The use of a website characterized a form of passive selling  and its prohibition a hardcore restriction. Despite the importance of this sales channel, to which the Commission was anxious to grant special protection, the prohibition of online sales was set out in the guidelines on vertical restraints only. 

Regulation No 2022/720, which takes into account the considerable developments in the online sales sector since the adoption of the first general regulation, safeguards the prohibition of online sales while recognizing that there is now less need to favor them over other forms of distribution. The prohibition on the use of the internet becomes a hardcore restriction in its own right, as set out in Article 4(e) of the regulation. The 2022 Guidelines considers as a prohibition on online sales any vertical agreement containing one or more restrictions on online sales or online advertising that de facto prohibit the buyer from using the internet to sell the contract goods or services or any agreement that, without directly prohibiting them, has the object of preventing the actual use of the internet by a buyer or its customers to sell the contract goods or services in specific territories or to a specific customer base . This includes agreements that have the object of significantly reducing the aggregate volume of online sales of the contract goods or services or the ability of end-users to purchase the contract goods or services online, of entirely preventing the use of one or more online advertising channels by the buyer, such as search engines or price comparison tools, or of preventing the buyer from setting up or using its own online store .

The guidelines list a series of obligations that may fall under Article 4(e) of the regulation. These include the requirement that the purchaser (i) prevents customers located in another territory from viewing its website or online store or to re-route customers to the online store of the manufacturer or of another seller; (ii) terminates consumers' online transactions when their credit card data reveal an address that is not within the buyer's territory; (iii) sells the contract goods or services only in a physical space or in the physical presence of specialized personnel; (iv) seeks the supplier's prior authorization before making individual online sales transactions;  (v) uses the supplier's trademarks or brand names on its website or in its online store; (vi) establishes or operates one or more online stores, irrespective of whether the online store is hosted on the buyer's own server or on a third party server; or (vii) uses an entire online advertising channel, such as search engines or price comparison services, or uses the supplier's trademarks or trade names for submissions to be referenced in search engines. 

However, compatibility of some restrictions on internet sales with the regulation is not entirely excluded. The text of Article 4 reserves the possibility of imposing other restrictions on online sales or restrictions on online advertising as long as they do not have the object of preventing the use of an online advertising channel entirely. In addition, following the Coty ruling of the Court of Justice  , the guidelines allow restrictions on the use of specific online sales channels, such as online marketplaces, or the imposition of quality standards for online sales .

Report on cross-border e-commerce in the EU, published in March 2009 by DG Health and Consumers http://ec.europa.eu/consumers/archive/strategy/docs/com_staff_wp2009_eu.pdf

Guidelines on Vertical Restraints, pt 52: “If a customer visits the web site of a distributor and contacts the distributor and if such contact leads to a sale, including delivery, then that is considered passive selling. The same is true if a customer opts to be kept (automatically) informed by the distributor and it leads to a sale”.

Vertical Restraints Guidelines of 2022, pt 203.

Case C-230/16 Coty Germany GmbH, Judgment of 6 December 2017, LawLex201800000317JBJ.

European Distribution Law

63. Prohibition of internet selling

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Les décisions de justice citées dans ce paragraphe :

Les notions juridiques connexes

63. Prohibition of internet selling

Demandez un accès gratuit au contenu exclusif Livv – juristes d’entreprise

Les décisions de justice citées dans ce paragraphe :

Les notions juridiques connexes

Demandez un accès gratuit
au contenu exclusif Livv – juristes d’entreprise