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

Where the supplier's and buyer's market share each do not exceed 30% , the exclusive distribution agreement falls within the scope of Commission Regulation (EU) No 2022/720, even if combined with other non-hardcore vertical restraints, such as a non-compete obligation limited to five years, quantity forcing or exclusive purchase . The exemption is limited to a maximum of five distributors per excl …

Where the supplier's and buyer's market share each do not exceed 30% , the exclusive distribution agreement falls within the scope of Commission Regulation (EU) No 2022/720, even if combined with other non-hardcore vertical restraints, such as a non-compete obligation limited to five years, quantity forcing or exclusive purchase . The exemption is limited to a maximum of five distributors per exclusive territory or exclusive customer group because, beyond that number, there is an increased risk of free riding among exclusive distributors that could eliminate the efficiencies that exclusive distribution is intended to achieve . The exemption only applies if the designated distributor is protected from active sales into the exclusive territory or to the exclusive customer group by all of the supplier's other buyers. Where a supplier designates more than one distributor for an exclusive territory or exclusive customer group, all of those distributors must also be protected from active sales into the exclusive territory or to the exclusive customer group by all of the supplier's other purchasers, but the active and passive sales of those distributors into the exclusive territory or to the exclusive customer group cannot be restricted . 

The exemption is excluded in the case of black clauses, such as the imposition of a minimum selling price  or territorial or customer restrictions . However, the restriction of active sales (but not on passive sales) to an exclusive territory or to an exclusive customer base reserved for the supplier or granted by the supplier to another buyer is permitted and may even, since the new regulation, be passed on (pass-on clause) to the distributor's direct customers . Similarly, the restriction of active or passive sales by the exclusive distributor and its customers to unauthorized distributors located in a territory in which the supplier operates a selective distribution system  for contract goods or services and the restriction of the place of establishment of the exclusive distributor are now allowed .

Finally, the benefit of the block exemption is subject to certain conditions intended to ensure market access or prevent collusion, listed in Article 5 of the Regulation. The post-contractual non-compete obligation must, in order to be valid, be limited to a period of one year from the expiry of the agreement and to the premises and land from which the buyer operated during the term of the contract, concern goods and services in competition with the contractual goods and services, and be indispensable for the protection of know-how. The contractual non-compete obligation, which, when included in the exclusive distribution agreement, often takes the form of an exclusive supply obligation, may not exceed five years or be for an indefinite period  if it covers 80% of the distributor's purchases from the supplier or an approved undertaking. Previously prohibited, non-compete obligations that are tacitly renewable beyond a five-year period may be block exempted, provided that the buyer can effectively renegotiate or terminate the vertical agreement containing the obligation with reasonable notice and at reasonable cost . The period may be longer if the goods or services are resold by the buyer from premises and land owned by the supplier .

Guidelines on Vertical Restraints of 2022, pt 175: “the market shares of the supplier and the buyer should in principle be calculated on the basis of value data, taking into account all sources of revenue generated by the sale of the goods or services. Where value data are not available, substantiated estimates can be made, based on other reliable market information, such as volume figures.”.

Guidelines on Vertical Restraints, pt 120.

Guidelines on Vertical Restraints, pt 248.

Guidelines on Vertical Restraints, pt 121.

Guidelines on Vertical Restraints, pt 122.

Recommended or maximum price practices are permitted under Article 4 of Regulation No 2022/720.

The Guidelines (pt 248) give as an example a contract with a 5-year non-compete obligation and a loan provided by the supplier. In this case, the repayment of the loan should not hinder the non-compete obligation from terminating. The repayment payments must be made in equal or decreasing instalments, but may not be progressive. The buyer must have the option of repaying the balance of the debt at the end of the non-compete obligation.

European Distribution Law

66. Block exemption

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

Les notions juridiques connexes

66. Block exemption

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

Les notions juridiques connexes

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