Macquarie Journal of Business Law
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CHRISTOFFER GNIECHWITZ[*]
This comment will provide for a short, yet comprehensive, overview on the European law covering the block exemption of vertical business arrangements restrictive to competition as it is laid down in Regulation (EC) 2790/1999 on the application of Art 81(3) EC to categories of vertical agreements and concerted practices[1] (hereinafter ‘the Regulation’).
Article 81(1) of the Treaty establishing the European Community (hereinafter ‘EC’) prohibits all agreements between undertakings, decisions by associations of undertakings and concerted practices which may affect trade between Member States of the European Community and which have as their object or effect the prevention, restriction or distortion of competition within the common market. The consequences of an infringement of that prohibition are serious, including deal postponements or prohibitions, the invalidity of the entire agreement, and exposure to fines.[2]
Yet, pursuant to Art 81(3) EC the Commission of the European Communities (hereinafter ‘Commission’) may declare Art 81(1) EC inapplicable to particular agreements provided the detailed conditions laid down in Art 81(3) EC are satisfied. Correspondingly, the Commission was faced with notifications of thousands of agreements between undertakings seeking for such individual declarations under Art 81(3) EC. However, from an EC competition policy point of view many of those notifications did not give rise to serious concerns.[3] In order to effectively deal with those applications the Council of the European Communities, and the Commission under delegated authority from by the Council, enacted block exemption regulations.[4] Block exemption regulations are pieces of legislation that, pursuant to Art 81(3) EC, refer group exemption from the application of Art 81(1) EC to particular categories of agreements defined by and subject to conditions laid down in these regulations.[5]
That legal framework for the enforcement of Art 81 EC significantly changed when Council Regulation (EC) 1/2003 on the implementation of the rules on competition laid down in Articles 81 and 82 of the Treaty[6] (hereinafter ‘Regulation 1/2003’) began to apply on 1 May 2004.[7] Even though the wording of Art 81(3) EC remains unchanged, Art 1(2) of Regulation 1/2003 provides that agreements, decisions and concerted practices caught by Art 81(1) EC shall not be prohibited if they satisfy the conditions of Art 81(3) EC, no prior Commission decision to that effect being required. Consequently, the old system of prior notification with and exemption by the Commission is abolished and replaced by a system of legal exception characterised by the direct and integrated application of Art 81(3) EC.[8] Under such a direct applicable exemption regime an administrative block exemption of certain groups of agreements seems no longer necessary.[9] Nevertheless, Regulation 1/2003 keeps the instrument of block exemption regulations.[10] Yet their function today is not to primarily exempt restrictive trade practices but to codify and clarify the interpretation and application of Art 81(3) EC with regard to the categories of agreements defined in the respective regulations.[11] Accordingly, pursuant to Art 3(2) of Regulation 1/2003 the application of national competition laws may not lead to the prohibition of agreements, decisions and concerted practices which are covered by a block exemption regulation.[12] Thus, existing and new block exemption regulations will establish a framework for the application of Art 81(3) EC[13] that will be of crucial importance in providing legal certainty for undertakings which must assess for themselves nowadays whether their restrictive practices comply with the European competition law, in particular with the legal exception contained in Art 81(3) EC.[14]
In 1966, the European Court of Justice (hereinafter ‘ECJ’) established in the classic case of Consten and Grundig v Commission[15] that not only horizontal arrangements between undertakings are caught by Art 81(1) EC, but that this provision also applies to restraints of competition within vertical business relations. The later decisional practice of the Commission on the treatment of vertical arrangements under Art 81(1) and (3) EC, and the accompanying case law of the Community Courts, have been one of the most controversial and severely criticized aspects of Community competition policy.[16] Vertical business relations were also covered by several block exemption regulations specifically dealing with exclusive distribution[17], exclusive purchasing[18] and franchising agreements[19].[20]
These regulations were replaced by Regulation 2790/1999 which was adopted by the Commission on 22 December 1999, entered into force on 1 January 2000, and conferred its applies with effect from 1 June 2000.[21] It will expire on 31 May 2010. That ‘new style’ block exemption regulation shall provide for a less formalistic, less prescriptive, and more economics-based application of the criteria provided for in Article 81(3) EC to vertical agreements.[22] It is accompanied by the Commission’s Guidelines on Vertical Restraints[23] (hereinafter ‘the Guidelines’) governing both the application of Art 81(1) EC by the Commission and the application of the new Regulation.
The purpose of this paper is to give a summary on the law in force regarding the block exemption of vertical agreements in the European Union. Thus, it will solely focus on Regulation (EC) 2790/1999, and it will not address further EC competition law issues concerning restraints of competition within vertical business relations.[24] At first, the structure of the Regulation shall be summarized (Part 2). However, the ensuing more detailed analysis will not adhere to that structure of the legislation. On the contrary, it starts with an examination of the objective and subjective scope of the block exemption granted by the Regulation involving a scrutiny of the eligible content of, and the parties to, block exempted vertical arrangements (Part 3). Then, it will be elaborated under which circumstances the block exemption, as a whole or in part, is not applicable to such vertical agreements (Parts 4 and 5). Finally, the Commission’s and Member States authorities’ ability to remove the benefits of the block exemption shall be addressed (Parts 6 and 7).
Regulation (EC) 2790/1999 comprises 13 Articles which are preceded by 17 Recitals.[25] Art 1 of the Regulation contains definitions of certain key terms. Yet, the most consequential terms ‘vertical agreements’ and ‘vertical restraints’ are delimited in Art 2 of the Regulation. In addition, Art 2(1) is the stipulation that actually confers block exemption on the circumscribed vertical arrangements pursuant to Art 81(3) EC.[26] Art 3 of the Regulation imposes a 30% market share cap, while Art. 4 outlines a catalogue of provisions that will hinder the block exemption of agreements in which they are incorporated (so-called ‘black list’). Also, Art 5 sets out a listing of obligations that will not be exempted if they are included into vertical arrangements. Art 6 to 13 of the Regulation provide for more procedural rules on the withdrawal of the benefit of block exemption by the Commission or Member State authorities, the calculation of market shares and turnover, the entry into force of the Regulation, and other transitional matters.
Article 2(1) of the Regulation provides for a definition of block exempted vertical agreements which originates from Council Regulation (EC) 1215/99.[27] Thereby, it describes the objective (see A) and subjective (see B) scope of application of the Regulation. It provides that, subject to the prerequisites of the Regulation, Art 81(1) EC shall not apply:
to agreements or concerted practices entered into between two or more undertakings each of which operates, for the purposes of the agreement, at a different level of the production or distribution chain, and relating to the conditions under which the parties may purchase, sell or resell certain goods or services (‘vertical agreements’).
This exemption shall apply to the extent that such [vertical] agreements contain restrictions of competition falling within the scope of Article 81(1) (‘vertical restraints’).
However, it should be emphasised that many vertical agreements do not infringe Art 81(1) EC up front[28] or might satisfy the conditions of Art 81(3) EC even though they do not comply with the rules laid down in the Regulation. Thus, there is no presumption that legal arrangements falling outside the Regulation’s block exemption are illegal.[29] Accordingly, where an agreement does not contain vertical restraints in terms of Art 81(1) EC or satisfies the conditions of Art 81(3) EC it will not be obligatory to bring the agreement in question within the terms of the Regulation.[30] But as a matter of course legal counsels are free to, and presumably often will, take advantage of the ‘safe haven’ provided for by the Regulation.[31]
In accordance with the definition above, vertical arrangements on the conditions of the purchase, sale or resale of goods or services are exempted from the prohibition contained in Art 81(1) EC. Next, some general remarks on the content of vertical restraints exempted by the Regulation shall be made. Then, some more detailed commentaries regarding specific types of agreements will ensue.
As a consequence of the broad definition contained in Art 2(1) of the Regulation, exemption is conferred on vertical agreements irrespective of whether they relate to the supply of goods or services, and whether or not goods and services are supplied for resale or for use.[32] That extensive circumscription entitles a vast number of agreements to benefit from the block exemption that never would have been eligible for block exemption under the old Regulations particularly pertaining to exclusive distribution, exclusive purchasing and franchising agreements.[33] This reflects the purpose of the Regulation to cover almost all forms of purchase and distribution agreements.[34] It follows a ‘catch all’ approach and establishes an ‘umbrella’ block exemption regulation that affords protection for most vertical arrangements.[35] Though, rental and leasing agreements are not comprised by the Regulation since they do not relate to conditions under which the parties may purchase, sell or resell certain goods or services.[36]
Manifold genuine agency agreements do not fall within the scope of application of Art 81(1) EC.[37] Accordingly, block exemption of these arrangements under Art 81(3) EC is not necessary. The determining factor in assessing the application of Art 81(1) EC to agency agreements is whether the financial or commercial risks that are directly related to the contracts concluded by the agent on behalf of the principal and to market-specific investments are borne by the agent.[38] However, where the agent incurs these risks or where the agreement could foreclose access to the market, Art 81(1) EC may apply.[39] Since the agent operates in such a situation at a different level of the market from the principal in the sense of Art 2(1) of the Regulation, the block exemption will apply to these non-genuine agency agreements subject to the further conditions laid down in the legislation.[40]
The extent to which vertical agreements containing provisions which relate to the assignment of intellectual property rights (hereinafter ‘IPR provisions’[41]) can benefit from block exemption is outlined in Art 2(3) of the Regulation.[42] It states that the Regulation’s block exemption
shall apply to vertical agreements containing provisions which relate to the assignment to the buyer or use by the buyer of intellectual property rights, provided that those provisions do not constitute the primary object of such agreements and are directly related to the use, sale or resale of goods or services by the buyer or its customers.
Since Art 2(3) is only applicable where there is a vertical arrangement within the meaning of Art 2(1) of the Regulation, ‘pure’ licensing agreements cannot be covered by the Regulation inasmuch as they do not relate to the conditions under which the parties purchase, sell or resell certain goods or services.[43] Moreover, the block exemption will only apply where IPR provisions are ancillary to the main purpose of the vertical agreement.[44] Those provisions are considered to be ancillary where they serve the implementation of a vertical agreement primarily relating to the purchase or distribution of goods or services.[45]
It has to be recognized that Art 2(3) of the Regulation applies only in case the IPRs are provided by the supplier to the buyer.[46] Consequently, Art 2(3) does not apply where the buyer assigns IPRs to the supplier of contract goods or services.[47] Hence, subcontracting agreements, whereby a buying company commissions the subcontracting enterprise to manufacture goods on its behalf and with use of the contractor’s IPRs, would not benefit from block exemption.[48] However, according to the Guidelines the block exemption remains applicable to vertical agreements under which the buyer simply provides specifications to the supplier as to the goods or services supplied.[49] And in addition, many subcontracting agreements do not infringe Art 81(1) EC first.[50]
Finally, pursuant to Art 2(3) of the Regulation IPR provisions attached to vertical agreements ought to be directly related to the use, sale or resale of goods or services by the buyer or its customers,[51] and they must not have the same object or effect as vertical restraints which are not exempted under the Regulation. By the latter the legislator seeks to prevent a circumvention of the Regulation’s catalogue of not exempted (hard-core) restrictions contained in Art 4 and 5 of the Regulation.[52]
A special kind of IPR-related vertical agreements are franchising agreements. Granted block exemption by Regulation 4087/88[53] before, the new Regulation is fitted in principle for application to franchising agreements except for industrial franchise agreements.[54] According to Paragraph 43 of the Guidelines franchise agreements can usually be considered as being covered by the Block Exemption Regulation, because the franchisor provides goods and services to the franchisee, and the included IPR provisions concerning trade marks, signs and know-how for marketing purposes are directly related to the use, sale and resale of goods or services by the franchisee.[55] However, a franchising agreement that solely or primarily pertains to the licensing of IPRs cannot benefit from the Regulation.[56] But in such a case it will be treated in a way similar to the agreements covered by the Regulation[57] which presumably means that the analysis under Art 81(3) EC will follow the principles of the Regulation.[58]
Article 2(1) of the Regulation confers block exemption on arrangements entered into between two or more undertakings. Next, the subjective scope of the block exemption granted by the Regulation shall be looked upon.
First, it should be mentioned that agreements entered into with final consumers are not covered by the Regulation’s definition of vertical agreements. Final consumers as members of the public buying final goods or services do not carry on an economic activity, and therefore, cannot be regarded as undertakings.[59] However, that observation is only of minor significance since for the same reason agreements with final consumers would normally not infringe Art 81(1) up front.[60]
Second, and more consequential, it is notable that agreements block exempted under the new Regulation may be multilateral. The old Regulations on exclusive distribution, exclusive purchasing and franchising agreements[61] applied to bilateral agreements only.[62] Once more, that regulatory change clearly broadens the range of agreements qualified to block exemption under the new Regulation.
Yet, irrespective of whether the agreement is bilateral or multilateral, it is a prerequisite to the application of the Regulation that each undertaking involved ‘operates, for the purposes of the agreement, at a different level of the production or distribution chain’.[63] Accordingly, even two or more undertakings usually operating on the same level of the market may fulfill that requirement provided they perform for the purpose of the particular agreement on different market levels.[64]
Article 2(2) of the Regulation states that vertical agreements in the sense of Art 2(1) of the Regulation entered into between an association of undertakings and its members, or between such an association and its suppliers can benefit from block exemption. However, the exemption only applies if all members of the association are retailers of goods and if no individual member, together with its connected undertakings, has a total annual turnover in excess of EUR 50 million.[65] The term ‘retailer’ is defined by the Guidelines as ‘distributors reselling goods to final consumers’.[66] Accordingly, it follows that Art 2(2) would prevent the application of the block exemption if the group of undertakings does not purchase the contract goods in order to sell to final consumers but for its own use.[67] By setting up those further prerequisites for the application of the exemption conferred by Art 2(1) of the Regulation in case an association of undertakings is involved, Art. 2(2) of the Regulation limits the subjective scope of the block exemption.[68]
Pursuant to Art 2(4) of the Regulation vertical agreements entered into between undertakings competing at any level of the market are expressly excluded from the application of the block exemption.[69] ‘Competing undertakings’ are defined by the Regulation’s Art 1(a) as actual or potential suppliers in the same product market, irrespective of whether or not they are competitors on the same geographic market.[70] An enterprise not actually manufacturing a product interchangeable with, or substitutable for, the contract goods or services can be considered to be a potential supplier supposing it would be able and likely to enter the market within one year in response to a small and permanent increase in relative prices.[71] The assessment of the market necessary for that purpose must not be theoretical but be based on realistic grounds.[72]
Notwithstanding that general exclusion of vertical agreements between competitors Art 2(4)(a) to 2(4)(c) of the Regulation provide for three exceptions to that rule.[73] Non-reciprocal agreements[74] between competing undertakings may benefit from the block exemption subject to certain conditions. Art 2(4)(a) generally permits such non-reciprocal agreements in case the buyer has a total annual turnover not exceeding EUR 100 million.[75] Moreover, pursuant to Art 2(4)(b) such agreements are covered by the block exemption without any turnover restriction if the supplier is a manufacturer and distributor of goods, while the buyer is only a distributor not manufacturing competing goods. That exception covers cases of ‘dual distribution’: the manufacturer appoints independent distributors of its goods, but also maintains its own distribution activities.[76] The third exception contained in Art 2(4)(c) applies to similar situations of dual distribution, adjusted for the purposes of an agreement in the service sector.[77]
The introduction of a market share cap is a novelty to the law of block exemptions and a key feature of the new Regulation.[78] Art 3(1) of the Regulation states that:
the exemption provided for in Article 2 shall apply on condition that the market share held by the supplier does not exceed 30% of the relevant market on which it sells the contract goods or services.
Pursuant to that section a supplier can be party to a block exempted vertical agreement only subject to the condition that the share of the relevant market accounted for by the supplier is 30% or less. Thereby the Regulation creates a ‘safe harbor’ only for situations without significant market power.[79]
In the event an agreement involves three parties, each operating at a different level of the market,[80] it is the market share of both parties operating at the higher market levels that has to be considered for the purpose of the market share cap in Art 3(1).[81] The only exception to that rule is provided for in Art 3(2) of the Regulation: in case of vertical agreements embracing exclusive supply obligations[82] it is the buyer’s share of the market on which it purchases the contract goods or services that determines the applicability of the Regulation. The calculation of the market share ought to be based on market sales value of the contract goods or services sold by the supplier, or in the absence of such figures on substantiated estimates.[83] Pursuant to Art 9(2)(c) to 9(2)(e) of the Regulation the block exemption shall continue to apply for a period of up to two years in case a market share originally below the market share cap subsequently rises above the level of 30%.
The Regulation’s predecessors[84] were criticized inasmuch as under those regulations even agreements concluded by dominant firms were automatically qualified for block exemption,[85] and the Commission’s disposal to prohibit such agreements were very burdensome.[86] The incorporation of the market share cap resolves that issue and in fact will bring about that many undertakings whose share of a certain relevant market exceeds 30%, and that profited from block exemption under the old regulations, will not be qualified for block exemption under the new regime.[87] As a result of the 30% market share cap, the Regulation will in practice only be relevant to vertical agreements concluded by a supplier (or a buyer respectively) holding a market share between 10% and 30% because, due to the Commission’s De minimis Notice,[88] arrangements between parties that do not hold an aggregate market share exceeding 10% do not fall within the scope of application of Art 81(1) EC up front.[89]
The Commission has been attacked for the inclusion of the market share cap provision because of the legal uncertainty that a market share test, especially the inherent difficulty in assessing the relevant market’s definition, would entail.[90] But vertical agreements are considered to be detrimental to competition only if the parties involved possess market power.[91] Hence a sensible economic examination of such agreements requires an assessment of the parties’ market shares, and it makes economic sense to use market share thresholds to limit the application of the block exemption.[92] The Commission cannot be blamed for applying a principled economics-oriented approach[93] in order to evade from the discredited and formalistic regulations of the past.[94] Also, there have been no suggestions by the business community with regard to a better single indicator than market share for use in a block exemption regulation.[95] And moreover, because of the Commission’s Notice on the definition of the relevant market for the purposes of Community competition law,[96] the Guidelines,[97] the hundreds of Commission decisions on particular markets, and the regular basis on which competition law practitioners are involved in delimiting certain markets the understanding of market definition on part of legal advisers and their clients has developed enormously in recent years resulting in a further decrease of legal uncertainty.[98]
The Regulation’s market share cap was also criticized for not taking into account the effects of vertical agreements on upstream or downstream markets. But although from an economic point of view a vertical agreement may also have effects on markets downstream of the buyer an assessment of these effects would introduce an undesirable complexity into the Regulation that should be avoided.[99] Accordingly, the restriction of the market share cap on the relation between the supplier and buyer is a manifestation of the Commission’s compromise between its new economics-oriented approach to vertical agreements and the endeavor to enhance legal certainty by means of a simplified standard of review.
Since the scope of the Regulation’s block exemption has been delimited above, it shall be scrutinized now which circumstances induce the non-applicability of the Regulation. According to Recital 10 of the Regulation the benefit of the block exemption should not apply to vertical agreements ‘containing certain types of severely anti-competitive restraints’ irrespective of the market share of the undertakings concerned. Correspondingly, Art 4 sets out a list of hard-core restrictions of competition (so-called ‘black list’). Pursuant to that stipulation the block exemption provided for by Art 2(1) of the Regulation:
shall not apply to vertical agreements which, directly or indirectly, in isolation or in combination with other factors under the control of the parties have as their object
any of these hard-core restrictions. Consequently, any vertical agreement that contains one of these hard-core restraints is excluded from the scope of application of the Block Exemption Regulation as a whole.[100] Moreover, it is unlikely too that such vertical agreements will be considered to satisfy the prerequisites of Art 81(3) EC.[101]
The new Regulation pursues a ‘black clause’ approach. That means it mainly defines the restrictions of competition that will prevent the application of the block exemption to the vertical agreement.[102]
In contrast to its predecessors[103] Regulation 2790/99 does not contain additional ‘white list’ provisions. Such provisions comprise a list of restrictions of competition explicitly permitted to be included in block-exempted agreements.[104] However, since block exemption regulations ought to be strictly interpreted in accordance with the European judiciary,[105] a particular agreement was not able to benefit from block exemption under the old regulations unless it complied exactly with the precise terms of the relevant legislation.[106] Consequently, block exemption was inapplicable in case of the incorporation of a single clause restricting the conduct of any party to the agreement which was not contained within a relevant ‘white list’, even if it did not appear in the relevant ‘black list’.[107] Hence, vertical agreements were often formulated by taking the relevant block exemption regulation as a model agreement. Thereby these ‘white list’ provisions produced a ‘strait jacket’ effect,[108] which indicates that they caused severe constraints imposed on the economic entities during the drafting process of vertical agreements.[109]
The absence of a so-called ‘white list’ as it was contained in its predecessors is an essential feature of the ‘new style’ block exemption on vertical restraints.[110] The consequence of having a ‘black list’ only is the wide application of the new Regulation. Every legally relevant conduct is permitted as long as it is not expressly prohibited by the Regulation.[111] As a result, every vertical restraint in the sense of Art 2(1) of the Regulation is block exempted, subject to the provisions of Art 2(2), 2(4), 2(5), and Art 3-Art 5, without needing to be specifically authorized by further stipulations of the Regulation.[112] Thus the Regulation’s black list approach removes, at least partially, the strait jacket effect.[113] It provides enterprises with more flexibility in the negotiation of vertical agreements[114] and enables them to structure deals in a way that makes the most commercial sense.[115] Likewise, it occasions a simplification of the applicable rules.[116]
The catalogue of black-listed restraints causing the inapplicability of the Regulation is mainly concerned with issues of intra-brand competition.[117]
The first severely anti-competitive restraint set out in Art 4(a) of the Regulation relates to resale price maintenance (hereinafter ‘RPM’).[118] Pursuant to that provision the block exemption is not available to agreements that have as their object ‘the restriction of the buyer’s ability to determine its sale price’. However, Art 4(a) expressly permits the imposition of a maximum sale price and the recommendation of prices by the supplier provided that these measures do not pursue the establishment of a fixed or minimum resale price or price level to be observed by the buyer.[119]
RPM must not be achieved through neither direct nor indirect means. Thus, every mechanism that brings about pressure from, or incentives offered by, any of the parties resulting in RPM endangers the block exemption of the entire agreement it is incorporated in. The Guidelines give a number of examples for such banned instruments to create RPM:
fixing the distribution margin, fixing the maximum level of discount the distributor can grant from a prescribed price level, making the grant of rebates or reimbursements of promotional costs by the supplier subject to the observance of a given price level, linking the prescribed resale price to the resale price of competitors, threats, intimidation, warnings, penalties, delay or suspension of deliveries or contract terminations in relation to the observation of a given price level.[120]
Moreover, measures like implementing a price monitoring system to identify price-cutting distributors or printing a recommended resale price on the product to reduce the buyer’s incentive to lower the resale price might also amount to indirect pressure to fix prices since they make other means of direct or indirect price fixing more effective.[121]
Article 4(b) of the Regulation pertains to market partitioning by territory or by customer.[122] Pursuant to Art 4(b), the Regulation’s block exemption will not apply to agreements that have as their object the restriction of sales by the buyer, in as far as those restraints relate to the territory into which, or the customers to whom, the buyer may sell the contract goods or services.
Again, neither direct nor indirect measures may result in such restrictions. The Guidelines give a number of examples of indirect measures illegitimately restricting the buyer’s sales:
refusal or reduction of bonuses or discounts, refusal to supply, reduction of supplied volumes or limitation of supplied volumes to the demand within the allocated territory or customer group, threat of contract termination or profit pass-over obligations.[123]
In addition, the withholding of a Community-wide guarantee service and the operation of a monitoring system in order to detect parallel imports and exports could also amount to indirect means of partitioning the market.[124]
However, the Regulation contains four exceptions to that hard-core restriction which define the extent to which it is possible, despite the general prohibition laid down in Art 4(b) of the Regulation, to grant territorial or customer exclusivity without losing the benefit of block exemption.[125]
The first exception permits a supplier to restrict:
active sales into the exclusive territory or to an exclusive customer group reserved to the supplier or allocated by the supplier to another buyer, where such restriction does not limit sales by the customers of the buyer.
The prerequisite of an exclusive allocation is satisfied in case the supplier agreed to sell its product only to one distributor for distribution in a particular territory or to a particular customer group, and the exclusive distributor is contractually safeguarded from active selling to the allotted territory or group by the supplier or by other buyers of the supplier.[126] It is notable that, in contrast to Regulation 1983/83 on exclusive distribution,[127] not only agreements conferring exclusive territories can be exempted, but that restrictions of active sales to certain groups of customers are permitted under the new Regulation too.[128] In addition, the supplier is entitled to combine the allocation of an exclusive territory and an exclusive customer group.[129]
However, although not expressly stated in the Regulation, passive sales to exclusively allocated territories or customer groups must remain possible.[130] Passive sales are defined by the Guidelines as sales resulting from ‘responding to unsolicited requests from individual customers including delivery of goods or services to such customers’, while active selling means ‘actively approaching individual customers inside another distributor’s exclusive territory or ... customer group’.[131] General advertising or promotion as well as the use of the Internet in order to sell the contract products are normally not considered to be a form of active sales by the Commission, since they are reasonable ways to reach customers within the buyer’s own territory or customer group, or within territories or groups not exclusively allocated to another buyer or reserved to the supplier.[132] In addition, the supplier cannot reserve to itself sales and advertising over the Internet.[133]
The other three exceptions to the second hard-core restriction contained in Art 4(b) of the Regulation allow for the limitation of both active and passive sales subject to certain conditions.[134]
Under the second exception to Art 4(b) it is permissible to restrict a buyer operating at the wholesale level of trade from selling to end users. That provision pursues the protection of market participants at the retail level.[135]
The third exception authorizes the restriction on an appointed distributor in a selective distribution system not to sell, at any level of trade, to unauthorized distributors in markets where such a system is run. A selective distribution system is defined in Art 1(d) of the Regulation as a distribution system where the supplier agrees to supply the contract goods or services only to distributors selected on the basis of specified criteria and those distributors agree not to sell the contract products to unauthorized distributors.[136] Thus, a selective distribution system restricts the group of customers the buyer may sell contract goods or services to by its very nature.[137] Accordingly, the third exception was essential to make the Regulation’s block exemption available for such selective systems.[138]
The last exception to the prohibition contained in Art 4(b) allows, in order to protect the supplier, to restrict a buyer of components[139] supplied for incorporation from reselling them to competitors of the supplier.
Although selective distribution systems generally are permitted by the third exception to Art 4(b) of the Regulation[140] the block exemption of such networks is subject to further conditions: Art 4(c) prevents the application of the block exemption when there exist restrictions on active or passive sales to end users, whether professional end users or final consumers,[141] by selected distributors at the retail level of trade. Thus, dealers in a selective distribution system cannot be restricted in the users to whom they may sell.[142] Consequently, such distributors must also be free to use the Internet to advertise and sell the contract goods or services.[143] Nevertheless, retailers in a selective distribution network may be contractually prevented from running their business out of an unauthorized place of establishment.[144]
Another important detail in regard to selective distribution, which is not explicit in the Regulation itself, is pointed out in the Guidelines: selective distribution may be combined with exclusive distribution provided that active and passive selling is not restricted.[145] Therefore a supplier in a selective distribution network may confine itself to supplying only one retailer in a given territory.[146] Such a combination of selective and exclusive distribution was not permissible under the old Block Exemption Regulation 1983/83[147] pertaining to exclusive distribution.[148]
Pursuant to Art 4(d) of the Regulation the block exemption will not apply to agreements that pursue the restriction of cross-supplies, that is active and passive selling of contract products,[149] between appointed distributors within a selective distribution system. Thus selected distributors must remain free to buy the contract goods or services from any approved distributor within the network, including distributors at different market levels.[150] Consequently, selective distribution cannot be combined with vertical restraints amounting to exclusive purchasing.[151]
Article 4(e) sets out the last hard-core restriction contained in the Regulation: it prevents the application of the block exemption in the event a direct or indirect restraint is agreed upon between a supplier of components and a buyer who incorporates these spare parts that the supplier will not sell the components to end users, independent repairers or service providers not entrusted by the buyer with the repair or servicing of its goods.[152] Those customer groups must be able to obtain spare parts directly from the manufacturer.[153] Prohibited indirect restrictions may result in particular from a contractual limitation of the ability of a supplier to provide technical information and special equipment necessary for the use of the spare parts by the users, repairers and service providers.[154] Nevertheless, the buyer can insist that repairers or service providers within its own service network buy the spare parts from it.[155]
Besides the ‘black list’ provisions examined before, Art 5 of the Regulation comprises a catalogue of three categories of anti-competitive obligations that as well will not benefit from the block exemption brought about by Art 2(1) of the Regulation if they are contained in vertical agreements (so-called ‘gray’[156] or ‘red’[157] clauses). However, there is a significant difference to the ‘black list’ provided for in Art 4 of the Regulation: the incorporation of obligations set out in Art 5 does not impede the block exemption from applying to the rest of the vertical agreement if that part is severable from the non-exempted obligations.[158] Thus, in those cases only the validity of the obligation not exempted under Art 5 is at stake.
Nevertheless, since Art 5 seeks ‘to ensure access to or to prevent collusion on the relevant market’[159] the exclusion of the restraints described in Art 5 of the Regulation from the coverage of the Block Exemption Regulation comes about whether or not the Regulation’s market share cap is exceeded.[160]
The first exclusion from the Regulation’s block exemption provided for in Art 5(a) relates to ‘any direct or indirect non-compete obligation, the duration of which is indefinite or exceeds five years’. According to the definition contained in Art 1(b) of the Regulation a non-compete obligation is any ‘obligation causing the buyer not to manufacture, purchase, sell or resell goods or services which compete with the [contract products]’.[161] Moreover, the definition in Art 1(b) also comprises obligations that require the buyer to purchase from the supplier, or from another undertaking designated by the supplier, more than 80% of the buyer’s total purchases of the contract goods or services and their substitutes on the relevant market.[162] As can be inferred from that terminology Art 5(a) of the Regulation only prevents the block exemption of long-term non-compete obligations imposed on the buyer.[163] In contrast, such obligations may be agreed on without any limit regarding their duration if they put a strain on the supplier.[164]
While it was permissible for the supplier to impose indefinite non-compete obligations on the buyer and franchisee under the old regulations on exclusive distribution and on franchising agreements[165],[166] the new Regulation limits the duration of a block exempted obligation of such kind to five years.[167] Moreover, a non-compete obligation that is ‘tacitly renewable beyond a period of five years’ is as well not covered by the block exemption.[168] But an agreement which requires explicit consent of both parties for renewal beyond five years is admissible provided there exist no obstacles that hinder the buyer from effectively terminating the non-compete obligation at the end of the five year period.[169]
The five year limitation on non-compete obligation does not apply when the contract products are sold from land and premises owned by the supplier or leased by the supplier from third parties.[170] Nevertheless, artificial ownership constructions in order to circumvent the general five year limit will not benefit from this exception.[171]
Article 5(b) of the Regulation rules out in general an application of the block exemption to obligations imposed on the buyer not to manufacture, purchase, sell or resell goods or services after the termination of the agreement.
Nevertheless, under the exception provided for in Art 5(b) such post-term non-compete obligations can be covered by the block exemption if four cumulative[172] prerequisites are met: the obligation must be necessary to protect know-how[173] transferred from the supplier to the buyer, must be limited to the point of sale at which the buyer operated during the contract period, must relate to goods or services competing with the contract products, and must be limited to a maximum period of one year after the termination of the agreement.[174] Such an exception was not contained in the previous Regulations No 1983/83 and No 1984/83 on exclusive distribution and purchasing[175] which thus did not permit post-term non-compete obligations at all.[176]
The last exclusion from the block exemption provided for in Art 5(c) of the Regulation relates to the sale of competing goods in a selective distribution system:[177] any direct or indirect obligation that prevents appointed members of a selective distribution network from selling brands of particular competing suppliers cannot benefit from block exemption.[178] It should be noticed that, in contrast to the draft version of the Block Exemption Regulation,[179] Art 5(c) does not preclude the supplier from demanding the buyer in a selective distribution system to sell brands of a certain competing supplier.[180]
However, even under Art 5(c) it is permissible to combine selective distribution with a non-compete obligation, requiring the members of a selective system not to resell competing brands in general.[181] But in order to avoid horizontal collusion between leading suppliers causing the exclusion of particular trademarks and the foreclosure of certain specific competitors through the creation of a selective club of brands,[182] a supplier cannot hinder its buyers from selling brands of a specific competing supplier in a block exempted vertical agreement.[183]
The presumption of legality bestowed on vertical agreements by the Regulation may be withdrawn in any particular case, even if no hard-core restriction or not exempted obligation is agreed on, subject to the conditions laid down in Art 6 and 7 of the Regulation.[184]
The Commission may, under the conditions laid down in Art 6 of the Regulation, withdraw the benefit of block exemption with regard to a certain vertical agreement provided such an arrangement, examined either in isolation or in conjunction with similar agreements enforced by competing suppliers or buyers, comes within the scope of Art 81(1) EC and has effects which are incompatible with the conditions of Art 81(3) EC.[185] The Commission was vested with similar withdrawal powers by the Regulation’s predecessors[186] before.[187] Though it made only little use of that authority.[188] Also, Art 29(1) of Regulation 1/2003 recently introduced a generalised possibility for the Commission to withdraw the benefit of block exemptions in individual cases.[189]
The withdrawal by the Commission under Art 6 implies the adoption of a formal decision establishing an infringement of Art 81(1) EC by an individual company.[190] In that case, the Commission bears the burden of proof that the vertical agreement falls within the scope of Art 81(1) EC and that it does not fulfill all conditions of Art 81(3) EC.[191] A withdrawal decision will have only ex nunc effect.[192]
In addition to the withdrawal power of the Commission, the competent authority of a Member State may under Art 7 of the Regulation withdraw the benefit of the block exemption with respect to a particular vertical agreement which has effects incompatible with the conditions laid down in Art 81(3) EC in the territory of the Member State concerned or in a part thereof, which has all characteristics of a distinct geographic market.[193] That withdrawal power of Member State authorities is a novel feature introduced into the EC law of block exemption regulations in order to enhance its decentralized enforcement by national competition authorities.[194] Accordingly, it was also implemented in a generalised form in Art 29(2) of Regulation 1/2003 during the modernisation process of the EC competition law.[195]
The national withdrawal decisions will only have effect within the territory of the Member State concerned, and must not prejudice the uniform application of EC competition law.[196] When the territory of a single Member State, or a part thereof, constitutes the relevant geographic market, the Commission and the Member State have concurrent competence for withdrawal.[197] In contrast, the Commission retains the sole power to withdraw the block exemption in regard to vertical agreements restricting competition on a relevant geographic market wider than a Member State.[198]
Article 8 of the Regulation contains another novelty to the law of block exemptions:[199] the Commission may, by means of a regulation, exclude from the scope of the Block Exemption Regulation parallel networks of similar vertical restraints where these agreements cover more than 50% of a given market.[200]
Such a regulation adopted under Art 8(1) removes, in respect of the restraints and markets concerned, the benefit of the block exemption, and thus, restores the full application of Art 81(1) and 81(3) EC.[201] It must clearly set out its scope by defining the relevant product and geographic markets, and the type of vertical restraints which will no longer be covered by the block exemption.[202] To provide the undertakings concerned with the time necessary to adjust their agreements, Art 8(2) of the Regulation stipulates that a regulation under Art 8(1) will not become applicable earlier than six months following its adoption.[203]
In contrast to the withdrawal of the block exemption under Art 6 and 7 of the Regulation, a declaration of disapplication pursuant to Art 8(1) is not addressed to individual undertakings but affects all undertakings which execute agreements that fall under the definition in the regulation disapplying the block exemption.[204] Hence in assessing the need to act under Art 8 of the Regulation, the Commission must take into consideration the Community principle of proportionality, and in particular whether an individual withdrawal pursuant to Art 6 would be a more appropriate remedy.[205]
Regulation 2790/1999 regarding vertical restraints on competition is a radical departure from the block exemption regulations it replaces.[206] The Commission started to generally recognize that vertical restrictions are on average less harmful than horizontal competition limitations.[207] It even acknowledges the positive effects of vertical restraints.[208] Consequently, the Commission seems to apply a more relaxed approach to the treatment of vertical agreements which is reflected by the new Regulation.[209]
Due to the improved structure of the Regulation compared with those of its predecessors,[210] Regulation 2790/1999 generates three main advantages: more categories of vertical arrangements are block exempted and thus considered to satisfy the conditions of Art 81(3) EC, firms are in principle freer to form contracts according to their commercial needs, and vertical agreements concluded by market dominant firms can no longer benefit from block exemption.[211] Nevertheless, the ‘black list’ examined above is quite extensive,[212] while the exceptions are rather narrow. Thus something similar to the strait jacket effect experienced under the block exemption regulations following a ‘white list’ approach can be expected to arise under Regulation 2790/99 too.[213] And in addition, the incorporation of the market share cap is accompanied by a reasonable amount of legal uncertainty with respect to the applicability of the Regulation. But absolute legal certainty is unfortunately incompatible with a more economics-based approach towards vertical agreements.[214] Competition rules are economic rules that by their very nature involve an inevitable degree of legal uncertainty.[215]
Altogether, the new Regulation is an important step towards a more economics-based approach in the application of Art 81 EC to vertical restraints.[216] It is undoubtedly less formalistic and more economics-oriented than its predecessors.[217] Furthermore, the treatment of vertical agreements under the Regulation comes closer to the US approach, proving an increasing convergence of US antitrust law and EU competition policy.[218] Since Regulation 2790/1999 is a considerable improvement on the system it replaces,[219] the overall reaction from the business community to the reformation of the European law pertaining to the block exemption of vertical business arrangements has been positive as well.[220]
[*] Ref iur Christoffer Gniechwitz is doctorand at the Faculty of Law, Friedrich-Schiller University Jena, Germany, and holds a postgraduate scholarship awarded by the free state Thuringia. This is the updated version of the paper originally submitted in September 2003.
[1] O J 1999, L 336/21; The process of enactment of the Regulation was initiated by the Commission’s Green Paper on Vertical Restraints in Community Competition Policy in January 1997, COM (96) 721 final, supplemented by the Communication from the Commission on the application of the Community competition rules to vertical restraints (Follow-Up to the Green Paper on Vertical Restraints) O J 1998, C 365/3. The draft of the block exemption regulation was published in September 1999, O J 1999, C 270/7. The enactment of the Regulation also necessitated the amendment of Council Regulations 19/65 and 17/62 - First Regulation implementing Articles 85 and 86 of the Treaty. These amendments were realized by Council Regulation (EC) 1215/1999, O J 1999, L 148/1, and Council Regulation (EC) 1216/1999, O J 1999, L 148/5, both based on the Commission’s proposals contained in COM(1998) 546 final, O J 1998, C 365/27 and C 365/30. For a description of the legislative process see, eg, M Bauer and G K de Bronett, Die EU-Gruppenfreistellungsverordnung für vertikale Wettbewerbsbeschränkungen (2001) para 6; J M Schultze, S Pautke and D S Wagener, Die Gruppenfreistellungsverordnung für vertikale Vereinbarungen. Praxiskommentar (2001) para 1; R Subiotto and F Amato, ‘The Reform of the European Competition Policy Concerning Vertical Restraints’ (2001) 69 Antitrust Law Journal 147-193, 151; G Terhorst, ‘The Reformation of the EC Competition Policy on Vertical Restraints’ (2000) 21 Northwestern Journal of International Law and Business 343-378, 344 and 359; S Rütters, Die neue Schirm-Gruppenfreistellungsverordnung (EG) Nr. 2790/1999 der Kommission. Zu den Ursachen der weitreichenden Reform der EG-Wettbewerbspolitik gegenüber vertikalen Wettbewerbsbeschränkungen und deren materiellrechtlichen Grenzen (2002) 27; For a detailed analysis of the legality of the Regulation see Rütters, above n 1, 112.
[2] Bauer and Bronett, above n 1, para 11 and 17.
[3] Cf Subiotto and Amato, above n 1, 147 and 149; Terhorst, above n 1, 357.
[4] Cf Subiotto and Amato, above n 1, 149; I Brinker, ‘Vertikale Wettbewerbsbeschränkungen – Anmerkungen zum neuen Regelungsansatz der Kommission’ in J Schwarze (ed), Neuere Entwicklungen auf dem Gebiet des europäischen Wettbewerbsrechts (1999) 59-70, 60; U Blaurock, ‘Vertikale Wettbewerbsbeschränkungen’ in J Schwarze (ed), Neuere Entwicklungen auf dem Gebiet des europäischen Wettbewerbsrechts (1999) 71-78, 72; B Munro Audia, P Tamussino and D W Hull, ‘Recent Developments in European Competition Law: Vertical and Horizontal Agreements’ (2001) 19 American Corporate Counsel Association Docket 52-72, 57; R Roniger, Das neue Vertriebskartellrecht. Kurzkommentar zur vertikalen EG-Gruppenfreistellungsverordnung (2000) E12; For a detailed description of the development of the legal institute ‘block exemption regulation’ see D G Goyder, EC Competition Law (3rded, 1998) 55.
[5] For a detailed description of the function of block exemption regulations see Goyder, above n 4, 130.
[6] O J 2003, L 1/1; Regulation 1/2003 was adopted on 16 December 2002 and replaces Council Regulation 17/62 of 6 February 1962 - First Regulation implementing Articles 85 and 86 of the Treaty which provided the legal framework for the enforcement of Articles 81 (former Art 85) and 82 (former Art 86) EC before. The process of modernisation of the EC competition law was initiated by the Commission’s White Paper on Modernisation of the Rules implementing Articles 85 and 86 of the EC Treaty, Commission Programme No 99/027, O J 1999, C 132/1. The Proposal for a Council Regulation on the implementation of the rules on competition laid down in Articles 81 and 82 of the Treaty and amending Regulations (EEC) No 1017/68, (EEC) No 2988/74, (EEC) No 4056/86 and (EEC) No 3974/87 (‘Regulation implementing Articles 81 and 82 of the Treaty’), COM(2000) 582 final, was published in September 2000, O J 2000, C 365 E/284.
[7] Cf Art 45 of Regulation 1/2003.
[8] White Paper on Modernisation, above n 6, para 79; W P J Wils, ‘The Modernization of the Enforcement of Articles 81 and 82 EC: A Legal and Economic Analysis of the Commission’s Proposal for a New Council Regulation Replacing Regulation No. 17’ (2001) 24 Fordham International Law Journal 1655-1717, 1658; J S Venit, ‘Brave New World: The Modernization and Decentralization of Enforcement under Articles 81 and 82 of the EC Treaty’ (2003) 40 Common Market Law Review 545-580, 546; F Schuhmacher, ‘Council Regulation (EC) No 1/2003 of December 16, 2002 on the Implementation of the Rules on Competition Laid Down in Articles 81 and 82 of the Treaty’ (2003) 9 Columbia Journal of European Law 480-486, 481; Cf also Recital 4 of Regulation 1/2003.
[9] Cf Wils, above n 8, 1683; R Bechtold, ‘EG-Gruppenfreistellungsverordnungen – eine Zwischenbilanz’ [2001] Europäisches Wirtschafts und Steuerrecht 49-55, 54.
[10] Wils, above n 8, 1683; Venit, above n 8, 556; Bechtold, above n 9, 54; Cf also Art 29 of Regulation 1/2003 which pertains to the withdrawal of the benefits of block exemption; Recital 10 of Regulation 1/2003.
[11] Proposal for a Council Regulation – Explanatory Memorandum, above n 6, Chapter II Article 4; Bechtold, above n 9, 54.
[12] Cf also Schuhmacher, above n 8, 484.
[13] Ibid 482.
[14] Cf the White Paper on Modernisation, above n 6, para 85; Proposal for a Council Regulation – Explanatory Memorandum, above n 6, Chapter II Article 4; Also, the fact that the Commission suggested to include a provision in Regulation 1/2003 that provides for a general power of the Commission to adopt block exemption regulations demonstrates that the Commission considers such regulations to be an important instrument of competition policy in the future. Cf Art 28(1) of the proposed Regulation and Chapter IX of the Explanatory Memorandum; See also Wils, above n 8, 1683 (Footnote 77).
[15] ECJ, Consten and Grundig v Commission, Cases 56 and 58/64, [1966] ECR 299; Cf also ECJ, Société Technique Minière v Maschinenbau Ulm, Case 56/65, [1966] ECR 234; Bauer and Bronett, n 1, para 9; Brinker, above n 4, 59.
[16] For a detailed analysis of the deficiencies of EC competition policy regarding vertical restraints see B E Hawk, ‘System Failure: Vertical Restraints and EC Competition Law’ (1995) 32 Common Market Law Review 973-989, 973; Cf also R Whish, ‘Regulation 2790/99: The Commission’s ‘New Style’ Block Exemption for Vertical Agreements’ (2000) 37 Common Market Law Review 887-924, 887; Terhorst, above n 1, 357; Subiotto and Amato, above n 1, 147. For an analysis of the economics of vertical agreements see H H Kallfass, ‘Vertikale Verträge in der Wettbewerbspolitik der EU’ [1999] Wirtschaft und Wettbewerb 225-244, 225; Rütters, above n 1, 169.
[17] Regulation 1983/83, O J 1983, L 173/1.
[18] Regulation 1984/83, O J 1983, L 173/5.
[19] Regulation 4087/88, O J 1988, L 359/46.
[20] Cf Schultze, Pautke and Wagener, above n 1, para 1; Bauer and Bronett, above n 1, para 1; Bechtold, above n 9, 50; R Polley and D Seeliger, ‘Die neue Gruppenfreistellungsverordnung für Vertikalverträge Nr. 2790/1999 – Ihre praktische Anwendung’ [2000] Wettbewerb in Recht und Praxis 1203-1217, 1203; M Griffiths, ‘A Glorification of de minimis – The Regulation on Vertical Agreements’ (2000) 21 European Competition Law Review 241-247, 242; J Nazerali and D Cowan, ‘Unlocking E.U. Distribution Rules – Has the European Commission Found the Right Keys?’ (2000) 21 European Competition Law Review 50-56, 51; Subiotto and Amato, above n 1, 150; Kallfass, above n 16, 234.
[21] See Art 13 of the Regulation; Cf also Subiotto and Amato, above n 1, 186 for details on the delayed application.
[22] Follow-Up to the Green Paper on Vertical Restraints, n 1, 3; Whish, above n 16, 887.
[23] Commission Notice, Guidelines on Vertical Restraints, O J 2000, C 291/1; A first version of draft guidelines was published by the Commission at O J 1999, C 270/12. Cf also Terhorst, above n 1, 363; The Guidelines will be revised after a period of four years. See Commission’s Press Release of 24 May 2000 accompanying the Guidelines, IP/00/520; Terhorst, above n 1, 344; For an analysis of the legal status of the Guidelines see Bechtold, above n 9, 53; Bauer and Bronett, above n 1, para 244.
[24] Large parts of the Guidelines are dedicated to these complementary legal aspects. See, eg, Parts II and VI of the Guidelines.
[25] For a short introduction into the structure of the Regulation see also K Pukall, ‘Neue Gruppenfreistellungsverordnung für Vertriebsbindungen’ [2000] Neue Juristische Wochenschrift 1375-1379, 1376; Subiotto and Amato, above n 1, 152; Whish, above n 16, 894.
[26] See only Whish, above n 16, 895; Bauer and Bronett, above n 1, para 85.
[27] Council Regulation (EC) 1215/1999 extended the legislative powers granted to the Commission by Council Regulation 19/65 in order to enable the Commission to adopt a broader block exemption regulation that covers all vertical agreements affecting finished or intermediate goods and services. See also above n 1; Cf likewise Whish, above n 16, 892 and 899.
[28] Eg, a selective distribution system does not infringe Art 81(1) EC if it satisfies the Metro doctrine: ECJ, Metro v Saba, Case 26/76, [1977] ECR 1875; Cf also Sections II and VI of the Guidelines; Whish, above n 16, 897.
[29] See the Guidelines para 62; Cf also Subiotto and Amato, above n 1, 189; Whish, above n 16, 897.
[30] Whish, above n 16, 897.
[31] Ibid.
[32] See, eg, Whish, above n 16, 899.
[33] Ibid; For the old regulations concerning vertical business relations see above, n 17 to 19.
[34] Cf the Follow-Up to the Green Paper on Vertical Restraints, above n 1, 16; Guidelines para 24; Schultze, Pautke and Wagener, above n 1, para 204; Rütters, above n 1, 43.
[35] Follow-Up to the Green Paper on Vertical Restraints, above n 1, 4 and 23; J F Winterscheid and M A Ward, ‘Two Part Harmony: New Rules for Vertical Agreements under European Union Competition Policy’ (2000) 14 Antitrust 52-56, 54; T Ackermann, ‘Die neuen EG-Wettbewerbsregeln für vertikale Beschränkungen. Ein Wegweiser durch die geplante Gruppenfreistellungsverordnung und die geplanten Leitlinien der Kommission’ [1999] Europäische Zeitschrift für Wirtschaftsrecht 741-746, 741; F J Semler and M Bauer, ‘Die neue EU-Gruppenfreistellungsverordnung für vertikale Wettbewerbsbeschränkungen – Folgen für die Rechtspraxis’ [2000] Der Betrieb 193-200, 194; Bauer and Bronett, above n 1, para 2 and 85; Schultze, Pautke and Wagener, above n 1, para 204; Terhorst, above n 1, 366; Polley and Seeliger, above n 20, 1204; Nazerali and Cowan, above n 20, 51; Blaurock, above n 4, 73.
[36] See the Guidelines para 25; See also Bauer and Bronett, above n 1, para 87; Whish, above n 16, 900; Polley and Seeliger, above n 20, 1205.
[37] For a detailed analysis of the issue under which prerequisites agency agreements fall outside Art 81(1) EC see the Guidelines para 12-20.
[38] See the Guidelines para 13; Cf also Polley and Seeliger, above n 20, 1208; Whish, above n 16, 922; For a detailed analysis see Schultze, Pautke and Wagener, above n 1, para 147.
[39] Cf the Guidelines para 15-17 and 20; See also Whish, above n 16, 901; Subiotto and Amato, above n 1, 188.
[40] Expressly stated in the Guidelines para 13; See also Subiotto and Amato, above n 1, 188; Whish, above n 16, 901; Polley and Seeliger, above n 20, 1206 and 1208.
[41] This terminology is not used in the Regulation. However, the Commission itself makes use of it in the Guidelines para 30; IPRs comprise three main areas: trade marks, copyrights and know-how.
[42] For a summary of the prerequisites of Art 2(3) of the Regulation see the Guidelines para 30; See also Bauer and Bronett, above n 1, para 89.
[43] Cf Bauer and Bronett, above n 1, para 89; Whish, above n 16, 903; Polley and Seeliger, above n 20, 1205; Schultze, Pautke and Wagener, above n 1, para 274; Subiotto and Amato, above n 1, 154; For examples of agreements comprising IPR provisions that would not benefit from block exemption see the Guidelines para 32.
[44] The term ‘ancillary’ is expressly used in Recital 3 of the Regulation. See also Whish, above n 16, 903; Subiotto and Amato, above n 1, 154.
[45] See the Guidelines para 34; Cf also Bauer and Bronett, above n 1, para 89; Whish, above n 16, 904; Schultze, Pautke and Wagener, above n 1, para 279; In addition, some scholars demand the IPRs to be of less value than the goods or services transferred through the vertical agreement. See, eg, Subiotto and Amato, above n 1, 154.
[46] Whish, above n 16, 903; Polley and Seeliger, above n 20, 1206; Schultze, Pautke and Wagener, above n 1, para 278.
[47] See the Guidelines para 33.
[48] Ibid; Cf also Whish, above n 16, 903; For a different opinion see Subiotto and Amato, above n 1, 157.
[49] See the Guidelines para 33; See also Whish, above n 16, 903.
[50] See Whish, above n 16, 903; Cf also the Commission’s Notice on Subcontracting Agreements, O J 1979, C 1/2.
[51] For examples of IPR provisions satisfying that requirement see the Guidelines para 38; Cf also Polley and Seeliger, above n 20, 1206.
[52] Cf Whish, above n 16, 905.
[53] See above, n 19.
[54] Cf Whish, above n 16, 904; Polley and Seeliger, above n 20, 1206; See also the Guidelines para 42; For a more detailed description of the three forms of franchising developed by the ECJ see Pronuptia v Schillgalis, Case 161/84, [1986] ECR 353; Subiotto and Amato, above n 1, 155; Schultze, Pautke and Wagener, above n 1, para 287; For a detailed analysis of franchise agreements under the new Regulation see E B Wulff and C A Nowak, ‘The New Commission Block Exemption: A Blurry Roadmap for Franchising in Europe’ (2000) 20 Franchise Law Journal 47-51, 47; C Liebscher and A Petsche, ‘Franchising nach der neuen Gruppenfreistellungsverordnung (EG) Nr. 2790/99 für Vertikalvereinbarungen’ [2000] Europäische Zeitschrift für Wirtschaftsrecht 400-404, 400.
[55] Cf Whish, above n 16, 904; Subiotto and Amato, above n 1, 156; Nevertheless, Subiotto and Amato take a critical position on that evaluation since the assignment of IPRs often constitutes the primary object of franchising agreements. See also Paragraph 44 of the Guidelines which sets out a list of IPR-related obligations that are considered to be ancillary to franchising agreements and necessary to protect the franchisor’s property rights, and thus would benefit from the block exemption.
[56] Guidelines para 43.
[57] Ibid.
[58] Cf Whish, above n 16, 904 who made this statement with regard to the Commission’s analysis of an individual exemption before the adoption of Regulation 1/2003.
[59] See the Guidelines para 24; Cf also Polley and Seeliger, above n 20, 1204; Whish, above n 16, 900; Semler and Bauer, above n 35, 196; Bauer and Bronett, above n 1, para 86; Roniger, above n 4, Art 2 para 3; Schultze, Pautke and Wagener, above n 1, para 210.
[60] Guidelines para 24; Whish, above n 16, 900; Semler and Bauer, above n 35, 196.
[61] See above, n 17 to n 19.
[62] Whish, above n 16, 899; Cf also Winterscheid and Ward, above n 35, 53.
[63] For examples of trilateral agreements (not) meeting that requirement see Whish, above n 16, 899.
[64] See Whish, above n 16, 900; Cf also Roniger, above n 4, Art 2 para 4.
[65] See Bauer and Bronett, above n 1, para 211; Whish, above n 16, 901. The annual turnover has to be calculated on the basis of Art 10 of the Regulation.
[66] Guidelines para 28.
[67] Whish, above n 16, 902 (Footnote 74).
[68] Schultze, Pautke and Wagener, above n 1, para 256; For a detailed analysis of the Regulation related to associations of undertakings see G Schulte and A Geiger, ‘Das Schicksal der Verbundgruppen unter der neuen Gruppenfreistellungsverordnung (EG) Nr. 2790/99 für Vertikalvereinbarungen’ [2000] Europäische Zeitschrift für Wirtschaftsrecht 396-400, 396 .
[69] See also the Guidelines para 26; Bauer and Bronett, above n 1, para 208; Whish, above n 16, 905.
[70] See the Guidelines para 26; Cf Subiotto and Amato, above n 1, 159; Whish, above n 16, 905.
[71] Whish, above n 16, 906; Subiotto and Amato, above n 1, 159; Munro Audia, Tamussino and Hull, above n 4, 63; Bauer and Bronett, above n 1, para 208; Schultze, Pautke and Wagener, above n 1, para 38; See also the Guidelines para 26.
[72] Guidelines para 26; Whish, above n 16, 906; Subiotto and Amato, above n 1, 159.
[73] Guidelines para 27; Cf also Bauer and Bronett, above n 1, para 209; Subiotto and Amato, above n 1, 158.
[74] For an example of a non-reciprocal agreement see the Guidelines para 27.
[75] The annual turnover has to be calculated on the basis of Art 10 of the Regulation. Subiotto and Amato, above n 1, 159 criticize that a non-reciprocal agreement between competitors shall not be covered by the block exemption in case the supplier, rather than the buyer, has a turnover not exceeding EUR 100 million.
[76] See Whish, above n 16, 906; Polley and Seeliger, above n 20, 1205; Roniger, above n 4, Art 2 para 12; Schultze, Pautke and Wagener, above n 1, para 330; Cf the Guidelines para 27. However, it remains equivocal whether this condition is already satisfied where the buyer does not actually manufacture goods competing with the contract goods, or whether the buyer also must not be a potential manufacturer of such products. See Subiotto and Amato, above n 1, 160.
[77] These are the cases in which the supplier is also a provider of services at the level of the buyer. See the Guidelines para 27; See also Whish, above n 16, 906; Schultze, Pautke and Wagener, above n 1, para 337.
[78] Whish, above n 16, 907.
[79] Follow-Up to the Green Paper on Vertical Restraints, above n 1, 4; Cf also Bauer and Bronett, above n 1, para 178; Griffiths, above n 20, 242; Nazerali and Cowan, above n 20, 53; Kallfass, above n 16, 241.
[80] Eg, a trilateral vertical agreement between a manufacturer, a wholesaler, and a retailer.
[81] See the Guidelines para 93; Cf also Whish, above n 16, 900; Roniger, above n 4, Art 3 para 11.
[82] The term ‘exclusive supply obligation’ is defined by Art 1(c) as any direct or indirect obligation causing the supplier to sell the contract goods or services only to one buyer inside the Community for the purpose of a specific use or resale.
[83] For more details see Art 9(1) of the Regulation and the Guidelines para 97 ; Cf also Bauer and Bronett, above n 1, para 189; Subiotto and Amato, above n 1, 164.
[84] Regulations 1983/83, 1984/83 and 4087/88, above n 17 to n 19.
[85] See the Follow-Up to the Green Paper on Vertical Restraints, above n 1, 3; Subiotto and Amato, above n 1, 150 and 162 ; Brinker, above n 4, 63; Kallfass, above n 16, 237; Rütters, above n 1, 26.
[86] Subiotto and Amato, above n 1, 162, in particular Footnote 72.
[87] Whish, above n 16, 909; Polley and Seeliger, above n 20, 1204; Semler and Bauer, above n 35, 194.
[88] Commission Notice on Agreements of Minor Importance, Which Do Not Fall Within the Meaning of Article 81(1) of the Treaty, O J 1997, C 372/13; Cf also Bauer and Bronett, above n 1, para 68.
[89] See Subiotto and Amato, above n 1, 165; Cf also Polley and Seeliger, above n 20, 1207 and 1209; Blaurock, above n 4, 75.
[90] Cf F Bayreuther, ‘Die Reform der EG-Wettbewerbspolitik gegenüber vertikalen Wettbewerbsbeschränkungen’ [2000] Europäisches Wirtschaftsrecht 106-115, 108; Bechtold, above n 9, 51; Whish, above n 16, 907; Polley and Seeliger, above n 20, 1209; Ackermann, above n 35, 742; Griffiths, above n 20, 245; Nazerali and Cowan, above n 20, 53; Semler and Bauer, above n 35, 195; Brinker, above n 4, 68; But see also the statements approving the market share cap by Kallfass, above n 16, 243; Schultze, Pautke and Wagener, above n 1, para 360; For a summary of the business community’s reactions to the Commission’s Green Paper gathered during the consultation phase of the policy reformation process see Follow-Up to the Green Paper on Vertical Restraints, above n 1, 5; Terhorst, above n 1, 373; For a summary of reactions of EC institutions and Member States see Rütters, above n 1, 29.
[91] See, eg, the Follow-Up to the Green Paper on Vertical Restraints, above n 1, 8.
[92] Ibid 15.
[93] The Commission presumes that, where the share of the supplier (or in the case of exclusive supply obligations the share of the buyer) on the relevant market is below 30%, vertical agreements will generate an objective improvement in production or distribution from which consumers will derive a fair share of the benefit. However, that presumption could not be made where the market share exceeds 30%. See Recital 8 and 9 of the Regulation; See also Whish, above n 16, 908.
[94] Whish, above n 16, 907; Terhorst, above n 1, 354.
[95] Follow-Up to the Green Paper on Vertical Restraints, above n 1, 15.
[96] O J 1997, C 372/5.
[97] For some remarks specifically aimed at the definition of the relevant market in the context of vertical agreements see the Guidelines para 88.
[98] Whish, above n 16, 907.
[99] See the Guidelines para 22; See also Whish, above n 16, 909; Schultze, Pautke and Wagener, above n 1, para 370.
[100] See the Guidelines para 46; See also Whish, above n 16, 911; Bauer and Bronett, above n 1, para 90; Polley and Seeliger, above n 20, 1211; Terhorst, above n 1, 364; Ackermann, above n 35, 743; Roniger, above n 4, Art 4 para 1; Schultze, Pautke and Wagener, above n 1, para 390.
[101] Cf the Guidelines para 46 where the Commission made that statement with regard to the likelihood of an individual exemption before the adoption of Regulation 1/2003; See also Whish, above n 16, 911; Subiotto and Amato, above n 1, 167; Terhorst, above n 1, 365; Polley and Seeliger, above n 20, 1211; Semler and Bauer, above n 35, 197.
[102] Subiotto and Amato, above n 1, 152; Bechtold, above n 9, 49.
[103] Regulations 1983/83, 1984/83 and 4087/88, above n 17 to n 19.
[104] See Goyder, above n 4, 132; Terhorst, above n 1, 359 (Footnote 94); Bechtold, above n 9, 49; Pukall, above n 25, 1375 (Footnote 8); Brinker, above n 4, 60; Kallfass, above n 16, 235.
[105] Cf ECJ, Delimitis v Henninger Bräu, Case C-234/89 [1991] EUECJ C-234/89; [1991] ECR I-935; See also Goyder, above n 4, 134; Bechtold, above n 9, 54.
[106] Goyder, above n 4, 134.
[107] Ibid; Polley and Seeliger, above n 20, 1204; Brinker, above n 4, 61; Blaurock, above n 4, 73.
[108] See the Follow-Up to the Green Paper on Vertical Restraints, above n 1, 3; Subiotto and Amato, above n 1, 150; Bechtold, above n 9, 50; Polley and Seeliger, above n 20, 1211; Blaurock, above n 4, 73; Rütters, above n 1, 23 and 81.
[109] Terhorst, above n 1, 357.
[110] Follow-Up to the Green Paper on Vertical Restraints, above n 1, 16; Whish, above n 16, 898.
[111] Whish, above n 16, 898; Bechtold, above n 9, 51; Terhorst, above n 1, 365; Polley and Seeliger, above n 20, 1211; Kallfass, above n 16, 241; Munro Audia, Tamussino and Hull, above n 4, 60.
[112] Whish, above n 16, 898.
[113] Subiotto and Amato, above n 1, 152; Griffiths, above n 20, 244; Follow-Up to the Green Paper on Vertical Restraints, above n 1, 19.
[114] Subiotto and Amato, above n 1, 152; Blaurock, above n 4, 76.
[115] Munro Audia, Tamussino and Hull, above n 4, 54 and 59.
[116] Follow-Up to the Green Paper on Vertical Restraints, above n 1, 4.
[117] See Whish, above n 16, 911; Restrictions of inter-brand competition are covered by Art 2(4) (agreements between competing undertakings), Art 3 (market share cap), Art 5 (non-compete provisions), and Art. 6-8 (withdrawal of the block exemption). Cf Whish ibid.
[118] For the terminology see the Guidelines para 47.
[119] See the Guidelines para 47; Cf also Subiotto and Amato, above n 1, 168; Polley and Seeliger, above n 20, 1212; Ackermann, above n 35, 743; Griffiths, above n 20, 242; Roniger, above n 4, Art 4 para 5 and 7.
[120] Guidelines para 47; See also Roniger, above n 4, Art 4 para 6; Bauer and Bronett, above n 1, para 97.
[121] Cf the Guidelines para 47.
[122] Cf the Guidelines para 49.
[123] Ibid; See also Roniger, above n 4, Art 4 para 10; Schultze, Pautke and Wagener, above n 1, para 448.
[124] See Whish, above n 16, 913; Cf also the Guidelines para 49.
[125] Cf the Guidelines para 50; Bauer and Bronett, above n 1, para 103; Schultze, Pautke and Wagener, above n 1, para 466.
[126] See the Guidelines para 50; Cf also Subiotto and Amato, above n 1, 173; Bauer and Bronett, above n 1, para 108; Schultze, Pautke and Wagener, above n 1, para 477.
[127] See above n 17.
[128] Whish, above n 16, 914; Subiotto and Amato, above n 1, 173; Roniger, above n 4, Art 4 para 9.
[129] Eg, the supplier may appoint an exclusive distributor for a specific customer group in a certain territory. See the Guidelines para 50; Subiotto and Amato, above n 1, 174.
[130] See the Guidelines para 50; See also Whish, above n 16, 914; Roniger, above n 4, Art 4 para 14; Schultze, Pautke and Wagener, above n 1, para 471.
[131] Cf the Guidelines para 50; See also Subiotto and Amato, above n 1, 169; Bauer and Bronett, above n 1, para 105; Schultze, Pautke and Wagener, above n 1, para 473.
[132] See the Guidelines para 50 and 51; C Vajda and A Gahnström, ‘E.C. Competition Law and the Internet’ (2000) 21 European Competition Law Review 94-106, 104; Subiotto and Amato, above n 1, 170; Polley and Seeliger, above n 20, 1212; Roniger, above n 4, Art 4 para 15; However, websites must not be specifically targeted at customers primarily inside the territory or customer group exclusively allocated to another distributor. Thus it is remarkable that the language used on the website or in the communication generally shall play no role in that evaluation. See the Guidelines ibid; Subiotto and Amato, above n 1, 170; Whish, above n 16, 914; For a more detailed analysis of competition law issues regarding the Internet distribution of products see Vajda and Gahnström, above n 132, 103; Bauer and Bronett, above n 1, para 249; Schultze, Pautke and Wagener, above n 1, para 536.
[133] Cf the Guidelines para 51; For a more detailed analysis of issues concerning Internet selling and advertising in the context of vertical agreements see the Guidelines para 51; Subiotto and Amato, above n 1, 170.
[134] See the Guidelines para 52.
[135] Schultze, Pautke and Wagener, above n 1, para 483.
[136] Cf also Whish, above n 16, 915; Subiotto and Amato, above n 1, 176.
[137] Schultze, Pautke and Wagener, above n 1, para 487.
[138] Ibid.
[139] The term ‘components’ includes any intermediate goods. See the Guidelines para 52.
[140] See above Part IV B 2(b).
[141] See the Guidelines para 53; Cf also Whish, above n 16, 915.
[142] Cf the Guidelines para 53; See also Schultze, Pautke and Wagener, above n 1, para 600.
[143] See the Guidelines para 53; Cf also Vajda and Gahnström, above n 132, 104.
[144] Art 4(c) of the Regulation; See also the Guidelines para 54; Whish, above n 16, 916.
[145] See the Guidelines para 53; See also Whish, above n 16, 916; Bayreuther, above n 90, 113; Bauer and Bronett, above n 1, para 128 and 130; Schultze, Pautke and Wagener, above n 1, para 607.
[146] Cf the Guidelines para 53.
[147] See above n 17.
[148] Whish, above n 16, 916.
[149] See the Guidelines para 55.
[150] Ibid; Cf Whish, above n 16, 916; Roniger, above n 4, Art 4 para 26; Schultze, Pautke and Wagener, above n 1, para 626.
[151] The Guidelines para 55; Bauer and Bronett, above n 1, para 132; Roniger, above n 4, Art 4 para 26; Schultze, Pautke and Wagener, above n 1, para 631.
[152] See the Guidelines para 56; Cf also Whish, above n 16, 917.
[153] Ibid.
[154] Cf the Guidelines para 56.
[155] Ibid; Whish, above n 16, 917; Bauer and Bronett, above n 1, para 135.
[156] Bechtold, above n 9, 49 and 51.
[157] Bauer and Bronett, above n 1, para 137.
[158] See the Guidelines para 57; See also Bauer and Bronett, above n 1, para 138; Whish, above n 16, 895 and 917; Subiotto and Amato, above n 1, 181; Ackermann, above n 35, 744; Roniger, above n 4, Art 5 para 1; Schultze, Pautke and Wagener, above n 1, para 649; However, there is no definition of the term ‘severable’ in the Regulation or in the Guidelines. See Whish, above n 16, 917.
[159] Recital 11 of the Regulation.
[160] Cf the Guidelines para 57; Whish, above n 16, 917; Roniger, above n 4, Art 5 para 1.
[161] Cf also Schultze, Pautke and Wagener, above n 1, para 48; Whish, above n 16, 895.
[162] See also the Guidelines para 58; Whish, above n 16, 896; Bauer and Bronett, above n 1, para 140; Schultze, Pautke and Wagener, above n 1, para 65; The 80% of the buyer’s total purchases of contract products ought to be calculated on the basis of the value of its purchases in the preceding calendar year, Art 1(b). Where no such data is available the buyer’s best estimate of its annual total requirements may be used. See the Guidelines para 58.
[163] Roniger, above n 4, Art 1 para 4; Schultze, Pautke and Wagener, above n 1, para 59 and 655.
[164] Schultze, Pautke and Wagener, above n 1, para 655.
[165] Regulations 1983/83 and 4087/88, above n 17 and n 19.
[166] See Schultze, Pautke and Wagener, above n 1, para 653; Subiotto and Amato, above n 1, 181 (Footnote 142); Bauer and Bronett, above n 1, para 162.
[167] Such a five year limit was contained in the old Regulation 1984/83 on exclusive purchasing before. See Schultze, Pautke and Wagener, above n 1, para 653; Polley and Seeliger, above n 20, 1214; Subiotto and Amato, above n 1, 181 (Footnote 142).
[168] See Art 5(a) of the Regulation. Cf also the Guidelines para 58; Whish, above n 16, 917; Subiotto and Amato, above n 1, 181; Polley and Seeliger, above n 20, 1214.
[169] See the Guidelines para 58; Cf also Schultze, Pautke and Wagener, above n 1, para 661; Whish, above n 16, 917; For two examples see the Guidelines para 58.
[170] See Art 5(a) of the Regulation and the Guidelines para 59.
[171] See the Guidelines para 59; Whish, above n 16, 918; Subiotto and Amato, above n 1, 182; Schultze, Pautke and Wagener, above n 1, para 674.
[172] See Schultze, Pautke and Wagener, above n 1, para 677 and 680; Roniger, above n 4, Art 5 para 6; Cf also Polley and Seeliger, above n 20, 1214.
[173] Know-how is defined as ‘a package of non-patented practical information, resulting from experience and testing by the supplier, which is secret, substantial and identified’. A detailed definition of the term ‘know-how’ is contained in Art 1(f) of the Regulation.
[174] Cf also the Guidelines para 60; Whish, above n 16, 918; Subiotto and Amato, above n 1, 183; Bauer and Bronett, above n 1, para 167.
[175] See above n 17 and n 18.
[176] See Schultze, Pautke and Wagener, above n 1, para 677.
[177] For a definition of the term ‘selective distribution system’ see Art 1(d) of the Regulation; See also above Part IV B 2(b).
[178] Cf the Guidelines para 61; Whish, above n 16, 918; Bauer and Bronett, above n 1, para 173; Schultze, Pautke and Wagener, above n 1, para 697.
[179] See above n 1.
[180] See Schultze, Pautke and Wagener, above n 1, para 703 who explain that this result contravenes previous Commission’s practice under Art 81(3) EC. See also Commission Decision, Givenchy, O J 1992, L 236/11, 13; Subiotto and Amato, above n 1, 182.
[181] See the Guidelines para 61; Schultze, Pautke and Wagener, above n 1, para 697; Whish, above n 16, 918; However, such a non-compete obligation must abide to the requirements of Art 5(a) of the Regulation, especially the five year limit. See Schultze, Pautke and Wagener, above n 1, para 697.
[182] See the Guidelines para 61 and 192; Bauer and Bronett, above n 1, para 173; For a more detailed analysis see Schultze, Pautke and Wagener, above n 1, para 693.
[183] Cf the Guidelines para 61; Whish, above n 16, 918; Bauer and Bronett, above n 1, para 173.
[184] For a detailed analysis see Bauer and Bronett, above n 1, para 215.
[185] For examples and a more detailed evaluation see Art 6 of the Regulation and the Guidelines para 71 .
[186] Regulations 1983/83, 1984/83 and 4987/88, above n 17 to n 19.
[187] See Schultze, Pautke and Wagener, above n 1, para 705 (in particular Footnote 85); Bauer and Bronett, above n 1, para 215; Roniger, above n 4, Art 6 para 1 (in particular Footnote 2).
[188] See Whish, above n 16, 918 (Footnote 143); Schultze, Pautke and Wagener, above n 1, para 705; Semler and Bauer, above n 35, 199. The Commission Decision, Langnese-Iglo, O J 1993, L 183/19 is one, if not the only, of those rare occasions.
[189] Cf Wils, above n 8, 1684; Schuhmacher, above n 8, 482.
[190] See the Guidelines para 81; Cf also Whish, above n 16, 919; Schultze, Pautke and Wagener, above n 1, para 711; Semler and Bauer, above n 35, 199; Bauer and Bronett, above n 1, para 222.
[191] Cf the Guidelines para 72; See also Schultze, Pautke and Wagener, above n 1, para 710; Whish, above n 16, 919.
[192] See the Guidelines para 75; Cf also Subiotto and Amato, above n 1, 183; Roniger, above n 4, Art 6 para 2.
[193] Cf also the Guidelines para 76; For a detailed analysis of the Member States’ withdrawal authority see G K de Bronett, ‘Der Entzug des Vorteils der Anwendung einer Gruppenfreistellung durch nationale Behörden’ [1999] Wirtschaft und Wettbewerb 825-832, 825 .
[194] Follow-Up to the Green Paper on Vertical Restraints, above n 1, 18; Schultze, Pautke and Wagener, above n 1, para 713; Terhorst, above n 1, 368; Cf also the Guidelines para 77; Bayreuther, above n 90, 110; Griffiths, above n 20, 244; Brinker, above n 4, 66.
[195] Cf Wils, above n 8, 1684; Schuhmacher, above n 8, 482.
[196] See the Guidelines para 78; Whish, above n 16, 920; Roniger, above n 4, Art 7 para 5.
[197] Cf the Guidelines para 77; Subiotto and Amato, above n 1, 184; Whish, above n 16, 920; Schultze, Pautke and Wagener, above n 1, para 715; Bauer and Bronett, above n 1, para 223.
[198] See the Guidelines para 77; Whish, above n 16, 920; Schultze, Pautke and Wagener, above n 1, para 715.
[199] Schultze, Pautke and Wagener, above n 1, para 718; Whish, above n 16, 921; Bauer and Bronett, above n 1, para 231.
[200] See also the Guidelines para 80 .
[201] Ibid para 81; Whish, above n 16, 921; Schultze, Pautke and Wagener, above n 1, para 722; Bauer and Bronett, above n 1, para 233.
[202] For more details see the Guidelines para 85; Cf also Schultze, Pautke and Wagener, above n 1, para 721; Bauer and Bronett, above n 1, para 237.
[203] Cf the Guidelines para 86; Whish, above n 16, 921; Nazerali and Cowan, above n 20, 54; Bauer and Bronett, above n 1, para 238.
[204] Cf the Guidelines para 80; Subiotto and Amato, above n 1, 185; Roniger, above n 4, Art 8 para 2.
[205] See Schultze, Pautke and Wagener, above n 1, para 720; Bauer and Bronett, above n 1, para 235; Roniger, above n 4, Art 8 para 4; Cf also the Guidelines para 84.
[206] Whish, above n 16, 924.
[207] See the Guidelines para 100; Follow-Up to the Green Paper on Vertical Restraints, above n 1, 9.
[208] Cf the Guidelines para 115 to 118; Follow-Up to the Green Paper on Vertical Restraints, above n 1, 12; See also Bauer and Bronett, above n 1, para 312 .
[209] Cf also the Guidelines, eg, para 9 (‘There is no presumption that vertical agreements concluded by undertakings having more than 10% market share automatically infringe Article 81(1).’ Those ‘agreements [... ] may still not have an appreciable effect on trade between Member States or may not constitute an appreciable restriction of competition’.).
[210] Griffiths, above n 20, 244.
[211] Subiotto and Amato, above n 1, 193.
[212] Griffiths, above n 20, 241 and 245.
[213] Subiotto and Amato, above n 1, 193.
[214] Terhorst, above n 1, 377; Cf also Winterscheid and Ward, above n 35, 55.
[215] Follow-Up to the Green Paper on Vertical Restraints, above n 1, 15.
[216] Subiotto and Amato, above n 1, 192; See also the Guidelines para 102.
[217] Whish, above n 16, 924.
[218] Winterscheid and Ward, above n 35, 52 and 55; For a synopsis on the treatment of vertical restraints under US anti-trust law see Rütters, above n 1, 45.
[219] Whish, above n 16, 924.
[220] Cf Terhorst, above n 1, 373 and 377.
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