What is the vertical block exemption?
What is the vertical agreements block exemption? Vertical agreements are those entered into between businesses operating at different levels of the production or distribution chain (e.g., manufacturers and wholesalers or retailers). The vertical agreement does not contain any ‘hardcore’ restrictions.
What is a vertical agreements in competition law?
A vertical agreement is a term used in competition law to denote agreements between firms at different levels of the supply chain. For instance, a manufacturer of consumer electronics might have a vertical agreement with a retailer according to which the latter would promote their products in return for lower prices.
Do vertical restraints limit competition?
Vertical restraints refer to restrictions of competition in agreements or contract terms between firms that operate at different levels of the supply chain, for example an agreement for the supply of goods between a manufacturer and a retailer or distributor, or an agreement for the supply of services.
What is vertical restraint of trade?
Vertical restraints are agreements, understandings, or other anticompetitive measures undertaken between different levels of production, distribution, or supply—for example, between a manufacturer and a retailer.
What is a block exemption competition law?
Block exemption: as a general rule, under EU competition law, agreements between companies which may be detrimental to trade and intentionally restrict or distort competition are prohibited.
Is vertical agreements illegal?
Conclusion. Vertical agreements are not illegal per se and subjected to rule of reason scrutiny by the competition law regulators. Any kind of vertical restraint agreement is scrutinized considering both the anti-competitive and pro-competitive aspects of it.
What is an example of vertical agreement?
Vertical agreements are agreements between parties at different levels of the supply chain (for example, between a manufacturer and distributor, or distributor and retailer). An example is an exclusive dealing agreement between a supplier and a retailer, whereby the retailer agrees to only sell the supplier’s products.
Are vertical restraints illegal?
Section 1 of the Sherman Act is the federal antitrust stat- ute most often cited in vertical restraint cases. Finally, section 5(a)(1) of the Federal Trade Commission Act (FTC Act) has application to vertical restraints. This declares unlawful unfair methods of competition – 15 USC, section 45(a)(1) (2006).
What is an example of vertical restraint?
“An example of a vertical restraint would be a situation where a soft drink supplier enters into an exclusive deal with a university that prohibits the university from selling any competitive soft drink on campus.” Vertical restraints of trade are not limited to those which are price-related.
What is general block exemption regulation?
The General Block Exemption Regulation (GBER) contains 26 measures which can be used to provide lawful State Aid without going through the normal notification and approval processes. It was published by the European Commission in 2008 with the aim of consolidating and simplifying existing State Aid regulations.