Wednesday, February 3, 2021
The European Commission Consults on New EU Competition Rules for Distribution Agreements
The Vertical Block Exemption Regulation (VBER) and its accompanying Vertical Guidelines (VGL) are designed to provide predictability to companies entering into supply and distribution agreements in Europe. Under the VBER, EU competition rules do not apply to vertical agreements entered into by companies with market shares not exceeding 30%. If the agreement contains so-called hardcore restrictions, i.e., a presumption of severe restriction of competition due to, for instance, illegal resale pricing restrictions or territory or customer allocation, then the VBER no longer applies but companies can still demonstrate that in their particular case the pro-competitive effects outweigh the negative effects.