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Supply and distribution agreements | Adapted competition rules as from 1 June!

The European Commission has adopted a new Vertical Block Exemption Regulation (‘VBER’) accompanied by new Vertical Guidelines. This Regulation (EU/2022/720) [1] enters into force on 1 June 2022.

This revised VBER is accompanied by revised Vertical Guidelines [2], which provide guidance on the application of the rules and also help for self-assessment of the individual exemption of those agreements which are not block-exempted under the VBER.

The VBER exempts supply or distribution agreements from the prohibition of restrictive agreements laid down in Article 101(1) TFEU provided they comply with certain conditions. This so-called “block exemption” is meant to create a “safe harbour” for many agreements or practices, whereby they will not be subject to that prohibition and complementary sanctions. If the regulatory block exemption does not apply, an individual exemption is still possible, provided the four conditions in article 101(3) TFEU are met.

Competition rules apply to formal written agreements but also to all forms of agreements, including concerted practices among undertakings. Therefore, even if not formalised in writing, all practices can be subject to examination and sanctions by the European Commission or a national competition authority.

The new rules will not immediately apply to agreements already in force before 1 June 2022 (Reg. 330/2010 remains applicable): these agreements will have to comply with the new rules within one year, i.e. by 1 June 2023.

Application of the new rules requires cautiousness but can offer some opportunities for reshaping or improving distributorship agreements.

The safe harbour in the VBER

According to the European Commission, the main changes to the existing rules focus on adjusting the safe harbour to ensure that it is neither too generous nor too narrow.

On the one hand, the new rules narrow somehow the exemption regarding certain aspects of dual distribution and certain parity obligations. On the other hand, the new VBER enlarges the scope of the exemption regarding certain restrictions on a buyer’s ability to make active sales and certain practices relating to online sales.

New practices in the online economy are taken into account, in particular to assess online restrictions and vertical agreements in the platform economy. The Vertical Guidelines provide guidance on particular topics such as selective and exclusive distribution, and agency agreements.

Main novelties in the VBER

More generally, the new VBER and Vertical Guidelines provide specific rules and guidance relevant to the platform economy. They address issues such as:

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For any questions or assistance, please contact the authors:

Fernand de Visscher | fdv@simontbraun.eu [3] | +32 (0)2 533 17 52
Emmanuel Cornu | ec@simontbraun.eu [4] | +32 (0)2 533 17 22
Eric De Gryse | edg@simontbraun.eu [5] | +32 (0)2 533 17 52

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This article is not legal advice or opinion. You should seek advice from a legal counsel of your choice before acting upon any of the information in this article.