Art 101 TFEU Vertical Agreements

  • Created by: Emma13
  • Created on: 17-06-18 23:00
What is a distribution agreement?
A type of sale of goods contract but it has some extra terms in it such as the giving of exclusive territory.
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What is the consequence of resale price maintenance?
Consumer may end up paying inflated prices, therefore resale price maintenance is prohibited under Art 101
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What is the Commissions aims?
Commissions double aims - consumer protection; widest possible range of g/s at best possible prices + maintenance of the single market; to avoid any terms that restrict the movement of goods across borders
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Why is exclusive territory anti-competitive?
Problematic for the single market because it leads to partitioning the single market
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Why is minimum purchase required anti competitive?
if they are very ambitious, distributors has to devote all time and resources to trying to sell these products, won't have any time/ resources to sell other products; ties distributors up so they can't sell other products
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Why is non-competent anti-competitive?
Supply is restricted as other sources of product will soon fall out of favour
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Why is price fixing anti-competitive?
Differential of prices can distort the market as makes one less attractive than the other due to lower price
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Why is export bans anti-competitive?
Each distributor getting its own rights in its own territory but would be band from exporting on anyone else, puts a firm line around each area, can distort the market
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What happens if the agreement contains an anti-competitive term which affects the market?
The agreement is void
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What does NAOMI establish?
Not have an appreciable effect on competition - ECJ De Minimis Notice, Art 8 = market threshold (10% Horizontal agreements) (15% Vertical agreements) Art 13 = restrictions by object and ******** restrictions (price fixing and export bans) (HA)
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When and how is the Vertical Block Exemption Regulation 330/2010 used?
VBER - None for horizontal agreements but vertical agreements.
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What is NAAT?
No Appreciable Affect on Trade - Commission notice, agreement which have NAAT, aggregate relevant market share not more than 5% + Suppliers turnover (VA) not more than 40 mil euro, also applies to HA
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What is Art 101(3)?
Would a national court or competition authority consider the agreement should be exempt? Unlikely if the agreement contains ******** restrictions.
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How can a term be exempt under Art 101(3)?
To be exempt under Art 101(3) the agreement must contribute to improving the production or distribution of goods or to promoting technical or economic progress, while allowing consumers a fair share of the resulting benefit
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What are the conditions under VRBE to be exempt under it?
Both parties must have a share that does not exceed 30% Art 3(1), Art 4 - if the agreement contains any ******** restrictions i.e price fixing/ export ban on passive sales BE will not apply.
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What does Art 5 VRBE say?
If the agreement contains restrictions mentioned here, the restrictions are void, but the agreement may still come within BE.
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What are the consequences of breach of Art 101?
The Agreement is void Art 101(2) TFEU, The EU commission/+ national competition authority may investigate and, if they find a breach, impose fine up to 10% worldwide turnover
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Does Art 101 have direct effect and why would this cause problems?
As treaty article it has direct effect - may have third party actions brought against anti-competitive behaviour in domestic court
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What does NAAT say?
If aggregate market share of the parties does exceed 5% there will be a breach of EU law, doesn't matter if there is a ******** restriction however may have penalty from domestic law.
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Other cards in this set

Card 2

Front

What is the consequence of resale price maintenance?

Back

Consumer may end up paying inflated prices, therefore resale price maintenance is prohibited under Art 101

Card 3

Front

What is the Commissions aims?

Back

Preview of the front of card 3

Card 4

Front

Why is exclusive territory anti-competitive?

Back

Preview of the front of card 4

Card 5

Front

Why is minimum purchase required anti competitive?

Back

Preview of the front of card 5
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