Vertical agreement meaning

This Checklist can be used to evaluate compliance of vertical agreements with EU competition law, notably under the Vertical Block Exemption Regulation 2022/720 (VBER 2022). For analysis of the VBER 2022, see further, Introduction to the application of Article 101 TFEU to vertical agreements and The Vertical Block Exemption Regulation 2022/720 Framework for assessment When applying EU law to vertical agreements, it is necessary to consider: The competition rules under Article 101 TFEU: Whether the agreement is captured by Article 101(1) TFEU at all (although, in practice, the VBER 2022—and other block exemptions—may often be considered before Article 101 TFEU). Whether the agreement restricts competition at all (this is frequently overlooked)—some categories of agreement may not be restrictive of competition. Also, agency will fall outside Article 101 TFEU where there is a genuine agency situation (exercise caution, as restrictions in an agency agreement may still fall foul of Article 101 TFEU)...

This Checklist summarises the key considerations when preparing new vertical agreements, or revising existing ones, to determine whether they benefit from the block exemption in The Competition Act 1998 (Vertical Agreements Block Exemption) Order 2022, SI 2022/516 (UK VABEO). It is not a full exposition of UK VABEO, but a tool for commercial lawyers to check that a vertical arrangement falls within UK VABEO (together with any accompanying guidance). For more detail, refer to: CMA Guidance: UK VABEO. A flowchart appears at the end of this Checklist, outlining the principal steps for assessing whether an agreement is covered by UK VABEO. Introduction to UK VABEO Agreements that affect trade and limit competition in the UK may fall within the prohibition on anti-competitive agreements contained in Chapter I of the Competition Act 1998 (CA 1998)...

This checklist outlines the key matters to weigh when preparing fresh vertical agreements, or revising current ones, to determine whether they qualify for the block exemption under Commission Regulation (EU) 2022/720, the Vertical Block Exemption Regulation 2022 (VBER 2022), together with the 2022 Vertical Guidelines. It is not a full manual to VBER 2022; rather, it serves where a commercial lawyer seeks confirmation that a vertical arrangement sits within VBER 2022 (and any guidance released pursuant to it). Introduction to EU VBER 2022 Any arrangement that influences trade or limits competition within the EU can fall under the ban on anti-competitive agreements in Article 101(1) TFEU. That said, an agreement is not barred if it either: qualifies for an individual exemption under Article 101(3) TFEU, or falls within an applicable block exemption Before 1 June 2022, the pertinent block exemption for vertical arrangements was set out in Commission Regulation (EU) No 330/2010, the Vertical Block Exemption Regulation 2010 (VBER...

VBER 2022 flowchart This flowchart provides an at‑a‑glance pathway to assess whether the VBER 2022 safe harbour applies to an agreement. For the purposes of the flowchart, it is taken that the agreement is a vertical arrangement and that it complies with Article 2(3), VBER 2022 (concerning IP provisions) and, where relevant, Articles 2(4)–(6), VBER 2022 (relating to dual distribution). Throughout the flowchart, the VBER 2022 is referred to as the EU VBER...

Alrubie v Chelsea Football Club Ltd and another [2025] EWHC 541 (Comm) What are the practical implications of this case? This decision will particularly interest arbitration practitioners and professionals working in sports clubs, and could equally concern other organisations whose members are controlled by association rules. Commonly, those participating in professional sports clubs accept, by reason of their membership, that they are bound by the club’s rulebook and by the regulations of any national and worldwide governing bodies. Such regimes routinely incorporate arbitration agreements, owing in part to the confidentiality of arbitral proceedings, which protects against undesirable public attention, and in part to the ability to appoint arbitrators with specialist knowledge of the sport’s rules and industry practices. The case clarifies that these rules may have ‘horizontal’ contractual effect between members, as well as ‘vertical’ effect between each member and the governing body, notwithstanding the absence of any express bilateral agreement between members. It underlines how membership-based governance can, through the acceptance of rulebooks, generate binding obligations that...

Antitrust AG delivers opinion on Belgian reference urging that an exclusive distributor be shielded from active sales in its territory by all the supplier’s other purchasers Advocate General Medina has presented her opinion in Case C-581/23 Beevers Kaas, a reference from Belgium addressing the interpretation of Article 101 TFEU and the former vertical agreements block exemption (Regulation 330/2010). The focus is whether an exclusive distribution arrangement accords with the parallel imposition requirement, under which a supplier must ensure its exclusive distributor is safeguarded against active selling into the protected territory by all the supplier’s remaining distributors or buyers. The opinion considers how these rules apply where exclusivity is granted and parallel obligations are expected across the supplier’s network to prevent targeted incursions into the exclusive area... Background Beevers Kass acts as the exclusive distributor in Belgium for Beemster cheese, sourced from the Dutch producer Cono. Since 1993, Cono and Beevers have been bound by an exclusive distribution agreement governing the sale of Beemster cheese in Belgium and...

In this issue: Competition and state aid Data protection and cybersecurity Dispute resolution Free movement, immigration and employment Financial services Energy Environment Insurance and reinsurance IP Life sciences Regulatory International trade LexTalk®EU Law: a Lexis®Nexis community Daily and weekly news alerts New and updated content Trackers Competition and state aid The European Commission has opened a public call for views on competition rules governing vertical agreements in the motor industry, covering Regulation (EU) 461/2010 (the Motor Vehicle Block Exemption Regulation (MVBER)) and the related Supplementary Guidelines. This review forms part of a continuing assessment intended to keep the framework in step with developments such as digitalisation and evolving mobility patterns. Stakeholders may submit observations until 23 May 2025. See: LNB News 28/02/2025 41. The Commission has issued a Call for Evidence to obtain input from interested parties on the objectives, scope and background for forthcoming guidelines on...

CASE HUB ARCHIVED – this archived case hub records the position as at the decision of 4 February 2016; it is no longer maintained. See the timeline, commentary and related cases for further information Case facts Outline European Commission merger investigation into the proposed acquisition by Liberty Global of BASE Belgium (Case M.7637). The deal features horizontal and vertical overlaps within Belgium’s telecommunications market. Latest developments The Commission cleared the transaction, subject to commitments, on 4 February 2016. Under these commitments Liberty Global: will divest BASE’s 50% stake in Mobile Vikings, an MVNO that runs on BASE’s network, to Belgian broadcaster Medialaan transfer a portion of BASE’s customer base to Medialaan—BASE and Medialaan currently have an agreement under which BASE sells mobile services under the JIM Mobile brand, owned by Medialaan; Liberty Global will move JIM Mobile customers to Medialaan has entered into an agreement with Medialaan, granting it access to BASE’s mobile network on conditions that will allow it to...

Article 101(1) TFEU outlaws agreements liable to affect trade between Member States whose object or effect is to prevent, restrict, or distort competition within the common market. Nonetheless, EU case law makes clear that limiting a party’s economic freedom does not automatically amount to a ‘restriction of competition’ under Article 101(1). The Court of Justice has suggested, for example, that it can be doubtful there is any interference with competition where a clause truly appears necessary for an undertaking’s move into a new area. That observation gave rise to the ‘ancillary restraints doctrine’, with the EU Courts and the European Commission (Commission) acknowledging that certain limitations are not ‘restrictions of competition’ within Article 101(1) when, having regard to the ‘legal and economic context’, they are shown to be necessary to protect the parties’ legitimate interests under the agreement. Doctrine Inspired by the common law analysis of commercial restraints (ie, exceptions to the rule against ‘restraints of trade’), an ‘ancillary restraint’ is any limitation directly related to, and necessary...

Intellectual property (IP) agreements IP arrangements—such as technology licensing or collaborating on the creation of new technologies—can restrict competition. Yet their pro‑competitive advantages are acknowledged through block exemptions that offer a ‘safe harbour’ from Article 101, TFEU. Where a deal sits squarely within a relevant block exemption, only a brief review of Article 101, TFEU concerns is typically required. In practice, though, multiple block exemptions may seem to apply, and confirming that an agreement truly benefits from a safe harbour can be challenging—so a more pragmatic assessment of everyday commercial deals is often warranted. Most block exemptions share a common framework, and understanding this helps with application of the rules. Recitals: set out the overarching aim and rationale of the instrument. Definitions: clarify key terms that shape how the exemption should operate. Scope of the ‘safe harbour’: identifies the categories of agreements covered and the types of undertakings involved. From a practical standpoint, it is wise to scrutinise the recitals and...

Please use this checklist before entering into any exclusive agreement Determining whether exclusivity is liable to produce anti-competitive effects is not straightforward; multiple factors must be weighed, and in many cases exclusive deals may not be feasible at all. Above all, ensure the justification for exclusivity is not simply to undermine competitors or to delay or impede new entrants. If this is driving the exclusivity, from a competition regulator's perspective it may not matter whether the conduct gives rise to an anti-competitive effect. You must seek guidance from [ insert, eg the legal team ] where flagged in this checklist and whenever you have any questions or concerns. Exclusivity Factor Result Comments 1. Is the buyer required or encouraged to concentrate its orders for a particular product or service with just one supplier (often termed single-branding/exclusive sourcing)? Note that even an obligation or incentive to purchase more than 80% of requirements from a single supplier amounts to exclusivity...

Question Summary What is competition law? Competition serves both consumers and companies. It highlights areas for improvement and pushes organisations to pursue higher efficiency, greater innovation, stronger productivity and, in the end, to operate as better businesses. Competition law exists to shield businesses and consumers from anti‑competitive conduct and to preserve effective rivalry. Every business must observe competition rules, and breaches can carry severe outcomes for firms and individuals, including directors. Non‑compliance can be costly and damaging at both organisational and personal levels too. Possible penalties include: Substantial fines Prison sentences Director disqualification Damage to reputation When is it an issue? Competition law can arise in three principal settings: cartels — typically horizontal arrangements in which two or more businesses, whether by written agreement or otherwise, decide not to compete with one another. Cartels are the gravest form of anti‑competitive agreement. They cover accords to fix prices, rig bids, cap output, and divide customers or markets. A cartel...