Jurisdiction(s):
United Kingdom

Related legal acts

Key definition

Selective distribution definition

What does Selective distribution mean? Selective distribution describes a distribution model in which a supplier appoints only distributors or retailers that meet specified qualitative (and sometimes quantitative) criteria, and requires them not to sell to unauthorised resellers in the territory where the system operates. It is a descriptive competition law concept, reflected in the UK Vertical Agreements Block Exemption Order 2022 (VABEO) and CMA guidance, and in Ireland in the EU Vertical Block Exemption Regulation 2022 (VBER) and Guidelines. Key legal features include: selection criteria applied consistently; the ability to restrict active and passive sales by authorised distributors to unauthorised dealers; a prohibition on restricting cross‑supplies...

UK distribution agreements: structures, exclusivity models (including selective), manufacturer-distributor terms, and competition law compliance under the Competition Act 1998 and the UK Vertical Agreements Block Exemption Order

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Practice notes

This Practice Note explores distribution arrangements in general and the commonly adopted models. It explains the distinctions between sole, exclusive, non-exclusive and selective distribution agreements, and describes the relationship between a distributor and the manufacturer.

The nature of distribution

In a distribution set-up, the distributor buys products from the manufacturer and resells them on its own account. By comparison, under an agency arrangement the agent does not purchase the goods, but secures sales on the manufacturer’s behalf. For a summary contrasting agency and distribution, see Practice Note: Agency and distribution compared.

Distribution is often chosen where a manufacturer needs support to access a particular market—for example, in an overseas territory where it lacks sufficient familiarity or connections, or where the products do not necessitate direct dealings with customers. Distribution arrangements can also be used by wholesalers, who act as intermediaries supplying other distributors rather than end users. For ease, this Practice Note refers to the ‘manufacturer’, but the same principles and considerations apply when a wholesaler appoints distributors...

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Web page updated on 21/05/2026

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