—

this first introductory section explains why the Commission provides guidance on vertical agreements and the scope of that guidance. It also explains the objectives of Article 101 of the Treaty, how Article 101 of the Treaty applies to vertical agreements, and the main steps in the assessment of vertical agreements under Article 101 of the Treaty;

—

the second section provides an overview of the positive and negative effects of vertical agreements. Regulation (EU) 2022/720, these Guidelines, and the Commission’s enforcement policy in individual cases are based on the consideration of those effects;

—

the third section deals with vertical agreements that generally fall outside Article 101(1) of the Treaty. While Regulation (EU) 2022/720 does not apply to those agreements, it is necessary to provide guidance on the conditions under which vertical agreements may fall outside Article 101(1) of the Treaty;

—

the fourth section provides further guidance on the scope of Regulation (EU) 2022/720, including explanations on the safe harbour established by the Regulation and the definition of a vertical agreement. That section also contains guidance on vertical agreements in the online platform economy, which plays an increasingly important role in the distribution of goods and services. That section also explains the limits of the application of Regulation (EU) 2022/720, as set out in Article 2(2), (3) and (4) of the Regulation. This includes the specific limits that apply to the exchange of information between a supplier and a buyer in scenarios of dual distribution, pursuant to Article 2(5) of the Regulation, and those that apply to agreements relating to the provision of online intermediation services where the provider of those services has a hybrid function, pursuant to Article 2(6) of the Regulation. The fourth section also explains how Regulation (EU) 2022/720 applies in cases where a vertical agreement falls within the scope of another block exemption regulation, as set out in Article 2(7) of the Regulation. Lastly, that section contains a description of certain common types of distribution system, in particular those which are the subject of specific provisions in Article 4 of the Regulation relating to hardcore restrictions;

—

the fifth section addresses the definition of the relevant markets and the calculation of market shares, by reference to the Market Definition Notice (5). This is relevant because vertical agreements may only benefit from the block exemption provided by Regulation (EU) 2022/720 if the market shares of the undertakings that are party to the agreement do not exceed the thresholds set out in Article 3 of Regulation (EU) 2022/720;

—

the sixth section covers the hardcore restrictions set out in Article 4 of Regulation (EU) 2022/720 and the excluded restrictions set out in Article 5 of the Regulation, including explanations as to why the qualification as ‘hardcore’ or ‘excluded’ restriction is relevant;

—

the seventh section contains guidance on the powers of the Commission and the competition authorities of the Member States (‘NCAs’) to withdraw the benefit of Regulation (EU) 2022/720 in individual cases, pursuant to Article 29 of Council Regulation (EC) No 1/2003 (6) and Article 6 of Regulation (EU) 2022/720, as well as guidance on the power of the Commission to adopt regulations declaring that Regulation (EU) 2022/720 does not apply, pursuant to Article 7 of Regulation (EU) 2022/720;

—

the eighth section describes the Commission’s enforcement policy in individual cases. To that end, it explains how vertical agreements that are not covered by Regulation (EU) 2022/720 are assessed under Article 101(1) and (3) of the Treaty, and provides guidance on various common types of vertical restraints.

—

first, the undertakings involved need to establish the market shares of the supplier and the buyer on the relevant market where they respectively sell and purchase the contract goods or services;

—

if neither the market share of the supplier nor that of the buyer exceeds the 30 % market share threshold set out in Article 3 of Regulation (EU) 2022/720, the vertical agreement is covered by the safe harbour established by the Regulation, provided that the agreement does not contain hardcore restrictions within the meaning of Article 4 of the Regulation or any excluded restrictions within the meaning of Article 5 of the Regulation that cannot be severed from the rest of the agreement;

—

if the relevant market share of the supplier or the buyer exceeds the 30 % threshold or the agreement contains one or more hardcore restrictions or non-severable excluded restrictions, it is necessary to assess whether the vertical agreement falls within the scope of Article 101(1) of the Treaty;

—

if the vertical agreement falls within the scope of Article 101(1) of the Treaty, it is necessary to examine whether it fulfils the conditions of the exception provided by Article 101(3) of the Treaty.

(a)

to address the vertical externality issue. The setting of too high a price by the distributor, not taking into account the effect of its decisions on the supplier, can be avoided by the supplier imposing a maximum resale price on the distributor. Similarly, to increase the distributor’s sales efforts, the supplier may use selective or exclusive distribution;

(b)

to address the free-rider problem. Free riding between buyers may occur at the wholesale or retail level, in particular where it is not possible for the supplier to impose effective promotion or service requirements on all buyers. Free riding between buyers can only occur on pre-sales services and other promotional activities, but not on after-sales services for which the distributor can charge its customers individually. Pre-sales efforts on which free riding can occur may be important, for example, where the goods or services are relatively new, technically complex or of high value, or where the reputation of the goods or services is an important determinant of their demand (22). Restrictions in exclusive or selective distribution systems, or other restrictions may be helpful in avoiding or reducing such free riding. Free riding can also occur between suppliers, for instance where one manufacturer invests in promotion at the buyer’s premises that also attracts customers for the competitors of that manufacturer. Non-compete type restrictions can help to overcome free riding between suppliers (23);

(c)

to open up or enter new markets. Where a supplier wishes to enter a new geographic market, for instance by exporting to another country, this may involve special sunk investments by the distributor to establish the brand on the market. In order to persuade a local distributor to make these investments, it may be necessary to provide territorial protection so that the distributor can recoup its investments. This may justify restricting distributors located in other geographic markets from selling on the new market (see also paragraphs (118), (136) and (137)). This is a special case related to the free-rider problem set out in point (b);

(d)

to address the certification free-rider issue. In some sectors, certain distributors have a reputation for stocking only quality goods or providing quality services (so-called ‘premium distributors’). In such a case, selling through those distributors may be crucial, in particular for the successful launch of a new product. If the supplier cannot ensure that the distribution of its products is limited to such premium distributors, it runs the risk of not being listed by such distributors. In that scenario, the use of exclusive or selective distribution may be justified;

(e)

to address the hold-up problem. Either the supplier or the buyer may need to make relationship-specific investments (for example in specific equipment or training) which are sunk investments and have little or no value outside the specific vertical relationship. For instance, a component manufacturer may have to build specific machines to satisfy the requirements of one of its customers, but the machines may be unsuitable for use with other customers and it may be impossible to resell them. In the absence of an agreement, the investing party will find itself in a weak bargaining position once it has made the relationship-specific investment, as it risks being ‘held up’ during negotiations with its trading partner. The threat of such opportunistic hold-up may lead to sub-optimal investments by the investing party. Vertical agreements can eliminate the scope for hold-up (in particular when the investment can be fully contracted and all future contingencies can be foreseen) or they can reduce the scope for hold-up. For example, non-compete obligations, quantity forcing, or exclusive sourcing can lessen the hold-up problem when the relationship-specific investment is made by the supplier, whereas exclusive distribution, exclusive customer allocation or exclusive supply can lessen the hold-up problem when the investment is made by the buyer;

(f)

to address the specific hold-up problem that may arise where there is a transfer of substantial know-how. The provider of know-how may not wish the know-how to be used by or for the benefit of its competitors, for example in franchising. Insofar as the know-how was not readily available to the buyer, and it is substantial and indispensable for the implementation of the agreement, such a transfer may justify a non-compete restriction, which would generally fall outside Article 101(1) of the Treaty in such cases;

(g)

to achieve economies of scale in distribution. To have scale economies exploited and thereby see a lower retail price for its goods or services, the manufacturer may want to concentrate the resale of its goods or services on a limited number of distributors. To do so, the manufacturer could use exclusive distribution, quantity forcing in the form of a minimum purchasing requirement, selective distribution containing a minimum purchasing requirement or exclusive sourcing;

(h)

to ensure uniformity and quality standardisation. A vertical restraint can help to create or promote a brand image, by imposing a certain measure of uniformity and quality standardisation on the distributors. This can protect the reputation of the brand, increase the attractiveness of the goods or services concerned for end users and increase sales. Such standardisation can, for instance, be achieved through selective distribution or franchising;

(i)

to address capital market imperfections. Providers of capital such as banks and equity markets may provide capital sub-optimally when they have imperfect information on the solvency of the borrower or where there is an inadequate basis to secure the loan. The buyer or supplier may have better information and may be able, through an exclusive relationship, to obtain extra security for its investment. Where the supplier provides the loan to the buyer, this may lead to the imposition of a non-compete obligation or quantity forcing on the buyer. Where the buyer provides the loan to the supplier, this may be the reason for imposing exclusive supply or quantity forcing on the supplier.

(a)

anti-competitive foreclosure of other suppliers or other buyers, by raising barriers to entry or expansion;

(b)

softening of competition between the supplier and its competitors and/or the facilitation of explicit or tacit collusion between competing suppliers, often referred to as the reduction of inter-brand competition;

(c)

softening of competition between the buyer and its competitors or the facilitation of explicit or tacit collusion between competing buyers, often referred to as the reduction of intra-brand competition where it concerns distributors of the goods or services of the same supplier (24);

(d)

the creation of obstacles to market integration, including, in particular, limitations on the consumer’s choice to purchase goods or services in any Member State.

(a)

increasing the prices charged to buyers of goods or services, which may in turn lead to higher retail prices;

(b)

limiting the choice of goods or services;

(c)

lowering the quality of goods or services;

(d)

reducing innovation or service at the supplier level.

(a)

increasing the retail prices of goods or services;

(b)

limiting the choice of price-service combinations and distribution formats;

(c)

lowering the availability and quality of retail services;

(d)

reducing the level of innovation at the distribution level.

(a)

the aggregate market share of the parties on any relevant market within the Union affected by the agreement does not exceed 5 %, and

(b)

the aggregate annual Union turnover of the supplier generated with the products covered by the agreement does not exceed EUR 40 million or, in cases involving agreements concluded between a buyer and several suppliers, the buyer’s combined purchases of the products covered by the agreements does not exceed EUR 40 million (31). The Commission may rebut the presumption if an analysis of the characteristics of the agreement and its economic context demonstrates the contrary.

(a)

contract-specific risks, which are directly related to the contracts concluded and/or negotiated by the agent on behalf of the principal, such as the financing of stocks;

(b)

risks related to market-specific investments. Those are investments specifically required for the type of activity for which the agent has been appointed by the principal, that is, which are required to enable the agent to conclude and/or negotiate a specific type of contract. Such investments are usually sunk, which means that upon leaving that particular field of activity the investment cannot be used for other activities or sold other than at a significant loss;

(c)

risks related to other activities undertaken on the same product market, to the extent that the principal requires, as part of the agency relationship, the agent to undertake such activities not as an agent on behalf of the principal, but at the agent’s own risk.

(a)

the agent does not acquire the property in the goods bought or sold under the agency agreement and does not itself supply the services bought or sold under the agency agreement. The fact that the agent may temporarily, for a very brief period of time, acquire the property in the contract goods while selling them on behalf of the principal, does not preclude the existence of an agency agreement that falls outside the scope of Article 101(1) of the Treaty, provided that the agent does not incur any costs or risks in relation to the transfer of property;

(b)

the agent does not contribute to the costs relating to the supply or purchase of the contract goods or services, including the costs of transporting the goods. This does not preclude the agent from carrying out the transport service, provided that the costs are covered by the principal;

(c)

the agent does not maintain at its own cost or risk stocks of the contract goods, including the cost of financing the stock and the cost of lost stock. The agent should be able to return unsold goods to the principal without charge, unless the agent is at fault, for example, because it fails to comply with reasonable security or anti-theft measures to avoid stock losses;

(d)

the agent does not take responsibility for the customers’ non-performance of the contract, with the exception of the loss of the agent’s commission, unless the agent is at fault (for example, failing to comply with reasonable security or anti-theft measures or failing to comply with reasonable measures to report theft to the principal or the police or to communicate to the principal all necessary information available to it on the customer’s financial reliability);

(e)

the agent does not assume responsibility towards customers or other third parties for loss or damage resulting from the supply of the contract goods or services, unless the agent is at fault;

(f)

the agent is not, directly or indirectly, obliged to invest in sales promotion, including through contributions to the advertising budget of the principal or to advertising or promotional activities specifically relating to the contract goods or services, unless such costs are fully reimbursed by the principal;

(g)

the agent does not make market-specific investments in equipment, premises, training of personnel or advertising, such as the petrol storage tank in the case of petrol retailing, specific software to sell insurance policies in the case of insurance agents, or advertising relating to routes or destinations in the case of travel agents selling flights or hotel accommodation, unless such costs are fully reimbursed by the principal;

(h)

the agent does not undertake other activities within the same product market required by the principal under the agency relationship (for example, the delivery of the goods), unless those activities are fully reimbursed by the principal.

(a)

limitations on the territory in which the agent may sell the contract goods or services;

(b)

limitations on the customers to whom the agent may sell the contract goods or services;

(c)

the prices and conditions at which the agent must sell or purchase the contract goods or services.

(a)

explicit acquiescence can be deduced from the powers conferred upon the parties in a general agreement drawn up in advance. If the terms of that agreement provide for or authorise one party to subsequently adopt a specific unilateral policy that is binding on the other party, the acquiescence to that policy by the other party can be established on that basis (52).

(b)

for tacit acquiescence, it is necessary to show that one party explicitly or implicitly requires the cooperation of the other party for the implementation of its unilateral policy and that the other party has complied with that requirement by implementing that unilateral policy in practice (53). For instance, if after a supplier’s announcement of a unilateral reduction of supplies in order to prevent parallel trade, distributors immediately reduce their orders and stop engaging in parallel trade, it can be concluded that those distributors tacitly acquiesce to the supplier’s unilateral policy. However, such a conclusion cannot be reached if the distributors continue to engage in parallel trade or try to find new ways to engage in parallel trade.

(a)

the undertaking that provides the online intermediation services cannot be categorised as a buyer within the meaning of Article 1(1), point (k) of the Regulation in respect of goods or services offered by third parties using those online intermediation services;

(b)

for the purpose of applying the market share thresholds set out in Article 3(1) of the Regulation, the market share of the undertaking that provides the online intermediation services is calculated on the relevant market for the supply of those services. The scope of the relevant market depends on the facts of the case, in particular the degree of substitutability between online and offline intermediation services, between intermediation services used for different categories of goods or services and between intermediation services and direct sales channels;

(c)

restrictions imposed by the undertaking that provides the online intermediation services on buyers of those services relating to the price at which, the territories to which, or the customers to whom the intermediated goods or services may be sold, including restrictions relating to online advertising and online selling, are subject to the provisions of Article 4 of the Regulation (hardcore restrictions). For example, pursuant to Article 4, point (a) of the Regulation, the exemption provided by Article 2(1) of the Regulation does not apply to an agreement under which a provider of online intermediation services imposes a fixed or minimum sale price for a transaction that it facilitates;

(d)

pursuant to Article 5(1), point (d) of the Regulation, the exemption provided by Article 2(1) of the Regulation does not apply to across-platform retail parity obligations imposed by the undertaking that provides the online intermediation services on buyers of those services;

(e)

pursuant to Article 2(6) of the Regulation, the exemption provided by Article 2(1) of the Regulation does not apply to agreements relating to the provision of online intermediation services where the provider of the services is a competing undertaking on the relevant market for the sale of the intermediated goods or services (hybrid function). As set out in section 4.4.4., such agreements must be assessed under the Horizontal Guidelines as regards possible collusive effects and under section 8 of these Guidelines as regards any vertical restraints.

(a)

the IPR provisions must be part of a vertical agreement, that is, an agreement with conditions under which the parties may purchase, sell or resell certain goods or services;

(b)

the IPRs must be assigned to or licensed for use by the buyer;

(c)

the IPR provisions must not constitute the primary object of the agreement;

(d)

the IPR provisions must be directly related to the use, sale or resale of goods or services by the buyer or its customers. In the case of franchising where marketing forms the object of the exploitation of the IPRs, the goods or services are distributed by the master franchisee or the franchisees;

(e)

the IPR provisions, in relation to the contract goods or services, must not contain restrictions of competition having the same object as vertical restraints that are not exempted under Regulation (EU) 2022/720.

(a)

agreements where a party provides another party with a recipe and licenses the other party to produce a drink with that recipe;

(b)

the pure licence of a trade mark or sign for the purposes of merchandising;

(c)

sponsorship contracts concerning the right to advertise oneself as being an official sponsor of an event;

(d)

copyright licensing such as broadcasting contracts concerning the right to record or broadcast an event.

(a)

an obligation on the franchisee not to engage, directly or indirectly, in any similar business;

(b)

an obligation on the franchisee not to acquire financial interests in the capital of a competing undertaking such as to give the franchisee the power to influence the economic conduct of such undertaking;

(c)

an obligation on the franchisee not to disclose to third parties the know-how provided by the franchisor as long as such know-how is not in the public domain;

(d)

an obligation on the franchisee to communicate to the franchisor any experience gained in exploiting the franchise and to grant the franchisor and other franchisees a non-exclusive licence for the know-how resulting from that experience;

(e)

an obligation on the franchisee to inform the franchisor of infringements of licensed IPRs, to take legal action against infringers or to assist the franchisor in any legal actions against infringers;

(f)

an obligation on the franchisee not to use know-how licensed by the franchisor for purposes other than the exploitation of the franchise;

(g)

an obligation on the franchisee not to assign the rights and obligations under the franchise agreement without the franchisor’s consent.

(a)

technical information relating to the contract goods or services, including information relating to the registration, certification, handling, use, maintenance, repair, upgrading or recycling of the contract goods or services, notably where such information is required to comply with regulatory measures, and information that enables the supplier or buyer to adapt the contract goods or services to the requirements of the customer;

(b)

logistical information relating to the production and distribution of the contract goods or services at the upstream or downstream levels, including information relating to production processes, inventory, stocks and, subject to paragraph (100), point (b), sales volumes and returns;

(c)

subject to paragraph (100), point (b), information relating to customer purchases of the contract goods or services, customer preferences and customer feedback, provided that the exchange of such information is not used to restrict the territory into which or the customers to whom the buyer may sell the contract goods or services within the meaning of Article 4, points (b), (c) or (d) of Regulation (EU) 2022/720;

(d)

information relating to the prices at which the contract goods or services are sold by the supplier to the buyer;

(e)

subject to paragraph (100), point (a), information relating to the supplier’s recommended or maximum resale prices for the contract goods or services and information relating to the prices at which the buyer resells the goods or services, provided that the exchange of such information is not used to restrict the buyer’s ability to determine its sale price or to enforce a fixed or minimum sale price within the meaning of Article 4, point (a) of Regulation (EU) 2022/720 (69);

(f)

subject to paragraph (100) and point (e) of this paragraph, information relating to the marketing of the contract goods or services, including information on promotional campaigns and information on new goods or services to be supplied under the vertical agreement;

(g)

performance-related information, including aggregated information communicated by the supplier to the buyer relating to the marketing and sales activities of other buyers of the contract goods or services, provided that this does not enable the buyer to identify the activities of particular competing buyers, as well as information relating to the volume or value of the buyer’s sales of the contract goods or services relative to its sales of competing goods or services.

(a)

information relating to the future prices at which the supplier or buyer intend to sell the contract goods or services downstream;

(b)

information relating to identified end users of the contract goods or services, unless the exchange of such information is necessary:

(c)

information relating to goods sold by a buyer under its own brand name exchanged between the buyer and a manufacturer of competing branded goods, unless the manufacturer is also the producer of those own-brand goods.

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Commission Regulation (EU) No 316/2014;

—

Commission Regulation (EU) No 1217/2010 (75);

—

Commission Regulation (EU) No 1218/2010 (76).

(a)

where a hardcore restriction within the meaning of Article 4 of Regulation (EU) 2022/720 is included in a vertical agreement, that agreement is likely to fall within the scope of Article 101(1) of the Treaty.

(b)

an agreement that includes a hardcore restriction within the meaning of Article 4 of Regulation (EU) 2022/720 is unlikely to fulfil the conditions of Article 101(3) of the Treaty.

(a)

fixing the resale margin;

(b)

fixing the maximum level of discount that the distributor can grant from a prescribed price level;

(c)

making the grant of rebates or the reimbursement of promotional costs by the supplier subject to the observance of a given price level;

(d)

imposing minimum advertised prices (‘MAPs’), which prohibit the distributor from advertising prices below a level set by the supplier;

(e)

linking the prescribed resale price to the resale prices of competitors;

(f)

threats, intimidations, warnings, penalties, delay or suspension of deliveries or contract terminations in relation to the observance of a given price level.

(a)

RPM may facilitate collusion between suppliers, by enhancing price transparency in the market, thereby making it easier to detect whether a supplier is deviating from the collusive equilibrium by cutting its price. This negative effect is more likely in markets prone to collusive outcomes, for example, where suppliers form a tight oligopoly and a significant share of the market is covered by RPM agreements;

(b)

RPM may facilitate collusion between buyers at the distribution level, in particular where it is driven by the buyers. Strong or well organised buyers may be able to force or convince one or more of their suppliers to fix their resale price above the competitive level, thereby helping the buyers reach or stabilise a collusive equilibrium. RPM serves as a commitment device for retailers not to deviate from the collusive equilibrium through discounting prices;

(c)

in some cases, RPM may also soften competition between manufacturers and/or between retailers, in particular when manufacturers use the same distributors to distribute their products and RPM is applied by all or many of them;

(d)

RPM may reduce the pressure on the supplier’s margin, in particular where a manufacturer has a commitment problem, that is, where it has an interest in lowering the price charged to subsequent distributors. In that situation, the manufacturer may prefer to agree to RPM, to help it to commit not to lower the price for subsequent distributors, and to reduce the pressure on its own margin;

(e)

by preventing price competition between distributors, RPM may prevent or hinder the entry and expansion of new or more efficient distribution formats, thus reducing innovation at the distribution level;

(f)

RPM may be implemented by a supplier with market power to foreclose smaller rivals. The increased margin that RPM may offer distributors may incentivise them to favour the supplier’s brand over rival brands when advising customers, even where such advice is not in the customer’s interest, or not to sell the rival brands at all;

(g)

the direct effect of RPM is the elimination of intra-brand price competition, by preventing some or all distributors from lowering their sale price for the brand concerned, thus resulting in a price increase for that brand.

(a)

When a manufacturer introduces a new product, RPM may be an efficient means to induce distributors to better take into account the manufacturer’s interest in promoting that product. Article 101(3) of the Treaty also requires that there are no realistic and less restrictive alternative means of incentivising the distributors to promote the product. To meet that requirement, suppliers may, for example, demonstrate that it is not feasible in practice to impose on all buyers effective promotion obligations by contract. In such circumstances, the imposition of fixed or minimum retail prices for a limited period of time in order to facilitate the introduction of the new product may be considered on balance pro-competitive.

(b)

Fixed resale prices, and not just maximum resale prices, may be necessary to organise a coordinated short-term low price campaign (of 2 to 6 weeks in most cases), in particular in a distribution system where the supplier applies a uniform distribution format, such as a franchise system. In such a case, given its temporary character, the imposition of fixed retail prices may be considered on balance pro-competitive.

(c)

A minimum resale price or MAP can be used to prevent a particular distributor from using the product of a supplier as a loss leader. Where a distributor regularly resells a product below the wholesale price, this can damage the brand image of the product and, over time, reduce overall demand for the product and undermine the supplier’s incentives to invest in quality and brand image. In that case, preventing that distributor from selling below the wholesale price, by imposing on it a targeted minimum resale price or MAP may be considered on balance pro-competitive.

(d)

In some situations, the extra margin provided by RPM may allow retailers to provide additional pre-sales services, in particular in the case of complex products. If enough customers take advantage of such services in order to choose a product but subsequently purchase at a lower price with retailers that do not provide such services (and hence do not incur those costs), high-service retailers may reduce or stop providing pre-sales services, which enhance the demand for the supplier’s product. The supplier must demonstrate that there is a risk of free riding at the distribution level, that fixed or minimum resale prices provide sufficient incentives for investments in pre-sale services and that there is no realistic and less restrictive alternative means of overcoming such free riding. In this situation, the likelihood that RPM will be considered as pro-competitive is higher when competition between suppliers is fierce and the supplier has limited market power.

(a)

requiring the buyer to request the supplier’s prior approval for sales to such customers (117);

(b)

refusing or reducing bonuses or discounts if the buyer sells to such customers (118) or making compensatory payments to the buyer if it stops selling to such customers;

(c)

terminating the supply of products if the buyer sells to such customers;

(d)

limiting or reducing the volumes supplied, for instance, so that the volumes correspond to the demand from customers in certain territories or the demand from certain customer groups;

(e)

threatening to terminate the vertical agreement (119) or not to renew it if the buyer sells to such customers;

(f)

charging a higher price to the distributor for products that are to be sold to such customers (120);

(g)

limiting the proportion of sales made by the buyer to such customers;

(h)

preventing the buyer from using additional languages on the packaging or for the promotion of the products (121);

(i)

supplying another product in return for the buyer stopping its sales to such customers;

(j)

paying the buyer to stop selling to such customers;

(k)

obliging the buyer to pass on to the supplier profits from such customers (122);

(l)

excluding from a Union-wide guarantee service reimbursed by the supplier products that are resold outside the buyer’s territory or products that are sold in the buyer’s territory by buyers located in other territories (123).

(a)

requiring the buyer to prevent customers located in another territory from viewing its website or online store or to re-route customers to the online store of the manufacturer or of another seller. However, obliging the buyer to offer links to the online stores of the supplier or of other sellers is not a hardcore restriction (125);

(b)

requiring the buyer to terminate consumers’ online transactions where their credit card data reveal an address that is not within the buyer’s territory (126);

(c)

requiring the buyer to sell the contract goods or services only in a physical space or in the physical presence of specialised personnel (127);

(d)

requiring the buyer to seek the supplier’s prior authorisation before making individual online sales transactions;

(e)

prohibiting the buyer from using the supplier’s trademarks or brand names on its website or in its online store;

(f)

prohibiting the buyer from establishing or operating one or more online stores, irrespective of whether the online store is hosted on the buyer’s own server or on a third party server (128);

(g)

prohibiting the buyer from using an entire online advertising channel, such as search engines (129) or price comparison services, or restrictions which indirectly prohibit the use of an entire online advertising channel, such as an obligation not to use the supplier’s trademarks or brand names for bidding to be referenced in search engines, or a restriction on providing price-related information to price comparison services. Such restrictions have the object of preventing the effective use of the internet by the buyer to sell the contract goods or services to particular territories or customers, as they limit the buyer’s ability to target customers beyond its physical trading area, inform them about its offers and attract them to its online store or other sales channels. Prohibiting the use of particular price comparison services or search engines is generally not a hardcore restriction, as the buyer may use other online advertising services to raise awareness of its online sales activities. However, prohibiting the use of the most widely used advertising services in the particular online advertising channel may amount to a hardcore restriction, if the remaining services in that advertising channel are de facto not capable of attracting customers to the buyer’s online store.

(a)

requirements intended to ensure the quality or a particular appearance of the buyer’s online store;

(b)

requirements regarding the display of the contract goods or services in the online store (such as the minimum number of items displayed, the way the supplier’s trademarks or brands are displayed);

(c)

a direct or indirect ban on the use of online marketplaces (133);

(d)

a requirement that the buyer operates one or more brick and mortar shops or showrooms, for instance as a condition for becoming a member of the supplier’s selective distribution system;

(e)

a requirement that the buyer sells a minimum absolute amount of the contract goods or services offline (in value or volume, but not as a proportion of its total sales) to ensure the efficient operation of its brick and mortar shop. This requirement can be the same for all buyers, or it can be set at a different level for each buyer, based on objective criteria, such as the buyer’s size relative to other buyers, or its geographic location.

(a)

a requirement that online advertising meets certain quality standards or includes specific content or information;

(b)

a requirement that the buyer does not use the services of particular online advertising providers that do not meet certain quality standards;

(c)

a requirement that the buyer does not use the brand name of the supplier in the domain name of its online store.

(a)

the obligation is indispensable to protect know-how transferred by the supplier to the buyer;

(b)

it is limited to the point of sale from which the buyer has operated during the contract period;

(c)

it is limited to a maximum period of 1 year.

(a)

retail parity obligations relating to the direct sales channels of buyers of online intermediation services (so-called ‘narrow’ retail parity obligations);

(b)

parity obligations relating to the conditions under which goods or services are offered to undertakings that are not end users;

(c)

parity obligations relating to the conditions under which manufacturers, wholesalers or retailers purchase goods or services as inputs (‘most favoured customer’ obligations).

(a)

the nature of the agreement;

(b)

the market position of the parties;

(c)

the market position of competitors (upstream and downstream);

(d)

the market position of buyers of the contract goods or services;

(e)

entry barriers;

(f)

the level of the production or distribution chain that is affected;

(g)

the nature of the product;

(h)

the dynamics of the market.

(a)

the presence of cumulative effects, deriving from the fact that the market is covered by similar vertical restraints imposed by other suppliers or buyers;

(b)

whether the agreement is ‘imposed’ (namely, most of the restrictions or obligations apply only to one party to the agreement) or ‘agreed’ (both parties accept restrictions or obligations);

(c)

the regulatory environment;

(d)

behaviour that may indicate or facilitate collusion, such as price leadership, pre-announced price changes and price discussions, price rigidity in response to excess capacity, price discrimination and past collusive behaviour.

(a)

it must produce objective economic benefits,

b)

consumers must receive a fair share of the resulting benefit (161),

(c)

the restrictions of competition must be indispensable to attain those benefits, and

(d)

the agreement must not afford the parties the possibility of eliminating competition in respect of a substantial part of the goods or services concerned (162).

(a)

the supplier itself uses the online marketplace that the buyer is prevented from using;

(b)

the supplier imposes the restriction on some distributors but not on others;

(c)

the operator of the online marketplace is itself an authorised member of the selective distribution system.

(a)

the market position of the supplier and its competitors;

(b)

the importance of price comparison services as an advertising channel in the relevant market for the sale of the contract goods or services;

(c)

the type and scope of the restrictions and the relative importance of the particular price comparison service whose use is restricted or banned;