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Document 52004XC0427(07)

Guidelines on the application of Article 101(3) TFEU (formerly Article 81(3) TEC)

Guidelines on the application of Article 101(3) TFEU (formerly Article 81(3) TEC)

 

SUMMARY OF:

Guidelines on the application of Article 81(3) of the Treaty

WHAT IS THE AIM OF THE COMMUNICATION?

  • Article 101 of the Treaty on the Functioning of the European Union (TFEU) (formerly Article 81 of the Treaty establishing the European Community) prohibits trade practices between EU countries which could prevent, restrict or distort competition. The European Commission guidelines recognise, however, that some restrictive agreements could lead to economic benefits that outweigh the negative effects of the restriction of competition.
  • The guidelines set out an interpretation of how exemptions can be determined and provide guidance on how to apply Article 101(3) in individual cases.

KEY POINTS

Article 101(1) TFEU prohibits any agreements between undertakings, decisions made by associations of undertakings, or concerted practices affecting trade between EU countries which could prevent, restrict or distort competition. Article 101(3) acknowledges that some restrictive agreements may generate objective economic benefits that outweigh the negative effects of the restriction of competition, and exempts those agreements from these prohibitions.

Article 101(3) can be applied in individual cases or to categories of agreements and concerted practices through block exemption regulation.

The guidelines focus on individual cases and provides for each of the 4 conditions to satisfy Article 101(3) indications as to how they will be applied.

These 4 conditions are:

  • it must contribute to improving the production or distribution of goods or to promoting technical or economic progress;
  • consumers must receive a fair share of the resulting benefits;
  • the restrictions must be essential to achieving these objectives; and
  • the agreement must not give the parties any possibility of eliminating competition in respect of substantial elements of the products in question.

FROM WHEN DOES THE COMMUNICATION APPLY?

It has applied since 27 April 2004.

BACKGROUND

See also:

MAIN DOCUMENT

Communication from the Commission — Notice — Guidelines on the application of Article 81(3) of the Treaty (OJ C 101, 27.4.2004, pp. 97-118)

RELATED DOCUMENTS

Consolidated version of the Treaty on the Functioning of the European Union — Part Three — Union policies and internal actions — Title VII — Common rules on competition, taxation and approximation of laws — Chapter 1 — Rules on competition — Section 1 — Rules applying to undertakings — Article 101 (ex Article 81 TEC) (OJ C 202, 7.6.2016, pp. 88-89)

Council Regulation (EC) No 1/2003 of 16 December 2002 on the implementation of the rules on competition laid down in Articles 81 and 82 of the Treaty (OJ L 1, 4.1.2003, pp. 1-25)

Successive amendments to Regulation (EC) No 1/2003 have been incorporated into the original text. This consolidated version is of documentary value only.

last update 29.05.2020

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