Distribution Agreements and the Law – new EU Regulation

by Kidd Rapinet on May 11, 2010

Every ten years, the European Commission revises its laws on distribution and franchising agreements and the law. On 1st June 2010, the new block exemption for vertical agreements which has now been adopted in final form and its accompanying Guidelines will come into force. Philip Astles, a Partner in Kidd Rapinet’s Slough Office says “On 20th April 2010 the EU adopted the new regulation which applies from 1 June 2010 for new agreements and, in particular, it changes rules on internet selling under competition law in the EU.

“The regulation very much follows the form of the old and bans:

  • price restrictions
  • absolute bans on exports although advertising outside a territory can be banned
  • some customers and territory restrictions
  • non competition restrictions which last more than five years.

“The regulation provides an ‘exemption’ if its hard core listed restrictions are avoided. However, companies where either party has more than 30% of a market cannot use it and will need to analyse their agreements from scratch under the competition rules using the useful Guidelines of the Commission to do so, which have also just been revised and issued.

“In the Guidelines there is new material on internet selling.”

Call Philip Astles on 01753 532541 for further information.