The Vertical Agreements Block Exemption

The vertical agreements block exemption (VABE) is an important piece of legislation that affects businesses throughout Europe. If you`re not familiar with this legislation, it`s time to get up to speed. Here`s what you need to know about the VABE and how it could impact your business.

What is the Vertical Agreements Block Exemption?

The VABE is a set of rules that govern how businesses can enter into vertical agreements with each other. A vertical agreement is one between two businesses at different levels of the supply chain. For example, a manufacturer might have a vertical agreement with a distributor, or a retailer might have an agreement with a wholesaler.

The VABE sets out the conditions under which these agreements are allowed, and which ones are prohibited. The aim of the legislation is to ensure that businesses can compete fairly and that consumers are protected.

What kinds of vertical agreements are covered by the VABE?

The VABE covers a wide range of vertical agreements. Some of the most common include:

– Supply agreements between manufacturers and distributors

– Exclusive distribution agreements

– Non-exclusive distribution agreements

– Franchise agreements

– Selective distribution agreements

– Resale price maintenance agreements

If you`re involved in any of these types of agreements, it`s important to make sure you`re complying with the VABE.

What are the conditions for exemption under the VABE?

To be exempt from competition law under the VABE, an agreement must meet several conditions. These include:

– The market share of both parties must not exceed 30%

– The agreement must not contain any “hardcore” restrictions such as fixing prices or limiting production

– The agreement must not harm competition in the market as a whole

– The agreement must benefit consumers

If an agreement meets these conditions, it will be exempt from competition law under the VABE.

What are the benefits of the VABE?

The VABE provides businesses with a clear set of rules to follow when entering into vertical agreements. This can help to ensure that businesses are competing fairly and that consumers are protected.

The VABE also provides businesses with legal certainty. If an agreement meets the conditions for exemption under the VABE, businesses can be confident that they are not breaking any competition laws.

Finally, the VABE can help to promote innovation. By allowing businesses to enter into vertical agreements without fear of breaking competition law, the VABE can encourage businesses to develop new products and services.

In conclusion, the vertical agreements block exemption is an important piece of legislation that affects businesses throughout Europe. If you`re involved in any kind of vertical agreement, it`s important to make sure you`re complying with the VABE. By doing so, you can ensure that you`re competing fairly and that you`re not breaking any competition laws.

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