The EU has outlined new ‘vertical’ rules on distribution: Paul Henty reports
- The EU Commission’s draft EU Vertical Agreements Block Exemption proposes changes to dual distribution, parity clauses, dual pricing and bans on active selling.
- Following Brexit, the UK’s Competition and Markets Authority is also consulting on a new instrument to replace the existing block exemption.
On 9 July 2021, the EU Commission released a draft version of the EU Vertical Agreements Block Exemption (VABE) for consultation, together with the accompanying vertical agreements guidelines. The proposed changes are significant for businesses.
Vertical agreements are those which relate to the supply of goods and services between parties at different levels of the supply chain.
The most obvious examples may occur in retail (for example, the supplier of luxury fashion items and a chain of high street stores) but the concept goes wider. In the construction context, examples of vertical arrangements would include an agreement between a manufacturer of materials and its wholesaler, or between a supplier of raw materials and a manufacturer
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