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8 The Law And Economics Of Vertical Restraints

Damien Geradin, Anne Layne-Farrar, Nicolas Petit

From: EU Competition Law and Economics

Damien Geradin, Dr Anne Layne-Farrar, Nicolas Petit

From: Oxford Competition Law (http://oxcat.ouplaw.com). (c) Oxford University Press, 2015. All Rights Reserved.date: 20 September 2020

Guidelines on Vertical Restraints — Basic principles of competition law

This chapter examines independent distribution and how it is treated under EU competition law. Since the 1960s, it is acknowledged that vertical agreements can entail restrictions of competition—generally called ‘vertical restraints’—which deserve competition law scrutiny. While the early case law and Regulations adopted in the field focused primarily on restrictions of intra-brand competition, a more liberal and economic approach was introduced with the promulgation of Regulation 2790/1999. The new legal framework rested on a basic economic premise: the ability of a vertical agreement to produce anticompetitive effects hinges predominantly on the market power of the parties to the agreement. With the expiry of Regulation 2790/1999 on 31 May 2010, but also with the growth of large retailers throughout Europe and the rise of internet distribution, the Commission initiated a review process in July 2009 which culminated in the adoption of Regulation 330/2010 and of a new set of Guidelines.

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