Tutorial 6 - Competition law
Important to address the vertical agreement, and the behaviour of the company/concerted
practice) is a bonus!
Problem is the contact, its something less than an agreement, it concerns proof.
Assume that they are both undertakings, according to Hofner. What about the object or
effect. If agreement has as object distortion of competition, you don’t have to prove fact. If
it’s not, but it has the consequence of doing it anyways, then its effect. If it is obvious, then
you don’t have to go further. If it doesn’t, then you have to check what effect it may have on
the market. You could use many cases for the effect such as Grundig, STM case.
To decide whether the object is to distort competition you can look at: (SIA Maxima Latvia
and blacksus meet & klein)
- aim
- content of agreement
- objectives
- economic and legal context
Art 101 (1) gives examples of what could be distortion of market but the list is not
exhaustive!
Did it affect trade? Use the extraterritoriality principle. Say that there is an effect/impact on
the EU, this is taking very broad (you can see this in the STM case) d irectly or indirectly,
actually or potentially. Another example if all parties are based in one MS it can still affect
trade (Vereniging). If either of these situations arises, then you know that it must affect trade
(French and Taiwanese mushroom packers).
De minimus rule. If there is at least 10%, then you can use it. For association of
undertakings then it is 15%, but undertakings it is 10! The de minimus rule is not applicable
here. There is one exception, the commission notice. If there is an allocation of markets or
customers, then the benefit of the de minimus rule is not applicable. there is an allocation of
customers, because pat (customer) if bound by the agreement so there is an allocation of
customer. But it was not applicable here.
Then you had to analyze the 101 (3) supposed to be mandatory conditoins for individual
exemptions and block exemptions. If there is block exemptions you go directly to the
regulation. 101 (3) you look for individual exemptions but block exemptions is directly the
regulation. Then you check whether this is a vertical agreement which it is. If it complies with
article 2, then the agreement is not void. But then look at exceptions to exceptions, which
are article 4 and 5. So if you find something from 4 or 5 then it is not exempted from
voidness. Article 5 (1) (a) applies here. If agreement doesnt have a certain time limit, then
you can assume that it is indefinite. In here you should have gone directly to article 5 (1) (a).
Here the agreement would have been caught by article 101 (1) meaning that the clause is
void. If article 4 applies, then the whole agreement is void. If it is caught in article 5, then only
the clause is void.
Can Pat breach the contract? Use the Courage case. Exclusive supplier agreement where
supplier sold beer cheaper to other pubs. Sued for damages under 101. Problem was that
UK did not have damages for private parties and neither did EU. Court said that individual
damages for breaches of EU law. No EU law regulating damages so up to the MS that have
jurisdiction to decide how they want to do this. National courts should take bargaining
positions into account. If it imposes a fine, Pat can go to court of justice which is in the
regulation. If the supplier sues Pat for non compliance with the contract, the Courage case
can be used as the bargaining positions of the parties must be taken into account. It is
Important to address the vertical agreement, and the behaviour of the company/concerted
practice) is a bonus!
Problem is the contact, its something less than an agreement, it concerns proof.
Assume that they are both undertakings, according to Hofner. What about the object or
effect. If agreement has as object distortion of competition, you don’t have to prove fact. If
it’s not, but it has the consequence of doing it anyways, then its effect. If it is obvious, then
you don’t have to go further. If it doesn’t, then you have to check what effect it may have on
the market. You could use many cases for the effect such as Grundig, STM case.
To decide whether the object is to distort competition you can look at: (SIA Maxima Latvia
and blacksus meet & klein)
- aim
- content of agreement
- objectives
- economic and legal context
Art 101 (1) gives examples of what could be distortion of market but the list is not
exhaustive!
Did it affect trade? Use the extraterritoriality principle. Say that there is an effect/impact on
the EU, this is taking very broad (you can see this in the STM case) d irectly or indirectly,
actually or potentially. Another example if all parties are based in one MS it can still affect
trade (Vereniging). If either of these situations arises, then you know that it must affect trade
(French and Taiwanese mushroom packers).
De minimus rule. If there is at least 10%, then you can use it. For association of
undertakings then it is 15%, but undertakings it is 10! The de minimus rule is not applicable
here. There is one exception, the commission notice. If there is an allocation of markets or
customers, then the benefit of the de minimus rule is not applicable. there is an allocation of
customers, because pat (customer) if bound by the agreement so there is an allocation of
customer. But it was not applicable here.
Then you had to analyze the 101 (3) supposed to be mandatory conditoins for individual
exemptions and block exemptions. If there is block exemptions you go directly to the
regulation. 101 (3) you look for individual exemptions but block exemptions is directly the
regulation. Then you check whether this is a vertical agreement which it is. If it complies with
article 2, then the agreement is not void. But then look at exceptions to exceptions, which
are article 4 and 5. So if you find something from 4 or 5 then it is not exempted from
voidness. Article 5 (1) (a) applies here. If agreement doesnt have a certain time limit, then
you can assume that it is indefinite. In here you should have gone directly to article 5 (1) (a).
Here the agreement would have been caught by article 101 (1) meaning that the clause is
void. If article 4 applies, then the whole agreement is void. If it is caught in article 5, then only
the clause is void.
Can Pat breach the contract? Use the Courage case. Exclusive supplier agreement where
supplier sold beer cheaper to other pubs. Sued for damages under 101. Problem was that
UK did not have damages for private parties and neither did EU. Court said that individual
damages for breaches of EU law. No EU law regulating damages so up to the MS that have
jurisdiction to decide how they want to do this. National courts should take bargaining
positions into account. If it imposes a fine, Pat can go to court of justice which is in the
regulation. If the supplier sues Pat for non compliance with the contract, the Courage case
can be used as the bargaining positions of the parties must be taken into account. It is
