Vertical Agreements Block Exemption Regulation

2. The Article 2 exemption remains applicable if, for a period of two consecutive years, the annual turnover threshold is not exceeded by more than 10%. 2. The exemption in paragraph 1 applies to vertical agreements between a business association and its members or between such an association and its suppliers only if all its members are retailers of goods and no member of the association has a total annual turnover of more than 50 million euros with its related companies. The vertical agreements concluded by these associations fall within the scope of this regulation, without prejudice to the application of Article 101 of the treaty to horizontal agreements concluded between the members of the association or by the association. In light of the expiry of the Vertical Agreements Class Exemption Regulation, which expires on May 31, 2022, and the related guidelines on vertical restrictions, the Commission conducted a review of the Class Exemption Regulation in October 2018 to decide whether or not to (…) « competing company, » a real or potential competitor; « effective competitor, » a company operating in the same market; a « potential competitor », an obligation which, in the absence of the vertical agreement, would be likely, for realistic and not only theoretical reasons, to realize, in a short period of time, the additional investments or other conversion costs necessary to enter the market in question in the event of a minor but lasting increase in relative prices; The regulation provides for a class exemption from Section 101, paragraph 1, of the TFUE for vertical agreements that meet certain requirements. These agreements may, for example, help a manufacturer open a new market or prevent a distributor from « driving freely » on the advertising efforts of another distributor, or allowing a supplier to devalue an investment for a given customer.