Consumer choice, legal certainty and European markets' competitiveness neglected with the proposed reform of the rules relating to dual distribution
Press release, Brussels, 17 September 2021 – AIM has published its response to the European Commission’s public consultation on the draft revised Regulation on vertical agreements and vertical guidelines.
AIM, the European Brands Association, has been an active participant in the evaluation process of the Vertical Block Exemption Regulation (VBER) and Guidelines on Vertical Restraints (VGL) since it started in 2019, as these are crucial instruments to assess, and ensure the fairness of, the commercial relationships between brand owners and retailers.
While the draft VBER and VGL published by the European Commission on 9 July 2021 reflect both the issues raised by stakeholders throughout the evaluation and impact assessment phases, AIM members remain strongly concerned by the proposed modification of the rules relating to dual distribution, which they believe could single-handedly offset the benefits of the VBER and VGL. If implemented, the proposed reform would result in reduced consumer choice, greater legal uncertainty for business, and less innovative and competitive European markets. AIM essentially argued the following:
- Exchanging information in the context of a dual distribution relationship is legitimate and necessary because it provides many benefits to consumers, while it is necessary to properly operate the supplier-reseller partnership, especially in certain contexts. It also enables suppliers to adopt a tailored, performance-driven approach and to respond to retailers’ focus on profitability.
- Treating problematic horizontal concerns should not command a full overhaul of the rules: completing the current framework with clear guidance would be sufficient to alleviate any potential horizontal concerns.
- Implementing a lower combined market share threshold at the retail level would create legal uncertainty, hinder the distribution of goods in Europe, limit manufacturers’ freedom of choice for the distribution of their goods and neglect the learnings from the Covid-19 crisis.
While welcoming the many well-deserved revisions proposed by the European Commission, AIM also conveyed reservations and requested clearer guidance on a series of other topics: marketplace bans, resale price maintenance, minimum advertised pricing (MAP), competition between distributors’ brands and branded goods in the same relevant market, dual pricing and the equivalence principle, territorial/customer restrictions, unauthorised sales, the combination of selective and exclusive distribution, the dual role of agents, online intermediation services, active sales restrictions, and resale prices permitted in tripartite fulfilment arrangements.
For further information, please contact: Laurent Cenatiempo
Tel: +32 2 736 03 05 / Email: firstname.lastname@example.org
AIM (Association des Industries de Marque) is the European Brands Association representing manufacturers of branded consumer goods in Europe on key issues that affect their ability to design, distribute and market their brands. AIM’s membership comprises 2500 businesses ranging from SMEs to multinationals, directly or indirectly through its corporate and national association members.