A set of notes from a class on Competition Law and the effect on commercial agreements, also includes answers to a set of multiple choice questions which includes some minor information on sole distributorship, incorporation of illegitimate terms and reservation of title clauses as well as the Unpa...
1. The purpose of article 101 TFEU is to regulate competition within the European union
and prevent internal market agreements with the effect or object of distorting,
[preventing or restricting competition within the EU single market. Paragraph 1
prohibits any agreement with this effect or object and paragraph 2 states such
agreement will be void and of no effect.
2. Article 102 of the TFEU prohibits an undertaking or undertakings that are in a
dominant position from abusing this position within the internal market or a
substantial part of it insofar as it may affect trade between member states.
3. Investigation of infringements is performed by the European commission.
4. Breaches of either article of the TFEU can lead to the commission imposing a fine upon
the undertaking of up to 10% of total turnover in the preceding business year.
Businesses affected by the infringement may also bring proceedings in national courts
and receive remedies permitted under the law in the member state concerned.
5. A vertical agreement is an agreement between parties who are at different levels of
the marketing chain, they are generally therefore not going to be direct competitors.
6. A horizontal agreement is one between parties who are at the same level of supply,
they are highly likely to be in direct competition and so far, more likely to distort
competition by coming to an agreement.
7. In an agency arrangement, the final contract Is between the customer and the
principal.
8. A distributorship agreement differs from an agency agreement as the distributor is not
made an agent and so is unable to negotiate a contract between customers and their
manufacturer/producer etc. the final contract under a distributorship agreement will
be between the distributor and the end customer.
9. An agent is generally treated as being part of their principal’s undertaking and so
unless the agent takes a significant amount of commercial or financial risk the
agreement will not be one that is likely to infringe articles 101 or 102. A distributorship
will be far more likely to be deemed an infringement.
10. The notice on agreements of minor importance has the purpose of allowing the
commission not focus on the major anti-competitive agreements not ones that are
only minor and also encourages smaller undertakings by allowing them to make
agreements which theoretically can distort competition but due to the size of the
parties the impact will be only negligible.
1. C- sole distributor does not negate the right to sell direct to customers in that area.
2. C
3. C
4. B
5. B
6. A
7. D- even If signed an illegitimate term will not be incorporated.
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