EU ANTITRUST: HOT TOPICS & NEXT STEPS

EU ANTITRUST: HOT TOPICS & NEXT STEPS 2022

Prague, Czechia

3.3.1Hardcore Restrictions on Online Sales Among the hardcore restrictions related to online sales, para. 192 of the Draft Vertical Guidelines explicitly mentions (i) a direct restriction on the use of the internet as a sales channel, as well as the indirect measures such as a requirement for a distributor (ii) to only sell in a physical space or in the physical presence of specialised personnel, (iii) to seek the supplier’s prior authorisation for selling online, or (iv) not to use the supplier’s trademarks or brand names on its website. Geo-blocking restrictions, i.e., requirements for a distributor (i) to prevent customers located in another territory from viewing its website or to automatically re-route its customers to the manufacturer’s or other distributors’ websites, or (ii) to terminate consumers’ online transactions once their credit card data reveal an address that is not within the distributor’s territory, are also regarded as hardcore (the Draft Vertical Guidelines, para. 192). The Draft Vertical Guidelines also consider a direct or indirect prohibition on the use of a specific channel for online advertising – such as total ban on the use of price comparison tools or advertising on search engines, or other measures indirectly prohibiting the use of a specific online advertising channel – as a hardcore restriction. On the other hand, the European Commission believes that restriction on the use of one specific price comparison tool or search engine would typically not prevent retailers from selling online effectively. A retailer can still use other tools to increase customer awareness of its online sales activities (the Draft Vertical Guidelines, para. 192). However, the assessment of situations that do not fall under either of the ‘extremes’ addressed by the European Commission – i.e., a situation where the use of only certain advertising services (but not “ all most widely used ” ones – see the Draft Vertical Guidelines, para. 192) in the relevant online advertising channel is restricted – can be tough, as the test of effective use of the internet for online sales purposes must be carried out. 3.3.2 Safe Harbour for Online Marketplace Bans and Online Sales Quality Standards Pursuant to para. 194 of the Draft Vertical Guidelines, restrictions on the use of specific online sales channels, such as online marketplaces, or setting quality standards for online sales, are block exempted provided that they are not intended to prevent buyers or their customers from effectively using the internet for online sales or from effectively using one or more online advertising channels. Following the Coty judgment, which applies generally and not just to luxury goods ( Coty Germany , para. 68; Wijckmans, F., 2018, p. 375; Botteman, Y. and Barrio, D., 2019, p. 527), this is a universal rule, without reference to a specific type of distribution system.

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