Category Certificate/Licence In Respect of Agreements between Suppliers and Resellers [1998] IECA 528 (4th December, 1998)

Category Certificate/Licence In Respect of Agreements between Suppliers and Resellers [1998] IECA 528 (4th December, 1998)

Vertical agreements between suppliers and resellers, as defined, do not contravene Section 4(1) of the Competition Act, 1991, as amended, provided neither party exceeds a 20% market share and the agreement does not contain prohibited clauses such as resale price maintenance, absolute territorial protection, or post-term non-compete restrictions (except as specified for franchise agreements). Where market shares are higher but below 40%, a category licence may apply if the agreement meets efficiency and consumer benefit criteria and does not eliminate competition. Certain sectors (motor fuels, LPG) and agreements between suppliers of identical or equivalent goods are excluded.

Citation
[1998] IECA 528
Parties
Decision Maker: Competition Authority
Jurisdiction
Ireland
Procedural Posture
Administrative Decision / Final Decision
Outcome
Category certificate and licence granted with specified exclusions and conditions.
Legal Topics
Vertical Agreements, Non Price Vertical Restraints, Exclusive Distribution, Exclusive Purchasing, Franchising, Selective Distribution, Resale Price Maintenance, Market Foreclosure
Competition Law Vertical Agreements Non Price Vertical Restraints Exclusive Distribution Exclusive Purchasing Franchising Selective Distribution Resale Price Maintenance +1 more

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Parties

Competition Authority

Decision Maker

Procedural Posture

Administrative Decision / Final Decision

Legal Issues

  1. 1 Whether certain categories of vertical agreements between suppliers and resellers contravene Section 4(1) of the Competition Act, 1991, as amended
  2. 2 Whether such agreements may be granted a category certificate or licence under Section 4(4) and 4(2) of the Competition Act, 1991, as amended

Ratio Decidendi

Vertical agreements between suppliers and resellers, as defined, do not contravene Section 4(1) of the Competition Act, 1991, as amended, provided neither party exceeds a 20% market share and the agreement does not contain prohibited clauses such as resale price maintenance, absolute territorial protection, or post-term non-compete restrictions (except as specified for franchise agreements). Where market shares are higher but below 40%, a category licence may apply if the agreement meets efficiency and consumer benefit criteria and does not eliminate competition. Certain sectors (motor fuels, LPG) and agreements between suppliers of identical or equivalent goods are excluded.

Court Disposition

Category certificate and licence granted with specified exclusions and conditions.

Orders

  • Certificate issued for non-price vertical agreements as defined, subject to market share and clause restrictions.
  • Licence granted for specified categories of agreements, effective January 1, 1999 to December 31, 2003, subject to market share thresholds and sectoral exclusions.