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Technology

Online Sales Prompt Simpler EU Antitrust Rules For Manufacturers, Distributors

Rules that govern agreements between manufacturers and distributors have been simplified because of the growth of online sales and the entry of new players such as online marketplaces, EU antitrust regulators said on Tuesday.

The rules, called the Verticals Block Exemption Regulation and the Vertical Guidelines, will go into force on 1 June to replace the current set of rules that expire this month.

Simpler EU Antitrust Rules

The new rules mean it will be easier for buyers to actively approach customers and for suppliers to set different wholesale prices for online and offline sales by the same distributor in order to incentivise or reward investments.

Agreements with sustainability objectives, such as exclusivity obligations to incentivise investments in green energy plants, also get more leeway.

The rules also said criteria imposed by suppliers for online sales should not prevent the effective use of the internet by the buyer or its customers to sell goods or services, an issue which in the past has pitted brand names against online platforms.

Illegal practices under the new rules include preventing a distributor from using an online advertising channel such as search engine advertising or price comparison services to attract customers to its website.

'Up-To-Date Guidance'

"The new rules will provide companies with up-to-date guidance that is fit for an even more digitalised decade ahead," European Commission digital chief Margrethe Vestager said in a statement.

Tech lobbying group CCIA criticised the rules, saying they make it easier for big brands and suppliers to discriminate against online sales channels.

"During the COVID lockdowns, many traditional businesses found their way online. Now the Commission wants them to move back offline again," CCIA policy manager Mathilde Adjutor said in a statement.

"With these changes, anticompetitive agreements that would be illegal for big brands and large merchants offline will become effectively legal online," she said.

News by Reuters, edited by ESM – your source for the latest technology news. Click subscribe to sign up to ESM: European Supermarket Magazine.

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