What to expect from the Commission‘s new approach on Dual Distribution

As the EU Commission’s review of the Vertical Block Exemption Regulation comes to an end, we will share a series of alerts dedicated to a specific area of change or business sector impacted by the upcoming rules, focusing on potential practical consequences for companies.

The main legal framework in the European Union governing distribution agreements (Vertical Block Exemption Regulation “VBER”) expires end of May 2022. The European Commission (“EC”) has published the revised draft VBER as well as a revised draft of its accompanying guidelines (Guidelines on Vertical Restraints – “Guidelines”) in July 2021. The EC has suggested significant changes in the revised version of the VBER and its Guidelines. Some of the changes can offer more flexibility to suppliers/brand owners and retailers, but in some instances may lead to stricter rules. The EC grants a transition period to any agreements which are in place before 01 June 2022 (when the new rules enter into force) as such agreements need to be compliant with the new rules by end of May 2023.

One of the topics of debate relates to proposed changes with respect to information exchange in the context of so-called “dual distribution”.