Exclusivity clauses in distribution contracts: when can they be considered abusive?

Abuse of a dominant position / Exclusivity clauses

The Court of Justice of the European Union (CJEU) confirms that abusive acts committed by the distributors of a dominant producer can be imputed to the latter if they have not been implemented independently by the distributors, but are part of a unilateral commercial policy of the producer and implemented by the distributors.

This applies in particular where, for example, the distributors of a dominant producer are required to have the operators of sales outlets sign standard contracts which are provided by this producer and contain exclusivity clauses for the benefit of its products.

However, in order to establish the existence of an abuse of dominance, competition authorities must establish that the conduct of the dominant undertaking had exclusionary effects on equally effective competitors or, at the very least, the ability to restrict competition on the merits.

When an undertaking submits evidence likely to demonstrate the lack of exclusionary effects of its conduct, the competition authority is required to assess the value of this evidence in order to find that the practice is abusive.

CJEU, January 19, 2023, Case C-680/20 | Unilever Italia Mkt. Operations