Legalize / European Union / Regulation

Commission Regulation (EU) No 1218/2010 of 14 December 2010 on the application of Article 101(3) of the Treaty on the Functioning of the European Union to certain categories of specialisation agreements Text with EEA relevance

Type Regulation

Publication 2010-12-18

Last updated 2022-12-18

State Expired

Department European Commission

Source EUR-Lex

articles 7

Reform history JSON API

COMMISSION REGULATION (EU) No 1218/2010

of 14 December 2010

on the application of Article 101(3) of the Treaty on the Functioning of the European Union to certain categories of specialisation agreements

(Text with EEA relevance)

Article 1

Definitions

For the purposes of this Regulation, the following definitions shall apply:

(a) ‘specialisation agreement’ means a unilateral specialisation agreement, a reciprocal specialisation agreement or a joint production agreement;

(b) ‘unilateral specialisation agreement’ means an agreement between two parties which are active on the same product market by virtue of which one party agrees to fully or partly cease production of certain products or to refrain from producing those products and to purchase them from the other party, who agrees to produce and supply those products;

(c) ‘reciprocal specialisation agreement’ means an agreement between two or more parties which are active on the same product market, by virtue of which two or more parties on a reciprocal basis agree to fully or partly cease or refrain from producing certain but different products and to purchase these products from the other parties, who agree to produce and supply them;

(d) ‘joint production agreement’ means an agreement by virtue of which two or more parties agree to produce certain products jointly;

(e) ‘agreement’ means an agreement, a decision by an association of undertakings or a concerted practice;

(f) ‘product’ means a good or a service, including both intermediary goods or services and final goods or services, with the exception of distribution and rental services;

(g) ‘production’ means the manufacture of goods or the preparation of services and includes production by way of subcontracting;

(h) ‘preparation of services’ means activities upstream of the provision of services to customers;

(i) ‘relevant market’ means the relevant product and geographic market to which the specialisation products belong, and, in addition, where the specialisation products are intermediary products which one or more of the parties fully or partly use captively for the production of downstream products, the relevant product and geographic market to which the downstream products belong;

(j) ‘specialisation product’ means a product which is produced under a specialisation agreement;

(k) ‘downstream product’ means a product for which a specialisation product is used by one or more of the parties as an input and which is sold by those parties on the market;

(l) ‘competing undertaking’ means an actual or potential competitor;

(m) ‘actual competitor’ means an undertaking that is active on the same relevant market;

(n) ‘potential competitor’ means an undertaking that, in the absence of the specialisation agreement, would, on realistic grounds and not just as a mere theoretical possibility, in case of a small but permanent increase in relative prices be likely to undertake, within not more than 3 years, the necessary additional investments or other necessary switching costs to enter the relevant market;

(o) ‘exclusive supply obligation’ means an obligation not to supply a competing undertaking other than a party to the agreement with the specialisation product;

(p) ‘exclusive purchase obligation’ means an obligation to purchase the specialisation product only from a party to the agreement;

(q) ‘joint’, in the context of distribution, means that the parties:
(i) carry out the distribution of the products by way of a joint team, organisation or undertaking; or
(ii) appoint a third party distributor on an exclusive or non-exclusive basis, provided that the third party is not a competing undertaking;

(r) ‘distribution’ means distribution, including the sale of goods and the provision of services.

For the purposes of this Regulation, the terms ‘undertaking’ and ‘party’ shall include their respective connected undertakings.

‘Connected undertakings’ means:

(a) undertakings in which a party to the specialisation agreement, directly or indirectly:
(i) has the power to exercise more than half the voting rights;
(ii) has the power to appoint more than half the members of the supervisory board, board of management or bodies legally representing the undertaking; or
(iii) has the right to manage the undertaking’s affairs;

(b) undertakings which directly or indirectly have, over a party to the specialisation agreement, the rights or powers listed in point (a);

(c) undertakings in which an undertaking referred to in point (b) has, directly or indirectly, the rights or powers listed in point (a);

(d) undertakings in which a party to the specialisation agreement together with one or more of the undertakings referred to in points (a), (b) or (c), or in which two or more of the latter undertakings, jointly have the rights or powers listed in point (a);

(e) undertakings in which the rights or the powers listed in point (a) are jointly held by:
(i) parties to the specialisation agreement or their respective connected undertakings referred to in points (a) to (d); or
(ii) one or more of the parties to the specialisation agreement or one or more of their connected undertakings referred to in points (a) to (d) and one or more third parties.

Article 2

Exemption

Pursuant to Article 101(3) of the Treaty and subject to the provisions of this Regulation, it is hereby declared that Article 101(1) of the Treaty shall not apply to specialisation agreements.

This exemption shall apply to the extent that such agreements contain restrictions of competition falling within the scope of Article 101(1) of the Treaty.

The exemption provided for in paragraph 1 shall apply to specialisation agreements containing provisions which relate to the assignment or licensing of intellectual property rights to one or more of the parties, provided that those provisions do not constitute the primary object of such agreements, but are directly related to and necessary for their implementation.

The exemption provided for in paragraph 1 shall apply to specialisation agreements whereby:

(a) the parties accept an exclusive purchase or exclusive supply obligation; or

(b) the parties do not independently sell the specialisation products but jointly distribute those products.

Article 3

The exemption provided for in Article 2 shall apply on condition that the combined market share of the parties does not exceed 20 % on any relevant market.

Article 4

Hardcore restrictions

The exemption provided for in Article 2 shall not apply to specialisation agreements which, directly or indirectly, in isolation or in combination with other factors under the control of the parties, have as their object any of the following:

(a) the fixing of prices when selling the products to third parties with the exception of the fixing of prices charged to immediate customers in the context of joint distribution;

(b) the limitation of output or sales with the exception of:
(i) provisions on the agreed amount of products in the context of unilateral or reciprocal specialisation agreements or the setting of the capacity and production volume in the context of a joint production agreement; and
(ii) the setting of sales targets in the context of joint distribution;

Article 5

For the purposes of applying the market share threshold provided for in Article 3 the following rules shall apply:

(a) the market share shall be calculated on the basis of the market sales value; if market sales value data are not available, estimates based on other reliable market information, including market sales volumes, may be used to establish the market share of the parties;

(b) the market share shall be calculated on the basis of data relating to the preceding calendar year;

(c) the market share held by the undertakings referred to in point (e) of the second subparagraph of Article 1(2) shall be apportioned equally to each undertaking having the rights or the powers listed in point (a) of that subparagraph;

(d) if the market share referred to in Article 3 is initially not more than 20 % but subsequently rises above that level without exceeding 25 %, the exemption provided for in Article 2 shall continue to apply for a period of 2 consecutive calendar years following the year in which the 20 % threshold was first exceeded;

(e) if the market share referred to in Article 3 is initially not more than 20 % but subsequently rises above 25 %, the exemption provided for in Article 2 shall continue to apply for a period of 1 calendar year following the year in which the level of 25 % was first exceeded;

(f) the benefit of points (d) and (e) may not be combined so as to exceed a period of 2 calendar years.

Article 6

Transitional period

The prohibition laid down in Article 101(1) of the Treaty shall not apply during the period from 1 January 2011 to 31 December 2012 in respect of agreements already in force on 31 December 2010 which do not satisfy the conditions for exemption provided for in this Regulation but which satisfy the conditions for exemption provided for in Regulation (EC) No 2658/2000.

Article 7

Period of validity

This Regulation shall enter into force on 1 January 2011.

It shall expire on 30 June 2023.

This Regulation shall be binding in its entirety and directly applicable in all Member States.

Reading this document does not replace reading the official text published in the Official Journal of the European Union. We assume no responsibility for any inaccuracies arising from the conversion of the original to this format.

This text is published under EUR-Lex's own terms of reuse, not a Legalize or public-domain licence. EUR-Lex
Creative Commons Attribution 4.0 International (CC BY 4.0)
© European Union, https://eur-lex.europa.eu — Source: EUR-Lex (Publications Office of the European Union). Reused under the Creative Commons Attribution 4.0 International (CC BY 4.0) licence. Only EU legislation published in the printed Official Journal of the European Union is deemed authentic; consolidated texts are reproduced here for documentation purposes and have been reformatted to Markdown.