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Practices

Cooperation and Vertical Agreements

Distinguishing between a legitimate business practice and an anti-competitive agreement is rarely straightforward. Agreements between firms can restrict competition by facilitating collusion or foreclosing rivals, but they can also generate significant benefits for both businesses and consumers.

Often, only economic analysis can show whether allegedly anti-competitive agreements are in fact pro-competitive, since their efficiency benefits outweigh any competitive harm. Some of issues that can be tackled through an in-depth economic analysis are:

  • Can a vertical agreement restrict competition in the markets where the buyer or the seller operate?
  • Does this agreement have significant pro-competitive effects?
  • Do customers benefit from this agreement?
  • Is this agreement indispensable for achieving these pro-competitive effects?

We have wide-ranging experience in both evaluating the effects of vertical agreements and advising companies on how best to design them in order to avoid allegations of anticompetitive behavior.

Our experience includes: assessing the set of vertical agreements (including rebate schemes) of a major Italian beer producer, assessing an exclusivity agreement between a major producer of impulse ice creams and its retailers, and supporting a worldwide manufacturer of beauty products in designing a distribution agreement with a wholesale distributor that was also one of its main competitors.

If your company needs advice in evaluating or structuring a vertical agreement, contact us.

 

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Paolo participated as an expert in the OECD Competition Committee’s Roundtable on “Vertical restraints for on-line sales”. Paolo was asked to prepare a background note that covers all aspect of the economic assessment of vertical restraints when these concern the distribution of products or services over the Internet. The Roundtable will also discussed the case […] Read more


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