Competitive Analysis of Non-Price Restraints in Vertical Agreements (A Comparative Study of American, European Union, and Iranian Law)

Abstract

A vertical agreement is an agreement between two or more economic entities, each of which operates at different levels of the commercial market. These agreements may contain non-price excluding terms that are contrary to competition law. One of the controversial issues in this regard is whether competition law will recognize non-price restraints on vertical agreements as detrimental to competition or not only does it not constitute a barrier to competition but also finds it useful in competition. The findings of the comparative studies show that non-price restraints on US and EU competition law are among the suspected restraints, however, due to the different approaches in competition law policies, the scope of inclusion in both legal systems is different. U.S jurisprudence has recognized it as independent restrictive arrangements and analyzes it under the rule of rationality. There are general and individual exemptions in EU law for the assessment of vertical restraints, which are declared legitimate if they meet the stated criteria. In Iranian law, the competitive approach to these restraints is ambiguous due to the lack of an explicit position, however, by relying on the general rules of competition law and the interpretation of Articles 44 and 45 of Law on Implementation of General Policies of Principle (44) of Constitution, we can find examples of restrictive procedures and agreements that can be adapted to these restraints in US and EU competition law.

Keywords

• vertical agreements
• non-price restraints
• competition law
• territorial restrictions
• tying arrangements
• exclusive transactions