Brussels, 7 January 2001
Competition policy: new Notice on agreements of minor importance (de minimis Notice)
The European Commission has adopted a new Notice on agreements of minor importance which do not appreciably restrict competition under Article 81 (1) of the EC Treaty ("de minimis Notice"). The new Notice replaces the previous Notice of 1997. (1) The revision of the "de minimis" notice is part of the Commission's review of the EC competition rules. By defining when agreements between companies are not prohibited by the Treaty, the Notice will reduce the compliance burden for companies, especially smaller companies. At the same time the Commission will be better able to avoid examining cases which have no interest from a competition policy point of view and will thus be able to concentrate on more problematic agreements.
Article 81 (1) of the EC Treaty prohibits agreements which may affect trade between Member States and which have as their object or effect the prevention, restriction or distortion of competition within the common market. The Court of Justice of the European Communities has clarified that this provision is not applicable where the impact of the agreement on intra-community trade or on competition is not appreciable. In the new Notice the Commission quantifies, with the help of market share thresholds, what is not an appreciable restriction of competition i.e. what is "de minimis" and is thus not prohibited by Article 81(1).
The new Notice reflects an economic approach and has the following key features:
The "de minimis" thresholds are raised to 10% market share for agreements between competitors and to 15% for agreements between non-competitors.
The previous Notice had fixed the "de minimis" thresholds at respectively 5% and 10% market share. The new Notice raises ese thresholds to respectively 10% and 15%.(2) Competition concerns can in general not be expected when companies do not have a minimum degree of market power. The new thresholds take account of this while at the same time staying low enough to be applicable whatever the overall market structure looks like.
The difference between the two thresholds takes into account, as before, that agreements between competitors in general lead more easily to anti-competitive effects than agreements between non-competitors.
It specifies for the first time a market share threshold for networks of agreements producing a cumulative anti-competitive effect.
The previous de minimis Notice excluded from its benefit agreements operated on a market where "competition is restricted by the cumulative effects of parallel networks of similar agreements established by several manufacturers or dealers." This meant in practice that firms operating in sectors like the beer and petrol sector could usually not benefit from the de-minimis Notice. The new Notice introduces a special "de minimis" market share threshold of 5% for markets where there exist such parallel networks of similar agreements.
It contains the same list of hardcore restrictions as in the horizontal and vertical Block Exemption Regulations.
The new Notice defines in a clearer and more consistent way the hardcore restrictions, i.e. those restrictions, such as price fixing and market sharing, which are normally always prohibited irrespective of the market shares of the companies concerned. Hardcore restrictions can not benefit from the de minimis Notice. For agreements between non-competitors the new Notice has taken over the hardcore restrictions set out in Block Exemption Regulation 2790/1999 for vertical agreements.(3) For agreements between competitors the new Notice has taken over the hardcore restrictions set out in Block Exemption Regulation 2658/2000 for specialisation agreements. (4)
Agreements between small and medium sized enterprises are in general "de minimis".
The new Notice states that agreements between small and medium sized enterprises (SMEs) are rarely capable of appreciably affecting trade between Member States. Agreements between SMEs therefore generally fall outside the scope of Article 81(1).
In cases covered by the new Notice, the Commission will not institute proceedings either upon application or on its own initiative. Where companies assume in good faith that an agreement is covered by the Notice, the Commission will not impose fines. Although not binding on them, the Notice also intends to give guidance to the courts and authorities of the Member States in their application of Article 81.
The new Notice on agreements of minor importance is published in the Official Journal of the Communities, C 368 of 22.12.2001, and is also available on the internet at the following address:
(1)OJ C 372, 9.12.1997, p. 13.
(2)This does not imply that agreements between companies that exceed the thresholds set out in the Notice do appreciably restrict competition. Such agreements may still have only a negligible effect on competition within the common market, but this can only be assessed on a case-by-case basis. Such an essment is relevant in particular for agreements that are not covered by any of the block exemption regulations of the Commission.
(3)Commission Block Exemption Regulation 2790/1999, OJ L 336, 29.12.1999, p. 21.
(4)Commission Block Exemption Regulation 2658/2000, OJ L 304, 5.12.2000, p. 3.