Turkey: European Commission’s New Vertical Restraints Block Exemption Regulation and Its Impacts on Internet Sales in the EU and Turkey

Last Updated: 3 May 2011
Article by Ozge Atilgan Karakulak

On 20 April 2010, the European Commission (the "Commission") adopted the Regulation No. 330/2010 on the "application of Article 101(3) of the Treaty on the Functioning of the European Union ("TFEU") to categories of vertical agreements and concerted practices", the so called new Vertical Restraints Block Exemption Regulation ("VBER") which exempts certain distribution agreements from competition law rules prohibiting restrictive agreements. The new VBER replaced the previous VBER, which expired on 31 May 2010. The new VBER is accompanied by new Guidelines1 which define the scope and conditions of the exemption. This article focuses on the key changes in the new VBER and draws comparisons with Turkish law.

Under Turkish competition law regime, the Block Exemption Communiqué on Vertical Agreements no. 2002/22 ("Turkish VBER") determines the conditions for exempting vertical agreements as a block from the application of the provisions of Article 4 of the Competition Act, which provides that "Agreements and concerted practices between undertakings, and decisions and practices of associations of undertakings which have as their object or effect or likely effect the prevention, distortion or restriction of competition directly or indirectly in a particular market for goods or services are illegal and prohibited". Currently the Turkish Competition Authority ("TCA")'s latest Guidelines of 2009 on Vertical Agreements ("Turkish Guidelines") which were significantly influenced by the Commission Notice on Guidelines on Vertical Restraints (2000/C291/01) is in force. The TCA's low speed in adopting the Commission's previous guidelines deflates though the hopes of adopting the Commission's new guidelines in the near future.

The main changes in the Commission's new VBER and the Guidelines regard the introduction of a buyer's market share threshold (30%) in addition to the existing supplier's market share threshold and online sales. Moreover the rules and guidelines provide clarification with regard to online distribution and some other commercial practices, such as resale price maintenance.

The new VBER maintains the similar approach in exempting distribution agreements from competition law rules as long as the supplier's market share is under 30 percent and the agreement does not contain hardcore restrictions.  However, according to the new VBER, the buyer's market share also should not exceed 30 percent of the relevant market in which it purchases the contracted goods or services. The rationale behind this change is based on the Commission's ten year-experience in applying the market share criteria and now it plans to have an eye on powerful buyers whose market shares may be leveraged as well as gives the small and medium-sized businesses the benefit of enjoying VBER safe harbor. Comparatively, according to the Turkish VBER, the determining factor for the application of the block exemption is considered as the market share of the supplier and the market share threshold in this respect is 40 percent. On the other hand, there is an exception with regards to the agreements involving obligations to supply an exclusive buyer, in which case the market share of the buyer becomes decisive. Currently companies wishing to benefit from the market share threshold find the application of Turkish VBER complex. Therefore if and once the new VBER and the guidelines are adopted, the new market share threshold may be found even more complicated as both the supplier's and the buyer's market shares must then be considered.

The new EU Guidelines introduce clarifications with regard to restrictions on internet sales and describes how the Commission interprets active online sales and passive online sales. According to paragraph (51) of the Guidelines, sending of unsolicited e-mails, actively approaching a specific customer group or customers in a specific territory through advertisement on the internet or other promotions are considered active sales. Moreover placing territory-based banners on third party websites and paying a search engine or online advertisement provider to have advertisements displayed specifically to users in a particular territory are also considered forms of active sales which suppliers are free to restrict and still benefit from the VBER. On the other hand, the Commission has also provided examples to the types of passive online sales such as responding to unsolicited requests from individual customers including delivery of goods or services; using a website to sell products although it may have effects that extend beyond the distributor's own territory and customer group; a customer opting to be kept (automatically) informed by the distributor and it leads to a sale. These activities cannot be restricted by a supplier.

Examples of restrictions on online sales that are considered hardcore restrictions of competition are provided in paragraph (52) as follows:

(a) An obligation imposed on a distributor to prevent customers located in another territory from viewing its website or shall automatically re-route its customers to the manufacturer's or other distributors' websites.

(b) An obligation imposed on a distributor to terminate consumers' transactions over the internet once their credit card data reveal an address that is not within the distributor's territory;

(c) An obligation imposed on a distributor to limit its proportion of overall sales made over the internet.

(d) An obligation imposed on a distributor to pay a higher price for products intended to be resold by the distributor online than for products intended to be resold offline.

As these examples of active and passive online sales and hardcore restrictions do not appear in the Turkish Guidelines, the companies who are active in the Turkish market and Turkish practitioners are lacking guidance at this stage to manage their online distribution strategies. The current Turkish Guidelines do not go beyond defining sales through internet as passive sales and sending e-mail to customers as active sales unless there is a demand from customer. On the other hand the TCA is likely to follow the Commission's approach in its new Guidelines should a question that has not been covered by the current Turkish Guidelines arises.

The Commission also provided guidance in relation to online sales in selective distribution systems which are commonly used by suppliers of luxury or other special character products. In general the Commission's approach to online distribution in a selective distribution is that every distributor must be allowed to sell its products on its website and that a supplier cannot limit the quantities that its distributor sell online and impose an obligation on a distributor to charge higher prices for products which will be sold online. On the other hand a supplier may require its distributor to have one or more "bricks and mortar" shops in compliance with the supplier's distribution model or select distributors on the basis of certain quality standards as long as the object of these requirements is not directly or indirectly limit the online sales by the distributors.

Consistent with the current Turkish VBER and Guidelines, an agreement or a concerted practice having the effect of fixing resale prices are still considered as a hardcore restriction under the new VBER.  However, according to the Commission, resale price maintenance may not only restrict competition but also, in particular where it is supplier driven, lead to efficiencies. According to the Guidelines, fixed resale prices, may be necessary to organize in a franchise system or similar distribution system applying a uniform distribution format a coordinated short term low price campaign (two to six weeks in most cases) which will also benefit the consumers. Moreover, during the introductory stage of a new product, resale price maintenance may be helpful to expand demand to induce distributors to better take into account the manufacturer's interest to promote the product. These efficiency arguments will ultimately be assessed under Article 101(3) TFEU in individual cases. 

The differences between US and EU law concerning distribution reveal that companies must be vigilant to ensure that their distribution strategies align with both systems of law. As these examples show, the analysis can differ, with significant impact on a firm's distribution strategy.

Although there have been many discussions about various proposals, after all the new VBER adopted by the Commission is generally consistent with the previous VBER except for the need to provide detailed guidance in relation to online distribution strategies. This reflects the previous block exemption had worked well in practice. With these considerations in mind the differences between the Commission's new Guidelines and current Turkish Guidelines are unlikely to cause great legal uncertainties. With regard to online distribution; we may expect that the TCA would follow the Commission's new Guidelines should a case that has not been covered by the current Turkish Guidelines is brought before the TCA. We may also expect the TCA to issue new Guidelines when internet distribution becomes more crucial for competition in the Turkish market.


1. Guidelines on Vertical Restraints (2010/C 130/01)

2. The Block Exemption Communiqué on Vertical Agreements no. 2002/2 combines the three Block Exemption Communiqués; Exclusive Distribution Agreements no. 1997/3, Exclusive Purchasing Agreements no., 1997/4 and Franchising Agreements no. 1998/7. The Block Exemption Communiqué on Vertical Agreements no. 2002/2 was amended on 25 May 2007 with the namesake Communiqué no. 2007/2.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Ozge Atilgan Karakulak
Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:
  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.
  • Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.
    If you do not want us to provide your name and email address you may opt out by clicking here
    If you do not wish to receive any future announcements of products and services offered by Mondaq you may opt out by clicking here

    Terms & Conditions and Privacy Statement

    Mondaq.com (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

    Use of www.mondaq.com

    You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about Mondaq.com’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


    Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

    The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


    Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

    • To allow you to personalize the Mondaq websites you are visiting.
    • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
    • To produce demographic feedback for our information providers who provide information free for your use.

    Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

    Information Collection and Use

    We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

    We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to unsubscribe@mondaq.com with “no disclosure” in the subject heading

    Mondaq News Alerts

    In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


    A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

    Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

    Log Files

    We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


    This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

    Surveys & Contests

    From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


    If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


    From time to time Mondaq may send you emails promoting Mondaq services including new services. You may opt out of receiving such emails by clicking below.

    *** If you do not wish to receive any future announcements of services offered by Mondaq you may opt out by clicking here .


    This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to webmaster@mondaq.com.

    Correcting/Updating Personal Information

    If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to EditorialAdvisor@mondaq.com.

    Notification of Changes

    If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

    How to contact Mondaq

    You can contact us with comments or queries at enquiries@mondaq.com.

    If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at problems@mondaq.com and we will use commercially reasonable efforts to determine and correct the problem promptly.

    By clicking Register you state you have read and agree to our Terms and Conditions