Vertical Agreements Getting The Deal Through

there is no public register of the extraterritorial application of Ukrainian competition law with regard to vertical restraints; However, the CMA regularly acts on other extraterritorial issues (e.g. B mergers between foreigners) and can theoretically do so with regard to vertical restraints imposed by non-Ukrainian enterprises affecting ukrainian product markets. It should be noted, however, that the extraterritorial enforcement of the AMC decision is difficult to achieve due to a series of legal uncertainties and technical complications related to the cross-border mutual recognition of court decisions (which force GAC decisions into enforcement). The GAC intends to implement Commission Regulation (EU) No 316/2014 of 21 March 2014 on the application of Article 101(3) of the Treaty to categories of technology transfer agreements. This regulation is expected to enter into force at the beginning of 2019. Under the Regulation, the technology transfer agreement is generally exempted (with the exception of essential restrictions) where: the CMA can assess all the agreements. In particular, in accordance with the Vertical Block Exemption Regulation, in cases where parallel networks of similar vertical restraints cover more than 50% of a relevant market, the CMA may adopt a resolution stating that the vertical block exemption does not apply to those restrictions. Competition law has not in itself annulled agreements which contain prohibited vertical restraints. The corresponding provisions of an agreement, and even the entire agreement, can be annulled by a court if they are requested by the interested parties on the basis of the CMA`s decision finding the violation of Ukrainian competition law.

It should be noted, however, that recent case law argues that agreements between shareholders aimed at restricting or eliminating economic competition in Ukrainian product markets are non-existent. It is not certain that the courts will extend this approach to cases of vertical restraints. Is the concept of vertical restraint defined in cartel law? As regards vertical restraints, competition law and other applicable rules apply to private and public entities, irrespective of their legal form and nature of ownership, in the case of “companies” within the meaning of the Competition Act, which provides that public authorities, local self-government authorities and administrative and economic and supervisory bodies are to be considered as undertakings for these purposes. even with regard to vertical restraints in the part of their activities concerning the production, sale and purchase of goods or any other commercial activity. . . .

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