A Study on Vertical Restraints in Competition Law of European Union and The Inspiration for Taiwan

• Main Authors: Hui-Ching Hsieh, 謝惠晴
• Other Authors: Ming-Jye Huang
• Format: Others
• Language: zh-TW
• Published: 2016
• Online Access: http://ndltd.ncl.edu.tw/handle/cy9fpy

碩士 === 國立臺灣大學 === 法律學研究所 === 107 === Vertical restraints refer to the agreement on competition restriction between upstream and downstream firms belonging to different production and marketing levels. Though the effects of restrictive competition might follow as a result, overall, the positive impact these restraints bring is larger than its negative influence. Therefore, not all Vertical restraints are definitely illegal since there might be possible legal exceptions. EU Competition Law adopts the Block Exemption Regulation regarding Vertical restraints: the concrete demands are announced ahead, and if the agreement between firms meets the relevant regulations, no submission for approval is needed for the agreement to be directly put into practice. The current Block Exemption Regulation is Commission Regulation No.330/2010 in which several hardcore restrictions and non-exempted restrictions are listed. The threshold of violating the competition law is 30% of market share. To determine whether Vertical restraints can be exceptionally legal, the Fair Trade Act of Taiwan only requires competent authorities to review the evidence provided by the firms. Meanwhile, the threshold for violating the law differs between vertical price restraints and non-price vertical restraints; the former deems the act of restricting resale prices to be illegal regardless of the size of the firms’ market share, while the latter has no unified standards for the threshold but relies upon actual court decisions in Taiwan, that is, 10% of market share. There are no specific regulations to comply with regarding the exceptions of Vertical restraints. Firms cannot determine if certain Vertical restraints are illegal, resulting in difficulties in putting forward a long-term business plan. Further, since market share cannot be used to determine legality, how does one expect firms to follow the regulations of Vertical restraints on their own if the regulations are nowhere to be found in the law? Moreover, the EU has a large-scale market and still uses 30% of market share as the threshold, whereas Taiwan, having a small-scale market, uses 10% of market share as the threshold, leading to firms being reproachable at every turn and detrimental effects on the economical development of Taiwan. In sum, the present study suggests that Taiwan can refer to the EU and conclude, categorize, and actualize the practical cases in order to formulate administrative regulations similar to the Block Exemption Regulation for firms to follow. As to the threshold for violating the law of Vertical non-price restraints, there should be clear regulations of a higher market share threshold than the current one so that a fair and ideal competitive environment can be achieved.