Effect on trade
Effect on trade

The following Competition guidance note provides comprehensive and up to date legal information covering:

  • Effect on trade
  • The Commission Notice
  • The process
  • The concept of 'trade'
  • What kind of effect on trade is required?
  • Agreements and practices

Article 101(1) TFEU and Article 102 TFEU will only apply to market conduct (whether agreements/concerted practices or unilateral conduct) that may appreciably affect trade between EU Member States. This amounts to a jurisdictional consideration—determining whether EU or national competition law applies to the behaviour in question.

Where there is no 'effect on trade' between Member States, national competition law may apply—for example, the Chapter I and Chapter II Competition Act 1998 (CA 1998) prohibitions in the UK will apply where conduct may affect trade exclusively within the UK.

The European Commission (Commission) and the EU Courts have given the inter-state clause a wide interpretation, with the implication that Article 101(1) TFEU and Article 102 TFEU will apply to national agreements or conduct where there is some foreclosure effect or impact on imports. In practice, this has proven to be a low hurdle to pass.

In addition, this inter-state requirement is of less significance as all Member States now have competition laws that are modelled on EU law meaning there is no major practical difference as to whether EU or UK (or some other national Member State law) applies—a price fixing cartel will be illegal under both EU and national law.

The Commission Notice

In 2004, the Commission published a Notice on the 'effect on trade' concept. The Notice provides non-binding