Introduction to the application of Chapter I to vertical agreements

Copyright © 2025 LexisNexis
Published by a LexisNexis Competition expert
Practice notes

Introduction to the application of Chapter I to vertical agreements

Copyright © 2025 LexisNexis

Published by a LexisNexis Competition expert

Practice notes
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This Practice Note refers to Chapter I of the Competition Act 1998 (CA 98), The Competition Act 1998 (Vertical Agreements Block Exemption) Order 2022 (VABEO), the Digital Markets, Competition and Consumers Act 2024 DMCC Act) and the Competition and Markets Authority’s (CMA) guidance on the VABEO (VABEO Guidance).

What is a vertical agreement?

A vertical agreement is an agreement entered into by separate undertakings operating at different levels in the supply chain, for example a manufacturer and its distributors. A supplier may wish to have one or multiple resellers for its goods or services, through one or more levels of the supply chain, such as a UK-wide or country/region-specific importer and further resellers operating at the wholesale and retail levels. These activities will all constitute vertical agreements.

Vertical agreements are generally agreements between non-competitors. This is opposed to horizontal agreements, which are agreements between competitors.

Vertical agreements can take many different forms. The key types include: (i) agency; (ii) exclusive distribution; (iii) selective distribution; (iv) ‘free’ or non-exclusive distribution; (v) franchising; and (vi)

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