Object restrictions under Article 101(1) TFEU

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

  • Object restrictions under Article 101(1) TFEU
  • The Cartes Bancaires judgment
  • Cartes Bancaires and the object test
  • After Cartes Bancaires
  • 'Object' and 'effect' are alternatives
  • What is an anti-competitive object?
  • Potential negative impact on competition–interpretation of the test before Cartes Bancaires
  • Intention of the parties
  • Positive aims of an agreement
  • Object restrictions v hardcore restrictions
  • More...

Object restrictions under Article 101(1) TFEU

Generally, agreements that have either the object or effect of restricting, distorting or preventing competition are prohibited.

Agreements with an anti-competitive object are those that are particularly high risk and are presumed to have a negative impact on markets—because of their seriousness, there is no need to prove that there is an actual negative effect on competition.

The meaning of what is the object of an agreement has been one of the most debated points in competition law, with a long line of case law dating back to 1966. The test to determine whether an agreement has an anti-competitive object has been interpreted widely, meaning that many agreements will fall within the test, even where it appears that the parties did not intend to do so.

The reason why the test has been interpreted widely is historic. Prior to 2004, only the European Commission could apply the exemption in Article 101(3) TFEU to agreements. Therefore, Article 101(1) TFEU and the object test existed solely to determine when the Commission had jurisdiction. Case law was developed to clarify this jurisdictional question and provide an easy test to apply. However, when Regulation 1/2003 (the Modernisation Regulation) entered into force in 2004, the sole competence of the Commission to apply Article 101(3) TFEU was swept away, with all competition authorities and courts in EU Member

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