Good cheese in a dog skin bag: contractual exclusivity fails without clear acceptance from other distributors

In Case C‑581/23, Beevers Kaas, [1] the exclusive distributor of Beemster cheese in Belgium, brought proceedings against the Albert Heijn companies for their alleged involvement, as third parties, in the infringement of an exclusive distribution agreement concluded with the Dutch producer Cono. Beevers Kaas claimed that Albert Heijn actively sold Beemster products in Belgium despite being aware of the existence of this agreement. The dispute raised the question of whether such exclusivity could benefit from the exemption provided under Article 4(b)(i)[2] of Commission Regulation (EU) No 330/2010[3] (the previous vertical block exemption regulation), in the absence of an explicit resale restriction imposed by Cono on other distributors.

The Court of Justice of the European Union held that, in order to benefit from the exemption provided by the Regulation, two cumulative conditions must be met: (i) the supplier must have invited its buyers (other distributors) not to carry out active sales in the exclusive territory allocated to another buyer, and (ii) those buyers must have accepted that obligation, either explicitly or tacitly. Such acceptance may be demonstrated through objective and consistent indications. The benefit of the exemption applies only for the period during which these conditions are fulfilled. According to the CJEU, the mere fact that other buyers do not carry out active sales in the exclusive territory is not sufficient to establish the existence of an “agreement” within the meaning of Article 101 TFEU. It is for the national court to assess these elements in fact.

Takeaways for drafting exclusive distribution agreements (in light of the CJEU ruling and the current vertical block exemption regulation (VBER) – Commission Regulation (EU) 2022/720)[4]:

• To benefit from the block exemption under the applicable VBER, the supplier and the exclusive distributor must ensure that the restriction on active sales into the exclusive territory or to protected customer groups is expressly and demonstrably accepted by the other authorised distributors. The passive conduct of those distributors (i.e., simply refraining from making active sales) is not sufficient to establish the existence of an agreement under Article 101 TFEU.

• This protective framework must be maintained throughout the entire duration of the exclusive distribution agreement in order for the exemption from the prohibition on restrictive agreements to remain applicable.

  
  

In practice, the emerging conclusion is that failure to meet the conditions established by the CJEU can lead to two major categories of risk: (i) incompatibility of the exclusive distribution structure with the requirements of the VBER, which may result in the agreement being classified as anticompetitive and subject to significant fines by competition authorities; and (ii) civil liability, since the failure to effectively protect the exclusive distributor’s rights may amount to a contractual breach by the supplier, potentially leading to the award of damages. Therefore, beyond careful drafting of contractual provisions, it is essential to establish a real and operational mechanism that ensures the effective enforcement of the exclusive distributor’s rights.

[1] C-581/23 Beevers Kaas BV v Albert Heijn België NV and Others 2025 ECLI:EU:C:2025:323 (CJEU, Second Chamber, 8 May 2025)

[2] Article 4(b)(i): “The exemption provided for in Article 2 shall not apply to vertical agreements which, directly or indirectly, in isolation or in combination with other factors under the control of the parties, have as their object: (…)(b) the restriction of the territory into which, or of the customers to whom, a buyer party to the agreement, without prejudice to a restriction on its place of establishment, may sell the contract goods or services, except: (i) the restriction of active sales into the exclusive territory or to an exclusive customer group reserved to the supplier or allocated by the supplier to another buyer, where such a restriction does not limit sales by the customers of the buyer”.

[3] Commission Regulation (EU) No 330/2010 of 20 April 2010 on the application of Article 101(3) of the Treaty on the Functioning of the European Union to categories of vertical agreements and concerted practices, which expired on 31 May 2022.

[4] Commission Regulation (EU) 2022/720 of 10 May 2022 on the application of Article 101(3) of the Treaty on the Functioning of the European Union to categories of vertical agreements and concerted practices.