Hybrid Restraints and Hybrid Tests Under US Antitrust and EU Competition Law

Abstract

The distinction between horizontal and vertical agreements is not always as obvious as suggested in case law. In particular, under US antitrust law, the current case law on section 1 of the Sherman Act sets out a dichotomy between horizontal and vertical restraints. Yet, the commercial reality, as seen for instance in the e-commerce sector, is that the line between those two types of restraints is sometimes blurred. As more recent cases have shown, the legal assessment of vertical restraints that have horizontal effect is more difficult compared to purely vertical or horizontal restraints. Under US antitrust and EU competition law the assessment of those ‘hybrid restraints’ is further obfuscated due to the emergence of intermediate approaches to the rule of reason/per se rule in section 1 of the Sherman Act and arguably the restriction by object/restriction by effect categories in Article 101 Treaty on the Functioning of the European Union (TFEU) respectively. This article explores whether those intermediate approaches are suitable for the legal assessment of vertical restraints with horizontal effect and how the analyses could be conducted in order to be more administrable. vertical restraints, horizontal restraints, hybrid restraints, Most-Favoured Nation clauses, resale price maintenance, rule of reason, per se rule, restriction by object, restriction by effect, Article 101 TFEU