As part of its “modernisation” programme, the EC Commission has published a Notice on the principles that govern whether an agreement should be granted an exemption under Article 81(3).1 Under the reforms, exemptions can now for the first time be granted by national competition authorities, and parties to such agreements are now required to undertake their own legal assessment since it no longer remains open to them to notify their agreements to the Commission.
The Notice describes a framework for the economic analysis of how an agreement that is held to restrict competition may nevertheless be lawful because it meets the four efficiency defence criteria of Article 81(3). The framework seeks to follow the approach taken on efficiencies in horizontal mergers: first, establish whether there is a likelihood of increased prices; then, if so, evaluate the existence of offsetting efficiencies. As we explain in this Brief, however, there are several difficulties in extending this framework from mergers to the assessment of agreements.
