Module 1 · Chapter 3

Competition Law in Distribution: Active and Passive Sales

Competition law decides which sales a supplier may stop its distributor making. This chapter shows where the line runs, and how this deal stays on the right side of it.

≈ 8 min read 8-question test

In this chapter

  • Why competition law reads a distribution agreement, and which rules apply
  • The four points every restriction in the deal must pass
  • Which sales Cressby may stop, and which it never may

3.1Competition law in one paragraph

Tullavane buys each machine from Cressby and may sell or rent it to anyone. Cressby wants to keep some customers for itself, and a clause can stop Tullavane chasing them. Competition law decides how far such a clause may go.

The line runs between two kinds of sale. Active sales are sales a distributor goes out to win. Passive sales are sales to customers who come to it unasked.

Key point

The line runs between chasing a customer and answering one. Cressby may stop the first in places it keeps for itself, and never the second.

Also in this chapter

  1. Why competition law reads a distribution agreement
  2. The four points every restriction must pass
  3. What Cressby may keep for itself
  4. The Belfast café
  5. When the UK Order ends
  6. Your job

Preview

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