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Commission Notice On Horizontal Cooperation Agreements

A closer distinction should be made between agreements for which the parties only agree on joint marketing and agreements for which marketing is linked to another type of upstream cooperation, such as. B joint production or joint purchasing. In the analysis of marketing agreements combining different phases of cooperation, it is necessary to define the centre of gravity of the cooperation in accordance with paragraphs 13 and 14. Third, marketing agreements can become a means for the parties to share markets or to allocate orders or clients, for example where the parties` production sites are in different geographic markets or where the agreements are reciprocal. Marketing agreements can lead to restrictions of competition in several respects. First, and most obviously, marketing agreements can lead to price cartels. (95) Standardisation can take several forms ranging from the adoption of consensus-based standards by approved European or national standardisation bodies to consortia and forums and agreements between independent undertakings. In some sectors where production is the most important economic activity, even a simple production agreement can in itself eliminate important dimensions of competition, thus directly limiting competition between the parties to the agreements. These Guidelines apply to the most common types of horizontal cooperation agreements, irrespectless of their degree of integration, with the exception of projects involving a concentration within the meaning of Article 3 of Council Regulation (EC) No 139/2004 of 20 June 2004.

(2) (`the Merger Regulation`), as would be the case, for example, in the case of joint ventures which permanently perform all the functions of an autonomous economic entity (`full-function joint venture`) (3). Standardisation agreements which do not need competition must be analysed in their legal and economic context in terms of their real and foreseeable impact on competition. In the absence of market power (110), a standardisation agreement cannot have restrictive effects on competition. Therefore, restrictive effects are least likely in a situation of effective competition between a number of voluntary standards. Production agreements can be competitive if they offer efficiency gains in the form of cost reductions or better production technologies. Joint production allows companies to reduce costs that they would otherwise have duplicated. They can also produce at a lower cost if cooperation allows them to increase production where marginal costs decrease with production, i.e. through economies of scale. Joint production can also help companies improve product quality by bringing together their complementary skills and know-how….

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