Resale Price Maintenance And The Italian Antitrust Authority: The Bell Is Ringing Loud

On 20 November last, for the second time in less than a month, the Italian Antitrust Authority started an investigation under article 101 of the TFUE in respect of the pricing and commercial policy adopted by Enervit (a leading supplier of food supplements for sports, fitness and well-being related nutrition needs) vis-à-vis its online and traditional retailers as well as wholesalers.

Namely, as a consequence of a complaint filed by a pharmacist and owner of an on-line retail shop in May this year, the Authority brought under its scrutiny the following conducts of Enervit in Italy, as potential (vertical) restraints of competition: i) the invitation to the retailers to keep the level of discounts applied on Enervit products between 20-25% ii) the prohibition on Italian retailers to sell products or promote the sale of products with an Italian label to non Italian residents iii) the prohibition imposed on Enervit's exclusive wholesalers to sell or promote the sales of the products outside of the territory of Italy, on penalty of immediate contract termination.

According to the Authority, the above contractual clauses appear on their face to qualify as hardcore restrictions in vertical agreements, as clarified by the European Commission Guidelines on Vertical Restraints (2010/C 130/01) with respect to those restrictions falling under Article 4 of Commission Regulation (EU) no. 330/2010. As such, they are presumed to amount to an illegal restraint of competition, provided that the undertakings concerned may demonstrate that "likely efficiencies result from including the hardcore restriction in the agreement" and "that in general all the conditions of Article 101(3) are fulfilled" (Paragraph 47 of Commission Guidelines on Vertical Restraints).

It is also of interest that the Authority is challenging the absolute prohibition imposed by Enervit to sell the products destined to Italian consumers to non-Italian residents, on grounds that this would result in an impediment of on-line sales which, as such, are always deemed as a form of "passive sales". In this connection, the Authority refers to para. 52 of Commissions Guidelines on Vertical Restraints, which consider that "The internet is a powerful tool to reach a greater number and variety of customers than by more traditional sales methods" and as a consequence certain restrictions to on-line sales shall be treated as restrictions on the ability to resell.

In the same vein, the Italian Authority...