Beer supply agreements within the community competition rules

Abstract

Beer Supply Agreements are considered as one of major concepts not only in the European market, but generally also in the world market. This is rightly so considering that an average of one hundred and sixty billion United States dollars are spent yearly by consumers for the purchase of beer. It is quite obvious, therefore, that each and every brewery has sought and will continue to seek ways and means of guaranteeing its own share of the market by tying a number of outlets to exclusively sell their beers, instead of that of other breweries. In return it offers a number of incentives to the reseller in order that the exclusivity which they seek will be secured. It is appreciated that in principle this an anti-competitive practice, nonetheless, considering the importance and the particularity of this sector, the EC Commission has seen fit to exempt such practices from the normal rules of competition which it sets out. This thesis deals with all the important competition rules within the EEC Treaty itself, namely articles 85 and 86, as well as all other Notices and Regulations pertinent to the subject, particularly the Notice on Agreements of Minor Importance and also Regulation 1984/83 on beer supply agreements. The first part of this thesis gives a brief history of the invention and the subsequent increase in consumption of this beverage, and the ensuing need to regulate its' distribution. The thesis deals also with the various types of beer supply agreements entered into between the two parties involved, namely the brewery and the reseller, as well as the situation currently existent in Malta. With reference to the Maltese position, a brief look at the Maltese agreements entered into by the two local breweries is also given, as well as the legality, and compatibility or otherwise of these agreements within the European rules on competition. The role of the national courts in this respect is also dealt with.