62021CJ0331
JUDGMENT OF THE COURT (Third Chamber)
26 October 2023 (
*1
)
(Reference for a preliminary ruling – Article 101 TFEU – Agreements, decisions and concerted practices – Prohibition of agreements, decisions and concerted practices – Agreements between undertakings – Distinction between a vertical and a horizontal agreement – Potential competition – Restriction of competition by object or by effect – Agreement between a supplier of electricity and a retailer of consumer products operating hypermarkets and supermarkets – Non-compete clause – Regulation (EU) No 330/2010 – Agency contract – Liberalisation of the market for the supply of electricity)
In Case C‑331/21,
REQUEST for a preliminary ruling under Article 267 TFEU from the Tribunal da Relação de Lisboa (Court of Appeal, Lisbon, Portugal), made by decision of 6 April 2021, received at the Court on 26 May 2021, in the proceedings
EDP – Energias de Portugal SA,
EDP Comercial – Comercialização de Energia SA,
MC retail SGPS SA, formerly Sonae MC SGPS SA,
Modelo Continente Hipermercados SA
v
Autoridade da Concorrência,
intervening parties:
Ministério Público,
THE COURT (Third Chamber),
composed of K. Jürimäe (Rapporteur), President of the Chamber, M. Safjan, N. Piçarra, N. Jääskinen and M. Gavalec, Judges,
Advocate General: A. Rantos,
Registrar: M. Ferreira, Principal Administrator,
having regard to the written procedure and further to the hearing on 9 November 2022,
after considering the observations submitted on behalf of:
–
EDP – Energias de Portugal SA by C. Botelho Moniz, T. Coelho Magalhães, T. Geraldo, P. Gouveia e Melo, J. Lima Cluny, L. Nascimento Ferreira, advogados,
–
EDP Comercial – Comercialização de Energia SA by C. Botelho Moniz, T. Coelho Magalhães, T. Geraldo, P. Gouveia e Melo, J. Lima Cluny, L. Nascimento Ferreira, advogados,
–
MC retail SGPS SA, formerly Sonae MC SGPS SA, by I. Gouveia, G. Rosas, D. Silva Ramalho and C. Vieira Peres, advogados,
–
Modelo Continente Hipermercados SA by J. Vieira Peres, advogado,
–
the Autoridade da Concorrência by D. Cardoso, A. Cruz Nogueira et I. Nascimento, advogadas,
–
the Portuguese Government by P. Barros da Costa and C. Chambel Alves, acting as Agents, and by S. Assis Ferreira, advogada,
–
the European Commission, by S. Baches Opi, T. Baumé, P. Caro de Sousa and B. Rechena, acting as Agents,
after hearing the Opinion of the Advocate General at the sitting on 2 March 2023,
gives the following
Judgment
1
The request for a preliminary ruling concerns the interpretation of Article 101 TFEU and Article 1(1)(a) and (c) of Commission Regulation (EU) No 330/2010 of 20 April 2010 on the application of Article 101(3) of the Treaty on the Functioning of the European Union to categories of vertical agreements and concerted practices (OJ 2010 L 102, p. 1).
2
The request has been made in proceedings between EDP – Energias de Portugal, SA (‘EDP Energias’), EDP Comercial – Comercialização de Energia SA (‘EDP Comercial’), MC retail SGPS SA (formerly Sonae MC SGPS SA) and, at the time of the facts in the main proceedings, Sonae Investimentos SGSP SA and SONAE MC – Modelo Continente SGPS) (‘MC retail’) and Modelo Continente Hipermercados SA (‘Modelo Continente’) and the Autoridade da Concorrência (‘the AdC’) concerning fines imposed on account of an anticompetitive agreement having been concluded.
Legal context
European Union law
Regulation No 330/2010
3
Article 1 of Regulation No 330/2010, entitled ‘Definitions’, provides:
1.   For the purposes of this Regulation, the following definitions shall apply:
(a)
‘vertical agreement’ means an agreement or concerted practice entered into between two or more undertakings each of which operates, for the purposes of the agreement or the concerted practice, at a different level of the production or distribution chain, and relating to the conditions under which the parties may purchase, sell or resell certain goods or services;
(b)
“vertical restraint” means a restriction of competition in a vertical agreement falling within the scope of Article 101(1) [TFEU]”;
(c)
‘competing undertaking’ means an actual or potential competitor; ‘actual competitor’ means an undertaking that is active on the same relevant market; ‘potential competitor’ means an undertaking that, in the absence of the vertical agreement, would, on realistic grounds and not just as a mere theoretical possibility, in case of a small but permanent increase in relative prices be likely to undertake, within a short period of time, the necessary additional investments or other necessary switching costs to enter the relevant market;
…’
The Guidelines on Vertical Restraints
4
The Guidelines on Vertical Restraints, contained in the Commission Notice of 10 May 2010 (SEC (2010) 411 final; ‘the Guidelines on Vertical Restraints’), clarify, inter alia, the scope of Regulation No 330/2010.
5
Section II of the Guidelines on Vertical Restraints, entitled ‘Vertical agreements which generally fall outside the scope of Article 101(1) [TFEU]’, contains a part 2, entitled ‘Agency agreements’, comprising, inter alia, paragraphs 12 to 17 of those guidelines, which are worded as follows:
‘(12)
An agent is a legal or physical person vested with the power to negotiate and/or conclude contracts on behalf of another person (the principal), either in the agent’s own name or in the name of the principal, for the:
–
purchase of goods or services by the principal, or
–
sale of goods or services supplied by the principal.
13.
The determining factor in defining an agency agreement for the application of Article 101(1) [TFEU] is the financial or commercial risk borne by the agent in relation to the activities for which it has been appointed as an agent by the principal. In this respect it is not material for the assessment whether the agent acts for one or several principals. Neither is material for this assessment the qualification given to their agreement by the parties or national legislation.
14.
There are three types of financial or commercial risk that are material to the definition of an agency agreement for the application of Article 101(1) [TFEU]. First, there are the contract-specific risks which are directly related to the contracts concluded and/or negotiated by the agent on behalf of the principal, such as financing of stocks. Secondly, there are the risks related to market-specific investments. These are investments specifically required for the type of activity for which the agent has been appointed by the principal, that is, which are required to enable the agent to conclude and/or negotiate this type of contract. Such investments are usually sunk, which means that upon leaving that particular field of activity the investment cannot be used for other activities or sold other than at a significant loss. Thirdly, there are the risks related to other activities undertaken on the same product market, to the extent that the principal requires the agent to undertake such activities, but not as an agent on behalf of the principal but for its own risk.
15.
For the purposes of applying Article 101(1) [TFEU], the agreement will be qualified as an agency agreement if the agent does not bear any, or bears only insignificant, risks in relation to the contracts concluded and/or negotiated on behalf of the principal, in relation to market-specific investments for that field of activity, and in relation to other activities required by the principal to be undertaken on the same product market. However, risks that are related to the activity of providing agency services in general, such as the risk of the agent’s income being dependent upon its success as an agent or general investments in for instance premises or personnel, are not material to this assessment.
16.
For the purpose of applying Article 101(1) [TFEU], an agreement will thus generally be considered an agency agreement where property in the contract goods bought or sold does not vest in the agent, or the agent does not himself supply the contract services and where the agent:
(a)
does not contribute to the costs relating to the supply/purchase of the contract goods or services, including the costs of transporting the goods. This does not preclude the agent from carrying out the transport service, provided that the costs are covered by the principal;
(b)
does not maintain at its own cost or risk stocks of the contract goods, including the costs of financing the stocks and the costs of loss of stocks and can return unsold goods to the principal without charge, unless the agent is liable for fault (for example, by failing to comply with reasonable security measures to avoid loss of stocks);
(c)
does not undertake responsibility towards third parties for damage caused by the product sold (product liability), unless, as agent, it is liable for fault in this respect;
(d)
does not take responsibility for customers’ non-performance of the contract, with the exception of the loss of the agent’s commission, unless the agent is liable for fault (for example, by failing to comply with reasonable security or anti-theft measures or failing to comply with reasonable measures to report theft to the principal or police or to communicate to the principal all necessary information available to him on the customer’s financial reliability).
(e)
is not, directly or indirectly, obliged to invest in sales promotion, such as contributions to the advertising budgets of the principal;
(f)
does not make market-specific investments in equipment, premises or training of personnel, such as for example the petrol storage tank in the case of petrol retailing or specific software to sell insurance policies in case of insurance agents, unless these costs are fully reimbursed by the principal;
(g)
does not undertake other activities within the same product market required by the principal, unless these activities are fully reimbursed by the principal.
(17)
This list is not exhaustive. However, where the agent incurs one or more of the risks or costs mentioned in paragraphs (14), (15) and (16), the agreement between agent and principal will not be qualified as an agency agreement. The question of risk must be assessed on a case-by-case basis, and with regard to the economic reality of the situation rather than the legal form. For practical reasons, the risk analysis may start with the assessment of the contract-specific risks. If contract-specific risks are incurred by the agent, it will be enough to conclude that the agent is an independent distributor. On the contrary, if the agent does not incur contract-specific risks, then it will be necessary to continue further the analysis by assessing the risks related to market-specific investments. Finally, if the agent does not incur any contract-specific risks and risks related to market-specific investments, the risks related to other required activities within the same product market may have to be considered.’
6
Under paragraph 24 and 25 of those guidelines:
‘(24)
Article 1(1)(a) of [Regulation No 330/2010] defines a “vertical agreement” as “an agreement or concerted practice entered into between two or more undertakings each of which operates, for the purposes of the agreement or the concerted practice, at a different level of the production or distribution chain, and relating to the conditions under which the parties may purchase, sell or resell certain goods or services”.’
(25)
The definition of “vertical agreement” referred to in paragraph (24) has four main elements:
…
(c)
The agreement or concerted practice is between undertakings each operating, for the purposes of the agreement, at a different level of the production or distribution chain. This means for instance that one undertaking produces a raw material which the other undertaking uses as an input, or that the first is a manufacturer, the second a wholesaler and the third a retailer. This does not preclude an undertaking from being active at more than one level of the production or distribution chain;
…’
7
Paragraph 27 of those guidelines states:
‘Article 2(4) of [Regulation No 330/2010] expressly excludes “vertical agreements entered into between competing undertakings” from its application. Vertical agreements between competitors are dealt with, as regards possible collusion effects, in the [Guidelines on horizontal cooperation agreements]. However, the vertical aspects of such agreements need to be assessed under these Guidelines. Article 1(1)(c) of [Regulation No 330/2010] defines a competing undertaking as “an actual or potential competitor”. Two companies are treated as actual competitors if they are active on the same relevant market. A company is treated as a potential competitor of another company if, absent the agreement, in case of a small but permanent increase in relative prices it is likely that this first company, within a short period of time normally not longer than one year, would undertake the necessary additional investments or other necessary switching costs to enter the relevant market on which the other company is active. That assessment must be based on realistic grounds; the mere theoretical possibility of entering a market is not sufficient. A distributor that provides specifications to a manufacturer to produce particular goods under the distributor’s brand name is not to be considered a manufacturer of such own-brand goods.’
Portuguese law
8
Article 9(1) of Lei No 19/2012 – Aprova o novo regime jurídico da concorrência, revogando as leis n.os 18/2003, de 11 de junho, e 39/2006, de 25 de agosto, e procede à segunda alteração à lei n.o 2/99, de 13 de janeiro (Law No 19/2012 laying down new rules of law governing competition, and repealing Law No 18/2003 of 11 June 2003 and Law No 39/2006 of 25 August 2006, and amending for the second time Law No 2/99 of 13 January 1999), of 8 May 2012 (Diário da República, Series I, No 89/2012, of 8 May 2012; ‘the NRJC’), provides:
‘Agreements between undertakings, concerted practices between undertakings and decisions of associations of undertakings which have as their object or effect the prevention, distortion or significant restriction of competition on part or the whole of the national market shall be prohibited …’
The dispute in the main proceedings and the questions referred for a preliminary ruling
9
It is apparent from the request for a preliminary ruling that Modelo Continente and MC retail are part of a group of companies active in many business sectors, including retail distribution, telecommunications and audiovisuals, shopping centres, wood products, tourism and energy, organised under the aegis of holding companies and sub-holding companies, structured by business sector and/or business area (‘the Sonae Group’).
10
Within this group, Modelo Continente is active in the food distribution and consumer products sector in Portugal. It operates, directly or indirectly, via shareholdings, a group of shops operating under the brands Continente, Continente Modelo and Continente Bom Dia. At the material time, MC retail, the corporate object of which was the management of shares, was active in the retail distribution sector. It held 100% of the capital of Modelo Continente Hipermercados.
11
EDP Energias and EDP Comercial are part of a Portuguese conglomerate the parent company of which is EDP Energias, active in, inter alia, the production and supply of electricity and natural gas in Portugal (‘the EDP Group’). The EDP Group is the largest Portuguese player on the markets for the production, distribution and supply of electricity, the third participant in the production of electricity and one of the largest distributors of gas in the Iberian Peninsula.
12
On 5 January 2012, EDP Comercial and Modelo Continente concluded an association agreement defining the terms and conditions of the ‘EDP Continente Scheme’. That agreement aimed to attract customers, stimulate sales and offer discounts to consumers. On the date when that agreement was concluded, those two companies were not actual competitors on the distinct markets for (i) the retail sale of food products and consumer products and (ii) the supply of electricity and natural gas in Portugal.
13
Clause 2.1 of the association agreement defined the purpose and scope of that agreement as, in essence, to promote the development of electricity supply activities by EDP Comercial and the retail distribution of food products by Modelo Continente in various hypermarkets and supermarkets and in the retail outlets operated by other companies affiliated with the Sonae group.
14
From a commercial point of view, the ‘EDP Continente Scheme’ provided for reductions in electricity prices which were reserved for customers holding a ‘Continente Card’, a discount card issued by Modelo Continente as part of a loyalty programme.
15
In addition to holding that card, customers wishing to sign up to the ‘EDP Continente Scheme’ had to conclude with EDP Comercial a contract for the supply of low-voltage electricity under the liberalised regime in Portugal. Those customers then benefited from a 10% reduction on their electricity consumption. That reduction was provided by issuing discount vouchers corresponding to the amount of that reduction which were loaded onto the Continente card of the customers concerned. Those customers could then use those vouchers to make purchases in the establishments referred to in clause 2.1 of the association agreement at issue in the main proceedings.
16
Initially, the amount of the reductions was borne entirely by EDP Comercial. Each month Modelo Continente was to issue a debit note for the amount of vouchers issued and actually activated during the previous month, which had to be paid at the end of the month in which each invoice was issued. However, as traffic in the abovementioned establishments and turnover resulting from the EDP Continente Scheme increased, it was agreed that MCH would bear part of the reductions granted.
17
The other costs of the association relating to advertising, marketing, communications and defending proceedings were borne in equal parts by EDP Comercial and MCH.
18
Clause 12.1 of the association agreement at issue in the main proceedings, entitled ‘Exclusivity’, stated:
‘During the term of this agreement and for a period of 1 year after its expiry, Modelo Continente undertakes not to:
(a)
engage, directly or through companies in which Sonae Investimentos SGPS SA has a majority shareholding, in the activity of supplying electricity and natural gas in mainland Portugal;
(b)
negotiate or conclude with any electricity or natural gas supplier which is not an entity exercising control over or affiliated with EDP Comercial … association agreements, joint ventures, agreements in principle, advertising campaigns or other instruments which have the object or effect of granting discounts or other monetary benefits relating to electricity or natural gas in whatever form.
…’
19
Under Clause 12.2, EDP Comercial undertook corresponding obligations on the market for the retail distribution of food products in mainland Portugal.
20
The association agreement at issue in the main proceedings was in force until 31 December 2012, although consumers could join the ‘EDP Continente Scheme’ only from 9 January 2012 to 4 March 2012.
21
Contracts for the supply of electricity could be entered into in a network of 180 commercial spaces operated by Modelo Continente, the supply of which was shared by EDP Comercial and Modelo Continente. 145775 customers subscribed to the EDP Continente Scheme, of whom 137144 remained contractually bound to EDP Comercial during and after the end of the campaign.
22
‘EDP Continente Scheme’ members benefited from a total amount of reductions of EUR 6907354 and the value of all the coupons activated came to around EUR 6024252. Of that amount, EUR 1795912 was borne by Modelo Continente.
23
The referring court states that that association agreement coincided with a crucial phase in the process of liberalising the market for the supply of electricity, with regulated tariffs for normal low-voltage expiring at the end of 2012. The EDP Group therefore sought to win a large number of customers on the liberalised national market, taking advantage of a period when that market had not yet seen the peak in transition of low-voltage customers.
24
In that regard, it is apparent from the request for a preliminary ruling that the process of liberalising the supply of electricity in Portugal took place gradually from 1995 onwards. The Portuguese regulatory framework applicable to the marketing of electrical energy has, since 1995, favoured a system of free competition in that sector by simplifying the legal conditions for access to and the exercise of the activity of supplying electricity, which is subject only to registration rather than a licence, thereby favouring the entry of independent operators.
25
The referring court states that, in 2006, Portugal established a transitional period during which consumers were able to choose between the regulated market and the liberalised market solely on the basis of the incentive and commercial attractiveness of offers, without any regulatory burden or constraint.
26
With effect from 1 January 2011, the regulated tariffs applicable to end customers for the supply of electricity at very high-, high- and medium-voltage and at specific low-voltage were abolished. The regulated tariffs applicable to the supply of low-voltage electricity (small businesses/households) were abolished, with effect from 1 July 2012 for end customers whose contracted power was greater than or equal to 10.35 kVA and, from 1 January 2013 for customers whose contracted power was less than 10.35 kVA. After those dates, new contracts could be concluded only on the liberalised market. Transitional tariff regimes were, however, established for consumers who, by those dates, had not chosen to enter into a contract on the liberalised market. Tariffs set by the Entidade Reguladora dos Serviços Energéticos (Energy Services Regulatory Authority, Portugal) were applied to those consumers, with increased prices to encourage the transition to the liberalised market. The last of those transitional schemes expired on 31 December 2017.
27
According to the referring court, in that context, between 2002 and 2008 the Sonae Group developed a business on the market for the supply of electricity in Portugal by means of an association with Endesa, the incumbent in Spain on the market for the production and supply of electricity. That partnership took the form of a joint company set up on 1 May 2002, Sodesa – Comercialização de Energia, SA (‘Sodesa’), which was 50% owned by each of the participating companies, with the aim of supplying electricity and services on the Portuguese liberalised market.
28
In May 2007, the EDP group lost market share on the liberalised market for the supply of electricity in Portugal. Its competitors, such as Sodesa and Unión Fenosa, reached combined market shares of over 50% of customers who had chosen to switch supplier. That loss of market share was, however, limited to the industrial segment.
29
In addition, since 2004, Modelo Continente and Petróleos de Portugal – Petrogal SA, an operator present, inter alia, on the market for the supply of electricity in Portugal and on the market for the supply of fuel, formed an association granting discounts to customers of both enterprises. In addition, the Sonae Group has been active since 2009 on the market for the production of electricity by means of photovoltaic panels installed on the roofs of the premises it operated.
30
By decision of 4 May 2017, the AdC imposed fines on the applicants in the main proceedings for infringement of Article 9 of the NRJC, which, in essence, repeats Article 101 TFEU.
31
According to the AdC, the infringement of competition law consisted of those undertakings entering into an association agreement which had the object of market-sharing, in the form of a non-compete clause, on the markets for the supply of electricity, the supply of natural gas and the retail distribution of food, all three of which were located in mainland Portugal. In addition, that agreement was implemented at a crucial stage in the process of liberalising the national market for the supply of electricity, which further strengthened the anticompetitive nature of the agreement.
32
Furthermore, the AdC took the view, inter alia, that the association agreement at issue in the main proceedings was neither an agency agreement nor a vertical agreement for the purposes of the application of the competition rules, and that it could not be ruled out that Clause 12.1(a) and Clause 12.2 of that agreement constituted ‘horizontal cooperation’. Accordingly, the non-compete clause in that agreement had to be characterised as a restriction by object and constituted an infringement of the prohibition laid down in Article 9 of the NRJC.
33
Following an action brought by the applicants in the main proceedings, the Tribunal da Concorrência, Regulação e Supervisão (Competition, Regulation and Supervision Court, Portugal) upheld, by judgment of 30 September 2020, the decision imposing a penalty which is at issue in the main proceedings, but reduced the amount of the fines imposed by 10%. In finding that there was a restriction of competition by object, that court took into account, inter alia, the Sonae Group’s activities on the markets for the production and supply of electricity before and during the implementation of the association agreement.
34
The applicants in the main proceedings and the AdC appealed against that judgment before the Tribunal da Relação de Lisboa (Court of Appeal, Lisbon, Portugal), the referring court.
35
The referring court has doubts regarding whether the association agreement at issue in the main proceedings and, more specifically, the non-compete clause contained in it, may have had a negative impact on competition on the markets concerned. In that regard, it points out that the applicants in the main proceedings were not actual competitors on those markets. In addition, it finds that there is no evidence capable of demonstrating that Modelo Continente or the companies forming part of the Sonae Group had made preparations or significant and sufficient investments.
36
The referring court also raises questions regarding the conditions required for such an agreement to be characterised as a restriction of competition by object, rather than a restriction of competition by effect, given that consumers have derived certain benefits from it.
37
It observes that, in accordance with the recent case-law of the Court of Justice, it is possible to disregard the presumption that certain practices which are sufficiently restrictive by object to be seriously harmful to competition have anticompetitive effects where the agreements have legitimate and proportionate objectives or where pro-competitive objectives or effects are demonstrated. It also asks whether the association agreement at issue in the main proceedings could be characterised as an agency contract and thereby fall outside, pursuant to the national provision equivalent to Article 101(3) TFEU, the prohibition laid down in Article 101(1) TFEU.
38
In those circumstances, the Tribunal da Relação de Lisboa (Court of Appeal, Lisbon) decided to stay the proceedings and to refer the following questions to the Court of Justice for a preliminary ruling:
‘(1)
Must Article 101 TFEU, on which Article 9 of the NRJC (Law No 19/2012 of 8 May 2012) is based, be interpreted as meaning that it permits the classification of a non-competition clause such as those contained in clauses 12(1) and 12(2) … of the association agreement as an agreement [constituting a restriction] by object which is concluded between an electricity supplier and a food retailer operating hypermarkets and supermarkets with a view to granting to customers, who sign up to a given energy tariff plan made available by the electricity supplier in mainland Portugal and are at the same time holders of a loyalty card offered by the food retailer, discounts which can be used only to buy products in the outlets operated by that retailer or by companies linked to it, in the case where that agreement includes other clauses providing that its purpose is to promote the pursuit of the activities carried on by the participating companies … and the benefits to consumers have been established … but no analysis has been carried out of the specific harmful effects which the aforementioned clauses 12(1) and 12(2) have on competition?
(2)
May Article 101(1) TFEU be interpreted as meaning that an agreement, which prohibits the pursuit of certain economic activities and provides for an alleged sharing of markets between two undertakings, may be regarded as being [a restriction] of competition by object, in the case where it is concluded between two entities which do not actually or potentially compete with each other on any of the markets affected by that obligation, even though the markets affected by that obligation may be regarded as liberalised or without insurmountable legal barriers to entry?
(3)
May Article 101(1) TFEU be interpreted as meaning that an electricity supplier and a food retailer operating hypermarkets and supermarkets which have concluded [an] agreement with each other with a view to promoting each other’s business activities and increasing each other’s sales (and, in the case of the food retailer, the sales of companies in whose capital [its parent company] has a majority shareholding) must be regarded as potential competitors, in the case where the food retailer and the … companies linked to it were not engaged [at the time when the agreement was concluded] in the activity of [supplying electricity], either on the geographical market in question or on any other market, … and it has not been shown in the proceedings that they intended to engage in that activity on that market or that they had taken any [preparatory] steps with a view to doing so?
(4)
Does the answer to the previous question remain unchanged if another company in whose capital a majority interest is held by a parent company of the food retailer that is a party to the agreement (where [proceedings have not been brought nor has a finding been made against either] of those two entities … by the [AdC] [nor has either of those two entities] been a party to the proceedings before this court), which did not fall within the subjective scope of the non-competition obligation, held a 50% interest in a third entity which pursued in Portugal activities [in the supply of electricity in Portugal] that came to an end three and a half years prior to the conclusion of the agreement [following] the dissolution of that entity?
(5)
Does the answer to the previous question remain unchanged in the case where the retailer that is a party to the agreement produces electricity via its mini-generation and micro-generation facilities on the roofs of its outlets, although it delivers all of the energy produced, at regulated prices, to the [supplier of last-resort].
(6)
Does the answer to the fourth question remain unchanged in the event that the retailer that is a party to the agreement, eight years prior to the date thereof, concluded with a third party [namely a supplier of] liquid fuel, … for the purpose of granting cross-discounts, another commercial cooperation agreement (still in force on the date of the former agreement) relating to the purchase of those products and of products sold in the retailer’s hypermarkets and supermarkets, in the case where the undertaking that is the other party to the agreement, in addition to [supplying] liquid fuels, also [supplies] electricity in mainland Portugal, and it has not been shown that, at the time when the agreement was concluded, the parties had any intention of extending that contract to the [supply] of electricity or had taken any [preparatory] steps with a view to doing so?
(7)
Does the answer to the fourth question remain the same in the event that another company in whose capital a majority interest is held by a parent company of the food retailer that is a party to the agreement (where [proceedings have not been brought nor has a finding been made against either] of those two entities by the [AdC] [nor has either of those two entities] been a party to the proceedings before this court), which did not fall within the subjective scope of the non-competition obligation, produced electricity in a cogeneration facility, although it delivered all of the energy produced, at regulated prices, to the [supplier of last-resort]?
(8)
If the foregoing questions are answered in the affirmative, must Article 101(1) TFEU be interpreted as meaning that a clause may be regarded as being [a restriction] by object, where it prohibits such a food retailer, during the term of the agreement and in the year immediately thereafter, from pursuing activities [comprising the supply] of electricity, either by itself or through a company in whose capital a majority interest is held by [a parent company which is] the subject of proceedings in the territory covered by the agreement?
(9)
Can the concept of ‘potential competitor’ for the purposes of Article 101(1) TFEU, Article 1(1)(c) of [Regulation No 330/2010] be interpreted as meaning that it includes an undertaking, bound by a non-competition clause, which is present on a product market that is completely separate from that of the other party to the agreement, in the case where the documents in the case file of the dispute brought before the national court contain no specific indication (such as [plans], investments or other preparations) that, before and in the absence of that clause, the undertaking in question might enter the other party’s market in the short term, and it has not been shown that, before and in the absence of that clause, that undertaking was perceived by the other party to the agreement as a potential competitor on the market concerned?
(10)
May Article 101(1) TFEU be interpreted as meaning that the mere fact that an association agreement, concluded between an undertaking engaged in the [supply] of electricity and an undertaking engaged in the retail sale of food and non-food products for household consumption for the purposes of the cross-promotion of their respective activities (in which, inter alia, the first undertaking grants to its customers discounts on their electricity consumption which the second undertaking deducts from the price of the purchases made by such customers in its retail outlets), contains a clause whereby both parties undertake not to compete with each other or to conclude similar agreements with each other’s competitors, means that the [object] of that clause is to restrict competition within the meaning of Article 101(1) TFEU, even if:
–
the temporal scope of the clause in question (one-year [from signature] of the agreement plus one year) coincides with the period, laid down in the same agreement, during which the parties are not authorised to use business secrets or know-how acquired in the course of implementing their association in projects with third parties;
–
the geographical scope of the clause is confined to the geographical scope of the agreement;
–
the subjective scope of the clause is confined to the parties to the agreement, to undertakings in whose capital they hold a majority interest and to other undertakings in the same group which also own or operate retail sales outlets falling within the scope of that agreement;
–
the subjective scope of the clause excludes the vast majority of the [undertakings] belonging to the same economic group as the parties, which, in consequence, are not bound by the clause and may compete with the other party to the agreement during and after the term of that agreement;
–
the undertakings subject to the non-compete clause are present on completely separate product markets, and it has not been shown that, at the time when the agreement was concluded they had pursued any projects or plans, made any investments or taken any other steps with a view to entering the other party’s market?
(11)
Must the concept of ‘vertical agreement’ for the purposes of Article 101(1) TFEU, Article 1(1)(a) of [Regulation No 330/2010] be interpreted as meaning that it includes an agreement exhibiting the characteristics described in the foregoing questions, in which the parties are present on completely separate product markets and it has not been demonstrated that, prior to and in the absence of the agreement, they undertook any projects, investments or plans with a view to entering the other party’s product market, but in which each party, for the purposes of that agreement, makes its commercial networks, sales teams and know-how available to the other party in order to promote, [win] and grow the other party’s customer base and business?’
The Court’s jurisdiction and the admissibility of the questions referred for a preliminary ruling
39
As regards, first, the jurisdiction of the Court of Justice, it should be noted that the applicants in the main proceedings were censured under Portuguese law, namely on the basis of the NRJC, and not under a provision of EU law. The referring court nevertheless observes that the relevant national provisions reproduce, in essence, Article 101 TFEU and are interpreted in the same way as that provision of EU law, in the light of the case-law of the Court of Justice.
40
According to settled case-law, under the procedure laid down in Article 267 TFEU, the Court has no jurisdiction to interpret national law, that being exclusively for the national court (see, to that effect, judgments of 1 December 1965, Dekker, 33/65, EU:C:1965:118, p. 1116, and of 30 January 2020, Generics (UK) and Others, C‑307/18, EU:C:2020:52, paragraph 25).
41
The Court does, however, have jurisdiction to give a ruling on a request for a preliminary ruling concerning the provisions of EU law in situations where, although the facts in the main proceedings do not fall directly within the scope of that law, the provisions of that law have been made applicable under national law by means of a reference made in national law to their content (see, to that effect, judgments of 18 October 1990, Dzodzi, C‑297/88 and C‑197/89, EU:C:1990:360, paragraphs 41 and 42, and of 30 January 2020, Generics (UK) and Others, C‑307/18, EU:C:2020:52, paragraph 26).
42
Where, in regulating purely internal situations, domestic legislation adopts the same solutions as those adopted by EU law in order, for example, to avoid any distortion of competition, or to ensure that a single procedure is applied in comparable situations, it is clearly in the interest of the European Union that, in order to forestall future differences of interpretation, provisions or concepts taken from EU law should be interpreted uniformly, irrespective of the circumstances in which they are to be applied (see, to that effect, judgments of 18 October 1990, Dzodzi, C‑297/88 and C‑197/89, EU:C:1990:360, paragraph 37, and of 30 January 2020, Generics (UK) and Others, C‑307/18, EU:C:2020:52, paragraph 27).
43
In the present case, as is apparent from the information provided by the referring court, Article 9 of the NRJC repeats the substance of Article 101 TFEU and is applied by the competent national authorities and by the national courts in a manner consistent with that provision.
44
The Court therefore has jurisdiction to answer the questions referred for a preliminary ruling.
45
As regards, second, the admissibility of the questions referred for a preliminary ruling, it must be borne in mind that a reference for a preliminary ruling, which is an instrument of cooperation between the Court of Justice and the national courts, is based on a dialogue between those two courts. It is for a national court to assess whether an interpretation of EU law is necessary to enable it to resolve the dispute before it, having regard to the procedural mechanism laid down in Article 267 TFEU, and it is also for that court to decide the manner in which those questions are to be worded. Although that court is at liberty to request the parties to the dispute before it to suggest wording suitable for the questions to be referred, it is for it alone, however, ultimately to decide both their form and content (see, to that effect, judgment of 29 June 2011, Super Bock Bebidas, C‑211/22, EU:C:2023:529, paragraph 21).
46
Questions on the interpretation of EU law referred by a national court in the factual and legislative context which that court is responsible for defining and the accuracy of which is not a matter for this Court to determine, enjoy a presumption of relevance. The Court may refuse to rule on a question referred by a national court only where it is quite obvious that the interpretation of EU law that is sought bears no relation to the actual facts of the main action or its purpose, where the problem is hypothetical, or where the Court does not have before it the factual or legal material necessary to give a useful answer to the questions submitted to it (judgment of 29 June 2023, Super Bock Bebidas, C‑211/22, EU:C:2023:529, paragraph 22 and the case-law cited).
47
In that latter regard, it must be recalled that, according to settled case-law, which is now reflected in Article 94(a) and (b) of the Rules of Procedure of the Court of Justice, the need to provide an interpretation of EU law which will be of use to the national court makes it necessary for the national court to define the factual and legal context of the questions it is asking or, at the very least, to explain the factual hypotheses on which those questions are based. Those requirements are of particular importance in the area of competition, where the factual and legal situations are often complex (judgment of 29 June 2023, Super Bock Bebidas, C‑211/22, EU:C:2023:529, paragraph 23 and the case-law cited).
48
In addition, it is essential, as stated in Article 94(c) of the Rules of Procedure, that the request for a preliminary ruling itself contain a statement of the reasons which prompted the referring court or tribunal to enquire about the interpretation or validity of certain provisions of EU law, and the connection between those provisions and the national legislation applicable to the main proceedings.
49
In the present case, in the spirit of cooperation inherent in the dialogue between the two courts and in order to enable the Court to deliver a decision which is as helpful as possible, it would have been desirable for the referring court to have set out more succinctly and clearly its own understanding of the dispute before it and the questions of law giving rise to its request for a preliminary ruling, rather than reproducing, in an excessively long form, numerous extracts from the file which had been submitted to it.
50
Similarly, as the Commission and the Portuguese Government, in essence point out, although the referring court has set out the reasons which led it to make a reference for a preliminary ruling to the Court, it would have been in the interests of effective cooperation for it also to reformulate the questions suggested to it by the parties to the main proceedings, in order to avoid unnecessary overlaps between those questions and to clarify the legal and factual assumptions on which those questions are based.
51
In addition, it should be noted that the order for reference distinguishes, within the relevant facts, between those considered to have been established and those which are not. The second question is based on factual assumptions which are stated not to have been established in so far as it takes as a premiss that there is no potential competition, even though one of the main questions of law justifying the reference for a preliminary ruling concerns that concept.
52
Similarly, the ninth question assumes that there is no evidence that the undertaking present on the market for the supply of electricity regarded its co-contractor, a retailer of food products, as a potential competitor. That assumption is not, however, within the established facts as set out by the referring court. On the contrary, it is apparent from the request for a preliminary ruling that the Tribunal da Concorrência, Regulação e Supervisão (Competition, Regulation and Supervision Court) took into account, in order to rule at first instance, the fact that each of the applicants in the main proceedings regarded the other as a potential competitor.
53
Lastly, the factual situation in the tenth question that the scope of the non-compete clause coincides with the period during which the parties to the association agreement at issue in the main proceedings were not permitted to use trade secrets or know-how acquired during the implementation of that association is not within the established facts but is, on the contrary, unproven.
54
In the light of the foregoing, the second question must be held to be inadmissible. As regards the ninth and tenth questions, they must be regarded as inadmissible in so far as they are based on the situations referred to in the preceding paragraphs.
Consideration of the questions referred
55
As a preliminary point, it should be observed that the questions referred overlap in part in so far as they concern the interpretation of a limited number of concepts of EU law, although the facts vary.
56
In that regard, according to the settled case-law of the Court, in the procedure laid down in Article 267 TFEU, which provides for cooperation between national courts and the Court of Justice, it is for the latter to provide the national court with an answer which will be of use to it and enable it to decide the case before it. With that in mind, the Court may have to reformulate the questions referred to it. In that regard, it is for the Court to extract from all the information provided by the national court, in particular from the grounds of the decision referring the questions, the points of EU law which require interpretation, having regard to the subject matter of the dispute (see, to that effect, judgments of 29 November 1978, Redmond, 83/78, EU:C:1978:214, paragraph 26, and of 20 April 2023, Blue Air Aviation, C‑775/21 and C‑826/21, EU:C:2023:307, paragraph 58).
57
In the present case, as the Advocate General suggests in points 33 and 34 of his Opinion, it is necessary to reformulate the questions referred by grouping them together where they relate to a common issue on which the referring court seeks clarification.
58
In that regard, the third to seventh and ninth questions concern the relevant criteria for determining whether two undertakings active on separate product markets are potential competitors. The eleventh question concerns the concepts of an ‘agency agreement’ and a ‘vertical agreement’. The tenth question concerns the conditions under which a restriction of competition may be regarded as being ancillary to an agreement the objective of which is not anticompetitive; and the first and eighth questions can also be dealt with together because they concern the distinction between the concepts of ‘restriction of competition by object’ and ‘restriction of competition by effect’.
The third to seventh and ninth questions, concerning the concept of ‘potential competition’
59
By its third to seventh and ninth questions, the referring court asks, in essence, whether and under what conditions Article 101(1) TFEU must be interpreted as meaning that an undertaking managing a network of consumer product retailers may be regarded as being, on the electricity market, a potential competitor of an electricity supplier with which it has concluded an association agreement containing a non-compete clause, even though that undertaking is not active on that product market.
60
In accordance with settled case-law, in order to assess whether an undertaking that is not present in a market is a potential competitor of one or more other undertakings that are already present in that market, it must be determined whether there are real and concrete possibilities of the former joining that market and competing with one or more of the latter (judgment of 30 January 2020, Generics (UK) and Others, C 307/18, EU:C:2020:52, paragraph 36 and the case-law cited).
61
Accordingly, when the agreement at issue has the effect of temporarily keeping an undertaking outside a market, it must be determined whether there would have existed, in the absence of that agreement, real concrete possibilities for that undertaking to enter that market and compete with the undertakings established in that market (judgment of 30 January 2020, Generics (UK) and Others, C‑307/18, EU:C:2020:52, paragraph 37).
62
Such a criterion means that there can be no finding of a potential competitive relationship resulting as an inference merely from the purely hypothetical possibility of such entry or even from the mere wish or desire of the undertaking which is not active on the market concerned. Conversely, there is no requirement that it must be demonstrated with certainty that that undertaking will in fact enter that market and, a fortiori, that it will be capable, thereafter, of retaining its place there (judgment of 30 January 2020, Generics (UK) and Others, C‑307/18, EU:C:2020:52, paragraph 38).
63
Accordingly, a demonstration of potential competition must be substantiated by body of consistent facts taking into account the structure of the market and the economic and legal context within which it operates, which results in it being established that, absent the agreement, the undertaking concerned would have had real and concrete possibilities of entering the market concerned (see, to that effect, judgment of 30 January 2020, Generics (UK) and Others, C‑307/18, EU:C:2020:52, paragraph 39).
64
In the judgment of 30 January 2020, Generics (UK) and Others (C‑307/18, EU:C:2020:52, paragraph 58), the Court thus took account of the specific features of the market for medicines and of the economic and legal context specific to that market in order to hold, in essence, that a manufacturer of generic medicines must be regarded as a potential competitor of a manufacturer of originator medicines, who is the holder of pharmaceutical patents for the medicine concerned, where it has in fact a firm intention and an inherent ability to enter the market concerned.
65
As noted in point 55 of the Advocate General’s Opinion, and contrary to the submissions of the applicants in the main proceedings, the interpretation of the concept of ‘potential competition’ provided by the Court in the judgment mentioned in the preceding paragraph cannot be regarded as being of general application. Such a standard of proof required to demonstrate that the undertaking concerned would have had, absent the agreement, real and concrete possibilities of entering the market concerned is based on an analysis specific to the markets for medicines at issue in the case which gave rise to that judgment.
66
In the present case, it is apparent from the order for reference that the association agreement at issue in the main proceedings coincided with a crucial phase in the process of liberalising the market for the supply of electricity, with regulated tariffs for normal low-voltage coming to an end at the end of 2012. At that time, it was no longer necessary to obtain authorisation to pursue activity on that market. The EDP Group sought to win a large number of customers on the liberalised national market, taking advantage of a period when that market had not yet seen the peak in transition of low-voltage customers. It is therefore apparent from such a description that, subject to verifications which are solely within the jurisdiction of the referring court, the specific economic and legal context of that market cannot be compared to the market for medicines, which is highly regulated and has barriers to entry such as patents protecting those medicines.
67
In that context, the referring court asks the Court, in essence, about the relevance of a number of items of evidence which could be taken into account in order to demonstrate that there is potential competition. In particular, it asks the Court whether account must be taken of the intention or perception of the parties to that association agreement regarding the activities of the entities of the group, of which the undertaking not present on the market concerned forms part, or even the activities of that undertaking on that market and on the upstream or related markets prior to signature of the agreement at issue in the main proceedings and the preparatory steps taken by that undertaking to enter that market.
68
While it is for the referring court to assess the relevance, in the present case, of the information available to it, the Court may nevertheless provide it with some useful guidance in that regard.
69
As regards, in the first place, the relevance of subjective evidence, the Court has already held, in accordance with what was recalled in paragraph 63 of the present judgment, that a demonstration of potential competition must be substantiated by a body of consistent facts taking into account the structure of the market and the economic and legal context within which it operates. Therefore, evidence of a subjective nature, such as the mere wish or desire of the undertaking which is not present on the market concerned to enter that market or even its perception of the undertaking which is already active on that market, cannot constitute independent, decisive or indispensable evidence demonstrating potential competition.
70
That said, as the Advocate General observed, in essence, in point 66 of his Opinion, there is nothing to prevent such a subjective element from being taken into account in order to support consistent objective evidence and thereby to strengthen the demonstration that there are real and concrete possibilities of entering the market concerned.
71
As regards, more particularly, the perception which the undertaking already present on the market has of the undertaking with which it has concluded an agreement providing for that undertaking to be kept out of that market, it must be observed, as the Advocate General did in point 73 of his Opinion, that the conclusion of such an agreement is a strong indication that there is potential competition. If the parties to a non-compete agreement did not perceive themselves as potential competitors, they would, in principle, have no reason to conclude such an agreement. An indication of that type may therefore usefully substantiate objective evidence seeking to demonstrate the real and concrete possibilities for the undertaking which is not present on the market to enter it.
72
As regards, in the second place, the activities of the entities of the group of which that undertaking forms part and the activities of that undertaking on the relevant market and on the upstream and related markets prior to signature of the agreement in question, it must be held that such factors may also be taken into account for the purposes of identifying potential competition. It is true that the existence of real and concrete possibilities of entering the market concerned must be assessed at the date when the agreement in question was concluded, such that, logically, indications relating to circumstances subsequent to the conclusion of that agreement are excluded. However, the same does not apply to earlier economic activities on the relevant market or on the upstream or related markets (i) of entities within the group of the undertaking which is not present on that market or (ii) of that undertaking on those markets. Such activities may, inter alia, prove to be relevant for determining possible barriers to entry or the structure of the market, or even constitute evidence of a potential viable economic strategy for entry to the market concerned.
73
In the present case, the referring court states that Sodesa, which is jointly controlled by the Sonae Group and Endesa, the incumbent player in Spain on the electricity production and supply market, was active in Portugal on the market for the supply of electricity from 2002 to 2008. Similarly, the Sonae Group, through one of its entities, acquired an undertaking which owned and operated an electricity cogeneration plant. In addition, at the time of the association agreement at issue in the main proceedings, Modelo Continente produced electricity by means of mini-generation and micro-generation installations located on the roofs of its premises and it resold that electricity to the supplier of last-resort. Finally, as regards related markets, the referring court also refers to the fact that Modelo Continente had concluded with a supplier of liquid fuels a cross-discounts contract, similar to the association agreement at issue in the main proceedings.
74
In that regard, as the Advocate General observed in point 78 of his Opinion, it must be held that, irrespective of whether the Sonae Group could be regarded as being one and the same undertaking for the purposes of competition law, the economic activities of the various entities of the group on the market concerned prior to the signature of the association agreement at issue in the main proceedings may be taken into account since they constitute relevant factual elements for the purpose of establishing whether there is potential competition. In addition to the possible creation or transfer of know-how which is useful for entering the market concerned, such evidence may in particular be relevant in assessing whether the undertaking concerned was likely to have a viable economic strategy for entering that market. That could be the case, in particular, if that undertaking had already demonstrated it was able to use its strong presence on a given geographical market to become active in new business sectors by means of associations with undertakings which are already active on the product markets concerned. Similarly, the activities of the undertaking in question on markets related to the market concerned are capable of being taken into account if they support a demonstration that that undertaking has real and concrete possibilities of entering that market.
75
As regards, in the third place, the relevance of the preparatory steps taken by the undertaking concerned with a view to entering the market concerned, those steps cannot constitute, as the Advocate General observed in point 69 of his Opinion, an autonomous requirement for the purpose of demonstrating whether potential competition exists. Such steps are relevant only in so far as they may be appropriate for demonstrating that the undertaking concerned had real and concrete possibilities of entering the market concerned. It cannot therefore be held that it must necessarily be established that the undertaking concerned took preparatory steps in order to be regarded as a potential competitor on the market concerned.
76
In any event, whether such steps are important for the purposes of entering the market concerned depends, inter alia, on the structure of that market and the economic and legal context within which it operates. Accordingly, the Court has held, in essence, that such steps may prove to be significant where, as was the case for the medicines market, there are numerous barriers to entry to that market (see, to that effect, judgment of 30 January 2020, Generics (UK) and Others, C‑307/18, EU:C:2020:52, paragraph 43).
77
In the light of all the foregoing reasons, the answer to the third to seventh and ninth questions is that Article 101(1) TFEU must be interpreted as meaning that an undertaking managing a network of consumer product retailers must be regarded as being, on the electricity market, a potential competitor of an electricity supplier with which it has concluded an association agreement containing a non-compete clause, even though that undertaking is not active on that market at the time when that agreement is concluded, in so far as it is demonstrated, on the basis of a body of consistent facts taking into account the structure of the market and the economic and legal context within which it operates, that there are real and concrete possibilities for that undertaking to enter that market and compete with that supplier.
The eleventh question, concerning the distinction between vertical and horizontal agreements
78
By its eleventh question, the referring court asks, in essence, whether Article 101(3) TFEU, read in conjunction with Article 1(1)(a) of Regulation No 330/2010, must be interpreted as meaning that a commercial association agreement concluded between two undertakings active on different product markets which are not upstream or downstream of each other, falls within the category of a ‘vertical agreement’ and an ‘agency agreement’ where that agreement consists in promoting the development of sales of the products of those two undertakings through a promotion and cross-discount mechanism where each of those undertakings bears a part of the costs relating to the implementation of that association.
79
As a preliminary point, first, it should be observed, as did the Advocate General in point 98 of his Opinion, that it will be for the referring court to assess the anti-competitive nature of the non-compete clause, irrespective of the nature of the association agreement at issue in the main proceedings, in particular in the light of whether the non-compete clause is ancillary to that agreement. That question must therefore only be answered where that clause is ancillary.
80
Second, Article 101(3) TFEU provides for an exemption from the application of Article 101(1) TFEU for agreements which confer sufficient benefits to outweigh the anticompetitive effects. For the purposes of applying Article 101(3) TFEU, Regulation No 330/2010 lays down, for certain categories of agreements, the conditions under which the exemption provided for by that provision may be implemented. It will therefore be for the referring court to ascertain not only whether the association agreement at issue in the main proceedings falls within one of the categories of agreements thereby identified, but also, depending on the circumstances, whether all the conditions laid down in that regulation are actually satisfied in order for the association agreement at issue in the main proceedings to benefit from the exception laid down in that provision.
81
That having been said, it should be observed that Article 1(1)(a) of Regulation No 330/2010 defines a ‘vertical agreement’ as an agreement or concerted practice entered into between two or more undertakings each of which operates, for the purposes of the agreement or the concerted practice, at a different level of the production or distribution chain, and relating to the conditions under which the parties may purchase, sell or resell certain goods or services.
82
The Guidelines on Vertical Restraints mentions agency agreements among the vertical agreements which do not generally fall within the scope of Article 101(1) TFEU and define them as contracts under which an agent has the power to negotiate and/or conclude contracts on behalf of another person, the principal, for, inter alia, the sale of goods or services supplied by that principal. Paragraph 13 of those guidelines states that the determining factor in defining an agency agreement for the application of Article 101(1) is the financial or commercial risk borne by the agent in relation to the activities for which it has been appointed as an agent by the principal. In other words, for the purposes of applying that provision, an agreement will be regarded as an agency contract if the agent does not bear any risk, or bears only a negligible part of the risk for contracts which he negotiates or which he concludes on behalf of the principal.
83
In the present case, the applicants in the main proceedings maintain that the association agreement at issue in the main proceedings must be regarded as being two cross-agency contracts, with each of the contracting parties being responsible for promoting sales by the other contracting party. However, it is apparent from the order for reference that the costs of implementing the ‘EDP Continente Scheme’ were borne equally by the parties to that association agreement.
84
In that regard, it follows from paragraphs 81 and 82 of the present judgment that an agreement which shares between the contracting parties the risks associated with the transactions covered by it cannot be characterised as an agency agreement. Similarly, where the contracting parties do not operate, for the purposes of the agreement or concerted practice in question, within the same production or distribution chain, such a characterisation is not possible.
85
It is, however, for the referring court alone to undertake the characterisation of the association agreement at issue in the main proceedings in the light of all the foregoing clarifications.
86
In the light of the foregoing, the answer to the eleventh question is that Article 101(3) TFEU, read in conjunction with Article 1(1)(a) of Regulation No 330/2010, must be interpreted as meaning that a commercial association agreement concluded between two undertakings active on different product markets which are not upstream or downstream of each other, does not fall within the category of a ‘vertical agreement’ and an ‘agency agreement’ where that agreement consists of promoting the development of sales of the products of those two undertakings through a promotion and cross-discount mechanism where each of those undertakings bears a part of the costs relating to the implementation of that association.
The tenth question, concerning the concept of ‘ancillary restriction’
87
By its tenth question, the referring court asks, in essence, whether Article 101(1) TFEU must be interpreted as meaning that a non-compete clause contained in a commercial association agreement concluded between two undertakings active on different product markets and intended to promote the development of sales of the products of those two undertakings by means of a promotion and cross-discount mechanism may be regarded as a restriction ancillary to that association agreement.
88
In accordance with settled case-law, if a given operation or activity is not covered by the prohibition rule laid down in Article 101(1) TFEU owing to its neutrality or positive effect in terms of competition, a restriction of the commercial autonomy of one or more of the participants in that operation or activity is not covered by that prohibition rule either if that restriction is objectively necessary to the implementation of that operation or that activity and proportionate to the objectives of one or the other (see, to that effect, judgments of 11 September 2014, MasterCard and Others v Commission, C‑382/12 P, EU:C:2014:2201, paragraph 89, and of 23 January 2018, F. Hoffmann-La Roche and Others, C‑179/16, EU:C:2018:25, paragraph 69).
89
Accordingly, where it is not possible to dissociate such a restriction from the main operation or activity without jeopardising the existence and aims of that operation or activity, it is necessary to examine the compatibility of that restriction with Article 101 TFEU in conjunction with the compatibility of the main operation or activity to which it is ancillary, even though, taken in isolation, such a restriction may appear on the face of it to be covered by the prohibition rule in Article 101(1) TFEU (see, to that effect, judgments of 11 September 2014, MasterCard and Others v Commission, C‑382/12 P, EU:C:2014:2201, paragraph 90, and of 23 January 2018, F. Hoffmann-La Roche and Others, C‑179/16, EU:C:2018:25, paragraph 70).
90
Where it is a matter of determining whether an anticompetitive restriction can escape the prohibition laid down in Article 101(1) TFEU because it is ancillary to a main operation which is not anticompetitive in nature, it is necessary to inquire whether that operation would be impossible to carry out in the absence of the restriction in question. The fact that that operation is simply more difficult to implement or even less profitable without the restriction concerned cannot be deemed to give that restriction the ‘objective necessity’ required in order for it to be classified as ancillary. Such an interpretation would effectively extend that concept to restrictions which are not strictly indispensable to the implementation of the main operation. Such an outcome would undermine the effectiveness of the prohibition laid down in Article 101(1) TFEU. (see, to that effect, judgments of 11 September 2014, MasterCard and Others v Commission, C‑382/12 P, EU:C:2014:2201, paragraph 91, and of 23 January 2018, F. Hoffmann-La Roche and Others, C‑179/16, EU:C:2018:25, paragraph 71).
91
In the present case, it is apparent from the order for reference that each of the contracting parties to the association agreement at issue in the main proceedings undertook, under the non-compete clause in that agreement, for a period of two years, that is to say, one year more than the duration of that association agreement, not to engage, directly or indirectly, in any activity on the market on which the other contracting party operated. As regards, more specifically, the market for the supply of electricity, that non-compete clause was not limited solely to the supply of low-voltage electricity as was the association agreement, but also covered the supply of medium- and high-voltage electricity to industrial customers. That clause also prohibited Modelo Continente negotiating or establishing with another electricity supplier an agreement which has the object or effect of granting discounts or other monetary benefits relating to the supply of electricity.
92
The applicants in the main proceedings submit that the non-compete clause in the association agreement at issue in the main proceedings was intended simply to prevent the parties to that agreement from using commercially sensitive information exchanged for the purposes of implementing the ‘EDP Continente Scheme’ for their own benefit, and that that information related, inter alia, to the electricity consumption patterns of customers who had joined the ‘EDP Continente Scheme’. In their view, the confidentiality clause and the clause protecting intellectual property were not sufficient to protect the investments made and know-how shared. The non-compete clause at issue in the main proceedings therefore enabled that risk to be covered.
93
In that regard, it will be for the referring court to assess whether that non-compete clause was objectively necessary for the implementation of the association agreement at issue in the main proceedings and whether it was proportionate to the objectives pursued by that agreement. In order to do so, it will be necessary, in particular, to ascertain whether there was any solution less restrictive of competition, which the parties to that agreement could have used at the time that agreement was concluded in order to achieve those objectives. To that end, the referring court may, inter alia, take into account the scope of the non-compete clause in order to ascertain whether it corresponds to the purpose and the geographical and duration aspects of the scope of the association agreement at issue in the main proceedings.
94
It follows from the foregoing that the answer to the tenth question is that Article 101(1) TFEU must be interpreted as meaning that a non-compete clause contained in a commercial association agreement concluded between two undertakings active on different product markets and intended to promote the development of sales of the products of those two undertakings by means of a promotion and cross-discount mechanism cannot be regarded as a restriction ancillary to that association agreement unless the restriction to which that clause gives rise is objectively necessary for the implementation of that association agreement and proportionate to its objectives.
The first and eighth questions, concerning the distinction between a ‘restriction of competition by object’ and a ‘restriction of competition by effect’
95
By its first and eighth questions, the referring court asks, in essence, whether Article 101(1) TFEU must be interpreted as meaning that a non-compete clause consisting, in particular, in the context of a commercial association agreement, in prohibiting one of the parties to that agreement from entering the national market for the supply of electricity on which the other party to that agreement is a major player, at the time of the final stages of the liberalisation of that market, constitutes an agreement which has as its object the prevention, restriction or distortion of competition, even if consumers derive certain benefits from that agreement and that non-compete clause is limited in time.
96
Under Article 101(1) TFEU, all agreements between undertakings, decisions by associations of undertakings and concerted practices which may affect trade between Member States and which have as their object or effect the prevention, restriction or distortion of competition within the internal market are prohibited as incompatible with the internal market.
97
To be caught by the prohibition laid down by that provision, an agreement must have ‘as its object or effect’ the prevention, restriction or distortion of competition within the internal market. According to established case-law of the Court since the judgment of 30 June 1966, LTM (56/65, EU:C:1966:38), the alternative nature of that requirement, indicated by the conjunction ‘or’, leads, first of all, to the need to consider the precise object of the agreement (see, to that effect, judgments of 26 November 2015, Maxima Latvija, C‑345/14, EU:C:2015:784, paragraph 16 and the case-law cited, and of 18 November 2021, Visma Enterprise, C‑306/20, EU:C:2021:935, paragraphs 54 and 55 and the case-law cited). Thus, where the anticompetitive object of an agreement is established, it is not necessary to examine its effects on competition (judgment of 29 June 2023, Super Bock Bebidas, C‑211/22, EU:C:2023:529, paragraph 31 and the case-law cited).
98
Furthermore, the concept of ‘restriction of competition by object’ must be interpreted restrictively. Accordingly, that concept applies only to certain types of coordination between undertakings which reveal a sufficient degree of harm to competition for it to be found that there is no need to examine their effects (see, to that effect, judgment of 29 June 2023_Super Bock Bebidas, C‑211/22, EU:C:2023:529, paragraph 32 and the case-law cited).
99
Certain collusive practices between undertakings reveal, in themselves and having regard to the content of their provisions, their objectives, and the economic and legal context of which they form part, a sufficient degree of harm to competition for the view to be taken that it is not necessary to assess their effects, since some forms of coordination between undertakings can be regarded, by their very nature, as being harmful to the proper functioning of normal competition (see, to that effect, judgment of 30 January 2020, Generics (UK) and Others, C‑307/18, EU:C:2020:52, paragraph 67 and the case-law cited).
100
Those collusive practices, which are capable of falling within the category of restrictions by object, include market-sharing agreements. Such agreements constitute particularly serious breaches of the competition rules (see, to that effect, judgments of 5 December 2013, Solvay Solexis v Commission, C‑449/11 P, EU:C:2013:802, paragraph 82, and of 4 September 2014, YKK and Others v Commission, C‑408/12 P, EU:C:2014:2153, paragraph 26), since they have, in themselves, an object restrictive of competition and fall within a category of agreements expressly prohibited by Article 101(1) TFEU, and such an object cannot be justified by an analysis of the economic context of the anticompetitive conduct concerned (see, to that effect, judgment of 20 January 2016, Toshiba Corporation v Commission (C‑373/14 P, EU:C:2016:26, paragraph 28 and the case-law cited).
101
The same is true of market-exclusion agreements, which have as their object the elimination of potential competition and the prevention of competition by keeping a potential competitor outside the market concerned.
102
In such a situation, the analysis of the economic and legal context of which the agreement forms part may be limited to what is strictly necessary in order to establish the existence of a restriction of competition by object (see, to that effect, judgment of 20 January 2016, Toshiba Corporation v Commission (C‑373/14 P, EU:C:2016:26, paragraph 29). In that regard, the anticompetitive object of an agreement of that nature may thus be borne out by the fact that it occurs in the particular context of market liberalisation, which is similar to the dismantling of significant barriers to entry.
103
In that regard, the Court held that, where the parties to an agreement rely on its procompetitive effects, those effects must, as elements of the context of that agreement, be duly taken into account for the purpose of its characterisation as a ‘restriction by object’, in so far as they are capable of calling into question the overall assessment of whether the concerted practice concerned revealed a sufficient degree of harm to competition and, consequently, of whether it should be characterised as a ‘restriction by object’ (judgment of 12 January 2023, HSBC Holdings and Others v Commission, C‑883/19 P, EU:C:2023:11, paragraph 139).
104
However, the mere fact that there are procompetitive effects is not sufficient to rule out such a classification. It is only if those effects are demonstrated, relevant, specifically related to the agreement concerned, sufficiently significant and that they justify a reasonable doubt as to whether that agreement caused a sufficient degree of harm to competition that characterisation as a restriction by object must be ruled out (see, to that effect, judgment of 30 January 2020, Generics (UK) and Others, C‑307/18, EU:C:2020:52, paragraphs 103 and 105 to 107).
105
In the present case, it is for the referring court to take account of the fact, which it noted in the order for reference, that the application of the non-compete clause at issue in the main proceedings coincided with the particular context of the final phase of liberalisation of the market for the supply of electricity in Portugal. Similarly, it is for the referring court to ascertain, if the non-compete clause was not ancillary to the association agreement at issue in the main proceedings, whether the procompetitive effects relied on by the applicants in the main proceedings were in fact specific to that clause and not simply connected with that agreement.
106
In the light of all the foregoing reasons, the answer to the first and eighth questions is that Article 101(1) TFEU must be interpreted as meaning that a non-compete clause consisting, in particular, in the context of a commercial association agreement, in prohibiting one of the parties to that agreement from entering the national market for the supply of electricity on which the other party to that agreement is a major player, at the time of the final stages of the liberalisation of that market, constitutes an agreement which has as its object the prevention, restriction or distortion of competition, even if consumers derive certain benefits from that agreement and that non-compete clause is limited in time, in so far as it is apparent from an analysis of the content of that clause and its economic and legal context that that clause displays a sufficient degree of harm to competition for the view to be taken that it is not necessary to assess its effects.
Costs
107
Since these proceedings are, for the parties to the main proceedings, a step in the action pending before the national court, the decision on costs is a matter for that court. Costs incurred in submitting observations to the Court, other than the costs of those parties, are not recoverable.
On those grounds, the Court (Third Chamber) hereby rules:
(1)
Article 101(1) TFEU
must be interpreted as meaning that an undertaking managing a network of consumer product retailers must be regarded as being, on the electricity market, a potential competitor of an electricity supplier with which it has concluded an association agreement containing a non-compete clause, even though that undertaking is not active on that product market at the time when that agreement is concluded, in so far as it is demonstrated, on the basis of a body of consistent facts taking into account the structure of the market and the economic and legal context within which it operates, that there are real and concrete possibilities for that undertaking to enter that market and compete with that supplier.
(2)
Article 101(3) TFEU, read in conjunction with Article 1(1)(a) of Commission Regulation (EU) No 330/2010 of 20 April 2010 on the application of Article 101(3) of the Treaty on the Functioning of the European Union to categories of vertical agreements and concerted practices,
must be interpreted as meaning that a commercial association agreement concluded between two undertakings active on different product markets which are not upstream or downstream of each other, does not fall within the category of a ‘vertical agreement’ and an ‘agency agreement’ where that agreement consists of promoting the development of sales of the products of those two undertakings through a promotion and cross-discount mechanism, where each of those undertakings bears a part of the costs relating to the implementation of that association.
(3)
Article 101(1) TFEU
must be interpreted as meaning that a non-compete clause contained in a commercial association agreement concluded between two undertakings active on different product markets and intended to promote the development of sales of the products of those two undertakings by means of a promotion and cross-discount mechanism cannot be regarded as a restriction ancillary to that association agreement unless the restriction to which that clause gives rise is objectively necessary for the implementation of that association agreement and proportionate to its objectives.
(4)
Article 101(1) TFEU
must be interpreted as meaning that a non-compete clause consisting, in particular, in the context of a commercial association agreement, in prohibiting one of the parties to that agreement from entering the national market for the supply of electricity on which the other party to that agreement is a major player, at the time of the final stages of the liberalisation of that market, constitutes an agreement which has as its object the prevention, restriction or distortion of competition, even if consumers derive certain benefits from that agreement and that non-compete clause is limited in time, in so far as it is apparent from an analysis of the content of that clause and its economic and legal context that that clause displays a sufficient degree of harm to competition for the view to be taken that it is not necessary to assess its effects.
[Signatures]
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*1
)	Language of the case: Portuguese.