GlaxoSmithKline Services Unlimited v Commission

An agreement which aims to prevent or limit parallel trade has an anticompetitive object, even if it does not harm final consumers, because article 101 protects the structure of the market and competition as such.

Citation
Joined Cases C-501/06 P and others, [2009] ECR I-9291
Court
Court of Justice of the European Union
Year
2009
Subject
Competition Law
Topic
Restrictions by object and effect, and exemption

Facts

GlaxoSmithKline's Spanish subsidiary introduced a dual pricing system, under which wholesalers in Spain were charged higher prices for medicines which were exported to other member states than for medicines sold in Spain, where prices were regulated. The aim was to prevent parallel trade into countries with higher prices, such as the United Kingdom. The General Court held that the agreement did not have an anticompetitive object, because it was not shown that parallel trade benefited final consumers.

Legal principle

The Court of Justice held that the General Court had erred in law. The court said that there is nothing in article 101 to indicate that only those agreements which deprive consumers of certain advantages may have an anticompetitive object, and that article 101 aims to protect not only the interests of competitors or of consumers, but also the structure of the market and, in so doing, competition as such. An agreement aimed at limiting parallel trade must in principle be regarded as having as its object the prevention of competition. However, the court upheld the General Court's finding that the Commission had not properly examined GSK's request for exemption under article 101(3), on the ground that the dual pricing system promoted innovation.

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This summary is for study and revision and is not legal advice. Although our case summaries are checked for accuracy, we do not guarantee that they are free from errors or omissions. Always read the full judgment for the court's reasoning.

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