Does a Company’s Non-distribution of Products to Other Parties Constitute an Anti-competitive Agreement?

Based on Clause 9, Article 11 of the Competition Law 2018, regulations on anti-competitive agreements are stipulated as follows:

- Agreements to restrict the development of technical, technological, and investment capabilities.

- Agreements imposing or stipulating conditions for entering into contracts for the purchase, sale of goods, and provision of services to other enterprises or agreements forcing other enterprises to accept obligations not directly related to the subject of the contract.

- Agreements to avoid transactions with parties not participating in the agreement.

- Agreements to restrict the market for consuming products, sources of goods supply, and provision of services of parties not participating in the agreement.

Thus, the agreement in your specific case is considered an anti-competitive agreement. Because the two parties agreed to transact only within their respective operational areas, neither party is allowed to transact with external agents or establishments. This falls under the instance of an anti-competitive agreement to avoid transactions with parties not participating in the agreement as stated in Clause 9, Article 11 mentioned above.

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