The Government of the Republic of Serbia has adopted the updated Vertical Block Exemption Regulation (“VBER”) together with three new regulations introducing separate block exemption regimes for motor vehicles and spare parts (“MVER”), technology transfer agreements (“TTBER”) and the rail and road transport (“RRBER”).
The new VBER marks Serbia’s first update to this regulation in fifteen years and is almost entirely aligned with the European Union’s vertical block exemption regulation (“EU VBER”). However, a key difference in the way vertical agreements are regulated remains. Namely, while the EU allows for a self-assessment regime for agreements that fall outside the EU VBER, Serbia continues to rely on a formal procedure for individual assessment. Any move to a fully self-assessment system would require amendments to the Competition Law.
Below we outline the key changes introduced by the new VBER.
- Increased Market Share Threshold
The most notable change is the increase of the market share threshold from 25% to 30%, bringing Serbia in line with the EU VBER.
Additionally, the VBER clarifies that if a market share initially does not exceed 30% but later rises above this level, the exemption will remain applicable for two consecutive calendar years following the year in which the 30% threshold was first exceeded provided that the increase above the threshold does not exceed 5%.
- Definition of Active and Passive Sales
The new VBER updates the concepts of active and passive sales, particularly in the context of online distribution.
Online sales are now treated with greater precision. The new VBER confirms that targeted online activities, such as search engine advertising or the use of country-specific domains or languages, constitute active sales.
At the same time, passive sales now expressly include sales resulting from participation in public procurement procedures or responding to calls for tenders.
- New Hardcore Restriction in relation to Online Sales
A new hardcore restriction has been introduced in relation to online sales. It is clarified that agreements that prevent the effective use of the internet as a sales channel will not benefit from the exemption.
This does not prevent: (i) other limitations on online sales or online advertising; and (ii) limitations that do not prevent the use of the entire channel for online advertising.
- Parity obligations
The new VBER also introduces specific rules on parity (most-favoured-nation) obligations in online sales.
Wide parity obligations (covering competing online platforms) are treated as excluded restrictions and therefore fall outside the scope of the VBER exemption. This means that, while the agreement may still benefit from the exemption, the parity clause itself will not be covered.
Other types of parity obligations (e.g. relating to direct sales channels) may still fall within the scope of the VBER.
- Non-Compete Clauses
Non-compete clauses may now benefit from the exemption even if they are tacitly renewable beyond five years, provided that the buyer has a real possibility to renegotiate or terminate the agreement.
- Exclusive Distribution
The new VBER introduces “joint exclusivity”, allowing a supplier to appoint up to three exclusive distributors per territory or customer group.
- Addressing Dual Distribution
The VBER introduces clearer rules on dual distribution, including conditions for information exchange and exclusion of hybrid online platforms.
- Concluding Remarks
Agreements previously benefiting from the old VBER will continue to be exempt for a transitional period of six months if they do not comply with the new rules. Market participants are therefore given six months to align their existing agreements with the new VBER.
Overall, the new VBER brings Serbia significantly closer to the EU framework, while also increasing legal certainty for businesses operating in the market.
The information in this document does not constitute legal advice on any particular matter and is provided for general informational purposes only.
