The Revised EU Competition Rules for Production and R&D Agreements Create a More Coherent Framework of Assessment and Provide Better Guidance to Companies

On December 14, 2010, the European Commission adopted revised EU competition rules for production agreements, research and development agreements, and other types of commercial cooperation agreements between competing undertakings. The revised block exemption regulations for research and development agreements (“R&D BER”) and specialization agreements (“Specialization BER”) and the revised Horizontal Guidelines entered into force on January 1, 2011. They replace the predecessor R&D BER, Specialization BER, and Horizontal Guidelines that were adopted in 2000.

While preserving the existing general approach for assessing such agreements under EU competition law, the revised texts significantly change the predecessor block exemption regulations and Horizontal Guidelines. The final revised texts also incorporate several improvements that stakeholders suggested in their comments on the drafts of the two block exemption regulations and the Horizontal Guidelines that the Commission published for public consultation in May 2010.

Even if not perfect on all accounts, the revised texts overall have to be welcomed as they provide a more coherent and clearer framework for the assessment of R&D and production agreements under EU competition law. They remedy many of the instances of legal uncertainty that arose under the predecessor rules and broaden the scope of the BERs, thus allowing companies more flexibility to structure their cooperation without running the risk of falling outside the safe harbor created by the BERs.