Supplier Terms and Pricing Issues Under Asian Legal Systems
Supplier terms and pricing issues under Asian legal systems Introduction What is the basic position under The majority of the legal systems in Asia that the active Asian systems have a competition law regime include regarding resale price provisions similar to Article 101 TFEU maintenance (RPM)? encompassing vertical restraints. Such Typically, under Asian systems, RPM occurs provisions are typically based on – or operate in where a manufacturer or supplier establishes a a manner similar to – the EU competition law fixed or minimum resale price which a system. However, there are some important distributor or retailer must observe when differences, most notably in Singapore, where reselling the contract goods or services. RPM absent dominance, vertical arrangements can be achieved directly or indirectly. RPM is benefit from a broadly worded exemption from typically viewed as a serious infringement of the prohibition on anti-competitive agreements. competition law in most Asian systems, leading to a restriction of competition in the At the time of publication, the following Asian downstream market. For example, China, jurisdictions are amongst those that have Hong Kong, Indonesia, Japan, Taiwan and provisions regarding vertical restraints that Korea all treat RPM practices as a serious operate in a similar manner to those in the EU: competition law infringement. China, Hong Kong, Indonesia, Taiwan, Thailand, Malaysia, Philippines, Myanmar and Vietnam. Japan and Korea also have provisions relating to vertical restraints. 02 HERBERT SMITH FREEHILLS As with the EU, in most of the active Asian systems, recommended retail prices (RRP) and maximum resale prices will generally be permitted provided they do not amount to a de facto minimum or fixed resale price (for example, through an upstream supplier threatening stock availability or offering incentives to a downstream distributor).
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