Article 7 Hardcore restrictions and effect of breach

(1)

The specialisation agreement must not directly or indirectly, in isolation or in combination with other factors under the control of any of the parties, have as its object—

(a)

the fixing of prices when selling any of the specialisation products to third parties, except for the fixing of prices charged to immediate customers in the context of joint distribution,

(b)

the limitation of output or sales, subject to the exceptions set out in paragraph (2), or

(c)

the allocation of markets or customers.

(2)

A specialisation agreement does not breach the condition in paragraph (1)(b) by—

(a)

in the case of a unilateral specialisation agreement or a reciprocal specialisation agreement, including provisions agreeing the amount of products that a party or parties—

(i)

are to cease or refrain from producing, or

(ii)

are to produce for the other party or parties to the specialisation agreement,

(b)

in the case of a joint production agreement, including provisions which relate to setting capacity and production volumes for any of the specialisation products, or

(c)

in the context of joint distribution, setting sales targets for any of the specialisation products.

(3)

Breach of the condition imposed by paragraph (1) has the effect of cancelling the block exemption in respect of the specialisation agreement concerned.