New Distribution Rules in the EU as of mid-2023

From June 2023, businesses in Europe have to implement new rules intended to protect fair competition within the European Single Market – The Vertical Block Exemption Regulation (VBER).

These updated rules contain some critical changes for online sales:

They allow suppliers to sell their goods to retailers at different wholesale prices depending on the distribution channel (dual pricing).
Suppliers are now allowed to apply different (even stricter) criteria to online sales than those for sales by retailers in brick-and-mortar shops.
Suppliers can ban retailers from selling their products via online marketplaces, as long as other online sales channels remain available for the seller, e.g., their own webshop.

Our colleagues in Europe – the Ecommerce Europe – is worried that these changes will make online selling more complicated, increase the dependency of SMEs on brands and manufacturers, and can lead to discrimination by suppliers against online selling – hurting the growth potential and digitalisation of SMEs and also retail in general. Although these rules are unlikely to effect many African ecommerce businesses exporting to the EU, if you are concerned let me know ([email protected]) and we will raise your concerns with our European colleagues.

Agriculture, hunting, forestry and fishing:
- All agriculture, hunting, forestry, fishing and related services, including the
  export of agricultural products permitted

Electricity, gas and water supply:
- All electricity, gas and water supply

Manufacturing:
- Manufacture of retail products permitted to be sold under Level Four, and
  all input products, permitted scaling up to full employment, except where
  otherwise indicated;
- Manufacture of paper and paper products, excluding stationery,
  permitted scaling up to full employment;
- Manufacture of packaging, including glass, plastic bottles and containers,
  permitted scaling up to full employment;
- Petroleum smelters, refineries and furnaces, permitted scaling up to full
  employment;
- Manufacture of winter clothing, bedding and heaters (and all inputs
  required) permitted, commencing at 25% and scaling up to 50%
  employment;
- Automotive manufacturing, including components, scaling up in phases to
  50% employment;
- Stationery production, scaling up in phases to 50% employment;
- Cement, other construction material, and hardware, scaling up in phases
  to 50% employment;
- All other manufacturing, scaling up to 20% employment;

Construction and related services (inc. tradespeople):
- Civil engineering for public works projects (including water, energy,
  sanitation);
- Critical public works construction;
- Road and bridge projects;
- Other public works civil engineering projects; and
- Critical maintenance and repairs;

Wholesale and retail trade, covering stores, spaza shops, eCommerce and informal traders:
- Any food product, including non-alcoholic beverages and animal food;
- The sale of hot cooked food, only for home delivery;
- Toilet Paper, sanitary pads, sanitary tampons, condoms;
- Hand sanitiser, disinfectants, soap, alcohol for industrial use, household
  cleaning products, and personal protective equipment;
- Products for the care of babies and toddlers;
- Personal toiletries, including haircare, body and face care products, rollons,
  deodorants, dental care products;
- Medical and Hospital Supplies, medicine, equipment and personal
  protective equipment;
- Fuel and lighting, including coal, wood, paraffin and gas;
- Airtime and electricity
- Hardware, components and supplies required by any qualified
  tradespersons solely for the purpose of emergency repairs at residential
  homes;
- Hardware, components and supplies required by any entity engaged in
  the provision of essential services for any project related to the provision of
  water, electricity or other essential services;
- Components for vehicles undergoing emergency repairs where such
  vehicle is used by a person engaged in essential services work;
- Chemicals, packaging and ancillary products used in the production of
  any these products;
- Textiles required to produce face masks, and other personal protective
  equipment;
- Winter clothing, bedding and heaters;
- Children’s clothing;
- Stationery and educational books;
- Personal ICT equipment including computers, mobile telephones and other
  home office equipment;
- No sale of liquor permitted

Information and communication services:
- All telecommunication services and infrastructure;
- Information and Communication Technology services for all private and
  business customers;
- Postal services and courier services related to transport of medical
  products

Media and entertainment services:
- Online services;
- Productions for local broadcast; and live streaming in support of COVID-19
  subject to directions; and
- Newspapers and broadcasting;

Financial and business services:
- Employees should work from home where possible;
- Call centres, for local and all international markets, may operate subject to
  directions issues by the relevant cabinet members;
- Essential financial services may operate subject to directions issues by the
  relevant cabinet member;
- Private security services may operate;
- Implementation of payroll systems;
- Rental of motor vehicles, machinery and equipment, and of personal and
  household goods to support other Level Four services;
- Other professional services may operate only where work-from-home is not
  possible, and only to support other Level Four services;

Accommodation and food service activities:
- Accommodation not permitted, except for quarantine and essential
  services;
- Restaurants only for food delivery services (9am-8pm) and subject to
  curfew (no sit down or pick-up allowed);

Transport, storage and communication services:
- Ocean and air transport permitted only for the shipment of cargo;
- Public rail, minibus taxi and bus services will resume at levels and on terms
  as will be set out in Directions, based on the progressive increase in
  commuter numbers during the various phases;
- E-hailing services subject to restrictions on capacity and times, and for
  permitted activities only; and
- Transport and logistics in respect of specified cargo, and permitted retail
  goods to neighbouring countries, which shall include all goods imported
  via SA ports of entry, for re-export to neighbouring countries;
- Essential imported goods will be prioritised through ports of entry and for
  transport and handling to final users. Directions will be issued in respect of
  other goods

Mining and quarrying:
- Coal production for Eskom scaling up to full employment;
- Open-cast mining scaling up to full employment; and
- All other mining starting in batches scaling up towards 50% employment

Repair and related emergency services:
- Tow trucks and vehicle recovery services;
- Emergency repair work, including plumbers, electricians, locksmiths,
  glaziers, roof repair work;
- Emergency automobile repairs for all persons

Supply Chains:
- Production, manufacturing, supply, logistics, transport, delivery, critical
  maintenance and repair in relation to the rendering of permitted services
  including components and equipment;
- All workplaces or premises must have care and maintenance that is
  essential to the prevention of the destruction or significant impairment of
  working areas, plant, machinery or inventory, or to permit orderly wind
  down arrangements, on such conditions as may be issued by means of
  directions by the relevant cabinet members

Private households employment:
- Permitted to support all Level 4 personnel and live-in staff

Public administration, government services and other arms of the state:
- Only essential government and administration services may operate, including:
  - Disaster management services;
  - Licensing, permitting and deeds offices; birth and death certificates, replacement identification documents;
  - Any other service designated by the Executive Authority, HODs, Heads of Courts, and Heads of other Chapter 9 Institutions
  - Essential municipal services;
  - Services related to the essential functioning of courts;
  - Essential SARS services defined by the Commissioner of SARS;
  - Police, peace officers, traffic officers, military medical personnel and soldiers, correctional services officials and traffic management services;
  - Services rendered by the Executive, members of Parliament, Members of the Provincial Legislature, Members of Local Councils, the Judiciary, traditional leaders and National Office Bearers of Political Parties represented in Parliament;
  - Commissioners of the South African Human Rights Commission, Gender Commission, the Commission for the Promotion and Protection of the Rights of Cultural, Religious and Linguistic Communities, the Public Protector and Deputy Public Protector and the Independent Electoral Commission

Health, social and personal services:
- Medical and veterinary services permitted;
- Cleaning, sanitation, pest control, sewerage, waste and refuse removal services;
- Recycling of glass, paper & metal inc informal recyclers permitted at 50% capacity;
- All Social work, counselling, care and relief activities permitted
- Wildlife Management, Antipoaching, Animal Care and Veterinary services;
- Funeral and cremation services, including mortuaries services and the transportation of mortal remains;
- Trade union essential staff for workers covered by Level 4, subject to Directions

Education services:
- Permitted on dates and schedule set out separately

Personal Movement:
- Interprovincial travel is not permitted except to return to work with proof of employment, in exceptional circumstances such as funerals (with
  approval) or essential services.
- Stay at home, other than essential travel for work and to purchase essential goods.
- No recreational travel or to meet friends or family.
- People can exercise under strict public health conditions, subject to directions, which will exclude organised activities, recreational facilities,
  and gyms
- Mandatory use of cloth masks (including home-made ones to cover nose and mask) and ensure hand hygiene when in public and at workplace.
- Emergencies for medical reasons.
- Those who have an exemption to travel for funerals
- South Africans returning home and foreign nationals leaving South Africa
- Elderly and persons with co-morbidities are encouraged to self-isolate and only leave home for exceptional reasons.
- Social distancing (2m away from other persons) to be applied in public when, shopping, visiting health facilities (pharmacies, clinics etc),
- Social distancing when using public and private transport, as per transport guidelines
- All public gatherings are prohibited.
- Stores to ensure that there is temperature screening of patrons, hand sanitisers available and measures to facilitate social distancing. Where the
  number of customers cannot be accommodated at once then measures such a ticket system and defined limit of time in the store per customer
  should be implemented instead of the physical queuing of customers.
- Curfews will be implemented between 8pm and 5am

New Distribution Rules in the EU as of mid-2023

Alastair Tempest

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Level Four: Permitted Retail and Service Operations; and Personal Movement

25 April 2020

New Distribution Rules in the EU as of mid-2023

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Alastair Tempest

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Level Four: Permitted Retail and Service Operations; and Personal Movement

25 April 2020