Distribution Agreements and Competition Law
A distribution agreement between a manufacturer and a distributor is assessed in Georgia within the framework of the Law on Competition. In the law's terminology, an agreement between parties operating at different levels of the production or distribution chain, concerning the conditions of purchase or sale of goods or services, is a vertical agreement. This classification determines which requirements apply to your contract and how safe its individual clauses are.
The law distinguishes horizontal and vertical agreements: the former are concluded between economic agents operating at the same level of the production or distribution chain, the latter between agents at different levels. The definition of the relevant market is likewise broad — it may cover the whole territory of Georgia, a part of it, or the Georgian territory together with a part of another country — so defining the market correctly is the first step in assessing any agreement.