For the application of Article 101(3) of the EC Treaty by means of a regulation, it is not necessary to define the vertical agreements which may fall within the scope of Article 101(1) of the Treaty. Several factors must be taken into account in the individual assessment of the agreements referred to in Article 101(1) TFEU, including the structure of the market on the supply and purchase side. 1. For the purpose of calculating the total annual turnover referred to in Article 2(2), the turnover of the party to the vertical agreement concerned in the preceding financial year and the turnover of undertakings related to all goods and services excluding taxes and other charges shall be added together. For that purpose, transactions between the party to the vertical agreement and its affiliated undertakings or between its affiliated undertakings shall not be taken into account. Whether a vertical agreement effectively restricts competition and whether, in this case, the benefits outweigh the anti-competitive effects often depends on the structure of the market. Market developments and, in particular, the growth of online sales and online platforms, which have changed the way companies provide and distribute goods and services, are of great importance for the assessment of eg. This shift to a digital economy has led to several problems with the operation of the VBER and has made it increasingly difficult for companies to evaluate their vertical agreements themselves with confidence. Margrethe Vestager, Vice-President in charge of competition policy, recognised that the rules need to be adapted so that they remain appropriate in a rapidly changing digital world5, which will certainly be a challenge for the EC in revising the rules. A vertical agreement is a term used in competition law to refer to agreements between companies at different levels of the supply chain. For example, a consumer electronics manufacturer could enter into a vertical agreement with a retailer under which the retailer would advertise its products against a price drop.
Franchising is a form of vertical agreement that falls within the scope of Article 101 under EU competition law.  3. The exemption provided for in paragraph 1 shall apply to vertical agreements which contain provisions relating to the transfer by the buyer of intellectual property rights or the use of intellectual property rights by the buyer, provided that such provisions do not constitute the main subject matter of such agreements and are directly related to the use, sale or resale of goods or services by the buyer or its customers. . . .