Commentary on Ruling Order No. 17108 of 2024: The Non-Competition Agreement and Illegal Agreements

The recent Order No. 17108 of June 20, 2024, issued by the Court of Cassation, offers an important reflection on the limits of non-competition contracts and the agreements prohibited by Article 2 of Law No. 287 of 1990. This ruling, which rejects the appeal filed by V. against D., highlights how anti-competitive agreements can influence the validity of contracts entered into in execution of such illegal agreements.

The Regulatory Context

The Italian regulatory framework regarding competition is primarily governed by Law No. 287 of 1990, which aims to ensure fair competition in the market. In particular, Article 2 prohibits agreements that may restrict competition. The central issue of this ruling focuses on the effect of such agreements on contracts entered into in their execution.

(NON-COMPETITION AGREEMENT) - IN GENERAL Prohibited agreements under art. 2 of Law No. 287 of 1990 - Contracts entered into in execution of the prohibited agreement - Authority responsible for market regulation - Assessment of the illegality of the agreement - Relevance for the nullity of the “downstream” contract - Condition - Case. In terms of assessing damages from anti-competitive conduct under art. 2 of Law No. 287 of 1990, compensation is due for all contracts that constitute application of illegal agreements, even if concluded before the assessment of their illegality by the independent authority responsible for regulating that market, provided that the agreement was made prior to the transaction reported as null. (In this case, the Supreme Court confirmed the ruling of the territorial court which excluded the nullity of the contract on the grounds that it had been concluded prior to the dissemination of the ABI model and the provision of the Supervisory Authority integrating an anti-competitive agreement).

Analysis of the Ruling

In the case examined, the Court confirmed the decision of the Court of Appeal of Rome, excluding the nullity of the contract entered into by V. against D. because the latter was concluded before the dissemination of an ABI model and the provision of the Supervisory Authority. This implies that the contract was not in violation of antitrust rules at the time of its conclusion, even if it later turned out to be part of an anti-competitive agreement.

In this context, it is essential to consider the following aspects:

  • The validity of contracts entered into before the assessment of illegality.
  • The temporal relevance of prohibited agreements concerning the “downstream” contracts.
  • The role of the Supervisory Authority in regulating anti-competitive practices.

Conclusions

Order No. 17108 of 2024 represents an important clarification in the field of competition law. It establishes that the validity of a non-competition contract cannot be automatically considered null if concluded before the assessment of an illegal agreement. This provides greater security to contracting parties, but also requires attention from lawyers in drafting and reviewing such agreements. The ruling, therefore, contributes to outlining a clearer legal framework and supporting competitiveness in the market, with the aim of ensuring fair and transparent business practices.

Bianucci Law Firm