Exclusivity and Distribution Clauses in Spain After the Google Android Judgment

Exclusivity and distribution clause risk in Spain after the CJEU Google Android judgment

Why distribution clauses deserve another look

The Court of Justice of the European Union has made the Android fine final. In doing so, it has sharpened the way exclusivity, bundling, loyalty and placement clauses may be assessed where a company holds a dominant position.

Companies operating in Spain should not treat this as a Big Tech story only. Spanish competition law applies the same core logic to dominant companies in any sector: a business that controls a narrow but important market can create risk through ordinary-looking commercial clauses.

What did the Court of Justice decide in Case C-738/22 P?

On 2 July 2026, the Court of Justice dismissed the appeal brought by Google LLC and Alphabet Inc. against the 2022 judgment of the General Court. The fine of EUR 4.125 billion for abuse of a dominant position under Article 102 TFEU is now final.

The sanctioned conduct was contractual. It concerned the tying of Google Search and Chrome to the licence for the Play Store, anti-fragmentation obligations affecting alternative Android versions, and payments conditioned on exclusive pre-installation.

The European Commission adopted its decision in July 2018 in Case AT.40099. After years of litigation, the essential architecture of the restrictions remained condemned.

Why does a Big Tech judgment matter to a mid-sized company in Spain?

Dominance is not measured by company size alone. It is measured on a relevant product and geographic market. Those markets can be much narrower than management expects.

A company with moderate turnover can still hold a dominant position in a specialised component, licensed technology, port service, regional infrastructure, essential input, niche software category or highly local distribution channel.

In Spain, the prohibition appears in Article 2 of Ley 15/2007 de Defensa de la Competencia, which prohibits abusive exploitation of a dominant position in all or part of the national market. The CNMC may also apply Article 102 TFEU where trade between Member States may be affected.

A judgment about smartphones can therefore become highly relevant to a Spanish distribution, reseller, supply, licensing or framework agreement.

What changed in the legal test?

Three points matter for businesses drafting or defending distribution terms.

1. The as-efficient-competitor test is not always a required step

The Court accepted that, in ecosystem markets, exclusionary effects do not always need to be analysed through the lens of whether a hypothetical equally efficient competitor could have replicated the dominant company's conduct.

Where network effects, access to data, multi-sided structures and high entry barriers make the emergence of such a competitor unrealistic, that test may be of limited use. The defence that "any equally efficient rival could have matched our offer" is no longer enough by itself.

2. A counterfactual model is not always mandatory

The Court also declined to make a full "what would the market have looked like without the conduct" counterfactual an indispensable element of proof in every case. Authorities can establish capability to foreclose without first building that model in full.

3. A single and continuous infringement can survive the loss of one strand

The General Court had already annulled the finding concerning portfolio-based revenue share agreements and reduced the fine accordingly. The overall classification of a single and continuous infringement nevertheless survived.

The practical lesson is that if one part of a commercial strategy falls away, the authority's wider theory may still stand.

Read together with Unilever Italia

The judgment should be read alongside Unilever Italia, Case C-680/20. In that case, the Court confirmed that exclusivity clauses in distribution contracts must be capable of producing exclusionary effects and that an authority must engage with economic evidence submitted by the dominant company.

The combined message is practical: the authority may need less economic work to open a file, while the company needs better evidence, earlier, to close one.

Which clauses now carry the most risk?

None of the following clauses is unlawful in itself. Risk increases when the company using the clause is, or may be found to be, dominant on the relevant market.

  • Exclusive purchase and single-branding obligations. Commitments that a distributor, installer or reseller will source only from one supplier or will not carry competing lines.
  • Tying and bundling. Requiring a customer to take product B, a service contract or a software module to obtain product A, where the two are distinct products and product A is where market power sits.
  • Loyalty and retroactive rebates. Discounts triggered by reaching a share of the customer's total requirements, or applied retroactively once a threshold is crossed.
  • Payments for exclusive placement or default status. Money, credits or marketing support in exchange for being the sole or preselected option on a shelf, in a catalogue, in an app or in a procurement framework.
  • English clauses and rights of first refusal. Terms requiring a customer to disclose competing offers and give the dominant supplier the chance to match them.
  • Compatibility and anti-circumvention restrictions. Clauses preventing a partner from supporting, integrating with or developing alternative versions of a product.
  • Parity and most-favoured-nation clauses. Guarantees that no other channel will receive better prices or conditions.
  • Territorial and online sales restrictions. These are especially sensitive when combined with exclusivity, broad coverage and long duration.

Duration and market coverage often decide the practical outcome. A short exclusivity with one distributor may be a normal commercial arrangement. The same wording replicated across a network that ties up most accessible demand in Spain can become a foreclosure strategy.

How is abuse of dominance enforced in Spain?

The CNMC may open sanctioning proceedings under Article 2 LDC, alone or together with Article 102 TFEU. Investigations are often triggered by complaints from competitors or customers.

Fines for very serious infringements may reach up to 10% of the infringing undertaking's total worldwide turnover in the preceding financial year. Legal representatives and directors who participated in the decision may also face personal fines of up to EUR 60,000.

An infringement decision can also affect public-sector contracting under Spanish procurement rules. Appeals against CNMC decisions normally go to the Audiencia Nacional and then, on points of law, to the Tribunal Supremo.

This is not theoretical. In December 2025, the CNMC fined UFD Distribucion Electricidad EUR 5.08 million for abuse of dominance in the market for installation of certain electricity measuring equipment.

What about the Digital Markets Act?

For companies dealing with the largest online platforms, the Digital Markets Act adds separate ex ante obligations for designated gatekeepers.

The DMA does not replace Article 102 TFEU or Article 2 LDC. For undertakings that are not gatekeepers, the general abuse-of-dominance prohibition remains the operative rule.

Does the judgment open the door to damages claims?

Yes. Once an infringement decision is final, injured parties may bring follow-on damages claims. Directive 2014/104/EU was transposed into Spanish law by Royal Decree-law 9/2017, which inserted Title VI, Articles 71 to 81, into the LDC and amended Spanish civil procedure rules.

These claims are heard by the Juzgados de lo Mercantil. A final infringement decision by the European Commission or the CNMC is binding on the Spanish civil court as to the existence of the infringement, so the claimant does not need to prove the infringement again.

The limitation period is five years. It generally runs from the cessation of the infringement and from the moment when the claimant knew, or could reasonably have known, of the conduct, the harm and the infringer.

Spanish courts also have disclosure powers over evidence held by defendants, subject to proportionality and protections for leniency materials.

There is one important caveat: the statutory presumption that an infringement caused harm applies to cartels, not to abuse of dominance. A claimant in an exclusivity case still has to prove causation and quantify the loss, usually with economic evidence.

What defences still work?

Objective justification and efficiency defences remain available. They are simply harder to improvise.

The strongest evidence is contemporaneous: a documented commercial rationale from the time the clause was agreed, showing why the restriction was necessary, why a less restrictive alternative would not have achieved the same result, why the duration was proportionate to the investment protected, and what benefit reached customers.

Evidence assembled after an inspection often reads as reconstruction. Evidence kept with the negotiation file reads as fact.

The other durable defence is a functioning compliance programme. The CNMC has published and updated guidance on competition compliance programmes. A genuine, resourced and tested programme may be relevant at sanction stage. A document filed in a drawer will not be enough.

A practical review for companies operating in Spain

  1. Define the market honestly. Ask what a customer could realistically switch to within a year, and at what cost.
  2. Inventory the clauses. Pull every distribution, reseller, supply, licensing and framework agreement in force and tag exclusivity, bundling, rebate, parity and placement terms.
  3. Calculate aggregate coverage. Identify what proportion of accessible demand in Spain is committed to the company and for how long.
  4. Test rebate schemes. Retroactivity and requirement-share thresholds are among the highest-risk design features.
  5. Review duration and automatic renewal. Shorter terms with genuine exit rights are often the cheapest mitigation.
  6. Document justification now. Keep clause-by-clause rationale with the contract file.
  7. Train the commercial team. Internal sales emails describing the intended effect on competitors can be more damaging than the clause itself.

How Strong Law and Compliance can help

Strong Law and Compliance reviews distribution and licensing structures for companies operating in Spain. Our work may include market-position assessment, clause-by-clause risk mapping, redrafting of exclusivity and rebate terms, competition compliance programmes aligned with CNMC guidance, defence in CNMC proceedings, and follow-on damages claims before the Spanish commercial courts.

We also advise international clients on wider Spanish legal structuring, including company formation in Spain, legal ways to structure operations in Spain, legal assistance in Spain and technology compliance matters such as the EU AI Act in Spain.

Frequently asked questions

Can a small company hold a dominant position in Spain?

Yes. Dominance is assessed on the relevant product and geographic market, not on absolute size. A company can be dominant in a narrow technical segment, a single region or a specific input while remaining small in national terms.

Are exclusivity clauses illegal in Spain?

No. Exclusivity is lawful and common. It becomes problematic when the company imposing it holds a dominant position and the clause, considered with its duration and market coverage, is capable of foreclosing competitors.

What is the maximum fine for abuse of dominance in Spain?

For a very serious infringement, the fine may reach up to 10% of the total worldwide turnover of the infringing undertaking in the financial year preceding the decision. Legal representatives involved in the decision may face personal fines of up to EUR 60,000.

How long do I have to bring a damages claim?

The limitation period is five years, generally running from the cessation of the infringement and from when the claimant knew or could reasonably have known of the conduct, the harm and the identity of the infringer.

Does the Digital Markets Act replace Article 102 TFEU?

No. The DMA imposes additional obligations on designated gatekeepers. Article 102 TFEU and Article 2 LDC continue to apply to undertakings holding a dominant position.

Official sources

This article is general information on Spanish and EU competition law as at 31 August 2026 and does not constitute legal advice on any specific situation.

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