In recent years, fewer and fewer franchise agreements contain exclusive territorial clauses in favor of the franchisee. Only where the supplier and/or distributor can demonstrate that territorial protection improves production or distribution or contributes to technological or economic development, that the restriction of competition is necessary to achieve the improvement, that an appropriate part of the improvement benefits users and, finally, that sufficient (residual) competition remains; territorial protection (the protection of efficiency) is allowed. This question has already been the subject of a brief debate on the question “What cooperation agreements are allowed?”. However, the protection of effectiveness in the event of “essential restrictions” is often not accepted by the Commission, national competition authorities and the courts. On the other hand, in the example, the parallel taxation condition means that if the French supplier does not prohibit active sales in the Netherlands by its other (European) distributors, the Dutch distributor is not protected from active sales in the Netherlands and the other distributors can simply buy customers in the Netherlands. From a legal point of view, therefore, the Dutch distributor does not have an exclusive territory, although this has been agreed between the French supplier and the Dutch distributor. By not offering protection to the Dutch distributor against active sale by other distributors, the French supplier is acting in contradiction with the distribution agreement. Protection against active sales by other traders may be necessary to protect the investments of the Dutch distributor. The French distributor will therefore do well to ensure that all agreements concluded with distributors include parallel taxation or a ban on active sales in the Netherlands. Otherwise, it may face a claim for damages from the Dutch distributor because the French supplier has not fulfilled what it should have done on the basis of the block exemption and the agreement: to protect the Dutch distributor. The relationship between a supplier and a distributor may be subject to the prohibition of cartel. This is particularly the case when the territory or customers to whom a distributor is authorized to sell are limited in a distribution agreement.

However, the exclusivity condition does not limit the direct sale of the supplier. A supplier may also decide not to use merchants in a particular area or for a particular block of customers, but to keep that area or block of customers to himself, even if he is not (yet) active in that area or with regard to that block of customers. The supplier can do this because he has not (yet) found a suitable dealer or because he already has a suitable distribution system in this area. It also means that in addition to a distributor, a supplier can start selling itself and therefore directly compete with a distributor.