AIJA News

AIJA Insider: Third annual T.R.A.D.E. conference to focus on trade, distribution and e-commerce

24 January 2019

Set to take place from 11-13 April in Athens, the third annual T.R.A.D.E. conference will feature an extensive programme focused on the latest legal developments in trade, distribution and e-commerce. Sessions are expected to bring practical and diverse points of view, with key presentations and discussions by high-profile professionals from private practice and in-house.

The conference will kick off on Friday, 12 April with several sessions looking at the challenges and opportunities for brand owners, platforms and resellers in a digitalised world. The ruling in the Coty case and its impact on e-commerce and the future of selective distribution will be one of the highlights of the day. This is followed by discussions on dynamic and personalised pricing, geo-blocking and legal trade (EU Regulation 218/302). On Saturday, 13 April, sessions will focus on the impact of the GDPR on distribution and franchise networks, digital transformation leading to new forms of cooperation between brand owners and resellers, and finally, optimised general terms and conditions for cross-border e-commerce.

In addition to a rich academic programme, participants will be able to explore an ancient but vibrant metropolis, Athens. A city with many cultural and culinary highlights ready for discovery.

This is just a small sample of what participants can expect. We also asked the organising committee (OC) to share more about some of the topics covered by the conference in the context of international trade. Here are the top three insights from two members of the OC, Babak Tabeshian (partner, LFR Laukemann) and Brian van Egmond (attorney-at-law, Conway & Partners).

Q1: What are the main challenges and opportunities for brand owners, platforms and resellers in a digitalised world?

Babak Tabeshian: The growth of e-commerce in the last decade significantly increased price transparency and price competition. Alternative distribution models such as online marketplaces became very powerful and are considered as key players in the retail business. Under growing pressure of price transparency and price competition, brand owners are seeking to exert more control over their distribution networks and show more presence at the retail level.

These developments have a huge impact on the business of ‘traditional’ resellers. While selling online allows for easy, worldwide market access with low investment costs, the growing (intra-brand) competition with manufacturers at the retail level and the loss of market shares to marketplaces create new challenges.

Despite growing price competition, brand owners have a lot to gain from digital trade. E-commerce allows brand owners to reshape classical distribution networks, target consumers directly, collect data to offer best possible services to their consumers, and finally, use technologies to sell for best possible prices.

Navigating clients through these challenges requires high business and technological understanding as well as the adoption of legal strategies to adapt to a fast-changing legal environment.  

Q2: What are the potential impacts of dynamic pricing on distribution and franchise networks?

Brian van Egmond: With dynamic and personalised pricing being the latest pricing trends, we see that Artificial Intelligence (AI) is more and more incorporated into trade processes. These pricing methods based on algorithms enable sellers to adjust prices automatically at any moment based on specific markers set by the retailer. Objectives for setting their markers vary from offering products at a lower price than the competition, to maintaining a certain minimum level of pricing for luxury products as well as influencing price perception. In cases of AI-based personalised pricing, a certain unit is sold to a consumer at another price than another consumer, depending on what the specific consumer is willing to pay. When used in the right manner, dynamic and personalised pricing may lead to increased revenues and growth for sellers.

These new pricing methods also bring us legal challenges as they impact distribution and franchise agreements. Especially when it comes to minimum prices and competition law. Besides this, contracts between franchisors and franchisees may need to be amended or re-drafted to incorporate a mechanism of dynamic pricing. In cases of personalised pricing, challenges regarding price discrimination can be expected. 

Q3: What does the new geo-blocking regulation mean for the future of e-commerce?

Brian van Egmond: The new geo-blocking regulation is a step in the right direction. It has the potential to open the e-commerce market even further by bringing down geographic barriers. Especially for services such as hotel accommodation, sports events, car rental, and entrance tickets for music festivals or leisure parks, the regulation provides more equality. Besides, there may be questions about the practical value of the regulation for these services. Buying tangible goods from other EU-countries may still be impractical in most common situations where a seller is not targeting markets of other EU-countries other than its own.  

For traders, this regulation will most likely result in challenges under franchise and distribution agreements, as the regulation directly impacts stipulations regarding territorial exclusivity. 

Legally, it would be interesting to look at consumer rights and see the developments there, e.g. the jurisdiction regarding consumer transactions under the Brussels I bis regulation. The future will also teach us a lot more about the enforcement of this regulation, particularly about what type of sanctions will be imposed on those violating this. Since the sanctions are left to the individual member states, a wide variety of sanctions may be the outcome of enforcement of this regulation. 

Join the conference to find out more! To register, click here.