1. Introduction

Industrial gas cylinder allocation is an important competition-law issue in Morocco because cylinders used for oxygen, nitrogen, argon, carbon dioxide, acetylene and other industrial gases are essential to manufacturing, metal fabrication, welding, healthcare-related production, food processing and construction.

Competition concerns arise when gas producers, cylinder owners, distributors, filling stations or industrial suppliers coordinate the allocation of cylinders, restrict access to filling facilities, reserve cylinder stocks for selected customers, or use exclusive agreements to prevent rival suppliers from competing.

The central legal question is whether cylinder allocation reflects legitimate operational requirements—such as safety, traceability, pressure testing and supply reliability—or constitutes an agreement or commercial practice that restricts competition.

Important distinction: The analysis below applies Moroccan competition law to a hypothetical industrial gas cylinder market. The six cases discussed are established comparative precedents, not representations that Moroccan courts have decided these exact industrial gas allocation disputes.

2. Legal framework in Morocco

A. Law No. 104-12 on freedom of prices and competition

Morocco's principal competition statute is Law No. 104-12 on freedom of prices and competition, as amended, including by Law No. 40-21.

Its principal relevance is the prohibition of anticompetitive agreements and the control of abuses of dominant positions.

Article 6 — Anticompetitive agreements

Article 6 addresses agreements, express or tacit, and concerted practices that have the object or potential effect of preventing, restricting or distorting competition in a market. In the cylinder-allocation context, potentially problematic arrangements include:

Competitors agreeing on how many cylinders each may allocate to customers.

Suppliers agreeing not to supply one another's customers.

Distributors coordinating allocation quotas or delivery territories.

Competitors jointly refusing to supply a new entrant.

Agreements designed to restrict output or maintain artificially high rental, deposit or filling charges.

An allocation arrangement is not automatically unlawful merely because it limits quantities. The assessment depends on its purpose, market effects, commercial context and any applicable legal justification.

Article 7 — Abuse of a dominant position

Article 7 is relevant when a dominant undertaking exploits its market position through conduct that restricts competition. Examples may include refusing access to an essential filling facility without objective justification, imposing discriminatory cylinder-rental terms, or tying access to cylinders to the purchase of other products.

Dominance itself is not unlawful. The concern is abusive conduct that harms the competitive process.

B. Law No. 20-13 on the Competition Council

Law No. 20-13, as amended, governs the Moroccan Competition Council (Conseil de la concurrence).

The Council's functions include examining anticompetitive practices, investigating competition concerns within its statutory powers, and reviewing mergers that fall within the applicable notification requirements.

A cylinder-allocation dispute may therefore raise issues concerning:

Evidence of coordination between competing suppliers.

Market power and access to filling or distribution infrastructure.

The competitive effects of exclusive supply agreements.

Merger-related concentration among gas producers or cylinder distributors.

C. Related legal considerations

The analysis may also require consideration of contract law, industrial safety rules, transport requirements, cylinder certification, pressure-testing obligations and sector-specific regulations.

These requirements can justify objective allocation criteria. They do not, however, automatically justify discriminatory treatment or agreements designed to exclude competitors.

3. Principal competition issues in industrial gas cylinder allocation

A. Allocation quotas and output restrictions

Suppose three industrial gas suppliers agree that each will allocate only a fixed number of cylinders to customers in Casablanca, Tangier and Rabat. They also agree not to increase supplies during periods of high demand.

Such conduct could restrict output, reduce customer choice and facilitate higher prices. If the agreement is between competing suppliers, Article 6 would be the principal provision to examine.

By contrast, a supplier's unilateral allocation of scarce cylinders according to documented safety requirements, existing orders and objectively defined emergency priorities is not inherently unlawful.

B. Customer and territory allocation

Suppliers may agree to divide industrial customers by sector—for example, one supplier serves metal fabricators, another serves food processors and a third serves construction companies.

If this arrangement prevents customers from choosing alternative suppliers, it may amount to market allocation. Similar concerns arise where distributors agree not to sell outside assigned territories or refrain from competing for one another's customers.

C. Refusal to supply cylinders

A dominant supplier may own a substantial proportion of the cylinders in circulation or control a filling facility that competing distributors cannot reasonably replace.

A refusal to supply may raise concerns under Article 7 where it is abusive and capable of restricting competition. Relevant considerations include:

Whether alternative suppliers or filling facilities exist.

Whether competitors can obtain or lease compatible cylinders.

Whether the refusal is based on objective safety, credit or capacity concerns.

Whether the refusal prevents a rival from competing effectively.

Whether the dominant supplier applies its rules consistently to comparable customers.

A cylinder shortage, standing alone, does not establish an infringement.

D. Exclusive distribution and cylinder ownership

Long-term agreements requiring customers to obtain all industrial gases from one supplier may foreclose competing suppliers, especially when cylinders remain the property of the incumbent and cannot practically be exchanged.

The assessment should consider the duration and scope of exclusivity, the proportion of demand covered, switching costs, alternative cylinder pools and whether customers can use compatible cylinders from other suppliers.

E. Discriminatory allocation and pricing

A supplier might allocate its best cylinders to affiliated distributors while giving independent distributors older equipment, longer delivery times or less favourable rental rates.

Such differences warrant scrutiny where the supplier is dominant or a customer is economically dependent on it. Differences justified by cylinder specifications, transport costs, credit risk or safety requirements should be assessed on their actual merits.

F. Safety, interoperability and legitimate cooperation

Industrial cylinders must be handled according to applicable technical and safety requirements. Suppliers may legitimately need common identification systems, inspection standards, traceability procedures and emergency-response arrangements.

The legal distinction is between cooperation necessary for safe and efficient supply and cooperation used to exclude rivals. Article 9 of Law No. 104-12 provides a framework for qualifying practices that contribute to economic or technical progress, pass an appropriate benefit to users, and impose only indispensable restrictions without eliminating competition in a substantial part of the market.

4. Market definition and assessment of market power

A sound investigation should define the relevant product and geographic markets before deciding whether allocation practices are restrictive.

Market shares are relevant but not conclusive. Control over scarce cylinders, filling infrastructure, transport networks and customer relationships may also be important.

5. Key case laws: six comparative precedents

The following European Union and UK cases provide useful comparative principles for applying Moroccan Law No. 104-12. They are not binding Moroccan precedents, and their legal tests should not be treated as substitutes for Moroccan statutory analysis.

Case 1: Commercial Solvents Corp. v Commission (Joined Cases 6/73 and 7/73, 1974)

Principle: Refusal to supply an input to exclude a downstream competitor.

Commercial Solvents controlled the supply of a raw material needed to manufacture a downstream product and discontinued supplies to a customer competing with its subsidiary.

The European Court of Justice found an abuse of dominance in the circumstances.

Application to Moroccan industrial gas cylinders: A dominant gas producer that controls an indispensable supply of cylinders or a critical filling input might infringe Article 7 if it refuses supplies to independent distributors to protect its own downstream distribution business.

The key issue is whether the refusal constitutes abusive exclusion, rather than a legitimate response to capacity constraints, safety risks or contractual default.

Case 2: United Brands Co. v Commission (Case 27/76, 1978)

Principle: Dominance, discriminatory conditions and unjustified commercial restrictions.

This case addressed several aspects of abusive conduct by a dominant undertaking, including discriminatory trading conditions and restrictions imposed on commercial partners.

Application: A dominant cylinder supplier that offers favourable rental rates and reliable delivery to its affiliated distributors while imposing materially worse terms on competing distributors may attract scrutiny.

The comparison must account for objective differences, such as volume commitments, credit risk, delivery costs and technical requirements. Unequal treatment is not automatically unlawful, but unjustified discrimination capable of distorting competition can be problematic.

Case 3: Oscar Bronner GmbH & Co. KG v Mediaprint (Case C-7/97, 1998)

Principle: Strict conditions for compulsory access to an essential facility.

The Court considered whether a dominant newspaper group had to provide a rival with access to its newspaper home-delivery system. It declined to impose access on the facts of the case.

Application: A Moroccan industrial gas supplier should not automatically be required to share its cylinder fleet or filling infrastructure merely because a rival requests access.

A compulsory-access argument becomes stronger where the input is genuinely indispensable, effective competition would otherwise be eliminated, and no objective justification exists for the refusal. The availability of compatible cylinders, alternative filling stations and feasible investment options is therefore critical.

Case 4: IMS Health GmbH & Co. OHG v NDC Health GmbH & Co. KG (Case C-418/01, 2004)

Principle: Exceptional circumstances for compulsory access to protected infrastructure or intellectual property.

The Court examined the conditions under which a dominant undertaking's refusal to license a protected structure could constitute an abuse. The judgment identified demanding requirements, including the emergence of a new product for which there was potential consumer demand, under the applicable circumstances.

Application: Where a cylinder-allocation system depends on proprietary tracking software, exclusive access protocols or a protected technical standard, a refusal to license or provide access requires careful analysis.

The case does not establish a general duty to share cylinder databases or technology. Its relevance lies in the exceptional nature of compulsory access and the importance of showing concrete competitive harm.

Case 5: Microsoft Corp. v Commission (Case T-201/04, General Court, 2007)

Principle: Interoperability restrictions and exclusionary conduct by a dominant undertaking.

The General Court upheld important parts of the European Commission's decision concerning Microsoft's refusal to disclose interoperability information and other abusive conduct.

Application: Imagine a dominant industrial gas supplier operates a digital cylinder-tracking platform that competing distributors must use to identify cylinders, verify inspections or arrange returns. If it selectively denies interoperable access to competing distributors while granting it to its own affiliated businesses, the conduct may raise concerns under Article 7.

The decisive issues would include dominance, the importance of the information, actual or likely foreclosure, and the existence of objective technical or safety justifications.

Case 6: Slovak Telekom a.s. v Commission (Case C-165/19 P, 2021)

Principle: Assessment of exclusionary access conditions imposed by a dominant undertaking.

This case concerned a dominant telecommunications operator's access conditions and conduct affecting competing operators. The Court of Justice examined the application of EU abuse-of-dominance principles to those circumstances.

Application: A dominant supplier of industrial gas cylinders might impose access terms that technically permit independent distributors to obtain cylinders but make effective competition commercially impracticable through excessive charges, unreasonable conditions or discriminatory procedures.

The case supports examining the practical effect of access arrangements rather than looking only at whether a formal refusal has occurred. Its application to cylinders would depend on the facts and Moroccan law.

6. Applying the law to hypothetical Moroccan scenarios

Scenario A: Competitors coordinate cylinder quotas

High legal risk

Four suppliers agree to cap monthly cylinder allocations, avoid supplying each other's major customers and maintain common rental prices.

Analysis: This could constitute an agreement restricting output, allocating customers and influencing prices under Article 6. If established, the arrangement would present a serious cartel concern.

Scenario B: A dominant supplier refuses access

Fact-dependent

A supplier refuses to lease compatible cylinders to an independent distributor, despite available capacity, while supplying its affiliated distributor.

Analysis: Article 7 may be relevant if the supplier is dominant and the refusal is abusive and restricts competition. The authority would examine alternatives, capacity, technical compatibility and the justification for different treatment.

Scenario C: Emergency allocation during a shortage

Potentially justified

A supplier prioritises cylinders according to documented safety needs, available stock, confirmed orders and objectively defined emergency requirements.

Analysis: This is not inherently anticompetitive. The criteria should be transparent, proportionate, consistently applied and not used as a pretext to exclude rivals.

Scenario D: Exclusive cylinder agreements

Fact-dependent

A supplier requires industrial customers to purchase all gases from it and prevents the return or transfer of its cylinders for use by competitors.

Analysis: Investigators should examine market coverage, contract duration, switching barriers, cylinder ownership, alternative supplies and the supplier's market power. Exclusivity is not automatically unlawful, but it may foreclose competing suppliers.

7. Evidence and investigation

An effective investigation should obtain:

Allocation records: Cylinder quantities, customer orders, rejected requests, waiting periods and delivery schedules.

Commercial communications: Emails, meeting records, messages and agreements indicating coordination between competing suppliers.

Cylinder ownership and access records: Ownership, lease terms, return arrangements, compatibility rules and access to filling facilities.

Pricing evidence: Rental charges, deposits, filling fees, transport costs, discounts and differences between affiliated and independent distributors.

Market evidence: Supplier shares, cylinder fleet capacity, filling-station locations, alternative suppliers and entry barriers.

Objective justifications: Inspection certificates, maintenance records, safety standards, credit assessments and evidence of genuine shortages.

Parallel conduct alone does not necessarily prove a cartel. Investigators should look for evidence of coordination and assess whether commercial behaviour has a credible independent explanation.

8. Potential remedies and compliance measures

Depending on the infringement, evidence and applicable procedural rules, possible responses may include:

Cease-and-desist measures against unlawful coordination or abusive conduct.

Removal or revision of restrictive allocation and exclusivity clauses.

Objective, transparent and nondiscriminatory cylinder-allocation criteria.

Access arrangements where legally justified and proportionate.

Appropriate sanctions under the applicable Moroccan statutory framework.

Internal compliance programmes, employee training, document retention and independent audits of allocation decisions.

Remedies should protect competition without compromising cylinder safety, traceability or reliable supply.

9. Practical compliance framework for industrial gas suppliers

A supplier operating in Morocco should adopt the following safeguards:

10. Conclusion

Industrial gas cylinder allocation in Morocco must be assessed under the country's competition framework, particularly Articles 6 and 7 of Law No. 104-12. Article 6 is central to agreements among competing suppliers that restrict output, allocate customers or divide markets. Article 7 is relevant where a dominant undertaking or an undertaking exploiting economic dependence engages in abusive refusals, discriminatory terms or restrictive commercial conditions.

The six comparative cases—Commercial Solvents, United Brands, Bronner, IMS Health, Microsoft and Slovak Telekom—help explain refusal-to-supply concerns, dominance, essential inputs and exclusionary access restrictions. They are comparative authorities, not Moroccan judgments on industrial gas cylinders.

The governing distinction is between legitimate safety-based allocation and conduct that restricts competition. Transparent allocation, objective access conditions and independent commercial decision-making can preserve both industrial safety and competitive markets.