Keywords
Summary

Keywords

1 . COMPETITION - ADMINISTRATIVE PROCEDURE - REGARD FOR RIGHTS OF THE DEFENCE - NON-DISCLOSURE TO UNDERTAKING CONCERNED OF FULL TEXT OF DOCUMENT COVERED BY TRADE SECRECY - UNACCEPTABILITY OF DOCUMENT AS EVIDENCE

( REGULATION NO 17 OF THE COUNCIL , ARTS 19 ( 1 ) AND 20 ( 2 ); REGULATION NO 99/63 OF THE COMMISSION , ART . 4 )

2.COMPETITION - ADMINISTRATIVE PROCEDURE - REGARD FOR RIGHTS OF THE DEFENCE - REFERENCE IN FINAL DECISION TO DOCUMENTS NOT MENTIONED IN STATEMENT OF OBJECTIONS - UNACCEPTABILITY OF DOCUMENTS AS EVIDENCE - DOCUMENTS WITH WHICH UNDERTAKING CONCERNED IS ACQUAINTED - NO EFFECT

( REGULATION NO 17 OF THE COUNCIL , ART . 19 ( 1 ); REGULATION NO 99/63 OF THE COMMISSION , ART . 4 )

3.COMPETITION - ADMINISTRATIVE PROCEDURE - REGARD FOR RIGHTS OF THE DEFENCE - INFRINGEMENT LIMITED TO CERTAIN SPECIAL ASPECTS OF PROCEDURE - EFFECT - LIMITS

( REGULATION NO 17 OF THE COUNCIL , ART . 19 ( 1 ); REGULATION NO 99/63 OF THE COMMISSION , ART . 4 )

4.COMPETITION - AGREEMENTS , DECISIONS AND CONCERTED PRACTICES - SELECTIVE DISTRIBUTION SYSTEMS - PERMISSIBILITY - CONDITIONS - IMPROVEMENT OF COMPETITION IN RELATION TO FACTORS OTHER THAN PRICE

( EEC TREATY , ART . 85 )

5.COMPETITION - AGREEMENTS , DECISIONS AND CONCERTED PRACTICES - SELECTIVE DISTRIBUTION SYSTEMS - PERMISSIBILITY - CONDITIONS - OBJECTIVE CRITERIA FOR SELECTION OF RESELLERS - APPLICATION OF OTHER CRITERIA - PROHIBITION

( EEC TREATY , ART . 85 )

6.COMPETITION - AGREEMENTS , DECISIONS AND CONCERTED PRACTICES - SELECTIVE DISTRIBUTION SYSTEMS - REFUSAL TO APPROVE DISTRIBUTORS SATISFYING QUALITATIVE CRITERIA OF SYSTEM - LEGAL NATURE - UNILATERAL CONDUCT EXEMPT FROM PROHIBITION OF AGREEMENTS , DECISIONS AND CONCERTED PRACTICES - NOT SO EXEMPT - ACT FORMING PART OF CONTRACTUAL RELATIONS BETWEEN MANUFACTURER AND HIS RESELLERS

( EEC TREATY , ART . 85 ( 1 ))

7.COMPETITION - AGREEMENTS , DECISIONS AND CONCERTED PRACTICES - SELECTIVE DISTRIBUTION SYSTEMS - PERMISSIBILITY - LIMITS - APPROVAL OF RESELLERS SUBJECT TO THEIR AGREEING TO CHARGE PRICES MAKING POSSIBLE A HIGH PROFIT MARGIN - NOT PERMISSIBLE

( EEC TREATY , ART . 85 )

8.COMPETITION - COMMUNITY RULES - INFRINGEMENT BY A SUBSIDIARY - IMPUTING CONDUCT TO PARENT COMPANY - CONDITIONS

9.COMPETITION - AGREEMENTS , DECISIONS AND CONCERTED PRACTICES - EFFECT ON TRADE BETWEEN MEMBER STATES - CRITERIA - SHARE OF MARKET

( EEC TREATY , ART . 85 ( 1 ))

10.COMPETITION - AGREEMENTS , DECISIONS AND CONCERTED PRACTICES - EFFECT ON TRADE BETWEEN MEMBER STATES - CRITERIA - SELECTIVE DISTRIBUTION SYSTEMS - LIMITATION BY MANUFACTURER OF FREEDOM OF ACTION OF RESELLERS - ABSENCE OF INTRA-COMMUNITY TRADE AT MATERIAL TIME ON THE PART OF RESELLERS APPROVED OR APPLYING FOR APPROVAL - FACT NOT EXCLUDING IN ITSELF POSSIBILITY OF OBSTACLES TO INTRA-COMMUNITY TRADE

( EEC TREATY , ART . 85 ( 1 ))

11.COMPETITION - AGREEMENTS , DECISIONS AND CONCERTED PRACTICES - SELECTIVE DISTRIBUTION SYSTEMS - PERMISSIBILITY - LIMITS - GUARANTEE OF A HIGH PROFIT MARGIN FOR APPROVED RESELLERS - OBSTACLE TO THE ADMISSION INTO THE SYSTEM OF NEW FORMS OF TRADE - NOT PERMISSIBLE

( EEC TREATY , ART . 85 )

12.COMPETITION - COMMUNITY RULES - INFRINGEMENTS - FINES - APPLICATION - DEFAULT INTEREST - PERMISSIBILITY

( REGULATION NO 17 OF THE COUNCIL , ART . 15 )

Summary

1 . WHERE , IN THE COURSE OF A PROCEEDING FOR ESTABLISHING WHETHER THERE HAS BEEN AN INFRINGEMENT OF COMMUNITY COMPETITION RULES , THE COMMISSION TAKES THE VIEW THAT A DOCUMENT CANNOT BE COMMUNICATED IN ITS ENTIRETY TO THE UNDERTAKING CONCERNED FOR REASONS OF CONFIDEN- TIALITY AND THE PROTECTION OF TRADE SECRECY , IT MUST ABSTAIN FROM USING THAT DOCUMENT AS EVIDENCE .

AN UNDERTAKING CANNOT ALLOW TO BE USED AGAINST IT A DOCUMENT PART OF WHICH HAS NOT BEEN COMMUNICATED TO IT AND IT IS NOT FOR THE COMMISSION TO JUDGE WHETHER A DOCUMENT OR A PART THEREOF IS OR IS NOT OF USE FOR THE DEFENCE OF THE UNDERTAKING CONCERNED .

2.WHERE DOCUMENTS MENTIONED IN A DECISION UNDER ARTICLE 85 OF THE TREATY WERE NOT MENTIONED IN THE STATEMENT OF OBJECTIONS , THE UNDERTAKING CONCERNED IS ENTITLED TO TAKE THE VIEW THAT THEY ARE OF NO IMPORTANCE FOR THE PURPOSES OF THE CASE .

BY NOT INFORMING THE UNDERTAKING THAT SUCH DOCUMENTS ARE TO BE USED IN THE DECISION , THE COMMISSION PREVENTS IT FROM PUTTING FORWARD AT THE APPROPRIATE TIME ITS VIEW OF THE PROBATIVE VALUE OF THE DOCUMENTS . IT FOLLOWS THAT SUCH DOCUMENTS CANNOT BE REGARDED AS ADMISSIBLE EVIDENCE EVEN IF THE UNDERTAKING IS ACQUAINTED WITH THEM INASMUCH AS THEY ORIGINATE IN ITS OWN OFFICES .

3.AN INFRINGEMENT OF THE RIGHTS OF THE DEFENCE AFFECTING ONLY CERTAIN SPECIAL ASPECTS OF A PROCEEDING FOR ESTABLISHING WHETHER THERE HAS BEEN AN INFRINGEMENT OF COMMUNITY COMPETITION RULES CANNOT IMPLY THAT THE PROCEDURE AS A WHOLE IS IRREGULAR . THE EXCLUSION OF CERTAIN DOCUMENTS USED BY THE COMMISSION IN INFRINGEMENT OF THE RIGHTS OF THE DEFENCE IS OF NO SIGNIFICANCE EXCEPT TO THE EXTENT TO WHICH THE COMMISSION ' S OBJECTIONS CAN BE PROVED ONLY BY REFERENCE TO THOSE DOCUMENTS .

4.ALTHOUGH SELECTIVE DISTRIBUTION SYSTEMS NECESSARILY INFLUENCE COMPETITION IN THE COMMON MARKET , LEGITIMATE REQUIREMENTS , SUCH AS THE MAINTENANCE OF A SPECIALIST TRADE CAPABLE OF PROVIDING SPECIFIC SERVICES AS REGARDS HIGH-QUALITY AND HIGH-TECHNOLOGY PRODUCTS , JUSTIFY A REDUCTION OF PRICE COMPETITION IN FAVOUR OF COMPETITION RELATING TO FACTORS OTHER THAN PRICE . SYSTEMS OF SELECTIVE DISTRIBUTION , IN SO FAR AS THEY AIM AT THE ATTAINMENT OF A LEGITIMATE GOAL CAPABLE OF IMPROVING COMPETITION IN RELATION TO FACTORS OTHER THAN PRICE , THEREFORE CONSTITUTE AN ELEMENT OF COMPETITION WHICH IS IN CONFORMITY WITH ARTICLE 85 ( 1 ) OF THE TREATY .

THE LIMITATIONS INHERENT IN A SELECTIVE DISTRIBUTION SYSTEM ARE HOWEVER ACCEPTABLE ONLY ON CONDITION THAT THEIR AIM IS IN FACT AN IMPROVEMENT IN COMPETITION IN THE SENSE ABOVE MENTIONED . OTHERWISE THEY WOULD HAVE NO JUSTIFICATION INASMUCH AS THEIR SOLE EFFECT WOULD BE TO REDUCE PRICE COMPETITION .

5.SELECTIVE DISTRIBUTION SYSTEMS CONSTITUTE ONE OF A NUMBER OF ASPECTS OF COMPETITION IN CONFORMITY WITH ARTICLE 85 ( 1 ) OF THE TREATY PROVIDED THAT RESELLERS ARE CHOSEN ON THE BASIS OF OBJECTIVE CRITERIA OF A QUALITATIVE NATURE RELATING TO THE TECHNICAL QUALIFICATIONS OF THE RESELLER AND HIS STAFF AND THE SUITABILITY OF HIS TRADING PREMISES AND THAT SUCH CONDITIONS ARE LAID DOWN UNIFORMLY FOR ALL POTENTIAL RESELLERS AND ARE NOT APPLIED IN A DISCRIMINATORY FASHION .

THE OPERATION OF A SELECTIVE DISTRIBUTION SYSTEM BASED ON CRITERIA OTHER THAN THOSE MENTIONED ABOVE CONSTITUTES AN INFRINGEMENT OF ARTICLE 85 ( 1 ). THE POSITION IS THE SAME WHERE A SYSTEM WHICH IS IN PRINCIPLE IN CONFORMITY WITH COMMUNITY LAW IS APPLIED IN PRACTICE IN A MANNER INCOMPATIBLE THEREWITH .

6.A REFUSAL BY A MANUFACTURER TO APPROVE DISTRIBUTORS WHO SATISFY THE QUALITATIVE CRITERIA OF HIS SYSTEM OF SELECTIVE DISTRIBUTION DOES NOT CONSTITUTE , ON THE PART OF THE UNDERTAKING , UNILATERAL CONDUCT EXEMPT AS SUCH FROM THE PROHIBITION CONTAINED IN ARTICLE 85 ( 1 ) OF THE TREATY . ON THE CONTRARY , SUCH AN ATTITUDE FORMS PART OF THE CONTRACTUAL RELATIONS BETWEEN THE UNDERTAKING AND RESELLERS , SINCE THE ADMISSION OF A DISTRIBUTOR IS BASED ON THE ACCEPTANCE , TACIT OR EXPRESS , BY THE CONTRACTING PARTIES OF THE POLICY PURSUED BY THE UNDERTAKING , WHICH REQUIRES INTER ALIA THE EXCLUSION FROM THE NETWORK OF DISTRIBUTORS WHO ARE QUALIFIED FOR ADMISSION BUT ARE NOT PREPARED TO ADHERE TO THAT POLICY .

7.A RESTRICTION OF PRICE COMPETITION , WHICH IS INHERENT IN ANY SELECTIVE DISTRIBUTION SYSTEM , IS LAWFUL ONLY TO THE EXTENT TO WHICH THE MAINTENANCE OF A CERTAIN LEVEL OF PRICES IS STRICTLY JUSTIFIED BY THE REQUIREMENTS OF A SYSTEM WITHIN WHICH COMPETITION MUST CONTINUE TO PERFORM THE FUNCTION ASSIGNED TO IT BY THE TREATY , SINCE THE OBJECT OF SUCH A SYSTEM IS SOLELY THE IMPROVEMENT OF COMPETITION IN SO FAR AS IT RELATES TO FACTORS OTHER THAN PRICES AND NOT THE GUARANTEE OF A HIGH PROFIT MARGIN FOR APPROVED RESELLERS .

A MANUFACTURER OPERATING A SYSTEM OF SELECTIVE DISTRIBUTION IS THEREFORE NOT JUSTIFIED IN TAKING THE VIEW THAT THE ACCEPTANCE OF A COMMITMENT TO CHARGE PRICES MAKING POSSIBLE A SUFFICIENTLY HIGH PROFIT MARGIN CONSTITUTES A LAWFUL CONDITION FOR ADMISSION TO A SELECTIVE DISTRIBUTION SYSTEM . BY THE VERY FACT THAT HE IS AUTHORIZED NOT TO ADMIT TO AND NOT TO KEEP IN HIS DISTRIBUTION NETWORK TRADERS WHO WERE NOT , OR ARE NO LONGER , IN A POSITION TO PROVIDE SERVICES TYPICAL OF THE SPECIALIST TRADE , HE HAS AT HIS DISPOSAL ALL THE MEANS NECESSARY TO ENABLE HIM TO ENSURE THE EFFECTIVE APPLICATION OF THE SYSTEM . IN SUCH CIRCUMSTANCES THE EXISTENCE OF A PRICE COMMITMENT CONSTITUTES A CONDITION WHICH IS MANIFESTLY FOREIGN TO THE REQUIREMENTS OF A SELECTIVE DISTRIBUTION SYSTEM AND THUS ALSO AFFECTS FREEDOM OF COMPETITION .

8.THE FACT THAT A SUBSIDIARY HAS SEPARATE LEGAL PERSONALITY IS NOT SUFFICIENT TO EXCLUDE THE POSSIBILITY OF IMPUTING ITS CONDUCT TO THE PARENT COMPANY , IN PARTICULAR WHERE THE SUBSIDIARY , ALTHOUGH HAVING SEPARATE LEGAL PERSONALITY , DOES NOT DECIDE INDEPENDENTLY UPON ITS OWN CONDUCT ON THE MARKET BUT CARRIES OUT , IN ALL MATERIAL RESPECTS , THE INSTRUCTIONS GIVEN TO IT BY THE PARENT COMPANY .

9.AN UNDERTAKING POSSESSING ROUGHLY 5 % OF THE MARKET CONCERNED IS AN UNDERTAKING OF SUFFICIENT IMPORTANCE FOR ITS BEHAVIOUR TO BE , IN PRINCIPLE , CAPABLE OF AFFECTING TRADE BETWEEN MEMBER STATES .

10.THE MERE FACT THAT AT A CERTAIN TIME TRADERS APPLYING FOR ADMISSION TO A SELECTIVE DISTRIBUTION NETWORK OR WHO HAVE ALREADY BEEN ADMITTED ARE NOT ENGAGING IN INTRA-COMMUNITY TRADE CANNOT SUFFICE TO EXCLUDE THE POSSIBILITY THAT RESTRICTIONS ON THEIR FREEDOM OF ACTION IMPOSED BY THE MANUFACTURER MAY IMPEDE INTRA-COMMUNITY TRADE , SINCE THE SITUATION MAY CHANGE FROM ONE YEAR TO ANOTHER IN TERMS OF ALTERATIONS IN THE CONDITIONS OR COMPOSITION OF THE MARKET BOTH IN THE COMMON MARKET AS A WHOLE AND IN THE INDIVIDUAL NATIONAL MARKETS .

11.A DISTRIBUTION POLICY MOTIVATED BY A DESIRE BOTH TO GUARANTEE A HIGH PROFIT MARGIN FOR APPROVED RESELLERS AND TO IMPEDE , SO FAR AS AT ALL POSSIBLE , THE ADMISSION OF NEW FORMS OF TRADE , WHICH ARE REGARDED A PRIORI AS BEING INCAPABLE OF SATISFYING THE SPECIALIST TRADE CONDITIONS , EXHIBITS CHARACTERISTICS WHICH CANNOT BE RECONCILED WITH A CORRECT APPLICATION OF A SELECTIVE DISTRIBUTION SYSTEM .

12.AN UNDERTAKING ON WHICH A FINE HAS BEEN IMPOSED UNDER ARTICLE 15 OF REGULATION NO 17 IS REQUIRED TO PAY DEFAULT INTEREST UP TO THE DATE OF ACTUAL PAYMENT OF THE FINE .