# CE2004084EN.01056101.xml

| 3.4.2004 | EN | Official Journal of the European Union | CE 84/561 |
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3.4.2004

EN

Official Journal of the European Union

CE 84/561

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(2004/C 84 E/0639)

WRITTEN QUESTION E-0273/04

by Stefano Zappalà (PPE-DE) to the Commission

(5 February 2004)

Subject:   Automar srl — concessionaire for Mercedes Benz motor vehicles

Subject:

Knowing that:

| 1. | The company Automar srl is based at Via SS 148 Pontina No 41, Latina, Italy. |
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1.

The company Automar srl is based at Via SS 148 Pontina No 41, Latina, Italy.

| 2. | Since 1968, this company has been the sole concessionaire for sales and assistance in Latina and the surrounding province for Mercedes Benz passenger cars and industrial vehicles. |
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2.

Since 1968, this company has been the sole concessionaire for sales and assistance in Latina and the surrounding province for Mercedes Benz passenger cars and industrial vehicles.

| 3. | Since 1997, this authorisation has been limited to passenger cars only. |
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3.

Since 1997, this authorisation has been limited to passenger cars only.

| 4. | The company currently has an annual turnover of around EUR 15 million and provides employment for some 50 staff. |
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4.

The company currently has an annual turnover of around EUR 15 million and provides employment for some 50 staff.

| 5. | In the period 1997-2000, Automar, on the strength of this agency contract, invested EUR 3,5 million on technological modernisation and new services. All these initiatives were authorised and/or supported by the mother company. |
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5.

In the period 1997-2000, Automar, on the strength of this agency contract, invested EUR 3,5 million on technological modernisation and new services. All these initiatives were authorised and/or supported by the mother company.

| 6. | On 19 September 2002, Daimler Chrysler Italia Spa unilaterally terminated the contract on the basis of the agreement in Regulation (EC) No 1400/2002 (1), giving 12 months' notice. |
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6.

On 19 September 2002, Daimler Chrysler Italia Spa unilaterally terminated the contract on the basis of the agreement in Regulation (EC) No 1400/2002 (1), giving 12 months' notice.

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| 7. | In 2001, while the contract was still in force, Daimler Chrysler Italia Spa signed another concessionary contract with a different company and made sales of cars to the value of around EUR 2,6 million. |
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7.

In 2001, while the contract was still in force, Daimler Chrysler Italia Spa signed another concessionary contract with a different company and made sales of cars to the value of around EUR 2,6 million.

| 8. | Automar contested this activity in August 2002. |
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8.

Automar contested this activity in August 2002.

| 9. | Daimler Chrysler Italia Spa changed its relationship with the new concessionaire, creating with the latter a NEW Co of which it holds a 51 % stake. |
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9.

Daimler Chrysler Italia Spa changed its relationship with the new concessionaire, creating with the latter a NEW Co of which it holds a 51 % stake.

| 10. | Daimler Chrysler Italia Spa offered Automar the chance to set up another NEW Co on its own terms or for Daimler Chrysler Italia Spa to acquire Automar at a greatly reduced price. |
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10.

Daimler Chrysler Italia Spa offered Automar the chance to set up another NEW Co on its own terms or for Daimler Chrysler Italia Spa to acquire Automar at a greatly reduced price.

| 11. | In keeping with Regulation (EC) No 1400/2002, Automar requested an after-sales contract with Daimler Chrysler Italia Spa, who refused and proceeded to suspend the supply of spare parts and accessories from 2 September to 1 October 2003. |
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11.

In keeping with Regulation (EC) No 1400/2002, Automar requested an after-sales contract with Daimler Chrysler Italia Spa, who refused and proceeded to suspend the supply of spare parts and accessories from 2 September to 1 October 2003.

The Commission:

| (a) | Does it view the actions outlined above as legitimate, and, if it does, should not a notice period of 24, not 12, months be given? |
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(a)

Does it view the actions outlined above as legitimate, and, if it does, should not a notice period of 24, not 12, months be given?

| (b) | Does it not think it necessary to intervene to ensure that the Community rules are respected? |
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(b)

Does it not think it necessary to intervene to ensure that the Community rules are respected?

Answer given by Mr Monti on behalf of the Commission

(11 March 2004)

(11 March 2004)

First of all, it has to be emphasized that like other suppliers, car manufacturers are generally free to distribute their products, providing that their distribution system does not infringe Article 81 or 82 of the EC Treaty. They may therefore choose to distribute their products through their own outlets, or through car dealers that are commercially independent. In this respect, the Commission draws the attention of the Honourable Member to the fact that a move of a car manufacturer towards a more vertically-integrated distribution structure is in general compatible with Regulation (EC) No 1400/2002 (2), as well as with the previous Regulation (EC) No 1475/95 (3).

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Furthermore, it should be noted that both Regulations cover quantitative selective distribution systems allowing car manufacturers to fix the number of dealers in their network, including through contract terminations, provided that certain notice periods are respected. As the notice of termination of Automar's dealership agreement was prior to the entry into force of Regulation (EC) No 1400/2002 (4), Regulation (EC) No 1475/95 is applicable to this specific case. According to Article 5(2)(2) of Regulation (EC) No 1475/95 (5), the notice period should not, as a general rule, be shorter than two years, if the agreement is concluded for an indefinite period. However, the Regulation provided for some exceptions (6), the main being the need for reorganization of the whole or a substantial part of the network, where the notice period could be reduced to one year. The question whether this exception applies to Automar's situation would have to be analysed in the light of the specific facts of the case (7).

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As regards the appointment of another dealer, in 2001, while the dealership contract with Automar Srl was still in force, this possible violation of the contract could only be assessed in the light of the applicable civil law by the competent national court.

As far as the Automar request for an after-sales contract is concerned, it should first be noted that in order for the Mercedes Benz authorised after-sales network to be covered by the Regulation (EC) No 1400/2002, Mercedes Benz has normally (8) to apply a qualitative selective distribution system. In such a system, the selection criteria must be limited to what is required by the nature of the product, must be laid down uniformly for all potential repairers and must not be applied in a discriminatory manner. Consequently, Mercedes Benz must allow all repairers which fulfil these criteria to operate as authorised repairers, including those authorised dealers whose dealership contracts have been terminated but who would like to continue as authorised repairers (9). It has to be emphasized, however, that these provisions are applicable to pre-existing agreements only as from the 1 October 2003 (10).

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It has to be observed that the specific problems raised in the Honourable Member's written question are likely to be better dealt with by the national competition authority or a national judge, having regard to the geographically limited impact of the practice and to the issues of contractual liability it raises.

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(1)  OJ L 203, 1.8.2002, p. 30.

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(2)  Commission Regulation (EC) No 1400/2002 of 31 July 2002 on the application of Article 81(3) of the Treaty to categories of vertical agreements and concerted practices in the motor vehicle sector, OJ L 203, 1.8.2002.

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(3)  Commission Regulation (EC) No 1475/95 of 28 June 1995 on the application of Article 81(3) of the Treaty to certain categories of motor vehicle distribution and servicing agreements, OJ L 145, 29.6.1995.

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(4)  According to Article 12 of Regulation (EC) No 1400/2002, the Regulation entered into force on 1 October 2002.

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(5)  This Regulation was applicable on the 19 September 2002, as the Regulation (EC) No 1400/2002 came into force on the 1 October 2002 and started to apply to the existing agreements on the 1 October 2003 (Articles 12 and 10 of the Regulation (EC) No 1400/2002).

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(6)  See Articles 5(2)(2) and 5(3).

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(7)  The Commission gave its interpretation of the exception pertaining to the reorganization of the network in the Explanatory Brochure on Regulation (EC) No 1475/95 [Distribution of Motor Vehicles (Regulation (EC) No 1475/95). Explanatory Brochure (IV/9509/95 EN), published on the Internet: http://europa.eu.int/comm/competition/car_sector/distribution/#reg_1475_95]. See in particular the reply to question no 16.

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(8)  This depends on the market share held by the supplier's network of authorised repairers in respect of repairs carried out on all motor vehicles of the brand in question (see reply to the question 72 in the Explanatory Brochure). If this market share exceeds 30 %, only a qualitative selective network is covered by the block exemption (see article 3(1) of the Regulation (EC) No 1400/2002).

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(9)  See Articles 3(1) and 1(1) (h) of the Regulation (EC) No 1400/2002 as well as replies to questions no 72-74 in the Explanatory Brochure on the Regulation (EC) No 1400/2002 (Distribution and Servicing of Motor Vehicles in the EU. Explanatory Brochure, published on the Internet: http://europa.eu.int/comm/competition/car_sector/).

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(10)  See Article 10 of the Regulation (EC) No 1400/2002 and, by analogy, the replies to questions 22 and 23 in the Explanatory Brochure on the Regulation (EC) No 1400/2002, cited above.

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