Commission notice of 19 December 1977 concerning agreements of minor importance which do not fall under Article 85 (1) of the Treaty establishing the European Economic Community (1)

I. On several occasions the Commission has made clear that it considers it important to promote cooperation between undertakings where such cooperation is economically desirable without presenting difficulties from the point of view of competition policy ; in particular, it wishes to facilitate cooperation between small- and medium-sized undertakings. To this end it published the "Notice concerning agreements, decisions and concerted practices in the field of cooperation between undertakings" (2) (hereinafter referred to as "agreements") listing a number of agreements that by their nature cannot be regarded as being restraints of competition. By issuing the present notice, the Commission is taking a further step towards defining the field of application of Article 85 (1) of the Treaty establishing the European Economic Community, in order to promote cooperation between small- and medium-sized undertakings.

In the Commission's opinion, agreements, whose effects on trade between Member States and on competition are negligible, do not fall within the prohibition on restrictive agreements in Article 85 (1) of the EEC Treaty. Only those agreements are prohibited which have an appreciable impact on market conditions, in that they appreciably alter the market position, i.e. the sales outlets and supply possibilities, of non-participating undertakings and of consumers.

In the present Notice the Commission has given a sufficiently concrete meaning to the term "appreciable" for undertakings to be able to judge for themselves whether the agreements they have concluded with other undertakings, being of minor importance, do not fall under Article 85 (1). The quantitative definition of "appreciable" given by the Commission is, however, no absolute yardstick ; in fact, it is quite possible that, in individual cases, even agreements between undertakings which exceed the limits mentioned below may well have only a negligible effect on trade between Member States and on competition and are therefore not caught by Article 85 (1).

As a result of this notice, there should no longer be any point in undertakings obtaining negative clearance, as defined by Article 2 of Regulation No 17 (3), for the agreements covered, nor should it be necessary to have the legal position established through Commission decisions on individual cases ; notification for this purpose will therefore no longer be necessary for agreements of this type. However, where it is doubtful whether in an individual case an agreement appreciably restricts trade between Member States or competition, the undertakings are free to apply for negative clearance or to notify the agreement.

This notice is without prejudice to any interpretation which may be given by the Court of Justice of the European Communities.

II. The Commission holds the view that agreements between undertakings engaged in the production or distribution of goods do not fall under the prohibition of Article 85 (1) of the EEC Treaty if: - the products which are the subject of the agreement and other products of the participating undertakings considered by consumers to be similar by reason of their characteristics, price or use do not represent in a substantial part of the common market more than 5 % of the total market for such products, and

- the aggregate annual turnover of the participating undertakings does not exceed 50 million units of account.

The Commission also holds the view that the said agreements do not fall within the prohibition of Article 85 (1) even if the abovementioned market share and turnover are exceeded by up to 10 % within two successive financial years.

For the purposes of this notice the participating undertakings are: 1. The undertakings which are parties to the agreement.

2. Undertakings in which the undertakings which are parties to the agreement hold: - at least 25 % of the capital or of the working capital whether directly or indirectly, or (1) This notice replaces the notice of 27.5.1970 published in OJ No C 64, 2.6.1970, p. 1. (2) OJ No C 75, 29.7.1968, p. 3, French and Dutch version as amended in OJ No C 84, 29.8.1968, German and Italian as amended in OJ No C 93, 18.9.1968. (3) OJ No 13, 21.2.1962, p. 204/62.

- at least half the voting rights, or

- the power to appoint at least half of the members of the supervisory board, the board of management or the bodies legally representing the undertaking, or

- the right to manage the affairs of the undertaking.

3. Undertakings which hold in an undertaking which is a party to the agreement: - at least 25 % of the capital or working capital whether directly or indirectly, or

- at least half of the voting rights, or

- the power to appoint at least half of the members of the supervisory board, the board of management or the bodies legally representing the undertaking party to the agreement, or

- the right to manage the affairs of the undertaking.

The aggregate turnover shall include the turnover in all goods and services achieved during the last financial year by the participating undertakings. The aggregate turnover shall not include dealings between undertakings which are parties to the agreement.