WRITTEN QUESTION E-1851/98

by Graham Mather (PPE) to the Commission

(12 June 1998)

Subject: Barriers to the single market in cars

Earlier this year, the Commission fined Volkswagen ECU 102 million for prohibiting its dealers in Italy from selling its cars to buyers from Austria and Germany.

Nevertheless, across the European Union, trade barriers which restrict the freedom of EU consumers to purchase cars in any Member State persist. In particular, consumers from the United Kingdom are put at a disadvantage because they are not able to purchase right-hand drive cars in other Member States.

Moreover, the free market in cars across the EU is further impeded by widely divergent prices in the Member States, as the Commission's latest report on this matter acknowledges. (Commission Press Release IP/98/154 of 13 February 1998).

1. Does the Commission share my concern that EU consumers in general, and UK consumers in particular, are being denied the benefits that the single market would otherwise offer them in this sector?

2. Does the Commission believe that any competition rules or single market legislation are being breached by the practices of car manufacturers?

3. Is the Commission currently investigating any specific complaints relating to this issue?

4. Is the Commission investigating this issue in general terms, over and above its monitoring of and twice yearly report on car prices in the Union?

5. What action does the Commission propose to take to resolve this unacceptable situation?

Answer given by Mr Van Miert on behalf of the Commission

(15 July 1998)

The Commission fully agrees with the Honourable Member that open market conditions should lead to more competition and, in fact, make it easier for consumers to buy vehicles within the Community wherever they find it most advantageous.

The Commission in its Regulation (EC) 1475/95 of 28 June 1995 on the application of Article 85 (3) of the EC Treaty to certain categories of motor vehicle distribution and servicing agreements(1) reinforces this freedom. A dealer within the common market may not reject a consumer's offer to buy, or ask for a higher price simply because the consumer is a resident of another Member State. However, since it is normally in a dealer's interest to maximise sales, the consumer's right is not accompanied by an obligation imposed on dealers to sell.

1. The Commission would certainly share the Honourable Member's concern if it were the case that the benefits of the single market were being denied to European citizens. While it is true that the some consumers, particularly from the United Kingdom, have encountered difficulties in purchasing a car abroad, it is also true that many such sales are effected.

2. In the Volkswagen/Audi Commission Decision 98/273/EC of 28 January 1998 relating to a proceeding under Article 85 of the EC Treaty(2) cited by the Honourable Member the Commission demonstrated that there was a breach of Community law.

3. The Commission has been dealing with many complaints from individual consumers related to the purchase of right-hand-drive (RHD) cars. Regarding the question of parallel trade in general, an investigation was carried out in December 1996 at the premises of Mercedes-Benz in Belgium, Germany, Spain and the Netherlands, and at Opel in the Netherlands. These cases are still under consideration.

4. In addition to producing the bi-annual report on car prices, the Commission is continually monitoring the implementation of Regulation (EC) 1475/95.

5. Under Regulation (EC) 1475/95 the Commission undertook to draw up a report on the functioning of the Regulation before the end of 2000. This report will form a basis for a decision on the future of the block exemption. Certain car manufacturers in Europe are aware of the problems in the market-place and have consequently designated telephone lines for people who experience problems trying to buy a car abroad.

In addition to the Volkswagen/Audi decision, the Commission has adopted two decisions condemning obstacles to the purchase of new RHD-cars(3) outside the United Kingdom. Also, the Honourable Member is asked to refer to the Commission's earlier answers to written question P-1957/97 by Mr Skinner and written question E-2874/91 by Mr Megahy(4).

(1) OJ L 145, 29.6.1995.

(2) OJ L 124, 25.4.1998.

(3) Commission Decision of 25/9/1986, OJ L 295, 18.10.1986, p. 19; Commission Decision of 2.7.1984, OJ L 107, 2.8.1987, p. 11.

(4) OJ C 162, 29.6.1992.