WRITTEN QUESTION E-3057/02

by Klaus-Heiner Lehne (PPE-DE) to the Commission

(25 October 2002)

Subject: Motor vehicle block exemption regulation

The Commission has now adopted the motor vehicle block exemption regulation. This has led to contracts between car dealers and manufacturers being terminated across the EU. The new block exemption will result in a considerable restructuring of the automobile industry and lead inevitably to closures, reopenings and diversification.

1. Will the Commission support the restructuring process, made necessary by the new block exemption, with accompanying measures, such as aid programmes for small and medium-sized enterprises?

2. In view of state aid law, what is the Commission's position on possible restructuring aid and support measures, to be provided at national, regional or local level?

3. Is the Commission aware of any existing programmes of this kind in the Member States?

Answer given by Mr Monti on behalf of the Commission

(11 December 2002)

1. 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(1) is designed to increase competition in the markets for the sale of new motor vehicles and for repair and maintenance services for motor vehicles and to bring tangible benefits to European consumers. In the past, vehicle manufacturers have been restructuring the networks for the distribution of their goods, in order to make them more efficient. This has been and is happening independently from the Regulation. A restructuring of the manufacturers' networks is indeed not a pre-condition for the implementation of the important measures foreseen in the new Regulation. The expiry of the former block exemption regulation and its replacement by the new Regulation does not in itself imply that motor vehicle manufacturers have to restructure their networks. This is shown also by the fact that some manufacturers have chosen to amend the agreements with their distributors. Other manufacturers have chosen to terminate these agreements. Both of these developments reflect independent business decisions of manufacturers.

Concerning a restructuring process in the motor vehicle industry it has, first of all, to be stated that a large majority of economic operators directly or indirectly concerned by the Regulation are small and medium-sized enterprises both within and outside the official manufacturers' networks of dealers and repairers.

Specific provisions of the Regulation have the object of strengthening the commercial independence of authorised dealers in order to allow them to develop their business and become more profitable. That is the case, for instance, through multi-branding, i.e. the sale of more than one brand of vehicles. The same is true as regards the possibility of a dealer in a selective distribution system to sell vehicles actively throughout the Internal Market. Moreover, dealers are given the opportunity to specialise in the sale of new motor vehicles or to (continue to) offer at the same time sales and after-sales services. In addition, a manufacturer must give detailed reasons for the termination of an agreement. These provisions improve the bargaining position of these operators vis-à-vis the manufacturers of motor vehicles.

Another important aspect is that the Regulation offers former dealers the opportunity to become authorised repairers within the network of the manufacturer. This is very important as it should compensate at least partly the tendency of decrease in dealer numbers initiated by most manufacturers of motor vehicles. They have been undertaking programmes to cut costs and rationalise distribution networks in the Community. This trend began already under the previous block exemption Commission Regulation (EC) No 1475/95 of 28 June 1995 on the application of Article 85 (3) of the Treaty to certain categories of motor vehicle distribution and servicing agreements(2) and is expected to continue also in the future, regardless of the competition rules applicable to the sector.

With regard to independent repairers, which are not members of a manufacturer's network, their competitive position is maintained and even enhanced through several provisions, such as the obligation on the vehicle manufacturers to provide them with non-discriminatory access to technical information, equipment and training. The Regulation also improves the access of independent repairers to spare parts.

It can be concluded that the Regulation itself includes provisions that strengthen the position of small and medium-sized undertakings. The Commission does not envisage specific accompanying measures such as aid programmes in relation with a restructuring of the motor vehicle sector.

2. As far as possible State aid measures are concerned, the Commission will assess on a case by case basis the compatibility of each measure, which has to be notified, with the EC Treaty, in the light of the applicable State aid rules.

For what regards small and medium-sized enterprises (SMEs), Commission Regulation (EC) No 70/2001 of 12 January 2001 on the application of Articles 87 and 88 of the EC Treaty to State aid to small and medium-sized enterprises(3) considers that investment aid to SMEs is compatible with the common market, when the aid does not exceed the thresholds specified in the Regulation.

Proposals to grant restructuring aid to firms particularly affected would be assessed under the Community guidelines on State aid for rescuing and restructuring firms in difficulty(4).

3. The Commission is not aware of any existing programmes of restructuring aid and support measures in the Member States for the motor vehicle sector.

(1) OJ L 203, 1.8.2002.

(2) OJ L 145, 29.6.1995.

(3) OJ L 10, 13.1.2001.

(4) OJ C 288, 9.10.1999.