98/273/EC: Commission Decision of 28 January 1998 relating to a proceeding under Article 85 of the EC Treaty (Case IV/35.733 - VW) (Only the German text is authentic) (Text with EEA relevance)
Date: 1998-01-28
Institutions: European Commission
Subjects: Germany, concessionaire, fine, infringement of EU law, motor car, motor vehicle industry

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Official Journal of the European Communities

25. 4. 98

II

(Acts whose publication is not obligatory)

COMMISSION

COMMISSION DECISION

of 28 January 1998

relating to a proceeding under Article 85 of the EC Treaty

(Case IV/35.733 — VW)

(Only the German text is authentic)

(Text with EEA relevance)

(98/273/EC)

Structure of the Decision

CHAPTER 1: THE FACTS

A. BACKGROUND ............................................................................................................

I.

Procedure ..................................................................................................................

II. The undertakings ....................................................................................................

III. Position of the makes on the relevant market ..................................................

B. PARALLEL TRADE IN VOLKSWAGEN AND AUDI MOTOR VEHICLES ....

I. Scale of parallel exports ..........................................................................................

II. Price differentials ......................................................................................................

C. THE AGREEMENTS AND CONDUCT IDENTIFIED ..........................................

I. Overall strategy .........................................................................................................

II. The agreements and practices in detail ................................................................

1. Terminology .........................................................................................................
2. Margins .................................................................................................................
3. Bonuses .................................................................................................................
4. Restricted supply to the Italian market ...........................................................
5. Restrictions on delivieries inside the distribution network ...........................
6. Termination of contracts ....................................................................................
7. Written undertakings ..........................................................................................

D. RESULT OF THE AGREEMENTS AND CONDUCT OF VOLKSWAGEN,
AUDI AND AUTOGERMA ........................................................................................

I. Consumer reactions .................................................................................................

II. Conduct of dealers towards Autogerma ...............................................................

III. Conduct of dealers towards customers .................................................................

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CHAPTER 2: LEGAL ASSESSMENT

A. ARTICLE 85(1) ..............................................................................................................

I. The undertakings ....................................................................................................

II. The agreement .........................................................................................................

1. The export ban/restriction ................................................................................

2. Agreement ...........................................................................................................

3. Conclusion ...........................................................................................................

III. Appreciable restriction of competition .................................................................

1. The object or effect of restricting competition .............................................

(a) The object .....................................................................................................

(i) Restrictive object of the combination of measures ..............................

(ii) Restrictive object of the measures of isolation .....................................

(b) The effect ......................................................................................................

(c) Conclusion .....................................................................................................

2. Appreciable restriction of competition ............................................................

IV. Appreciable effect on trade between Member States .........................................

V. Conclusion ...............................................................................................................

B. ARTICLE 85(3) ..............................................................................................................

I. Block Exemption Regulations (EEC) No 123/85 and (EC) No 1475/95 .......

1. Article 3(10)(a) of Regulation (EEC) No 123/85 ............................................

(a) Terminology ..................................................................................................

(b) Form of the measures .................................................................................

2. Article 3(11) of Regulation (EEC) No 123/85 ...............................................

3. Article 3(10)(a) and (11) of Regulation (EC) No 1475/95 ............................

4. Article 6 of Regulation (EC) No 1475/95 ......................................................

II.

Individual exemption ..............................................................................................

III. Conclusion ...............................................................................................................

C. COUNTER ARGUMENTS PUT FORWARD BY VOLKSWAGEN .....................

I.

Inconclusiveness of internal documents ...............................................................

II. The lawyers employed by Audi can claim privilege .........................................

III. Volume of grey imports .........................................................................................

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D. DURATION OF THE INFRINGEMENT .................................................................

91

E. ARTICLE 3(1) OF REGULATION No 17 ................................................................

91

F. ADDRESSEE OF THE DECISION ............................................................................

92

G. ARTICLE 15 OF REGULATION No 17 .................................................................

92

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25. 4. 98

THE COMMISSION OF THE EUROPEAN COMMUNITIES,

(2)

Having regard to the Treaty establishing the European
Community,

Having regard to Council Regulation No 17 of 6 February
1962, First Regulation implementing Articles 85 and 86
of the Treaty (*) (1), as last amended by the Act of Acces-
sion of Austria, Finland and Sweden, and in particular
Article 3, Article 15(2) and Article 16(1) thereof,

Having regard to the Commission Decision of 24 October
1996 to open a proceeding in this case,

Having given the parties concerned the opportunity to
make known their views on the objections raised by the
Commission, pursuant to Article 19(1) of Regulation No
17 and Commission Regulation No 99/63/EEC of 25 July
1963 on the hearings provided for in Article 19(1) and (2)
of Council Regulation No 17 (2),

After consulting the Advisory Committee on Restrictive
Practices and Dominant Positions,

Whereas:

Chapter 1:

THE FACTS

A. Background

I. Procedure

(1)

From the beginning of 1994 onward the Commis-
sion received a growing number of letters from
German and Austrian consumers complaining of
difficulties encountered with the purchase in Italy
of new motor vehicles of the Volkswagen and Audi
makes for re-export to Germany or Austria. These
complaints gave grounds for the suspicion that at
least since the beginning of 1994 Volkswagen AG
and Audi AG, together with their joint importer for
Italy, Autogerma SpA, and their dealers in Italy,
had entered into agreements according to which
motor vehicles, and passenger cars in particular,
were not to be sold to final consumers resident in
other Member States
than Italy. A market-
partitioning strategy of this kind would fall under
Article 85(1) of the EC Treaty.

(*) All the notes and the translations of passages quoted in lan-
guages other than English appear at the end of this Decision.

On 17 October 1995, in order to establish whether
it could be concluded on the basis of that evidence
that the suspected conduct had in fact taken place,
the Commission adopted a decision ordering inves-
tigations under Article 14(3) of Regulation No 17.
The investigations ordered were carried out on 23
and 24 October 1995. The present Decision is
founded on documents discovered in the course of
those investigations and on consumer complaints
lodged with the Commission.

The investigations were carried out on the premises
of
the following undertakings: Volkswagen AG,
Wolfsburg; Audi AG, Ingolstadt; Autogerma SpA,
Verona; Auto Brenner SpA, Bolzano/Bozen; Auto
Pedross Herbert & Co., Silandro/Schlanders; Dori-
goni SpA, Trento; Eurocar SpA, Udine; IOB Silvano
& Co. SRL, Gemona; Adriano Mansutti, Tricesimo;
G(cid:129)nther Rabanser, Pontegardena/Waidbruck; Mut-
schlechner SAS, Brunico/Bruneck; and Franz Nitz,
Vipiteno/Sterzing.

II. The undertakings

Volkswagen AG, with its
registered office in
Wolfsburg, is the parent company of the Volks-
wagen group, and the largest and most important
company in the group. The group’s business
includes the manufacture of motor vehicles of the
Volkswagen, Audi, Seat and Skoda makes, and the
manufacture of components and parts
its
worldwide group structure. The group also has
industrial motors, spare parts, financial services and
insurance operations.

for

Volkswagen AG has a 98,99 % holding in Audi AG
(Audi), Ingolstadt, and a 100 % holding in Auto-
germa SpA (Autogerma), Verona. Audi’s main busi-
ness is the manufacture and distribution of vehicles
of the Audi make, and the manufacture of vehicle
parts
Italian
importer of Volkswagen and Audi vehicles and of
spare parts and accessories for those vehicles.

and engines. Autogerma

the

is

(3)

(4)

(5)

(6)

This Decision is
addressed to
Volkswagen as the parent company of Audi and
Autogerma.

consequently

III. Position of the makes on the relevant

market

(7)

the Commission’s

In the three years 1993, 1994 and 1995, according
of
to
Volkswagen and Audi passenger
in the
Member States were as follows (numbers of units,
with market shares shown in brackets).

information,

sales

cars

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Year

1993
1994
1995

Volkswagen

Audi

1 231 844
1 253 750
1 276 900

(11,1 %)
(10,7 %)
(10,5 %)

312 920
314 095
370 712

(2,8 %)
(2,7 %)
(3,0 %)

(8)

In the same period sales of the two makes in Italy were as follows (numbers of
units, with market shares shown in brackets).

Year

1993
1994
1995

Volkswagen

Audi

169 738
129 063
157 463

(9,0 %)
(7,0 %)
(8,3 %)

40 812
45 095
46 997

(2,2 %)
(2,4 %)
(2,5 %)

(9)

Sales of the two makes in Germany were as follows (numbers of units, with market
shares shown in brackets).

Year

1993
1994
1995

Volkswagen

Audi

665 496
677 274
677 307

(20,8 %)
(21,3 %)
(20,7 %)

169 861
156 998
156 484

(5,3 %)
(4,9 %)
(4,8 %)

(10)

Sales of the two makes in Austria were as follows (numbers of units, with market
shares shown in brackets).

Year

1993
1994
1995

Volkswagen

Audi

48 384
49 199
50 851

(16,9 %)
(17,5 %)
(16,9 %)

12 303
9 713
11 366

(4,3 %)
(3,5 %)
(3,8 %)

B. Parallel trade in Volkswagen and Audi
motor vehicles

Volkswagen and Audi models
Germany amounted to about 19 000 vehicles.

from Italy to

I. Scale of parallel exports

(11) Documents found on Audi’s premises put

the
number of vehicles of all makes re-exported from
Italy in the period from January to June 1994 at
131 472 (about 12 % of all vehicles delivered to
customers in Italy). On the basis of this figure,
re-exports for the whole of 1994 were estimated at
some 250 000 vehicles, (about 13 % of deliveries to
customers in Italy). There were 19 429 Volkswagen
and Audi vehicles re-exported from Italy in the
first half of 1994, giving a total of about 39 000
vehicles for the year (3). Other documents found on
the premises of Volkswagen and Audi show that
reimports of Volkswagen and Audi vehicles from
Italy into Germany amounted to some 19 000
vehicles in 1993 (4). In 1994 the figure for corres-
ponding reimports of those two makes was substan-
tially higher, at 22 000 (5). In their comments on
the Commission’s
the
in 1995 re-exports of
undertakings

statement of objections,

said that

(12) Until May 1993 the number of vehicles reimported
was evidently small, but from June and July 1993
onward it rose considerably, for all Volkswagen and
Audi models. Between December 1992 and June
1995 the Audi vehicles reimported into Germany
accounted for between 17,4 % and 20,3 % of del-
iveries to Italy (6). In Volkswagen’s case the figure
was lower, at 13,0 % in January 1994 and 15 % in
March 1995 (7). The proportion of re-exports to
deliveries in Italy was substantially higher in the
case of Volkswagen and Audi than it was in the
case of their competitors, with the exception of the
Italian manufacturers and Seat (8).

(13)

re-exports of
Looked at on a monthly basis,
Volkswagen vehicles
to Germany
from Italy
showed a strong upward trend from June 1993
onward, reching a climax in November 1993, and
were appreciably lower again from February 1994.
There was a fresh increase in August 1994, and this
continued into 1995, although without reaching the
high levels of the second half of 1993 (9).

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25. 4. 98

(14)

The monthly figures for re-exports of Audi vehicles
from Italy to Germany increased substantially from
May 1993, and reached their high point in October
1993. Thereafter, that is to say in the course of
1994, they fell to a much lower level, before rising
appreciably once again from February 1995 (10).

Commission’s objectives in publishing this study is
to achieve a measure of price tansparency, so as to
encourage consumers to buy motor vehicles in
those Member States in which prices and other
terms are most advantageous. The Commission has
not set out to establish price parity throughout the
Community. The Commission does hope, however,
that greater price transparency will release market
forces which will reduce price differentials.

II. Price differentials

(15)

Twice a year the Commission publishes a study of
car prices in the European Union (11). The data are
the
supplied by motor manufacturers. One of

(16) On the basis of the prices reported in these studies,
the price differentials between Italy, Germany and
Austria for
the biggest-selling Volkswagen and
Audi models have been as follows (12).

Reference date

Model

Italy

Germany

Austria

1. 5. 1993

1. 11. 1993

1. 5. 1994

1. 11. 1994

1. 5. 1995

1. 11. 1995

VW Polo
VW Golf
VW Vento
VW Passat
Audi 80
Audi 100

VW Polo
VW Golf
VW Vento
VW Passat
Audi 80
Audi 100

VW Polo
VW Golf
VW Vento
VW Passat
Audi 80
Audi 100

VW Polo
VW Golf
VW Vento
VW Passat
Audi 80
Audi A 6

VW Polo
VW Golf
VW Vento
VW Passat
Audi A 4
Audi A 6

VW Polo
VW Golf
VW Vento
VW Passat
Audi A 4
Audi A 6

100,0
100,0
100,0
100,0
100,0
107,5

101,2
106,3
110,0
100,0
102,1
105,0

106,3
106,2
108,9
102,9
102,7
100,2

101,6
100,6
105,8
100,0
100,0
100,0

100,0
100,0
100,0
100,0
100,0
100,0

106,5
100,0
100,0
101,3
100,0
100,0

147,0
121,9
128,2
131,6
123,5
125,0

126,3
119,4
131,3
129,6
119,8
128,0

125,7
117,0
114,6
117,1
115,6
118,2

125,0
115,6
113,5
120,1
116,5
112,9

136,6
126,5
123,0
131,2
132,5
123,9

135,9
118,1
114,6
130,6
120,8
119,8

n.a.
n.a.
n.a.
n.a.
n.a.
n.a.

n.a.
n.a.
n.a.
n.a.
n.a.
n.a.

n.a.
n.a.
n.a.
n.a.
n.a.
n.a.

n.a.
n.a.
n.a.
n.a.
n.a.
n.a.

128,9
130,5
132,0
128,9
133,7
125,8

125,6
115,7
108,1
106,7
120,6
118,0

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(17)

It can be concluded from these figures that for the
selected models the price differentials between Italy
and Germany were generally sufficiently wide to
provide an incentive for parallel exports from Italy
from 1 May 1993 until 1
to Germany at
November 1995, and that the same is true of Italy
and Austria from 1 January 1995.

least

C. The agreements and conduct identified

(18) An overall strategy can be discerned in the agree-
ments concluded and conduct engaged in by
Volkswagen, Audi, Autogerma and their authorised
Italian dealers: this strategy is aimed at preventing
or substantially restricting parallel exports from
Italy to Germany and Austria. The agreements and
conduct in question, even considered in isolation,
have the object and the effect of appreciably
restricting trade between Member States.

(19)

Parallel trade in the motor vehicle business (in this
case parallel exports or parallel imports) is the sum
of all cross-border sales. These sales are of two
kinds: on the one hand sales by dealers in the offi-
cial distribution network to dealers outside the
network (‘independent dealers’) in other Member
States, and on the other hand sales to final consu-
mers in other Member States, whether direct or
through an intermediary. That distinction also
(EEC) No
underlies Commission Regulations
123/85 and (EC) No 1475/95 on the application of
Article 85(3) of the Treaty to certain categories of
motor vehicle distribution and servicing agree-
ments (13).

I. Overall strategy

(20)

In the course of its investigations the Commission
has found documents listing some of
the com-
ponent measures in the overall strategy.

1944 (14) (1994 is meant, compare the date given in
the Annex to the letter) describes the measures, and
tabulates them in an Annex:

der

‘. . . Bei der gesamten italienischen Verkaufsorgani-
sation besteht große Sorge um die Erreichung der
Verkaufsziele und die Notwendigkeit der Auf-
rechterhaltung
bisherigen Verkaufserfolge.
Diese Notwendigkeit hat dazu gef(cid:129)hrt, daß einige
Partner, gedr(cid:132)ngt von außenstehenden Verkaufsor-
ganisationen (darunter
ausl(cid:132)ndische
Volkswagen- und Audi-H(cid:132)ndler), Verkaufsaktivi-
t(cid:132)ten auch in Gebieten t(cid:132)tigen, die weit von der
vertraglich festgelegten Zone liegen, manchmal
sogar bis ins Ausland.

zahlreiche

hinsichtlich

Das Eingreifen der Autogerma hat daher den Sinn
und Zweck, die Volkswagen-Audi-H(cid:132)ndler in die
vertraglich festgelegten Gebiete zu verweisen, wobei
der Vertragserf(cid:129)llung,
Kontrollen
die Verkaufsaktivit(cid:132)ten im
insbesondere was
Vertragsgebiet selbst betrifft, bei
jeder einzelnen
Firma durchgef(cid:129)hrt werden (wobei bei Nichterf(cid:129)l-
lung der Vertragsbedingungen 6 H(cid:132)ndlervertr(cid:132)ge
gek(cid:129)ndigt worden sind unter Ber(cid:129)cksichtigung der
vorgesehenen Termine, die das Vertragsende per
Ende 1994/Mitte 1995 vorsehen). Bei anderen
aufgrund einiger
H(cid:132)ndlern beabsichtigen wir,
“Auditing-Ergebnisse” bez(cid:129)glich Auslieferungen,
die Nichterf(cid:129)llung zu beanstanden, um genauere
Daten (cid:129)ber die Endverbraucher der Fahrzeuge
selbst zu erfahren.

Dieses Vorgehen werden wir weiter
in der
Verkaufsorganisation ausarbeiten; das Projekt sieht
eine neue Margenstruktur mit noch gr(cid:148)ßerem
Wichtigkeitsgrad vor, wobei der Prozentsatz der
“maggiori-sconti” (Bonus) — dem die Erreichung
der Vertragsverpflichtung mengen- und qualit(cid:132)ts-
m(cid:132)ßig unterliegt — erh(cid:148)ht und der feste Prozent-
satz auf Fahrzeugrechnungen reduziert wird. Hier-
durch wird eine bessere Verteilung der belastenden
Margen erreicht.

(21) A letter from the chairman of Autogerma, Mr
to Volkswagen, dated 21 September

Schlesinger,

Anlage zum Schreiben COMIORG/EP/st., vom 21.
September 1994:

Verk(cid:132)ufe außerhalb Vertragsgebiet und/oder (cid:129)ber nicht autorisierte Kan(cid:132)le

Vorbeugende Maßnahmen Kontrollmaßnahmen

Strafmaßnahmen

1. Generelle

Hinweise

1. Kontrolle

der Zulas-

1. Ermahnungsgespr(cid:132)ch

jeder Besprechung

sungen/Verk(cid:132)ufe

2. Direkte

Hinweise
anl(cid:132)ßlich jeder Unterre-
dung

3. Schriftliche Ermahnung
der

Einhaltung
zur
Vertragsvereinbarungen

2. Auditing

2. Verwarnungsschreiben

3. Untersuchungen außer-
halb Vertragsgebiet

3. Blockierung

des
maggior-sconto (Bonus)

4. K(cid:129)ndigung des H(cid:132)ndler-

vertrags . . .’.

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(22) A memo (in English) from Autogerma to Volks-
wagen, dated 26 September 1994 and entitled
Measures
to control and prevent re-export (15),
includes the following:

— ‘. . . With reference to the discussion we had in
Verona on Thursday 15 and Friday 16
September
Schlesinger, Bertino, De
Simone, Wichmann, Kuhn) and the following
phone calls on the subject, we confirm herewith
the main measures taken by Autogerma to
control and prevent re-export.

(Mr

— circular letters explaining to the dealers, the
limits set by the EC guidelines contained in
Regulation (EEC) No 123/85,

— overproportional

list price increase (with the
well-known consequences in terms of price
index and volumes),

— auditings at the suspected dealerships,

— strong recommendation of

the President of
Autogerma at the Verona dealers meeting of 14
July 1994 to sell the imported cars in Italy and
in particular in their territory,

— same recommendation to the marketing dealer
group meeting held in Verona on 27 July,

— the concept has been resumed once again by
the President of Autogerma on the occasion of
the New Polo congress of 3 and 4 September in
Paris,

— also in the dealer council meeting which took
place in Paris on 4 September, clear sentences
were said by Mr Schlesinger in order to avoid
the re-export of the New Polo and in general of
the cars imported by Autogerma,

— with an internal note of 28 June addressed to
the management of Autogerma, the President
takes upon himself the approval of the quar-
terly bonus for all the extra-territory sales,

— the quarterly bonus, blocked for all the extra-
territory sales, will be paid, starting from the
next quarter, only on the basis of car registra-
tion,

— also for

the final customer,

the promotional actions which are
the
mostly in favour of
registration in Italy is required for the payment
of the support generally consisting in acces-
sories, buy-back promise of financing oppor-
tunities,

avoid trials and the costs with them involved
also in terms of damage of image. Furthermore
replacements at the present time could be diffi-
cult or
additional
impossible. This brings
problems in the territory coverage,

— increment of the Autogerma stock to reduce
the dealers’ financial investments. This avoids
that dealers look for undesired selling channels,
— due-to this policy we still have in Autogerma

the following very old unsold stock:

cars older than 14 months

cars older than 13 months

cars older than 12 months

cars older than 11 months

cars older than 10 months

41

48

323

656

915

cars older than 9 months

1 460

Total

3 443

— all

actions

the promotional

are developed
adding value to the cars mounting accessories.
This avoids dealers to use additional marge in
the re-export,

— field representatives are also monitoring the
various situations reporting, where is the case,
re-export activities of the dealers,

— the distribution of the New Polo will be strictly
controlled. The dealers with past re-export ac-
tivities will be cut in supplying,

— our marketing is studying new action models
specific for Italy and unknown abroad. These
action models could be launched in 1995,
— we are convinced that with these measures we
shall possibly reduce drastically the re-export if
also in Germany actions are taken with the
German dealers which are continuously looking
for new cars getting in touch directly with our
dealers and Companies like VAGAS are pro-
hibited to make interesting offerings to our
dealers which are in this moment
in red
figures. . . .’.

— dealer orders are daily controlled. Orders ex-
the demand need special

ceeding 10 % of
approval to be accepted,

— specific letters are sent
involved with re-export,

to dissuade dealers

— suspected foreign buyers have to sign an obliga-
tion not to resell the car before a minimum
number of months; penalties are set
in the
contract,

— recidivous dealers receive notice to leave (up to
date six have received notice). In any case this
measure will be applied carefully in order to

(23) A Volkswagen memo, Maßnahmen durch Auto-
germa
von Re-Exporten
(Measures taken by Autogerma to avoid re-exports),
dated 6 February 1995 (16), includes this:

zur Vermeidung

‘. . .

— Schriftliche

Information (Handel)

zur EU-

Richtlinie 123/85.

— Wiederholtes Auditing verschiedener H(cid:132)ndler.
Abmahnungen, Bonusk(cid:129)rzungen, 11 K(cid:129)ndi-
gungen (gef(cid:132)hrdetes Volumen ca. 8 800 Fzg. in
1995) — siehe Anlage.

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— Bonus (Trimester) wird gezahlt auf Basis Fahr-

zeug-Zulassungen im Vertragsgebiet.

— (cid:154)berproportionale Listenpreis-Erh(cid:148)hungen.

— Vermeidung “(cid:154)berlagerung”

auf Einzelhan-

delsebene.

— “Margen-Splitting” beim Polo A 03

— 8 % sofort bei Rechnung

— 5 % Nachweis NZ im Vertragsgebiet

— 3 % Bonus (Zielsetzung, Kundenzufrieden-

heit, Betriebsstandards).

— Sonstiges

(siehe

Schreiben AG vom 26.

September 1994). . .’.

imports could not

(24) With reference to its German distributors, Audi
stated that in the light of Regulation (EEC) No
123/85 parallel
legally be
prevented by manufacturers, and that it would be
‘somewhat risky’ to connect the measures taken in
Italy with the prevention of reimports ‘and to docu-
ment this in a letter to the German dealers’ organ-
isation’. Audi consequently proposed that
the
measures taken in Italy ‘should be communicated
orally between regions’ (17).

(25) An Autogerma memo (in English), Measures to
control and prevent re-export, dated 15 March
1995 (18), includes this.

‘Measures to control and prevent re-export

Time

Prevention
measures

Time

Control
Measures

Time

Sanctions

15.10.1991-28.1.1993-
1.7.1993
11.8.1993-12.10.1993-
15.10.1993
6.6.1994-21.3.1995
(ready)

Periodic

Periodic

letters
Circular
contained limits
set
by Regulation (EEC)
No 123/85

Strong recommenda-
general
tion
meeting

in

Strong recommenda-
tion in meeting with
dealer

since
2o F.M.P. 1994

Delivery and N.C.R.
control

Periodic

Meeting with dealer and
recall

since
2o F.M.P. 1994

Auditing
suspected dealers

at

the

7.12.1993 &
24.2.1995

Warning letters (76-20)

since
2o F.M.P. 1994

Dealers orders daily
controlled

since
3o F.M.P. 1993

Quarterly bonus blocked
for extra-territory sales

since
2o F.M.P. 1994

requested

documents
for
promotion

N.C.R.
are
payment
actions

since
1o F.M. 1995

Quarterly
paid only for N.C.R.

sales

bonus

ORGANIZZAZIONE 15. 3. 1995 GD control’

since
3o F.M.P. 1994

Polo and A4 distribu-
tion is controlled

since
6.1994

Dealer contract cancella-
tion (11)

(26)

By comparing deliveries to the importer with new
car registrations in Italy and Germany, Volkswagen
and Audi were able to establish the precise volume
of reimports into Germany from Italy for each
model on a monthly basis (19). The corresponding
information was supplied to Audi by the Kraft-
fahrt-Bundesamt
the German Federal
Office for Motor Traffic). Audi had to give the
Office an undertaking that it would not use the
data to identify or monitor
foreign authorised
dealers (20).

(‘KBA’,

(27)

For
the issue of manufacturers’ certificates of
conformity which had hitherto been free of charge,
Volkswagen now introduced a fee of DEM 150 ‘to

make reimports difficult’; in addition to this fee,
Audi also demanded evidence of purchase (invoice,
contract of sale or the like) (21).

(28)

In order to be able to monitor re-exports, Volks-
wagen and Audi instructed Autogerma to maintain
systematic surveillance of the Italian dealers’ sales
activities and to report its observations back to the
manufacturers (22). In this connection, Volkswagen
and Audi provided Autogerma with chassis
numbers they had noted, mainly in Germany (23),
and asked Autogerma to trace the supplying Italian
dealers and customers (24). This system of surveil-
lance made it possible to establish a breakdown of
reimports by dealer, customer and model (25).

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Official Journal of the European Communities

25. 4. 98

(29)

(30)

Volkswagen told Autogerma, when it carried out
what were known as ‘audits’
‘auditings’ of Italian
dealers, to note deliveries to German and Austrian
Volkswagen and Audi dealers, and to investigate
sales to unauthorised dealers (26).

In one case in which an Audi employee had
bought an Audi A 4 in Italy and had sought a
manufacturer’s certificate with a view to registration
in Germany, the employee gave Audi a statement
confirming that
the vehicle would be used for
private purposes only and would not be sold within
six months, on the ground that in the event of a
check on the statistics issued by the KBA the
vehicle ‘would show up as a reimport and would
cause trouble’ (27).

(35)

(36)

(31) Audi asked its German dealers to note and report
the chassis numbers of reimported vehicles offered
for sale by independent dealers in Germany (28).
The Austrian main importer Porsche Austria (29)
monitored reimportation into Austria, even by
private customers (30). The steps taken by Audi were
successful: in the first quarter of 1995 there was
‘not a single A 4 imported from Italy to Austria’ (31).

replies

a uniform formulation for

In January 1994, in view of an increasing number
of letters it had received from customers complain-
ing of difficulties with re-exports, Audi decided to
adopt
to
consumers. They were to be told that reimported
vehicles often had different specifications, and had
to be re-equipped, which could increase the cost.
Audi would also point to the much longer time
which had to be spent on the purchase of a reim-
special approvals are often
ported vehicle,
required by the authorities’. Lastly, reference was to
be made to advantages in terms of inspections and
guarantees
from a
domestic dealer (32).

the vehicle was bought

‘as

if

In answers to customer complaints Audi referred
among other things to the different specifications
of the models intended for the Italian market, the
longer delivery times for those models, and the fact
that Audi had no power to tell dealers which
consumers to sell to (33).

(32)

(33)

(34)

Instead it was

gegeben werden d(cid:129)rfen’
to be
expressly emphasised that there were no instruc-
tions or trade restrictions which had been imposed
in order
to
Community law (34).

reimports

contrary

obstruct

to

Volkswagen instructed Autogerma as to how to
reply to customers who asked the importer for
assistance. Autogerma was
the
importer it could not accept orders, since it did not
sell to private customers, and that a dealer could
not be forced to sell to a particular customer (35).

to say that as

From records of
the correspondence between
manufacturers and consumers it is clear that in
some cases the manufacturers gave the importer or
dealers the ‘green light’ for a sale to a consumer,
but only after considering the circumstances of the
case (36).

(37) Autogerma received a large number of letters from
customers complaining of obstacles to the purchase
of vehicles from Italian dealers, and asking Auto-
germa for assistance (37). In its replies Autogerma
referred especially to long delays for the delivery of
certain models such as the new VW Polo, which
depended on the manufacturer’s capacity to deliver,
but
to
it did not give a binding commitment
deliver by a particular date (38). In certain cases
Autogerma asked customers to confirm in advance
that they intended ‘to acquire the car in Italy direct
or through a reliable intermediary’ (39).

(38)

(39)

It was Autogerma’s intention ‘to warn [the Italian
dealers] to stay in the territories designated by their
contracts’; if it were shown that a dealer had sold
outside the contract territory, or through unauthor-
ised channels, Autogerma would take measures on
a graduated scale of intensity (40).

In order to keep a check on sales, Volkswagen and
Audi supplied Autogerma with the chassis numbers
which they had ascertained for vehicles offered for
sale in Germany, especially by independent dealers,
and instructed Autogerma to use these numbers to
establish which Italian dealers had supplied the
vehicles and to report
this information back to
them (41). Autogerma also kept the manufacturers
the results of checks on
regularly informed of
dealers and of measures to restrain unwanted sales.

In the event of enquiries from final consumers
Volkswagen recommended:
‘in keinem Fall den
Eindruck entstehen (zu) lassen, daß auf Anweisung
der VW AG, der Autogerma oder einzelnen
Personen dieser Unternehmen keine Informationen
an Privatkunden oder zul(cid:132)ssige Vermittler heraus-

(40)

To ensure the success of the overall strategy, Auto-
germa stepped up the monitoring of registrations
in Italy. Dealers were called on generally for all
deliveries to indicate the registration number with
the delivery notification. From September 1994

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L 124/69

onward Autogerma also monitored the orders
received on a daily basis (42); dealers wishing to
depart from their planned requirements by more
than 10 % had to have special authorisation from
Autogerma. When Italian dealer’s export business
expanded Autogerma evidently reacted by delaying
or limiting supplies to them (43).

From 1993 at the latest Autogerma instructed one
of its divisions, SEVO, to monitor the Italian dealer
network, and in particular sales activities and the
number of vehicles sold abroad (44). The first mon-
itoring reports contained lists of foreign customers,
and referred to warnings to dealers not
to sell
abroad (45).

In a letter to Audi, Autogerma confirmed that every
effort was being made to stop all exports by dealers
including sales to other authorised dealers and to
final consumers (46). All vehicles supplied by Auto-
germa were invoiced including VAT (47), with the
clear intention of encouraging sale inside Italy and
making exportation more difficult administratively.
For the new VW Polo strict checks were carried out
on sales, and deliveries were reduced in the case of
dealers who had in the past been noted for their
high volumes of re-export (48).

‘re-export activities’ (49). In a handwritten memo of
July 1995 discussing the case of a ‘genuine inter-
mediary’ who had threatened to complain to the
Commission
evidently
obstructed the purchase of a vehicle, Volkswagen
recommended giving in ‘on political grounds’, in
order to avoid the ‘withdrawal of the Block Exemp-
tion Regulation’ (50).

after Autogerma

had

(45) Audi has likewise used various terms (such as the
‘grey market’, ‘reimports’, the ‘reimport market’, the
‘illegal reimport market’, and ‘supply by unauthor-
ised dealers’) especially in connection with analyses
of the problem of parallel trading between Italy
and Germany or Austria and the measures to be
taken, or already taken.

(46) At the end of 1994 Audi set up a ‘task force’, with
authority to combat the grey or reimport market,
re-
and the necessary human and material
sources (51). This officially began its work — which
was to last for no more than two years — on 1
January 1995 (52). Audi sent its dealers and impor-
ters a circular informing them of the ‘objectives
and terms of reference’ of the task force, and asked
its dealers to cooperate (53).

II. The agreements and practices in detail

(47)

The agreements and practices which together form
the overall strategy described in recital 1 are as
follows.

1. Terminology

(a) Definitions

(48)

(49)

In its correspondence both inside and outside the
company Volkswagen has not used uniform terms
to define parallel trading. It has usually referred to
sales to unauthorised dealers as the ‘grey market’,
but has often spoken of the grey market and the
reimport market in the same breath, or referred
generally to ‘reimports’ or ‘re-exports’.

In its marketing plan for 1995 Volkswagen referred,
in connection with its distribution strategy, on the
subject of ‘reimports’ to countermeasures aimed at
‘stopping reimports by exercising influence with
dealers’ and to ‘targeted measures against “grey
importers”’. In internal memos of September 1994
and February 1995, discussing measures that had
of
been taken, Volkswagen spoke

generally

reimports’

The ‘objectives and terms of reference’ were, first,
(primarily ‘supply into
‘to combat
Germany’ but also ‘into other countries of
the
European Union’), and, second,
‘to prevent supply
by unauthorised dealers’ (54). Elsewhere the unit’s
objective was described as ‘lasting limitation and
prevention of the grey or reimport market’ (55), or
its
restriction to a normal competitive level.
Reference was also made here to the competitors
(BMW and Mercedes).

In a memo on the subject of the project for com-
bating the ‘grey market/reimports’, Audi defined
the terms of reference and objectives of the project
(i.e. of the task force) as ‘1. to combat reimports’
and
unauthorised
dealers’ (56). Elsewhere Audi used the term ‘reim-
ports’ to refer only to ‘cross-purchases abroad by
authorised German dealers’ and supply to dealers
outside the organisation (grey market dealers) (57).

to prevent

supply

‘2.

to

to less

The task force’s immediate working objective was
to limit exports
than 100 vehicles a
month (58), or
reduce the grey market/reimport
volume by half within six months, the results to be
visible by September 1995 (59). A series of measures
was decided with a view to achieving the task
force’s objectives (60).

(41)

(42)

(43)

(44)

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Official Journal of the European Communities

25. 4. 98

(50)

(51)

Thus, Audi presents the grey market as a part of
the broader reimport market, but the measures it
takes are often aimed at the grey and reimport
markets together, as is clear here. The inconsistent
terminology has consequently had the effect, or the
object, of giving the Italian dealers the impression
that export bans and other measures to stop parallel
trading, including penalties, also apply to sales to
and re-exports by non-Italian final consumers.

This choice of
terminology has confused the
distinction between sales to dealers outside the
distribution network, trading for their own account,
on the one hand, and sales to final consumers,
intermediaries acting on consumers’ behalf, or
dealers belonging to the network, on the other, and
made that distinction harder to apply, or indeed
deliberately blurred it.

(52)

The main distinction Autogerma had made in its
correspondence with the authorised dealers is a
distinction between sales inside and sales outside
the contract territory.

to

their

influence

(53) At least from 1993 onward Autogerma sent the
Italian dealers instructions, cautions and warnings
activities.
intended
Thereafter Autogerma repeatedly urged the Italian
dealers, both verbally and in writing, not to engage
in grey imports. In view of their increased efforts to
achieve their sales targets, and the numerous en-
quiries reaching them from authorised VW and
Audi dealers, Italian dealers were emphatically told
to sell in their own contract territories (61).

sales

territory either

(54) Autogerma repeatedly cautioned the Italian dealers,
both verbally and several times in writing, not to
sell outside their contract territory, that is to say
inside or outside
outside their
Italy (62). The dealers in Trento, Bolzano/Bozen and
Silandro/Schlanders at whose premises the invest-
igations were carried out stated to the Commission
that Autogerma had repeatedly given them verbal
instructions not to export. The instructions related
in particular to unauthorised dealers, but expressly
included sales to final consumers (63). It was made
clear to dealers (64) that if they failed to comply with
this instruction they could expect to have their
contract terminated (65).

(55)

Similar instructions and warnings were also given
in respect of particular models (the Audi A 4, the
new VW Polo, the VW Golf Berlina and the VW
Golf Variant) (66). As regards the new VW Polo, the

dealers were cautioned in September 1994 not to
give discounts and not to sell for export (67).

(56) Autogerma forbade the dealers from selling to ‘salo-
nisti’ (68). In Italian usage this expression (which
might be translated ‘showroom operators’) contrasts
with ‘concessionari’, or dealers belonging to the
distribution network, but it does not distinguish
between independent dealers and intermediaries.
The importer repeatedly referred in this connection
to Regulation (EEC) No 123/85, which in its view
prohibited such sales (69), and warned dealers that
any infringement could be expected to result in
withdrawal of the exemption by the Commission.
Autogerma was here giving a truncated account of
the position which would necessarily leave dealers
under the false impression that also if they sold to
intermediaries they would be breaking Community
competition law, and would leave themselves open
to penalties.

(57) Autogerma and Audi were aware that dealers were
telling customers that they were unable or were not
allowed to sell abroad or to foreigners (‘they tell
customers they cannot sell abroad’). Dealers were
accordingly instructed, especially with a view to
possible investigation by the Commission, not to
speak of a ban imposed by Autogerma or the
instead to accept orders and
manufacturers, but
subsequently to invoke difficulties with stocks and
deliveries (70).

(58) Autogerma repeatedly confirmed its determination
to take the necessary steps ‘to achieve the goal of
stopping exports from Italy’ (71). Lists of measures
in pursuit of this objective were drawn up in agree-
ment with the manufacturers (72). Autogerma was
aware that some aspects of its strategy would not be
compatible with the future Community rules on
motor vehicle distribution (73).

(b) Security classification of documents

(59)

Volkswagen, Audi and Autogerma have included a
confidentiality clause in many documents dealing
with limitation measures. For example, correspon-
dance concerning the list of measures to control
and prevent re-export was classified ‘highly confi-
dential’ (in English) or ‘riservato’ (confidential) (74).
Documents concerning the introduction of margin
splitting (75), cautions to or supervision of dealers (76)
and cancellation of dealership contracts (77) were
often classified ‘riservato’ or ‘vertraulich’ (confiden-
tial).

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L 124/71

(c) Effects on dealers

(b) Audi AG

Italian dealers,

(60) As a result of the terminology used by the group,
and especially by Autogerma in correspondence
impression has
with the
the
frequently been given that all
re-exports were
prohibited. The terminology necessarily left dealers
in a state of uncertainty which in many cases led
them to avoid dealing with final consumers or
intermediaries
behalf.
Whether or not
there is in fact an established
terminology of parallel trading, careful distinctions
ought to have been drawn, as they are in Regula-
tions (EEC) No 123/85 and (EC) No 1475/95 on
motor vehicle distribution.

consumers

acting

on

(61)

(62)

(63)

Inconsistent and imprecise terminology in relation
to parallel trading has led to uncertainty inside the
group, that is to say in conversations and corres-
pondence between Volkswagen, Audi and Auto-
germa. The terminology has also had an effect on
relations between the group and its dealers, and left
the dealers uncertain as to which sales are per-
missible and which are not. It has thus reduced the
dealers’ margin of discretion with regard to sales
outside their contract territories.

2. Margins

(a) Volkswagen AG

importer gives

In October 1994 Volkswagen announced the intro-
duction of a ‘split-margin’ for sales of the new VW
Polo in Italy; this was to be linked to sales inside
territory (78). As a general rule the
the contract
manufacturer or
a
discount on the amount invoiced for every vehicle
ordered; for the old VW Polo model the discount
was 13 %. For the new VW Polo the discount was
split into a basic discount of 8 %, to be paid on the
invoice, and a further 5 % to be paid later, upon
registration of the vehicle in the dealer’s contract
territory (79).

the dealer

Volkswagen was aware that the introduction of this
split margin system would not be compatible with
Regulation (EC) No 1475/95 or with Regulation
(EEC) No 123/85, ‘because it aims to put an end to
cross-border trading, when cross-border trading is
the Commission wants.’ The
precisely what
measure was described as ‘sehr bußgeldverd(cid:132)chtig’
(very likely to attract a fine), and was to remain
‘internal’. Volkswagen therefore suggested to Auto-
germa that they should ‘agree on a formulation and
method that would be defensible in dealings with
the Commission too’ (80). Volkswagen several times
confirmed that
the split-margin system was in
operation (81).

(64)

(65)

(66)

In view of the high level of sales by Italian dealers
outside their contract territories, Audi, after con-
sulting Autogerma, the dealers’ association Unione
Concessionari Audi Volkswagen (‘UCAV’),
and
Volkswagen, decided in October 1994 to introduce
a new scheme for the payment of dealers’ margins
on new models (the first such new model being the
A 4).

The new scheme involved the division of the 15 %
basic margin, which was paid on the invoice for
such old models as the Audi 80 into a 10 %
component payable at once, that is to say on the
invoice, and a 5 % ‘split margin component’
payable after a two-month interval upon presenta-
tion of registration certificates.

This scheme was changed with effect
from 18
October 1994: the entire 15 % basic margin was
now to be payable on the invoice, but the 5 % split
margin component could be claimed back later (82).
The scheme enabled the manufacturer or importer
as a first step to check systematically all vehicle
to distinguish
registrations,
between registrations
the
contract territory. As a second step, the 5 % split
margin component was to be recovered from the
dealer in the event of sales outside the contract
territory.

and in particular

and outside

inside

(c) Autogerma SpA

(67) Contracts between Autogerma and Italian dealers
included an Annex (Allegato A) setting out the
dealer’s margin (sconto in fattura) for each model.
On Volkswagen models the margin was 13 % or
15 %, and on Audi models
it was 15 % or
from 1 January 1994 an
16 % (83). With effect
agreement
added which
expressly excluded new models from the scope of
this dealer’s margin (84).

(Convenzione) was

(1) Measures in respect of Volkswagen

(68)

In October
and November 1994 Autogerma
informed the Italian dealers of the new margins
scheme for sales of the new VW Polo. The new
scheme first of all covered Polo demonstration
vehicles, for which the previous basic margin of
13 % was divided into two parts, a 10 % com-
ponent and a 3 % component which would be
allowed only if the vehicle was registered in the
dealer’s name, that is to say inside the contract
territory, for at least six months. For all other orders
of the new Polo, Autogerma followed Volkswagen’s
instruction to divide the previous basic 13 %
margin into an 8 % component payable immedi-

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Official Journal of the European Communities

25. 4. 98

ately and a 5 % discount allowed only in the event
territory (85). In the
of sale inside the contract
course of the Commission’s investigations it was
confirmed that since 1994 the split dealer’s margin
had been applied in such a way that part was paid
only if the vehicle was registered in the contract
territory (86).

(2) Measures in respect of Audi

(69) When the new Audi A 4 was being launched Auto-
germa decided to change the system of dealer’s
margins. In place of the basic discount of 15 %
that had applied to the old Audi 80 model, which
was payable immediately, that is on the invoice, the
new basic margin, known as the ‘sconto in fattura’
(invoice discount) or
‘sconto base/immediato’
(basic/immediate discount), would amount to only
10 %. The remaining 5 % ‘sconto differito a breve’
(short-term deferred discount) would be paid after
two months only on vehicles delivered and regis-
tered in the contract territory (87). The use of the
expression ‘short-term deferred discount’ to desig-
nate the separate 5 % component was intended to
avoid any direct reference to the condition that the
sale or registration had to be inside the contract
territory (88).

(70)

(71)

The new system of margins was to be included in
the Italian dealership contracts in the form of a
supplementary agreement which would entitle
Autogerma to redebit the 5 % split-margin com-
ponent
to the dealer immediately if Autogerma
became aware of sales outside the dealer’s area (89).

In November 1994 Autogerma informed Audi that
the new system of margins had been introduced for
the Audi A 4 in Italy, initially for a trial period
running to 30 April 1995. The 5 % discount
component would initially go on being paid until
that date, at which point a final decision would
have to be taken.

(72) A margins policy that provides for lower dealer’s
registrations outside the
margins on sales or
contract territory reduces the dealer’s revenue and
It consequently
the profit
reduces
to
the commercial
engage in such business.

remaining to him.

latitude he enjoys

3. Bonuses

(73)

The 3 % bonus payable over and above the dealer’s
margin was generally to remain as before. Audi
emphasised here that ‘sales outside the dealer’s own
area were allowed up to a maximum of 15 %’, and
that the 3 % bonus would not be paid on sales
above that proportion (90).

(74) As this bonus was made dependent on sales, and
inside the ‘area of

later also on registrations (91),

market responsibility’ (92), a dealer would suffer a
financial disadvantage equal to 8 % of the basis of
calculation on sales outside his own contract ter-
ritory. Audi expressly noted that given the distribu-
tion costs, which could be estimated at 10 %, and
which in general had to be borne by the dealer,
dealers selling outside their contract territory would
in future suffer negative cash flow (93).

the

that had been attached to
(75) Under an agreement
dealership contracts
latest
since 1987 at
(Convenzione ‘B’), there was a quarterly bonus of
3 %, made up of sub-bonuses for ‘target registra-
‘standards’, and ‘customer satisfaction’ (94).
tions’,
This bonus was paid in addition to the customary
dealer’s margin. The mode of calculation centred
on the number of vehicles sold inside the contract
territory, but it was also paid in respect of sales
outside the contract territory, provided that those
sales did not exceed 15 % of total deliveries by the
dealer.

(76) No later than 1993 Autogerma suspended payment
of this bonus on all sales outside the contract ter-
ritory (95), and from January 1994 at the latest it
refused to pay it on those sales (96). In September
1994, with the declared intention of preventing
parallel exports, Autogerma decided that in future
it would pay the bonus only on registrations inside
the contract territory (97).

(77)

The agreement attached to the dealer contract
which was referred to in recital 75 (Convenzione
‘B’) was therefore amended accordingly. The bonus
was previously paid only on sales
inside the
territory; as amended on 31 December
contract
1994 the agreement now also required that the
vehicle be registered in the contract territory (98).
The 15 % restriction on sales or
registrations
outside the contract territory was maintained (99).

(78)

The dealers’ association UCAV doubted whether
the planned measures would be legally compatible
with the Community regulations on motor vehicle
distribution and dealership contracts (100).

later

(79) Audi confirmed that the new bonus scheme with
the 3 % bonus made conditional on registration in
Italy was being introduced and implemented (101).
The fact that the new scheme was actually in force
was
repeatedly confirmed by Autogerma:
‘With regard to bonus payments for the period
it was decided that 63
January to April 1994,
dealers would receive no bonus on deliveries to
customers outside the territory designated in their
contracts’ (102). And from the last quarter of 1994 or
the first quarter of 1995 onward this bonus was in
fact paid only on registrations in the contract ter-
ritory. Autogerma also refused to pay what was
known as the ‘contribution to organisation’ on
vehicles sold outside the contract territory (103).

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(80)

to avoid sales (or

It must be concluded that the newly introduced
margin and bonus scheme was an effective means
of exerting pressure, particularly financial pressure,
on the dealers,
registrations)
outside their contract territories. Dealers who sold
outside their contract
territories could expect a
substantial reduction in their profit on the transac-
tion. In such transactions the dealer in any event
loses the after-sales business, which is generally
very profitable. The new margin and bonus policy
substantially reduced the financial
incentive to
make such sales. For this reason many dealers
refrained altogether from such business, regardless
of whether the potential sale was to an independent
dealer or a final consumer. That the new arrange-
ments were in fact being applied was confirmed by
Audi on several occasions (104).

(81) A policy under which there is a smaller margin or
bonus on sales or registrations outside the contract
territory reduces the dealer’s revenue and the profit
remaining to him from sales of that kind. It con-
latitude he
sequently reduces
enjoys to engage in such business.

the commercial

livery times were too long: (between 1 January and
10 April 1995 more than 9 % of them did so) (108).
And yet
in February 1995 the manufacturer
decided to cancel a delivery of 8 000 extra A 4 cars
that had been promised by Autogerma to the
Italian dealers
and were clearly intended for
re-export (109). In April 1995 Audi gave as its justi-
fication for restricting deliveries of the new A 4 that
‘only Italian demand can be met’ (110). In the course
of the same year, too, Audi and Autogerma argued
that restricted supply to the Italian market should
be maintained with an eye to the grey market (111).

(86) A supply policy which is based on the anticipated
or actual demand from Italian customers, and does
not take special account of what is clearly strong
demand from abroad, restricts the supply available
for sales to customers from other Member States, or
leads to long delivery times, especially for sales to
customers from other contract territories, or both.
This appreciably narrows dealers’ latitude to make
such sales, especially to customers from abroad.

4. Restricted supply to the Italian market

network

5. Restrictions on deliveries inside the distribution

(82)

Volkswagen and Audi formulated initial guidelines
for limiting grey market deliveries as long ago as
August 1993, dividing them into ‘formal steps’ and
steps were
‘practical measures’ (105). The formal
aimed primarily at ensuring compliance with the
dealership contracts;
the main practical measure
proposed was a reduction in the level of stocks in
Italy.

(a) Volkswagen AG

(83) At

the end of 1993, with a view to restricting
re-exports from Italy, Volkswagen decided upon an
‘adjustment of production for the Italian market in
line with requirements’,
‘supply to the retail trade
in line with requirements’ and measures to ‘reduce
dealers’ stocks’ (106). The supply policy for Italy led
to shortages and long delivery times for almost all
models at least in the year 1995.

(84)

In the first quarter of 1995 Volkswagen ‘adapted
supplies of the Vento, Valiant and Passat models to
demand in Italy, so that there ought no longer to
be any pressure from stocks’ (107). Volkswagen’s
re-export by
policy of
restricting supply to the Italian market thus proved
successful.

reducing the scope for

(b) Audi AG

(85) Many customers who had ordered an Audi car
cancelled their orders on the grounds that the de-

(87)

(88)

Increased grey imports effected by unauthorised
dealers, and reimports offered by authorised VW
and Audi dealers at prices appreciably below those
of the German authorised dealers, evidently led to
substantial falls in orders placed with authorised
VW and Audi dealers in some areas. Some au-
thorised dealers, especially in Germany, conse-
quently found it necessary to reimport cars from
Italy through authorised Italian dealers, or direct
through Autogerma, but complained of unusually
long delivery times (112).

Volkswagen explained the situation by saying that
measures had been taken to ensure ‘supply tailored
to the requirements of the Italian market . . . with
the consequence that the Italian dealers sell in the
local clientele’. In
first place to their traditional
September 1993 the VAG dealer’s association told
Volkswagen ‘that
in Europe,
whether by dealers or by our customers, must be
combated by all available means’ (113).

cross-purchases

(89) German dealers also told Audi that ‘the possibility
of reimporting export cars subsidised by the manu-
facturer into Germany must be closed off urgently’,
as ‘the selling price of these cars in Germany is
below the dealer’s cost price in the German organ-
isation’ and would ultimately ‘destroy the livelihood
the German dealers’ (114). Reimports by au-
of
thorised German dealers were discovered by other
authorised German dealers, who notified Audi of
the chassis numbers and the names of the Italian
dealers who had supplied the vehicles (115).

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(90) Autogerma asked Audi to take steps to ensure that
German dealers who were interested in the possibi-
lity of parallel imports, and who had written to
Autogerma, would not be constantly ‘bothering’
Italian dealers (116). German authorised dealers who
approached Autogerma with enquiries about the
possibility of supplies (known as ‘cross-deliveries’
inside the VAG distribution network) were turned
away with references to insufficient stocks, delivery
shortages and long delivery times (117).

(97)

that is to say sales to non-Italian final consumers or
through intermediaries acting with authority from
consumers.

Termination or
termination of a
the threat of
dealership contract by reason of sales outside the
dealer’s
the dealers
concerned to avoid effecting such sales.

territory induces

contract

7. Written undertakings

(91) As a possible solution it was suggested that there
should be clear agreements with the importer
stating that the vehicles imported were intended for
the importer’s market only, and that in the event of
any breach contractual penalties or termination of
the contract should be threatened or indeed put
into effect (118). Thus the manufacturers were under
pressure from the German authorised dealers to
stop reimports into Germany.

(92)

Restriction of cross-deliveries inside the distribu-
tion network, that is to say the acquisition by an
authorised dealer of vehicles from an authorised
dealer in another Member State, reduces the lati-
tude enjoyed by the dealer in the procurement of
stocks of vehicles.

6. Termination of contracts

(93) At the end of 1993 Autogerma cautioned 50 dealers
(including Brenner Garage
in Bolzano/Bozen,
whose turnover was very high) to cease organised
territories at
sales activity outside their contract
once or face penalties in accordance with their
contracts (119). These cautions continued in 1994
and 1995 (120).

(94)

In 1993 three dealers had their contracts termi-
nated (121), and in May 1994 Autogerma decided to
terminate its contract with Brenner Garage, too (122).
By February 1995 the number of dealers whose
contracts had been terminated had risen to 12 (123).

(95) Autogerma was

clearly

terminating

dealers’
contracts for selling outside their contract territ-
ories (or for ‘grey imports’), but it emphasised that
‘to the outside world these terminations of course
took place for other reasons’ (124). Sales to unautho-
rised dealers were in fact never given as the reason
for the termination (125);
the main grounds cited
were failure to reach sales targets and breach of
contract. In at least one case Regulation (EC) No
1475/95 was invoked to justify the termination of
the contract (126).

(98) As long ago as 1993, Autogerma recommended that
Italian dealers should require consumers to sign
what it called an undertaking (127). In March 1995 a
further circular formulated this recommendation
more strongly. All customers not known to the
dealer, and foreign customers in particular, were at
the same time as they signed the contract of sale to
sign a written undertaking
(dichiarazione di
impegno) by which they undertook, on pain of a
contractual penalty of 10 % of the purchase price,
not to sell the vehicle they were purchasing within
a period of three months after purchase, or in any
event before it had travelled at least 3 000 km (128).

(99) A declaration required by the manufacturer, the
importer or another enterprise in the distribution
network whereby the final consumer undertakes
not to sell the vehicle before the expiry of a stated
period, or until it has travelled a stated distance, or
both,
restricts the final consumer’s freedom of
choice as to whether or not to sell a car in another
Member State.

D. Result of the agreements and conduct of

Volkswagen, Audi and Autogerma

(100) Autogerma, as party to the contracts with the
Italian authorised dealers, has had the responsibility
of applying these measures. Autogerma argued that
Audi could not independently apply measures in
Italy and that any such measures required Auto-
germa’s consent (129).

(101)

(letters,

In various ways
inspections, bilateral
meetings, or verbal cautions) Autogerma has drawn
dealers’ attention to the consequences of selling
territories, and they have
outside their contract
often refrained from such sales as a result. Many
customers have refrained from buying a vehicle
because dealers referred to supply problems and
delays, and ruled out, verbally or in writing, exports
or sales to non-Italians.

I. Consumer reactions

(96)

This conduct shows that Volkswagen, Audi and
Autogerma were aware that the measures they were
taking affected legally permissible reimports too,

(102) Many customers have informed the Commission
and the manufacturers of difficulties with the
purchase of cars in Italy. From the documents

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assembled it is clear that there have been refusals to
sell to customers on grounds of their nationality.
Many customers report similar reactions on the part
of different dealers, as follows:

— ‘. . . erhalte ich von den H(cid:132)ndlern dort immer
wieder die Auskunft, daß sie zwar gerne an
mich liefern w(cid:129)rden, aber vom Importeur kein
Auto bek(cid:132)men,
als
Erwerber auftritt’ (130);

sobald ein Deutscher

— ‘. . . bekam ich vom Firmenchef die telefonische
Auskunft, daß er mir als Deutschem kein Auto
verkaufen darf
(eine Bestimmung der Volks-
wagen AG)’ (131);

— ‘. . . wurde mir . . . bei drei VW-H(cid:132)ndlern mitge-
teilt, daß der Export jeglicher Fahrzeuge nicht
erlaubt sei und man sich an diese Anordnung
strikt zu halten habe. Einigen H(cid:132)ndler sei —
wegen Mißachtung dieser Anordnung — bereits
die Konzession entzogen worden’ (132);

— ‘All dealers told me that it is not possible to
buy a car for export. Some of them told me that
it is not possible because they wouldn’t become
any car in the future if they order a car for an
Austrian once more’ (133);

— ‘Es wurde mir . . . mitgeteilt, daß die jeweilige
Werkst(cid:132)tte ein Verbot von der Generalvertre-
tung v. Audi h(cid:132)tte, die Autos an Ausl(cid:132)nder zu
verkaufen’ (134);

— ‘. . . daß die italienischen H(cid:132)ndler an Personen
aus der Bundesrepublik Deutschland und
(cid:153)sterreich, angeblich wegen einer Weisung des
verkaufen
Fahrzeugherstellers,
d(cid:129)rfen’ (135);

nichts

— ‘. . . wurde uns mitgeteilt, daß wir, auf Anord-
nung von Wolfsburg, als Deutsche keinen
Wagen dieser Modelle bekommen k(cid:148)nnten’ (136);

— ‘Die Antwort . . . lautete n(cid:132)mlich unisono, daß
sie mit Repressalien seitens des Generalinpor-
teurs zu rechnen h(cid:132)tten, wenn sie auch nur ein
Auto nach (cid:153)sterreich liefern’ (137);

— ‘Von ital. VW/Audi-H(cid:132)ndlern wurde mir in den
letzten Monaten aufgrund diverser Anfragen
jeweils mitgeteilt, daß es ihnen vom VW/Audi-
ist, Fahrzeuge nach
Konzern nicht gestattet
(cid:153)sterreich zu verkaufen’ (138);

— ‘Mit “leichtem Hinterton in der Stimme” wurde
mir (cid:129)berall gesagt, daß “keine Lieferm(cid:148)glich-
keit” f(cid:129)r Kunden aus Deutschland best(cid:129)nde.
Manchmal wurde auch etwas mehr gesagt’ (139);

— ‘sobald wir aber dem H(cid:132)ndler sagen, diese Fahr-
zeuge sind f(cid:129)r einzelne Privatpersonen in
Deutschland oder (cid:153)sterreich bestimmt und daß
wir Ihnen ohne weiteres ein Vermittlungs- oder
Einkaufsmandat mit einer vom Notar beglau-
bigten Unterschrift vorlegen, will kein H(cid:132)ndler

ist

folgende: was Audi,

‘Die Antwort der
nichts mehr wissen’, bzw.
H(cid:132)ndler
Ingolstadt
(Deutschland) sagt, wissen sie nicht, sie haben
von ihrem Generalimporteur Autogerma abso-
lutes Exportverbot, auch an private Endkunden.’
bzw.
‘hat ca. vor einem Monat der (cid:148)sterrei-
chische Automobilclub ((cid:153)MTC) auch probiert
in Norditalien Fahrzeuge Ihrer Marke mit
Mandat f(cid:129)r Endkunden einzukaufen, auch die
haben kein einziges Fahrzeug von dem H(cid:132)ndler
bekommen.’ (140);

— ‘Er sagte mir, daß er von Seiten der Gesch(cid:132)fts-
f(cid:129)hrung von Auto Brenner gehalten sei, den
Kaufvertrag nicht eher rauszuschicken, bis von
Ihnen die ausdr(cid:129)ckliche schriftliche Best(cid:132)ti-
gung vorliegt, daß (. . .) Frau ein Fahrzeug
kaufen darf.’ (141).

II. Conduct of dealers towards Autogerma

contract

territories,

and more

(103) As a result of the instructions and warnings issued
by Autogerma, several dealers gave the importer
express assurances that they would not sell outside
their
especially
outside the country (142). A number of dealers took
practical measures to this end (no exports, or no
more than 15 %; all vehicles to be registered in
Italy; dismissal of employees who had sold to
foreign buyers; or prior authorisation by Auto-
for
germa) (143). Autogerma
example that the measure requiring the importer’s
prior authorisation for all sales had been successful.

reported to Audi

III. Conduct of dealers towards customers

and the

aimed at

(104) As a result of the strategy followed by the manufac-
stopping
importer
turers
re-exports of new vehicles from Italy to Germany
and Austria, Italian dealers in many cases refused to
sell vehicles to customers from those Member
States (see Section I). Dealers advised customers not
to register the vehicle outside Italy, citing the threat
of ‘difficulties’ with the manufacturer:

‘Stiamo facendo tutto il possibile per tentare di
riportare la vettura in Italia convincendo il cliente
ad annullare la targatura. Siamo veramente spia-
centi che questa vendita Vi abbia creato spiacevoli
inconvenienti con la fabbrica’ (144).

(105) This refusal was explained to foreign customers in
various ways, one example being a standard refer-
ence to the intended re-export of
the vehicle:
‘Thank you for your fax (letter), but we do not (no
longer) sell abroad’ (145) or ‘we are sorry to say that
we have stopped exporting’ (146).

(106)

In other cases dealers cited restricted supplies from
the manufacturer and suggested that the customer

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abandon the planned purchase. Dealers answered
many customer enquiries with a standard letter:

‘da wir vom Werk nur eine kontingentierte St(cid:129)ck-
zahl an Fahrzeugen (VW-Audi) erhalten, ergeben
sich unsichere Lieferzeiten, die sich bis (cid:129)ber ein
Jahr erstrecken k(cid:148)nnen. Als Folge davon regelm(cid:132)-
ßige Preis(cid:132)nderungen und die Preisgarantie kann
nicht mehr gew(cid:132)hrt werden. Aus diesem Grund
werden Sie wahrscheinlich davon absehen,
Ihr
Fahrzeug bei uns zu kaufen’ (147).

A. Article 85(1)

I. The undertakings

(110) Volkswagen AG,

its subsidiaries Audi AG and
Autogerma SpA, and the authorised dealers consti-
tute undertakings for the purposes of Article 85(1).

II. The agreement

(107) Autogerma confirmed that this strategy had been

1. The export ban/restriction

successful, and told Audi:

‘. . . wie aus der Ihnen vorliegenden monatlichen
Verkaufsstatistik hervorgeht,
ist der Verkauf von
Audi-Neuwagen ins Ausland enorm zur(cid:129)ckge-
gangen.
. . . Nach unseren Erkenntnissen beh(cid:132)lt
sich der H(cid:132)ndler im Rahmen seiner Verkaufspo-
litik vor, basierend auf den ihm zugeteilten Produk-
tionsquoten Lieferzeiten zu nennen und seine
Stammkundschaft zu bedienen’ (148).

Audi accepted this, but nevertheless noted that:
‘leider . . . nach wie vor von vielen italienischen
H(cid:132)ndlern die Aussage gemacht (wird), daß es ihnen
vom Hersteller bzw. vom Importeur untersagt
worden sei, Fahrzeuge an ausl(cid:132)ndische Endab-
nehmer zu verkaufen’ (149).

Chapter 2:

LEGAL ASSESSMENT

selective

sole importer

(108) Volkswagen and Audi distribute their vehicles in
delivery
through
the Community
networks. Volkswagen and Audi have appointed
Autogerma as
their
vehicles. Autogerma concludes distribution agree-
ments with the dealers in the network on the basis
of a standard dealership agreement covering sales
of both VW and Audi vehicles. Volkswagen has in-
dicated that it intends to distribute VW and Audi
vehicles separately after 1997.

in Italy for

(111) An examination of the agreements and concerted
practices entered into by Volkswagen, Audi and
Autogerma and described in Chapter 1, Section C
demonstrates that within the framework provided
by the exclusive and selective distribution network
they and their Italian dealers have agreed a policy
for
the market. That market-
partitioning policy takes the form of an export
ban/restriction imposed on Italian dealers.

partitioning

(112) The export ban/restriction derives from a system of
measures consisting of preventive measures, mon-
itoring measures and penalties. In the course of its
investigations the Commission has found docu-
ments which list these various measures. The main
evidence is provided by the documents specified in
Chapter 1, Section C.I (see footnotes 14 to 18 and
the Maßnahmenprogramm (Programme of meas-
ures) dated 10 February 1995 and referred to in
footnote 123).

(113) The specific measures include the warnings and
instructions to dealers described in Chapter 1,
Section C.II.1 (see the documents referred to in
footnotes 14 and 61 to 70).

(114) Surveillance of dealers through monitoring of in-
coming orders, monitoring of sales (including an
obligation on authorised dealers to refrain from
selling vehicles to non-Italian customers without
Autogerma’s prior consent), monitoring of vehicle
registrations and monitoring by means of ‘audits’
are described in Chapter 1, Section C.I (see the
documents referred to in footnotes 40 to 48 and
143). The cooperation between the manufacturers
and the importer in the surveillance of the sales
activities of the Italian dealers is apparent from
Chapter 1, Section C.I (see the documents referred
to in footnotes 19 to 31).

(109) The Court of Justice of the European Communities
has consistently held that agreements between
traders at different levels in the economic process,
also known as ‘vertical agreements’, may constitute
agreements within the meaning of Article 85(1) of
the Treaty and be prohibited by it (see for example
Case C-266/93 Bundeskartellamt v. Volkswagen
and VAG Leasing [1995] ECR I-3477).

(115) Examples of penalties applied to Italian authorised
dealers, such as cautions, warnings and termination
of dealership contracts, are indicated in Chapter 1,
Section C.II.6; reference may be made in particular
to the documents listed in footnotes 71 and 120 to
127, and the document Export aus Italien (Exports
from Italy) dated 13 June 1994 and referred to in
footnote 62.

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least,

The clause to the effect that bonuses are in prin-
ciple payable only for dealers’ sales within their
contract territories, which has been contained in
Italian dealers’ contracts since 1987 at
is
described in Chapter 1, Section C.II.3 (see the
documents referred to in note 94). The clause was
tightened up when the dealership contract was
amended, with effect from 1 January 1995 (see the
document referred to in note 98), to make payment
of the bonus in principle conditional on the quali-
fying vehicles also being registered in the dealer’s
contract territory as is also described in Chapter 1,
Section C.II.3. That bonuses were in fact withheld
least since 1993 is explained in Chapter 1,
at
Section C.II.3 (see the documents referred to in
footnotes 18, 95 and 96). The introduction of a split
margin, beginning with the VW Polo and Audi A4
models, is shown by the documents referred to in
footnotes 78 to 81, 84 and 85 relating to Volkswa-
gen’s marketing (Chapter 1, Section C.III.1. and
Chapter 1, Section C.II.2.(c)) and the documents
referred to in footnotes 82, 87, 88 and 89 relating
to Audi’s marketing (Chapter 1, Section C.II.2).

(116) The export ban/restriction incorporates a prohibi-
tion of cross-deliveries, that is deliveries within the
distribution network. Italian authorised dealers are
prohibited from supplying to VW and Audi author-
ised dealers in other Member States. This is evident
from Autogerma’s information to Audi regarding
German authorized dealers ‘bothering’ their Italian
to prevail
counterparts, and its request
upon German authorised dealers to refrain from
cross-purchases. Evidence is listed especially in
footnotes 112 and 113 (Chapter 1, Section C.II.5)
and footnotes 14 and 116 (Chapter 1, Section
refused
C.II.5).
requests from non-Italian authorised dealers on the
ground that it had insufficient stocks, rather than
on the ground that as the importer it did not sell
direct (see the document referred to in note 117,
Chapter 1, Section C.II.6).

In addition, Autogerma

to Audi

itself

of

(see

‘Maßnahmenprogramm’

(117) The export ban/restriction has also been under-
pinned by the restriction of supply to the Italian
10
market
February 1995, note 123). The documents found by
the Commission in its investigations show that
VW, since November 1993 (see the document
referred to in footnote 106, Maßnahmen zur
Begrenzung
Italien
von Re-Exporten
(Measures to restrict re-exports from Italy), Chapter
1, Section C.II.4) and Audi, since at least December
1993 (see the memo Gespr(cid:132)ch am 14.12.93 in
Wolfsburg, Marken Audi und VW: Preisplanung
Italien/EG-Preisharmonisierung (Discussion held
on 14 December 1993 in Wolfsburg concerning
Audi and VW vehicles: planning of prices for
Italy/harmonisation of EC prices) referred to in
note 106), have been compelling Italian authorised
dealers to comply with the prohibition/restriction
on exports by restricting deliveries to the Italian
market.

aus

(118)

In its letter to Audi Export aus Italien dated 13
June 1994, Autogerma confirmed the existence of
that restriction on deliveries (see footnote 62, with
translation):

‘. . . Obwohl die Lieferzeiten f(cid:129)r den Audi 80 von
bis
zu 8 Monaten deutlich reduziert werden
konnten, werden die H(cid:132)ndler noch immer kontin-
gentiert. Ein H(cid:132)ndler, der eine (cid:129)bergroße Anzahl
an Audi 80 bestellt, bekommt diese nicht gelie-
fert . . .’.

(119) Volkswagen stated in a discussion with Audi on 22
March 1995 (see the minutes of this discussion,
dated 27 March 1995, referred to in footnote 107)
that the supply of VW vehicles had been adapted
to demand in Italy. Dealers received only the
number of vehicles necessary to enable them to
supply customers in their contract territory. And in
an internal memo, Stand Maßnahmen gegen
Graumarkt, 25.11.1994 (The state of measures
against the grey market at 25 November 1994),
Audi indicated with regard to the new Audi A4 (see
the document referred to in footnote 82, with
translation):

‘. . . Belieferung wird so gesteuert, daß nur die
italienische Nachfrage befriedigt wird . . .’.

(120) Among the measures taken in connection with the
export ban/restriction is the imposition of the rule
that dealers should make the conclusion of sales
contracts with final consumers conditional on such
consumers giving a written undertaking (see
Chapter 1, Section C.II.7 and the documents
referred to in footnotes 127 and 128).

2. Agreement

(121) The export ban/restriction forms part of

the
contractual relations which Autogerma maintains
with dealers in the selective distribution network in
Italy for the VW and Audi makes. The export ban/
restriction was agreed with the dealers partly by
means of circulars and partly by word of mouth,
and the dealers consented to this agreement.

an

for
1994;

this action with effect
agreement

(122) Autogerma sent dealers two circulars implementing
Volkswagen’s instructions regarding new arrange-
ments for margins. It had already established the
legal basis
from 1
January
(convenzione)
appended to the dealership contract discontinued
the application of the previous margins scheme for
new models, without, however, determining new
arrangements for such margins (see Chapter 1,
Section C.II.2,
in particular Chapter 1, Section
C.II.2(c)). Autogerma subsequently provided the
following details of a new margins scheme, by
circulars dated 20 October and 2 November 1994
(see Chapter 1, Section C.II.2 and the documents
referred to in footnote 85). In the circular of 20
October 1994, Autogerma set out the structure of
the new scheme, giving the example of the new
VW Polo, which was arriving on the market (see
footnote 85, with translation):

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‘. . .

A. Tutti i Concessionari

lettera del: 20. 10. 1994

foglio: 2

Loro Sedi

COM1/ORG/EP/ad

Ci(cid:149) premesso, nell’intento di trovare valide soluzioni di interesse vitale, per noi come per tutta la
Organizzazione, in merito alle problematiche pi(cid:151) volte emerse, che spingono talora alcune
Aziende a comportamenti non in linea con i reciproci interessi (per esempio, vendite tramite
rivenditori non autorizzati, sconti non motivati ed eccessivi, vendite fuori territorio, e altro) si (cid:138)
trattata — con il Presidente, i Vicepresidenti e alcuni Consiglieri dell’UCAV, presenti a Verona
marted(cid:141) 18.10 u.s. nell’ambito della riunione del Gruppo di lavoro ISC — una nuova struttura-
zione degli sconti per la Nuova Polo, cos(cid:141) composta:

a- Sconto base/immediato in fattura

b- Sconto “differito a breve”

Totale (come per il modello precedente)

c- Maggior Sconto (con stesse modalit(cid:133))

= 8 %

= 5 %

= 13 %

= 3 %

In particolare, lo sconto “differito a breve” di cui al punto b- verr(cid:133) riconosciuto a posteriori ma in
tempi brevi, e sar(cid:133) basato specificatamente sul reciproco impegno, sia nostro come anche di
ciascuna Azienda concessionaria della Autogerma, di curare il territorio contrattuale per cui
entrambi — Autogerma e concessionaria — sono competenti per impostazione, per commercia-
lizzazione e vendita, nonch(cid:130) per l’obbligo della intensa cura reciproca dell’utilizzatore finale resi-
dente nel territorio affidato.

Rimane da valutare se opportuno, cio(cid:138) di interesse comune per tutti noi, di modificare o meno
(in su o in gi(cid:151)) la franchigia dell’attuale 15 % (di fuori territorio).

I Signori Delegati UCAV di area prenderanno quindi rapidamente contatto con Voi per appro-
fondire quanto sopra nonch(cid:130) accogliere riflessioni, suggerimenti e migliorie in relazione.

I predetti Delegati si consulteranno quindi successivamente con urgenza con noi affinch(cid:130) la
Autogerma possa prendere la propria decisione in via definitiva. . .’

(123) By the circular of 2 November 1994 (see footnote
85) dealers were informed that the new margins
scheme, as set out in the circular of 20 October
1994 would apply with immediate effect and until
at least 30 April 1995. Both circulars form part of
the contractual relations between Autogerma and
the dealers, since the purpose of the circulars was
to flesh out
the dealership
the provisions of
contract laid down in the ‘convenzione’ appended
to the contract, which excluded the new models
from the previous margins scheme. In its circular
of 2 November 1994, Autogerma states that the
new arrangements for margins are to apply forth-
with. Since 2 November 1994, the new margins
scheme has formed a part of the contractual rela-
tions between Autogerma
authorised
dealers. This interpretation is substantiated by the
rulings of the Court of Justice of the European
Communities
and BMW v.
ALD (150).

in Ford-Werke

and the

an additional agreement (see Autogerma’s letter to
Audi dated 10 November 1994 Splitmargensystem
— Audi A 4 (split margins scheme — Audi A 4) in
footnote 87, Chapter 1, Section C.II.2(c)(2), and the
document referred to in footnote 93).

(125) Furthermore, Autogerma has

since 1987 been
specifying in dealership contracts concluded with
Italian dealers that bonuses would be paid in prin-
ciple only on sales to customers in the contract
territory (whether final consumers, intermediaries,
other authorised dealers or independent dealers not
being members of
the distribution network).
‘Convenzione B’ covering the bonus arrangements
was framed in more stringent terms with effect
from 1 January 1995: the bonus was now payable
only on vehicles which were registered in the
dealer’s contract territory. This is established by the
document referred to in note 98.

(124) Autogerma acted on Audi’s instructions regarding
the margins scheme, bringing it into effect not
later than November 1994; the scheme was embod-
ied in the Italian dealership contracts by means of

(126) Authorised dealers have also given an express
undertaking to the importer that they will refrain
from making sales outside their contract territory,
in particular abroad (see Chapter 1, Section D.II).
This is shown by the documents referred to in foot-
note 142.

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(127) The following conduct on the part of the author-
they have

ised dealers
likewise
consented to the export ban/restriction:

shows

that

— on the basis of

to its

the export ban/restriction,
authorised dealers have required subdealers to
refrain from foreign sales. As evidence of this
the Commission would point to the letter of 6
March 1995 from the VW/Audi dealer, Eurocar
subdealers, Fantini, Mansutti,
SpA,
Torresan, Ciesse Car, Tonero, Fantini and Auto-
gris, in which it is stated that Autogerma abso-
lutely prohibits foreign sales of vehicles and
tolerates a volume of sales outside a dealer’s
contract territory only up to 15 % of total sales
(see footnote 62, with translation):

‘Gi(cid:133) in passato abbiamo avuto modo di intratte-
sulla delicata questione delle vendite
nerVi
fuori zona.

Poich(cid:130) l’Autogerma non intende pi(cid:151) tollerare
una eccessiva attivit(cid:133) di vendita al di fuori della
propria area di competenza, ribadiamo quanto
segue:

— sono assolutamente vietate le vendite al-
l’estero (anche di quelle vetture preventiva-
mente immatricolate in Italia)

— saranno penalizzate tutte le vendite al di
fuori della propria zona di competenza
eccedenti il 15 % delle proprie consegne’;

— authorised dealers have dismissed employees
who have concluded foreign sales. This
is
shown by the memo Oggetto: Colloquio con Sig.
Beikricher.-BZ, (Subject: Conversation with Mr
Beikircher of Bolzano/Bozen) dated 21 October
1994, referred to in footnote 143,

— authorised dealers have requested Autogerma
for permission before they conclude sales
contracts with final consumers abroad (see
Chapter 1, Section D.II). Reference may be
made to Brenner Garage’s letter to Autogerma
of 19 December 1994 and Dorigoni’s letter of
22 June 1995, referred to in footnote 143,

— authorised dealers have refused sales to final
consumers resident outside Italy, and to other
VW/Audi dealers, on the grounds that they no
longer sell abroad (see Chapter 1, Section D.III).
This can be seen from the letters from the
dealer Dorigoni referred to in footnotes 145 and
146,

— authorised dealers have suggested to final
consumers and to other dealers in the distribu-
tion network that they would be wiser not to
purchase, as delivery times can be longer than a
year (see Chapter 1, Section D.III). This can be
seen from the letters
from Auto Brenner
referred to in footnote 147,

— authorised dealers have requested the written
undertakings from final consumers. This is es-
tablished by the sales contracts indicated in
footnote 128,

— authorised dealers have acquiesced in the with-
holding of bonuses on all sales outside their
contract
territory. Autogerma’s chairman was
able to claim the sole right to authorise bonuses
without anticipating trouble from dealers. This
is shown by the internal memo Non riconosci-
mento/trattenuta del Maggior
per
fuori zona (compreso esportazioni
vendite
parallele)
the
extra bonus
(including
parallel exports)) of 28 June 1994 (see footnote
97).

(Non-payment/withholding of

for out-of-area sales

Sconto

3. Conclusion

for

that

the practical application of

(128) The measures adopted by Volkswagen, Audi and
Autogerma to prevent or obstruct parallel exports
do not constitute unilateral conduct
falls
outside the scope of the prohibition contained in
Article 85(1): they form part of the contractual rela-
tions which the manufacturers maintain, through
Autogerma, with the dealers in their selective distri-
bution network, since they were adopted by mutual
agreement
the
dealership contract. The Court of Justice has
already held in Case 107/82 AEG v. Commis-
sion (151), that admission of a distributor to a select-
ive distribution system is based on acceptance, tacit
or express, of the policy pursued by the manufac-
turer. The restrictive deliveries policy applied by
Volkswagen and Audi, viewed in its economic and
legal context, likewise produces its effects within
the distribution agreements
the framework of
concluded with the authorised dealers. It alters the
contractual relations between Volkswagen, Audi,
Autogerma and the dealers. Orders placed by
dealers are no longer met by the manufactures. The
Commission would refer to the judgment of the
Court of Justice in Joined Cases 25 and 26/84
Ford-Werke, which is based on similar facts (152).
Moreover, since at least September 1993 German
and Austrian authorised dealers have urged Volks-
wagen and Audi to restrict supplies to the Italian
market (see the document Rede von Herrn Knief
zur Plenum-Veranstaltung mit Herrn Dr. Pi(cid:137)ch
anl(cid:132)ßlich des Europa-Kongresses am 8. September
1993 in Frankfurt (Speech by Mr Knief to the full
meeting with Dr Pi(cid:137)ch at the European Congress
on 8 September 1993 in Frankfurt) mentioned in
footnote 113 and Protokoll der 7. Konferenz des
Europ(cid:132)ischen H(cid:132)ndlerbeirats VW/Audi vom 21.
bis 23. April 1994 in Dublin (Proceedings of the
seventh conference of
the European VW/Audi
dealer council held in Dublin on 21-23 April 1994)
referred to in footnote 105).

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(129)

It is irrelevant whether or not the dealers have
complied with the prohibition/restriction on
exports as a result of pressure brought to bear by
the manufacturers. In its Decision 82/367/EEC in
Hasselblad (153), the Commission has stated that for
a concerted practice to exist it is sufficient ‘for . . .
an undertaking knowingly and of its own accord to
adjust
its behaviour in line with the wishes of
another undertaking. The motive or the knowledge
that the act is unlawful is irrelevant’.

III. Appreciable restriction of competition

1. The object or effect of restricting competition

(a) The object

(130) The system for identifying authorised dealers en-
gaging in exporting and the penalties associated
with it, have as their object the restriction of intra-
brand competition. The intention is to prevent
Italian authorised dealers from exploiting competi-
tive advantages they enjoy over authorised dealers
from other Member States, as a result of currency
fluctuations for example, by selling vehicles to
customers who are not resident in their contract
territory or in Italy. The only distinction drawn is
whether the customer is resident or non-resident in
the contract territory or in Italy; no distinction is
made between final consumers,
intermediaries
acting on their behalf, other authorised dealers
belonging to the distribution network, or indepen-
dent dealers outside the network. Markets are thus
being partitioned.

(131) That the object is to restrict competition is ap-
parent both from the combination of measures and
from the individual measures in isolation.

(i) Restrictive
measures

object

of

the

combination of

of

parallel

prevention

That the object of the combination of measures is
the
as
Volkswagen, Audi and Autogerma frequently ex-
‘re-exports’) emerges clearly from Volks-
press it,
internal memo Re-exporte
wagen’s
(Re-exports)
dated 1 March 1994 (see footnote 102, with transla-
tion):

exports

(or,

‘. . .

3. Trotz

unserer
preislicher Verschlechterung
Produkte in Italien ergab sich durch den Lira-
Verfall ein erhebliches Preisgef(cid:132)lle zu Deutsch-
land und anderen M(cid:132)rkten. Diese Situation hat
vor allem bei den H(cid:132)ndlern im norditalieni-
schen Raum zu Re-Exporten gef(cid:129)hrt (in Summe
17 000 Volkswagen PKW nach
1993
Deutschland).

ca.

Stand: 20. Dezember 1993 KFZ-Zul.Amt Flens-
burg

4. Durch geeignete Maßnahmen

— H(cid:132)ndleraudits
— Abmahnungen
— gezielte Zuteilung
— Bonusk(cid:129)rzungen
— K(cid:129)ndigungen (3 H(cid:132)ndler in 1993)

wurde seitens Autogerma S.p.A. und Volkswagen
AG Einfluß genommen.

Dadurch wurden die Re-Exporte
eingeschr(cid:132)nkt . . .’.

erheblich

(132) Autogerma’s letter

to Volkswagen, Measures

to
control and prevent re-export of 26 September 1994
(see Chapter 1, Section C.I and footnote 15), is very
clear:

‘with reference to the discussion we had in Verona
Thursday 15 and Friday 16 of September . . . we
confirm herewith the main measures taken by
Autogerma to control and prevent re-export.

We are convinced that with these measures we
shall possibly reduce drastically the re-export if also
in Germany actions are taken with the German
dealers which are continuously looking for new
cars getting in touch directly with our dealers and
Companies like VAGAS are prohibited to make
interesting offerings to our dealers which are in this
moment in red figures . . .’.

(133) These documents show that the combination of
measures is based on a strategy developed by
Volkswagen, Audi and Autogerma intended to
bring about drastic reductions in parallel exports
from Italy. By taking these measures, the manufac-
turers intend to intervene on the market and deter-
mine how that market will develop. Audi’s express
object is to limit exports to less than 100 vehicles
per month (see the handwritten memo referred to
in footnote 58), or to reduce the grey market/
reimport volume observed in February 1995 by half
within six months. The combination of measures
was to achieve this by September 1995 (see minutes
of the departmental meeting dated 3 February 1995
referred to in footnote 59).

the

(see

(134) That the object of the combination of measures is
to restrict competition is particularly clear from the
example of the linkage between the bonus and
margins schemes and the policy of restrictive de-
Maßnahmenprogramm
liveries
(Programme of measures) dated 10 February 1995
referred to in footnote 123). The bonus and margin
form the basis of the calculations which the dealer
carries out
in order to determine how he can
economically sell a vehicle in the course of his
business, taking account of the related expenditure
on such things as his sales staff and his showroom.
The bonus and margin also condition the dealer’s
room for manoeuvre on prices in his negotiations
with customers. A dealer who knows that he will
lose the 3 % bonus if he sells a vehicle outside his

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contract territory will refrain from such sales, at
least if he is able to dispose of his allotted vehicles
within that territory. The margins scheme has the
same objective, but is even more severe, since a
dealer selling to customers who are not resident in
his contract territory generates earnings which are
lower by almost 40 % (5 % out of
the 13 %
margin) or together with the bonus 50 %, in the
case of VW (see Maßnahmenprogramm dated 10
February 1995, footnote 123), and 33 % (5 % out
of the 15 % margin) or together with the bonus
in the case of Audi. The dealer cannot
44 %,
increase the selling price of
the vehicle corres-
pondingly, so as to pass this financial disadvantage
on to the customer, except at the risk of losing his
competitive edge. Given the policy of restrictive
deliveries practised by VW and Audi,
therefore,
authorised dealers have an incentive not to accept
offers to purchase from final consumers outside
their contract territory.

(ii) Restrictive object of the measures in isolation

(138)

in order

(135) Not only do the measures adopted by Volkswagen,
Audi and Autogerma with regard to authorised
dealers
to enforce the export ban/
restriction hinder competition when they operate
in combination; taken in isolation, too, they are
objectively likely to make it unprofitable for Italian
dealers to export.

(136) — The restriction of bonus payments to sales
made within the dealer’s contract territory, as
agreed in ‘Convenzione B’
to the dealership
contract, removes dealers’ incentive to supply to
final consumers, intermediaries acting on their
behalf, or other authorised dealers belonging to
the distribution network if the customer comes
from another contract territory. In its Decision
85/617/EEC in Sperry New Holland (154), the
Commission has already determined that agree-
ments or practices concerning bonuses which
are conditional on the goods in question not
subsequently being exported by the customer
are prohibited. For the measure to be consi-
dered to have the restriction of competition as
its object it is enough that the relevant clause
should have been included in the dealership
agreement. It
the clause
should have been applied (155). That the bonus
was
in fact withheld on sales outside the
contract territory at least from September 1993
underlines the restrictive object. The withhol-
ding of the bonus is a penalty — and indeed is
(see letter
seen as such by Autogerma itself
dated 21 September 1994 referred to in foot-
note 14 and Chapter 1, Section C.I) — which is
intended to impede intra-Community trade.

is unnecessary that

(137) — The margins scheme comes on top of the with-
holding of bonuses, and pursues
the same
object. For the measures to be considered to

have the restriction of competition as their
object, it is enough that they should have been
introduced for a limited initial period (see
circular dated 2 November 1994 referred to in
footnote 85). This restricts authorised dealers’
freedom of trade, since if they sell outside their
contract territory they have reason to believe
that Autogerma will act against
for
instance by claiming back their margins. The
the
Commission has confirmed this view of
matter in a number of decisions (156). But in fact
the margins scheme went on being applied
after 30 April 1995 (see Maßnahmen zur
Reduzierung von Grauexporten (Measures to
reduce grey exports) dated 21 August 1995, in
footnote 81, and the document referred to in
footnote 86).

them,

In an internal Audi memo sent by Mr Diaz
Ruiz to Dr Demel,
the chairman of Audi’s
management board, on 23 November 1994,
Audi makes the following statement on the
objective of the margins and bonus schemes
(see footnote 93, with translation):

‘. . . Anbei erhalten Sie die schriftliche Best(cid:132)ti-
gung von Herrn Schlesinger (cid:129)ber die zus(cid:132)tzlich
eingef(cid:129)hrten Maßnahmen (Splitmarge), um
Grauimporte zu verhindern.

Dies bedeutet, daß ein H(cid:132)ndler, der Grauim-
porte
Splitmargen-
Anteil + 3 % Bonus verliert, was eine zus(cid:132)tz-
liche Preiserh(cid:148)hung von 8 % darstellt.

vornimmt,

5 %

Die Zustimmung der H(cid:132)ndler zu dieser Split-
marge bedeutet, daß die Mehrzahl aller H(cid:132)ndler
bereit ist, Grauimporte zu verhindern, weil die
Vertriebskosten beim Kauf eines Autos mehr
als 10 % darstellen.

Das heißt, kurzfristig w(cid:129)rde der H(cid:132)ndler einen
negativen Cash-flow f(cid:129)r jedes Auto erzielen . . .’.

(139) — The object of

the prohibition on cross-
deliveries is to impede cross-border trade in
goods between Italian authorised dealers and
authorised dealers in other Member States, and
to segregate markets at that level of distribution.
This makes it possible to maintain price diffe-
rences for VW and Audi vehicles within the
common market (see Chapter 1, Section B.II).
The Commission and the Court of Justice have
frequently pointed out that impeding or prohi-
biting cross-deliveries
incompatible with
Article 85(1) (157).

is

(140) — Autogerma required dealers to enter into an
obligation to obtain the prior consent of the
importer before selling any vehicle outside their
contract territory (see, in particular, the docu-
ments referred to in footnotes 70 and 143). It
thereby limited dealers’ contractual freedom in
order to restrict competition within the distri-
bution network.

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vehicles which manufacturers

(141) — The object of the restriction by Volkswagen and
Audi of deliveries to the Italian market is, as
has been indicated in Chapter 2, Section A.II.1,
to keep Italian dealers to their contract territo-
ries. There had been some measure of pressure,
of stocks on Italian dealers (i.e. a high volume
of
required
dealers to buy from them); the restriction of
deliveries was not intended to reduce this pres-
for
sure in order to provide financial relief
dealers, but rather to ensure that the pressure of
stocks did not undermine the export ban/
restriction. This is clear from the document
referred to in footnote 107. In its letter to Audi
Export aus Italien dated 13 June 1994 (see
footnote 62 and the quotation in Chapter 2,
Section A.II.1), Autogerma spoke of the anti-
competitive object of reducing deliveries. More-
over, restricted deliveries cannot be justified on
the grounds of difficulties in supplies, since the
measure has applied to all models since the end
of 1993, and was applied more stringently in
the case of the new models, the VW Polo and
the Audi A4. In February 1995 Audi cancelled
a delivery of 8 000 Audi A4 vehicles.
In
response to a complaint from Autogerma, Audi
confirmed its policy of restricted deliveries to
the Italian market. An internal memo from the
Task Force set up by Audi, dated 6 February
1995, states,
in this connection (see footnote
109, with translation):

‘Lieferung von weiteren 8 000 Fahrzeugen f(cid:129)r
den italienischen Markt

Die italienischen H(cid:132)ndler haben gefordert, daß
weitere 8 000 Audi A4 1995 nach Italien gelie-
fert werden sollen. Die Autogerma soll eine
entsprechende Zusage bereits gegen(cid:129)ber den
italienischen H(cid:132)ndlern abgegeben haben.

Urspr(cid:129)nglich war vorgesehen, den italienischen
Markt restriktiv und marktgerecht zu beliefern.
Durch die Zusage von weiteren 8 000 Fahr-
zeugen k(cid:148)nnen sich die italienischen H(cid:132)ndler
bereits im jetzigen Stadium auf den Reexport
von Audi A4 einstellen und entsprechende
Zusagen gegen(cid:129)ber
freien Importeuren und
H(cid:132)ndlern abgeben. Die Marktbearbeitung mit
Fahrzeugen
den
k(cid:148)nnte vernachl(cid:132)ssigt werden.

urspr(cid:129)nglich

zugesagten

Ihnen

restriktive

angek(cid:129)ndigte

Um in Italien ein Zeichen zu setzen, daß die
und
von
marktgerechte Belieferung beibehalten wird,
sollte die Zusage vom Ressortgespr(cid:132)ch, daß die
geforderten 8 000 Fahrzeuge nicht geliefert
werden, umgehend dem Importeur bekanntge-
geben werden.

Wir bitten Sie, diese Beschlußlage der Auto-
germa umgehend mitzuteilen und f(cid:129)r eine

entsprechende Kommunikation im italieni-
schen Handel zu sorgen . . .’.

fear

that

(142) — With the knowledge of Volkswagen and Audi,
their
Autogerma has used dealers’
contracts might be terminated as a means of
bringing pressure on them to comply with the
export ban/restriction. A dealership contract
can be terminated without giving reasons on
notice of at least one year (see Article 1 of §XXI
of the dealership contract, footnote 83). Auto-
germa has in fact terminated the contracts of
dealers who sold vehicles for export (see the
document Export aus Italien dated 13 June
1994, referred to in footnote 62); internally it
was emphasised that ‘to the outside world these
terminations of course took place on other
(see the document Besuch bei Auto-
grounds’
germa (Visit to Autogerma) dated 10 February
1995 mentioned in footnote 125 and Chapter 1,
Section C.II.6). The use by a manufacturer or
importer of selective dealership contracts to
reduce the contractual freedom and economic
independence of dealers constitutes a restriction
of competition for the purposes of Article 85(1)
of
the Treaty. The Commission has already
taken this view in the Hasselblad Decision (158).

(143) — With the knowledge of

the manufacturers,
Autogerma has agreed with dealers that final
consumers are to be required to provide a
written undertaking accepting restrictions on
their right to use their property as they saw fit.
This conduct constitutes a restriction of compe-
tition for the purposes of Article 85(1). The
Court of Justice has ruled that ‘it is clear from
previous judgments of the court that clauses in
contracts of sale restricting the buyer’s freedom
to use the goods supplied in accordance with
his own economic interests are restrictions on
competition within the meaning of Article 85
of the Treaty’ (159).

(b) The effect

(144) The effect of the measures is to restrict cross-border
sales of vehicles. Authorised dealers were repeatedly
told that they were free to sell vehicles only within
their contract territories (see the letter Measures to
control and prevent re-export dated 26 September
1994, mentioned in footnote 15 and referred to in
Chapter 1, Section C.I; see also the document
referred to in footnote 18 cited in Chapter 1,
Section C.I). If they failed to comply, they were
told to expect penalties. Dealers complied with
Autogerma’s instructions and refrained from sales
to customers resident outside their contract territ-
ory, drawing no distinction between customers who
were final consumers,
intermediaries acting on
behalf of such consumers, other authorised dealers
forming part of the distribution network, or inde-
pendent dealers outside that network. Chapter 1,
Section D shows
that authorised dealers have
refused to sell consumers VW or Audi vehicles on

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if

the grounds that the manufacturers or main im-
porters had prohibited exports (see the documents
referred to in Chapter 1, Section D.I and footnotes
130, 132, 134, 135, 136, 138 and 140). Authorised
dealers have frequently refused to make sales to
consumers on the ground that
they sold for
export, there would be reprisals on the part of the
main importer (loc. cit. and footnote 137), and
indeed that
their dealership contract might be
terminated (loc. cit. and footnote 132). Authorised
dealers responded to enquiries from outside their
contract territory by a standard letter, even when
the enquiries obviously came from final consumers;
in that letter, they advised the customer not to
purchase from them because of the long delivery
time (see the documents referred to in Chapter 1,
Section D.III footnotes 145 and 147). A document
in the Commission’s possession shows that an au-
thorised dealer attempted to buy back a vehicle
supplied to a final consumer resident outside his
contract territory, and in giving an account of this
to Autogerma apologised for the inconvenience
caused to the manufacturer by the sale (see the
document referred to in Chapter 1, Section D.III
and footnote 144).

(145) Autogerma

that

informed Audi

the measures
adopted had resulted in a large-scale fall in the
volume of VW and Audi vehicles exported (loc. cit.,
footnote 148). The Austrian main importer
for
in a
Volkswagen, Audi and Porsche also noted,
letter of 27 March 1995 to Audi, that the measure
had had the effect of partitioning the market (see
footnote 31, with translation):

‘. . . Aus den in der j(cid:129)ngsten Zeit mit den H(cid:132)ndlern
der betroffenen Gebiete gef(cid:129)hrten Gespr(cid:132)chen
konnten wir
feststellen, daß sich das Thema
Grauimporte beruhigt hat. So ist bis zur Stunde
kein einziger A4 aus
Italien nach (cid:153)sterreich
importiert worden.

Die von Ihnen gemeinsam mit dem italienischen
Importeur eingeleiteten Maßnahmen scheinen also
zu wirken. Daf(cid:129)r m(cid:148)chten wir uns bei Ihnen und
allen, die daran mitgewirkt haben, sehr herzlich
bedanken . . .’.

(c) Conclusion

(146) Volkswagen, Audi and Autogerma sought to imple-
ment an export ban/restriction by the measures
they took and as regards Gremany and Austria at
least they achieved that aim. These measures, in
combination and in isolation, are capable of re-
stricting competition.

2. Appreciable restriction of competition

(147) Volkswagen and Audi hold significant shares of the
Community market in new vehicles (see Chapter I,
Section A.III). The market shares of Volkswagen
and Audi will be considered together, since Audi is
a subsidiary of Volkswagen and pursues a market
strategy determined by its parent. The Commission
would refer here to the record of a discussion
which it has found, entitled Preisharmonisierung
(Price harmonisation) dated 30 August 1993 (see
footnote 105). The record reports a discussion
between Volkswagen and Audi on stopping the
flow of grey-market products, mainly from Italy.
Under heading IV, Weiteres Vorgehen (Further
steps) the following is stated (see footnote 105, with
translation):

‘. . . Ziel
Vorgehen der Marken VW und Audi . . .’.

ist ein abgestimmtes, gleichgerichtetes

(148) Since 1993 there have been significant differencies
in prices between Italy and the other Member
States. Reference is made to the overview in
Chapter 1, Section B.II. The differences in prices
between Italy and in particular Germany and
Austria decreased in the course of 1996. This can
be attributed to the strengthening of
the lira,
among other factors (such as price increases by
Volkswagen and Audi). The financial gains to be
made from parallel trade in motor vehicles from
Italy have thus been falling. Nevertheless,
the
object of the measures introduced by Volkswagen
and Audi, through Autogerma, remains unaltered.
The measures could come into play once again if
currency fluctuations or other
factors were to
permit price differentials to develop. Potentially,
therefore,
the restriction of competition in the
common market remains appreciable.

IV. Appreciable

effect on trade between

Member States

(149) Trade between Member States is affected because
the export ban/restriction applied by Volkswagen
and Audi restricts cross-border trade. The Italian
market is eliminated as a possible source of parallel
exports, and at the same time markets for those
exports where prices are significantly higher, such
as the German and Austrian markets, are protected
from parallel imports.

(150) As has been indicated in Chapter 1, Section B.I, the
volume of actual and potential parallel exports is
considerable. There is consequently an appreciable
effect on trade between Member States.

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V. Conclusion

(151) Volkswagen and Audi, through Autogerma, have
agreed with the Italian authorised dealers an export
are
ban/restriction under which those dealers
required to refrain from selling VW and Audi
vehicles outside their contract territories.

(152) The unlawful object of preventing or restricting
parallel
trade has been pursued by means of a
written agreement. The measures adopted by the
manufacturers and the importer form part of the
contractual relations maintained by the manufac-
turers, through Autogerma, with the dealers in their
selective distribution network.

(153) These are appreciable restrictions of competition
with an appreciable effect on trade between
Member States. There is therefore an infringement
of the prohibition in Article 85(1).

B. Article 85(3)

I. Block Exemption Regulations (EEC) No

123/85 and (EC) No 1475/95

(154) Regulation (EEC) No 123/85 (160) was in force from
1 July 1985 to 30 June 1995. It was superseded on
1 July 1995 by Regulation (EC) No 1475/95 (161).
Article 13 of Regulation (EC) No 1475/95 lays
down that the provisions of Regulation (EEC) No
123/85 continue to apply until 30 September 1995.
Article 7 of Regulation (EC) No 1475/95 lays down
that the provisions of Regulation (EEC) No 123/85
continue to apply until 30 September 1996 to
agreements already in force on 1 October 1995
which satisfy the conditions for exemption laid
down in the latter Regulation. Consequently, until
1 October 1996 this case falls to be assessed only
under Regulation (EEC) No 123/85. From 1
October 1996 onwards, Regulation (EC) No
1475/95 applies without reservation.

(157) Regulation (EEC) No 123/85 was in force from 1
July 1985 to 30 June 1995. It can therefore be
assumed that the distinction it makes between, on
the one hand, sales to final consumers, intermedi-
aries and dealers in the distribution network and,
on the other, sales to independent dealers who are
not part of the distribution network is a familiar
one. The latter are also often referred to as ‘grey
importers’. Terminology, however, is not uniform:
‘grey imports’ sometimes includes parallel imports
by final consumers or intermediaries or both. The
term ‘reimports’ usually includes all
types of
parallel imports, whether by final consumers, inter-
mediaries, other dealers in the network or inde-
pendent dealers; even here, however, it cannot be
assumed that there is a general recognised termin-
ology.

(158)

the export ban/restriction imposed by Volks-
If
wagen, Audi and Autogerma were to include only
measures directed solely and explicitly at
inde-
pendent dealers, such measures would be exempted
this
by Regulation (EEC) No 123/85. However,
does not apply to the measures in question, for the
following reasons.

(159) Volkswagen, Audi and Autogerma make no distinc-
tion, either in the language they use or in the
actual form of the measures, between independent
dealers on the one hand and final consumers, inter-
mediaries acting on their behalf or other authorised
dealers within the distribution network on the
other.

(a) Terminology

(160) — As explained in Chapter 1, Section C.II.1, Volk-
swagen was not consistent in its terminology,
but referred to grey imports and reimports toge-
ther. The documents mentioned in footnote 50
may be cited as evidence of this. This prompts
the conclusion that all possible types of reim-
port are covered by the set of measures in the
export ban/restriction.

(155) Regulation (EEC) No 123/85 and Regulation (EC)
No 1475/95 do not exempt an agreement imposing
an export ban/restriction aimed at preventing
parallel exports by final consumers, by intermedi-
aries acting on their behalf or by other dealers in
the dealer network.

(161)

1. Article 3(10)(a) of Regulation (EEC) No 123/85

the manufacturer

(156) Article 3(10)(a) of Regulation (EEC) No 123/85
allows
to prohibit authorised
dealers from supplying contract goods or corres-
ponding goods to ‘resellers’ who are not part of the
distribution network. In this way the Block Exemp-
tion Regulation acknowledges the manufacturer’s
interest
selective distribution
system.

in protecting his

is

confirmed

That reimports by final consumers or interme-
diaries acting on their behalf are also to be
prevented
by Volkswagen’s
conduct. In the internal memo Verkauf an
europ(cid:132)ische Privatkunden und ‘echte’ Vermit-
tler (Sales to European private customers and
‘genuine’ intermediaries), of 4 July 1995 (see
footnote 50, with translations), Volkswagen
a
states
properly
the
authorised
for
purposes of Article 3(11) of
the Regulation,
intends
to complain to the Commission
because, on an internal instruction from Auto-
germa, no information is being given to him. In
the memo, such behaviour towards the interme-
diary is seen as not in conformity with the
Regulation:

intermediary,

intermediary

a genuine

that

i.e.

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‘. . . Achtung: Entzug der GVO m(cid:148)glich!’

(162)

There is no suggestion, however, that the anti-
competitive behaviour should cease, only advice
that

(163)

(164)

(165)

‘Aus politischen Gr(cid:129)nden m(cid:129)ssen hier Wogen
gegl(cid:132)ttet werden . . .’.

that

Volkswagen instructed Autogerma as to what
words to use with final customers (see footnote
35). Autogerma was to point out
final
customers could be supplied; if there had been
a refusal to do so hitherto, this could only have
been due to a regrettable misunderstanding;
that said, no dealer could be forced to sell to a
particular customer. The letter shows that Volk-
swagen wants to give the impression it is acting
in accordance with competition law, but is in
fact evading customers and failing to respect
their right to buy the goods want anywhere in
the single market. An internal Volkswagen
memo confirms this objective (see footnote 34,
with translation):

‘in keinem Fall den Eindruck entstehen lassen,
daß auf Anweisung der VW AG, der Autogerma
oder einzelnen Personen dieser Unternehmen
keine Informationen an Privatkunden oder
zul(cid:132)ssige Vermittler herausgegeben werden
d(cid:129)rfen. . .’.

Had Volkswagen wanted to exclude final consu-
mers
there
from the export ban/restriction,
would have been no need for guidance to Auto-
germa of this type, nor for the advice that the
impression must not be given that parallel
trading by final consumers or intermediaries
was being restricted. An impression of that kind
could arise only if there were large numbers of
complaints on the part of consumers, in which
case manufacturer and importer would have
ample time to ensure that such ‘misunderstan-
dings’ on the part of dealers did not occur.
Consequently, there is no need for a certain
formulation if the behaviour itself accords with
competition law.

From the internal memo Reimporte Italien
(Reimports from Italy), dated 24 March 1995
(see footnote 91), it is clear that the attitude of
Autogerma reproduced in the circular of 16
March 1995 (see footnote 68) describes only the
latter’s ‘official’ position (see the memo Reim-
porte Italien, footnote 91). This is confirmed in
the internal memo Reimporte Italien of 9 May
1995 (see footnote 70, with translation):

‘. . . Das anliegende Schreiben der EG-Kommis-
sion zeigt, daß man sich mit unserem
Schreiben vom 30. M(cid:132)rz 1995 sowie dem
letzten Rundschreiben der Autogerma nicht

zufrieden gibt. Der Inhalt des Rundschreibens
muß auch praktiziert werden, wenn wir nicht
das hohe Risiko eines Bußgeldes laufen wollen
. . .’.

description:

(166) — In the Audi memo Projektbeschreibung Grau-
markt/Reimporte
grey
(Project
market/reimports), dated 14 December 1994
(see footnote 56, with translation), which was
also submitted to the Audi management board,
a conceptual distinction is made between reim-
ports and the activities of independent dealers,
even though it is emphasised at the same time
that all types of grey imports and reimports are
to be combated:

‘Projektbeschreibung:
markt/Reimporte

Bek(cid:132)mpfung

Grau-

(167)

(168)

Aufgaben und Zielsetzungen

1.

Bek(cid:132)mpfung von Reimporten

— Einlieferung nach Deutschland

— Illegale Exporte aus Deutschland

— Andere L(cid:132)nder der Europ(cid:132)ischen Union

Verhinderung der Belieferung von nicht-

2.
autorisierten Wiederverk(cid:132)ufen . . .’.

In the paper of 9 February 1995 presented to
the meeting of the management board on 13
February 1995, the following definition of reim-
ports is given under the heading Einleitung
von Maßnahmen gegen den Graumarkt/
Grauimportmarkt (Introduction of measures to
combat the grey market/grey import market)
(see footnote 57, with translation):

‘. . .

2.

Ausgangssituation

Reimporte unterscheiden sich in

a: Quereink(cid:132)ufe der deutschen Vertragsh(cid:132)ndler

im Ausland

b: Belieferung organisationsfremder Wiederver-

k(cid:132)ufer (= Graumarkt-H(cid:132)ndler)

. . .’.

Although Audi was clear about the necessity of
a conceptual distinction and, hence, of separate
measures for cross-purchases or reimports by
final consumers or intermediaries and for reim-
ports by independent dealers outside the distri-
bution network (see document entitled Reim-
portsituation, dated 23 October 1995, in foot-
note 104), such a distinction was not made in
the documents which related directly to the
combating of grey imports and reimports. This
suggests that the combating of reimports by
final consumers or intermediaries from Italy
into Germany was at least part of the objective.
As evidence of this, further documents can be
adduced in addition to those cited above: in the

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25. 4. 98

Situationsbericht Grauimporte K-VSK am 6.
April 1995 (Situation report grey imports
K-VSK, 6 April 1995), the following statement
is to be found under the heading Organisation
(see footnote 104, with translation):

einer Organisationseinheit

‘Gr(cid:129)ndung
im
Vertrieb Audi zur dauerhaften Einschr(cid:132)nkung
des Grau-, bzw. Reimportmarktes. Ziel ist der
langfristige Schutz des exklusiven Vertriebs-
weges und der Preis- und Wertstabilit(cid:132)t der
Produkte . . .’.

survey Graumarkt Italien (Grey
In Audi’s
Market Italy), dated 5 February 1995 (see foot-
note 8), the Italian grey market was described as
the difference between registrations on the
Italian market and the deliveries declared by
the importers, without a distinction being made
between reimports by independent dealers
outside the distribution network and those by
final consumers or intermediaries and cross-
deliveries. In the confidential Graumarktbe-
richt 9/95 (Grey Market Report 9/95), of 28
September 1995 (see footnote 104, with transla-
tion), under the heading 1. Derzeitige Grau-
markt/Reimportsituation . . . Deutschland)
(1.
Current grey market/reimport
situation . . .
Germany), a statistic is quoted, In D zugelas-
sene Re-importfahrzeuge — Gesamt (Reimport
vehicles
registered in Germany — total),
preceded by the following introductory remark:

‘. . . Der Privatimport von Neufahrzeugen durch
Endverbraucher nimmt stetig zu.

Eine Differenzierung nach Privatimport und
Import durch nicht-autorisierte Wiederver-
k(cid:132)ufer ist nicht m(cid:148)glich . . .’.

as

Volkswagen’s:

Audi’s strategy towards final customers is the
consumers who
same
complained that Italian Audi dealers refused to
sell vehicles to foreigners have been given a
standard reply (see Chapter 1, Section C.I, and
document in footnote 32). This refers to the
different equipment of the vehicles, and also
uses Volkswagen’s argument that the manufac-
turer cannot tell Italian dealers to which final
consumers vehicles are to be sold (see the docu-
ments referred to in footnote 33). These formu-
lations are superficially unobjectionable from
the legal point of view, but in conjunction with
the other documents found in the investigation
they show that Audi also wanted to prevent the

(169)

(170)

parallel import of vehicles by final consumers
and intermediaries. It was to be made clear to
dealers that they were not to say that they had
been forbidden by
or
importer to sell to final consumers (see docu-
ment in footnote 149). It would not have been
necessary to insist on this question of formula-
tion if dealers had not actually been forbidden
from selling to non-Italian final consumers.

the manufacturer

(171) — In various documents Autogerma and Audi that
its dealers are forbidden to sell outside their
territory. The latter Parallelexporte
contract
(Parallel exports), of 14 June 1994 (see footnote
65), the letter of the same title of 21 September
1994 (see footnote 14, cited in Chapter 1,
Section C.I) and the letter from Autogerma
Measures to control and prevent re-export of 26
September 1994 (see footnote 15, cited in
Chapter 1, Section C.I), provide particular
evidence of this. Further, Autogerma confirms,
with regard to Audi, in its letter Export aus
Italien dated 13 June 1994 (see footnote 62,
with translation):

‘. . . Durch Autogerma wurden betreffende
H(cid:132)ndlerbetriebe mehrfach
ihr
Gesch(cid:132)ft ausschließlich auf dem Inlandsmarkt
Italien abzuwickeln. Es erfolgten sogar zwei
H(cid:132)ndlerk(cid:129)ndigungen . . .’.

angemahnt

(172)

In internal memos, too, Autogerma emphasises
that authorised dealers must sell their cars in
Italy. No distinction is made between inde-
pendent dealers and other purchasers, but only
between sales outside and inside Italy. The
memo from the chariman of Autogerma dated
28 June 1994 provides particular evidence of
this (see footnote 97, with translation):

‘. . . Oggetto: Non riconoscimento/trattenuta del
maggior
zona
vendite
(compreso esportazioni parallele).

sconto

fuori

per

A conferma di quanto gi(cid:133) verbalmente antici-
pato, desidero approvare per iscritto (mia sigla e
data), o meno, ogni singolo caso di eventuale
successivo riconoscimento di accantonamento/
trattenuta di maggior sconto per vendite fuori
zona/esportazione parallela.

Ci(cid:149) (cid:138) tra l’altro di fondamentale importanza in
connessione ai dati statistici sulle consegne ed
immatricolazioni pubblicati dalla stampa che,
oltre tutto, ci mette in cattiva luce nei confronti
del pubblico e rende impossibile un’esatta valu-
tazione della situazione del mercato.

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(173)

Ricordo ancora una volta che la nostra rete deve
vendere i nostri autoveicoli in Italia (ci(cid:149) oltre-
tutto affinch(cid:130) possa ‘sopravvivere’) e non svol-
gere attivit(cid:133) di ‘distribuzione’ fuori zona.

Come (cid:138) noto, la Autogerma da molto tempo
richiede continuamente alle proprie case madri
agevolazioni di
forniture, prezzo, equipaggia-
menti
speciali, ecc. e ci(cid:149) non pu(cid:149) essere
‘contraccambiato’ con una rivendita dei nostri
veicoli all’estero.

Qualora necessitassero ulteriori precisazioni in
merito, prego rivolgersi al sottoscritto’.

Autogerma differentiates in the circulars to au-
thorised dealers (see the documents cited in
footnote 68) between final consumers or inter-
mediaries and independent dealers outside the
distribution network, but on other occasions
makes it clear to the authorised dealers that
sales outside the contract
territory are un-
desirable, whoever the customer may be.

Reference may be made in particular to the
Protokoll der
Sitzung der Arbeitsgruppe
Marketing UCAV — Autogerma 27. Juli 1994
(Minutes of
the UCAV —
Autogerma Working Party on Marketing held
on 27 July 1994) (see footnote 67, with transla-
tion):

the meetings of

. . .

(page 2)

‘Scarabel:

Unterstreicht, daß Sonderrabatte f(cid:129)r Verk(cid:132)ufe
außerhalb des Vertragsgebiets bei
einigen
H(cid:132)ndlern blockiert worden seien, die —
zumindest in der Theorie — legal eingefordert
werden k(cid:148)nnten. Er betont ferner die Notwen-
digkeit,
des
Vertragsgebiets
von 15 %
erneut zu diskutieren.

tolerierte Quote

f(cid:129)r Verk(cid:132)ufe

außerhalb

die

Dr. Schlesinger:

. . . Der Sonderrabatt sei einfach ein zus(cid:132)tzlicher
Rabatt — etwas (cid:129)ber das (cid:154)bliche hinaus. In der
Vergangenheit sei er sehr großz(cid:129)gig gehandhabt
worden und wenn heute ungef(cid:132)hr 20 H(cid:132)ndler
von insgesamt 234 diesen Sonderrabatt nicht
erhalten h(cid:132)tten dann deshalb, weil keine Groß-
h(cid:132)ndler oder Exporteure belohnt werden sollen.
Fr(cid:129)her haben wir ein Auge und mehr zuge-
dr(cid:129)ckt, doch heute tendieren wir dazu, den
Sonderrabatt beim Verkauf
außerhalb des
Vertragsgebiets zu verweigern, weil er auf Zulas-
sungen und nicht auf Auslieferungen vergeben
wird.’

(page 4)

‘Dr. Schlesinger:

Fordert die U.C.A.V. auf, die Basis zu einem
guten Anlauf des neuen Polo zu sensibilisieren
. . .’.
(begrenzte Rabattgew(cid:132)hrung, kein Export)

(174)

By letter dated 21 January 1995, UCAV
reported to the authorised dealers on the

(175)

(176)

meeting held with Autogerma on 20 January
1995 concerning the Golf Variant model (see
document in footnote 66, with translation):

. . .

(page 3)

‘Nessuna di queste auto va venduta al di fuori
dell’area di competenza Autogerma . . .’.

In letters to authorised dealers, Autogerma asks
dealers to confirm that they will refrain from
selling outside their contract
territory. In its
investigation,
the Commission found a large
number of such letters to authorised dealers (see
the documents cited in footnote 65). An
example is the letter to Brenner Garage dated
15 November 1993 (see footnote 64, with trans-
lation):

‘Oggetto: Attivit(cid:133) di vendita organizzata fuori
del territorio contrattuale.

. . .

Ci riferiamo alla nostra precedente ORG/EP/cb
del 20 ottobre 1993 con oggetto pari alla
presente.

Siamo piuttosto perplessi nel rilevare che non
avete ancora riscontrato il contenuto della
nostra
lettera, che valutiamo estremamente
importante ma anche determinante ai fini di
una corretta impostazione dell’attivit(cid:133) di vendita
della Vostra azienda.

La mancata Vostra risposta — Vi ricordiamo —,
e quindi la mancata conferma da parte Vostra
della cessazione di qualsiasi attivit(cid:133) di vendita
organizzata
territorio contrattuale
demandato alla Vostra competenza, avr(cid:133) come
conseguenza quanto esposto nell’ambito del
penultimo capoverso della nostra sopraccitata.

fuori del

In attesa di Vostro riscontro che confermi
pertanto anche la Vostra adesione alle norma-
tive in atto . . .’.

The term used here by Autogerma,
‘vendita
organizzata’ (organised sales), is not found either
in Article 3(10) of the Italian version of Regula-
tion (EEC) No 123/85 or in Autogerma’s stan-
dard dealership contract for authorised dealers
(see footnote 83). The context
in which the
term ‘vendita organizzata’ is used by Autogerma
makes it clear that the reference is not merely
to a contractual obligation on the dealer not to
sell contract goods
to dealers who do not
belong to the distribution network, an obliga-
tion which would be covered by Article 3(10)(a)
of Regulation (EEC) No 123/85. Rather, Auto-
germa always combines the term ‘vendita orga-
territorio
nizzata’ with the words ‘fuori del
territory).
(outside the contract
contrattuale’

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This qualification serves no purpose if all that is
meant
is sales to independent dealers, since
under the dealership contract sales to indepen-
dent dealers are always inadmissible regardless
the independent dealer has his
of whether
registered office inside or outside the authorised
dealer’s contract territory (see the last sentence
of point 3 of the dealer contract with Eurocar
referred to in footnote 83). In addition,
in
German-language letters, Autogerma also uses
the
term ‘außenstehende Verkaufsorganisa-
tionen’ (outside sales organisations), and makes
it clear that non-Italian VW and Audi dealers
are also meant. Reference may be made here to
the letter of 21 September 1994 cited in
Chapter 1, Section C.1, which states (see foot-
note 14, with translation):

‘. . . Diese Notwendigkeit hat dazu gef(cid:129)hrt, daß
einige Partner, gedr(cid:132)ngt von aussenstehenden
Verkaufsorganisationen
zahlreiche
ausl(cid:132)ndische Volkswagen- und Audi-H(cid:132)ndler),
Verkaufsaktivit(cid:132)ten auch in Gebieten t(cid:132)tigen,
die weit von der vertraglich festgelegten Zone
liegen, manchmal sogar bis ins Ausland . . .’.

(darunter

In other standard letters to authorised dealers,
Autogerma uses only the words ‘Vendita al di
fuori del territorio contrattuale’
(sales outside
the contract territory). This is evidenced by the
letter to 20 dealers mentioned in footnote 65,
Vendita al di fuori del territorio contrattuale
(Sales outside the contract territory), dated 24
February 1995 (Autogerma, AG 000263), taken
in conjunction with the memo Elenco Concessi-
onari ai quali (cid:138) stata inviata lettera del
territorio
24.2.1995 per vendita fuori dal
contrattuale (List of dealers to whom the letter
of 24 February 1995 regarding sales outside the
contract
territory has been sent), dated 23
February 1995. In this standard letter, Auto-
germa threatens a number of authorised dealers,
whose names are given in the list attached to
the internal memo, with termination of
the
dealership contract
they sell outside their
if
contract territory. This proves that Autogerma’s
concern is to prohibit without distinction all
sales outside the contract territory, whether to
final
au-
intermediaries, other
thorised dealers or independent dealers.

consumers,

(177)

(178)

In addition, in the course of the investigation,
the dealers in Trento, Bolzano/Bozen and Silan-
dro/Schlanders at whose premises the investiga-
tions were carried out stated to the Commission
that Autogerma had repeatedly given them
verbal instructions not to export. The instruc-
tions included sales to final consumers (see the
document referred to in footnote 63).

(179)

The Commission is satisfied that Autogerma
deliberately chose an unclear formula in order

to give authorised dealers the impression that
the ‘Vendita organizzata fuori del
territorio
contrattuale’ prohibited by Autogerma included
cross-deliveries within the distribution network
and sales to final consumers or their intermedi-
aries. Autogerma thus avoided a direct ban on
selling to other authorised dealers, final con-
sumers and intermediaries because it was aware
— as explained in Chapter 1, Section C.1 —
that certain elements of its strategy infringed
Community competition law. Autogerma was
encouraged in this approach by the manufac-
turers, who also advised caution (see document
in 17).

(b) Form of the measures

(180) — In the supervision of dealers’ activities no
distinction is made between sales to indepen-
dent dealers and other customers; the autho-
rised dealer must as a general rule obtain Auto-
germa’s approval
for every sale outside his
contract territory (see footnote 69). The reports
to Autogerma on the results of audits on dealers
always show all sales outside the contract ter-
ritory (see documents in footnote 44).

(181) — In accordance with Convenzione B to the
dealer contract, bonus payments have in prin-
ciple been made, at least since 1987, only on
sales within the contract territory, and, since
January 1995, have also been made conditional
on the vehicle being registered in the contract
territory. This restriction is not exempted by
Regulation (EEC) No 123/85. Nor does that
Regulation exempt the 15 % clause contained
in the Convenione, whereby the bonus is also
territory
paid for sales outside the contract
provided these do not exceed 15 % of
the
dealer’s total deliveries. The protection of the
exclusive and selective distribution system does
not require such a clause, since account
is
already taken of this interest of the manufac-
turer’s by Article 3(10) of the Regulation. The
manufacturer may prohibit
authorised
dealer from making any sales to dealers outside
the distribution network. He is prevented from
prohibiting the authorised dealer from making
sales to final consumers, intermediaries or other
authorised dealers in the distribution network.
The 15 % clause does not distinguish, however,
between these groups of customers but applies
equally to sales to dealers outside the distribu-
tion network, final consumers, intermediaries,
and other authorised dealers in the distribution
network.

the

In addition,
since September 1993, bonus
payments have in fact been withheld (see docu-
ment in footnote 18), without regard to the type
of customer
final
consumer, intermediary, or independent dealer)
to whom an export sale is made.

(other authorised dealer,

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(182) — The same applies to the margins scheme. Here,
too, Autogerma makes no distinction as to
whether the seller is an authorised dealer, a
final consumer, an intermediary or an inde-
pendent dealer. The only decisive factor for
granting the full margin is whether or not the
vehicle is registered within the contract territory
of the authorised dealer making the sale (see
documents in note 85). This shows that it is not
just a question of preventing sales to indepen-
dent dealers, but that all parallel exports are to
be excluded.

(183) — The restrictive supply of the Italian market is
intended to ensure that only demand from
Italian customers is satisfied (see document in
footnote 107). Consequently, it is not only inde-
pendent dealers who are cut off
from the
sources of supply, but also final consumers,
intermediaries acting on their behalf and other
authorised dealers.

(184) — The ban on cross-deliveries is by definition
concerned only with sales within the distribu-
tion network. Consequently, this measure, too,
is inconsistent with Article 3(10)(a). Volkswagen
was informed by Autogerma about the obstruc-
cross-deliveries within the dealer
tion of
21
(see Autogerma’s
network
September 1994 in footnote 14, cited in
Chapter 1, Section C.I) and did not put an end
to Autogerma’s anticompetitive behaviour. Audi
agreed to the ban on cross-deliveries within the
dealer network. Audi was asked by Autogerma
to see that cross-deliveries within the dealer
network did not occur (see document in foot-
note 116). German authorised dealers also noti-
fied Audi of
reimports by other authorised
dealers (see documents in footnote 115).

letter

of

2. Article 3(11) of Regulation (EEC) No 123/85

(185) Article 3(11) of Regulation (EEC) No 123/85 states
that the manufacturer may oblige the authorised
dealer to sell motor vehicles within the contract
programme (i.e. range) or corresponding goods to
final consumers using the services of an inter-
mediary only if that intermediary has prior written
authority to purchase a specified motor vehicle and,
as the case may be, to accept delivery thereof on
their behalf. Article 3(11) is the only provision of
the Regulation which gives the manufacturer or
importer the opportunity indirectly to impose an
obligation on the final consumer by means of an

agreement between the manufacturer or importer
and the dealer. No other obligations, such as the
obligation requiring
the written undertaking
described in Chapter 1, Section C.II.7, may be
imposed on the final consumer. This follows from
the principle that exceptions to the ban on restrict-
ive practices, such as the block exemption in Regu-
lation (EEC) No 123/85, are to be interpreted
strictly. Reference may be made in this context to
the decision of
the Court of First Instance in
Peugeot (162). It must be concluded that Regulation
(EEC) No 123/85 does not exempt the obligation
to require the final consumer to give this written
undertaking which is imposed on dealers by Volks-
wagen and Audi through Autogerma.

3. Article 3(10)(a) and (11) of Regulation (EC) No

1475/95

(186) The assessment of

the conduct of Volkswagen,
Audi and Autogerma and the Italian authorised
dealers in the light of Article 3(10)(a) and (11) of
Regulation (EEC) No 123/85 holds good for the
period from 1 October 1996, as the provisions of
Article 3(10)(a) and (11) were incorporated without
change into the new Regulation (EC) No 1475/95.

4. Article 6 of Regulation (EC) No 1475/95

(187) Pursuant to Article 6(1)(3), (7) and (8) of Regulation
(EEC) No 1475/95, the exemption is automatically
inapplicable if
the parties agree restrictions of
competition that are not expressly exempted. In
cases covered by Article 6(1)(3), the exemption does
not apply to any of the clauses restrictive of com-
petition contained in the agreement concerned; in
cases covered by Article 6(1)(7) and (8), the exemp-
tion does not apply to those clauses restrictive of
competition which are to the manufacturer’s ad-
vantage (Article 6(2)). It is a matter for the national
courts to determine the effects of Article 6 in civil
law.

II. Individual exemption

(188) Pursuant to Article 85(3), the Commission may,
under
an individual
certain conditions, grant
exemption from the ban in Article 85(1). This
presupposes, however, that the agreement in ques-
tion has been duly notified in advance to the
since Volkswagen, Audi and
Commission. But

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25. 4. 98

(189)

Autogerma have not notified any of the agreements
concluded with the authorised dealers under their
market-partitioning policy and the agreements do
not satisfy the tests of Article 4(2)(1) of Regulation
No 17 (the parties are from several Member States,
and the agreements relate to imports and exports
between Member States), an individual exemption
cannot be granted.

If the agreements had indeed been notified, they
would not have qualified for exemption in any
event. Even if it could be assumed that such an
export ban/restriction helped to improve the distri-
bution of goods, there would still be the fact that
consumers do not share in the resulting benefit.
Consumers are prevented from taking advantage of
the single market and of differences in the price of
motor vehicles between the Member States. The
right of consumers to buy goods of their choice
anywhere they want
is
restricted. The restriction is plain when one con-
siders the content of the written undertaking. The
export ban/restriction is in serious contradiction
with the objective of consumer protection which
Article 85(3) makes an integral part of the Com-
munity’s competition rules.

in the single market

III. Conclusion

(190) The export ban/restriction imposed by Volkswagen,
Audi and Autogerma is not covered by Regulation
(EEC) No 123/85.

(191) For the period from 10 October 1996, the export
ban/restriction imposed by Volkswagen, Audi and
Autogerma is not covered by Regulation (EC) No
1475/95.

(192) An individual exemption cannot be granted.

(193) Article 85(1) is therefore directly applicable.

C. Counter-arguments put forward by Volks-
wagen

particular between the sales and financial divisions,
but also between Autogerma and the manufac-
turers. This sometimes led to biased reports or ex-
aggerated proposals (see page 6, point 5 of
the
comments). The documents exchanged between
VW, Audi and Autogerma, however, represented
only an internal discussion, which is of no rele-
vance in terms of antitrust law (see page 5, point 3
of the comments).

of

an

anti-competitive

(195) This argument fails to recognise that the Commis-
sion is not here objecting under Article 85(1) to the
agreement
existence
between parent and subsidiary companies. Only in
such a context would it have to be considered
whether the correspondence between parent and
subsidiary companies might be relevant for anti-
trust purposes. This decision is concerned with the
fact
that Volkswagen and its subsidiaries, Auto-
germa and Audi, entered into anti-competitive
agreements and anti-competitive concerted prac-
tices with other undertakings, namely the Italian
Volkswagen and Audi authorised dealers. The
correspondence between parent and subsidiary is
an anti-
therefore cited here as evidence of
competitive
anti-
concerted
competitive agreements with those other under-
takings.

practices

and

(196) Volkswagen’s argument that there were conflicts of
interest within the group is intended to show that
Audi’s
and Autogerma’s behaviour cannot be
imputed to Volkswagen. The fact that it can is
explained in detail
to
which reference is made here.

in Chapter 2, Section F,

(197)

It should be noted, moreover, that the documents
cited in Chapter 1, Section C.I (see footnotes 14,
15, 16 and 18), for example, are not discussion
papers, but reproduce decisions that have already
been taken. Thus, Autogerma’s memo of 26
September 1994 (see recital 22) reads:
‘we confirm
herewith the main measures taken by Autogerma
to control and prevent
re-export.’ Autogerma’s
memo Measures to control and prevent re-export,
of 15 March 1995 (see footnote 18)
likewise
summarises the measures already taken in the past.

I. Inconclusiveness of internal documents

(194)

In their comments of 12 January 1997 on the
statement of objections, Volkswagen and Audi
claim that
in order to substantiate the alleged
infringements of competition law the Commission
is in part basing itself not on external evidence but
on documents internal to the group in which such
external actions are postulated. There were conflicts
in
interest within the group as a whole,
of

II. The lawyers employed by Audi can claim

privilege

(198) Audi claimed in the investigation — and repeated
the claim in its letter of 2 November 1995 (163) —
that the documents copied in the course of the
investigation in the legal department and in depart-

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L 124/91

ment MI-11 should not be used. The staff of the
legal department and the head of department
MI-11 claimed ‘attorney’s privilege’, since they were
to advise the specialist departments as independent
lawyers. Audi concedes, however, that all these staff
are employees of Audi.

(199) Pursuant to Article 14(1) of Regulation No 17, the
Commission may in the course of an investigation
examine the undertaking’s business records.
‘Busi-
ness records’ are those which relate to the activity
of the undertaking on the relevant market. Written
communications between lawyer and client are in
this respect ‘records’ within the meaning of Article
14. Regulation No 17 protects the confidentiality of
written communications between lawyer and client,
but only on condition that, on the one hand, such
communications are made for the purposes and in
the interests of the client’s rights of defence and,
on the other hand, they emanate from independent
lawyers, that is to say lawyers who are not bound to
the client by a relationship of employment (164).
Neither condition is met in the present case, and
Audi cannot therefore invoke ‘attorney’s privilege’.

III. Volume of grey imports

(200)

In their comments of 12 January 1997 on the
statement of objections, Volkswagen and Audi
contend that by far
the largest proportion of
re-exports from Italy to Germany and Austria was
accounted for by clearly inadmissible supplies to
independent dealers. Sales to private individuals
(direct or
through intermediaries) and to other
dealers in the VW-Audi sales organisation played
no substantial part (see pages 12 et seq., points 14 et
seq. of the comments).

(201) The decisive factor for the legal assessment of the
case is whether or not there has been prevention of
sales to final consumers, acting independently or
via intermediaries, and to other VW/Audi dealers.
This is the case (see Chapter 2, Section A and
Chapter 2, Section B.I.1), even if it were to be
assumed, in favour of Volkswagen, that the major
proportion of re-exports were organised by dealers
operating outside the distribution network. Even if
only a small number of sales to final consumers,
their intermediaries or other VW/Audi dealers is
prevented, there is an infringement of Article 85(1).
And as explained in Chapter 2, Section A.IV, the
restriction of trade between the Member States is
appreciable.

D. Duration of the infringement

(202) The infringement can be established with certainty
from 30 December 1987. The Commission bases
its case on the following documents, cited in foot-
note 94: Annex to the dealership contract: ‘Conven-
zione “B” aggiunta al Contratto di Concessione
Autogerma — Prodotti Audi e Volkswagen,’ 30
December 1987 (Autogerma/Brenner Garage; and
Annex to the dealership contract: ‘Convenzione “B”
aggiunta al Contratto di Concessione Autogerma,’
28 April 1994 (Autogerma). These documents set
the bonus scheme. Under that scheme the
out
bonus is in principle granted for sales within the
contract territory. The bonus for sales outside the
contract territory is paid only on condition that
such sales do not exceed 15 % of the dealer’s total
deliveries. The measures to prevent or obstruct
parallel exports were intensified from 1 September
1993. In the internal memo Measures to control
and prevent re-export, of 15 March 1995 (docu-
ment quoted in Chapter 1, Section C.I and footnote
18), Autogerma summarises
the measures and
concedes that, from 1 September 1993, the bonus
was no longer paid on any sales outside the
contract territory.

From other proceedings against Volkswagen AG,
the Commission is aware that the written under-
taking (see Chapter 1, Section C.II.7) has no longer
been required for any models of the VW group in
any Member State since 13 June 1996.

E. Article 3(1) of Regulation No 17

(203) Article 3(1) of Regulation No 17 states that where
the Commission, upon application or upon its own
initiative, finds that there is infringement of Article
85 of the Treaty, it may require the undertakings
concerned to bring such infringement to an end.

In order to bring the infringements established in
this case to an end, taking into account the fact
that they still persist today (see Chapter 2, Sections
A.III.2, B.I.4 and D), the Italian authorised dealers
must be informed that the warnings, instructions
and penalties have been declared invalid. Further-
more, the contracts with the Italian dealers must be
amended with respect to the bonus and margins
dealers within the
schemes. All
Community must be told that cross-deliveries
within the Community are allowed and not to be
penalised in any way.

authorised

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25. 4. 98

(204)

In view of the gravity of the infringement, which
constitutes obstruction of parallel
the
undertaking concerned should be faced with the
threat of a periodic penalty payment in order to
ensure the effectiveness of these measures.

trading,

the other parties to their contracts, to which they
consented under pressure. The dealers did not ac-
tively cooperate. The Commission is therefore not
imposing a fine on them.

F. Addressee of the decision

is

for

responsible

(205) The Commission holds Volkswagen responsible.
Audi is 98,99 % owned by Volkswagen, and Auto-
germa is a wholly owned subsidiary of Volkswagen.
Thus Volkswagen
their
actions (165). In addition, the activities of its subsid-
iaries were known to Volkswagen: Chapter 1,
Section C.II. 2 explains that both Volkswagen and
Audi wanted to split
the dealer margin; Auto-
germa’s bonus policy was approved by Volkswagen
(see the letters to Volkswagen cited in Chapter 1,
Section C.I and footnotes 15, 16 and 17, and
Chapter 1, Section C.II.2); the policy of restricted
supply of the Italian market was followed by both
Volkswagen and Audi, and hence approved by
Volkswagen (Chapter 1, Section C.II.4); the ban on
cross-deliveries was approved by Volkswagen (see
letter
in Chapter 1, Section C.I, note 15 and
Chapter 1, Section C.II.5). Volkswagen and Audi
monitored reimports of their respective models (see
Chapter 1, Section C.I). The use of written under-
takings
in relations with final consumers was
agreed by Autogerma and the authorised dealers
with Volkswagen’s knowledge (see Chapter 1,
Section C.II.7). Uniform evasive
tactics were
adopted towards final consumers (see Chapter 1,
Section C.I). Autogerma’s approach to the autho-
rised dealers was known to Volkswagen and
approved by it.

G. Article 15 of Regulation No 17

(206) Article 15(2) of Regulation No 17 empowers the
Commission to impose fines, within stated limits,
on undertakings which have infringed Article 85(1)
either intentionally or negligently.

(207) The Commission takes the view that in the present
case it is appropriate to fine Volkswagen. No fine
should be imposed on Audi and Autogerma, since
their behaviour is imputable to Volkswagen.

(208) The Italian authorised dealers, as parties with
Volkswagen, Audi and Autogerma to an agreement
aimed at preventing or restricting parallel exports,
are victims of the restrictive policy introduced by

(209)

In fixing the amount of the fine, the Commission
must have regard to all relevant circumstances and
in particular to the gravity and duration of the
infringement. The gravity depends on the type of
infringement, on its effects on the market and on
the size of the market concerned.

(210) The obstruction of parallel exports of vehicles by
final consumers and of cross deliveries within the
dealer network hampers the objective of the crea-
tion of the common market, a principle of the
Treaty, and is already for that reason to be classified
as a particularly serious infringement.

(211) The Commission has already examined numerous
cases of obstruction of parallel imports; the relevant
rules have been settled for many years.

(212) The Volkswagen group has the highest market
share of any motor vehicle manufacturer in the
Community.

(213) The infringement has had direct effects on the
Italian market for the sale of new motor vehicles,
by rendering considerably more difficult, and even
temporarily impeding altogether, sales of vehicles
for parallel export by final consumers. Corres-
pondingly, the infringement has also had effects on
the markets for new motor vehicles, in particular in
Germany and Austria, but also on the markets in
all other Member States. The dealers in these
markets have been sheltered against price competi-
tion from Italy.

(214) Volkswagen knew that the measures aimed to or at
least were liable to obstruct parallel exports of
vehicles from Italy by final consumers, and inter-
mediaries, and restrict competition. Volkswagen
was also aware that its behaviour was infringing
Article 85. This is evident from the internal memo
‘Reimporte Italien’
(Reimports from Italy) of 23
February 1995 (see footnote 80). According to this,
Volkswagen was aware of the effect of the margins
policy and regarded the scheme itself as ‘very likely
to attract a fine’. The deliberate nature of
this
policy can be seen further in the measures for
monitoring and penalising dealers. A memo from
Audi (see footnote 17) states that it would be ‘some-
what risky’ to ‘connect’ the measures taken in Italy
‘with the obstruction of reimports. . .’, and suggests
that the measures ‘should be communicated orally

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L 124/93

between the regions’. In addition, the documents
concerning or connected with the export ban/
restriction were always classified as ‘confidential’ or
‘highly confidential’
(see Chapter 1, C.II.1.(b) and
the documents referred to in footnotes 74 to 77).
it can be concluded from this that
Altogether,
Volkswagen has
infringement
against Article 85(1) deliberately (166).

committed the

(215) The infringement committed by Volkswagen is, all
in all, a very serious infringement of Article 85.
This is true both for the bonus scheme introduced
from 31 December 1987 (see recital 73 et seq.), and
for the reinforcing measures (see recitals 82 to 99)
taken in the years 1993 to 1995 in order to further
impede or prevent parallel trade. Consequently, a
fine has to be imposed which penalises this very
serious violation in an appropriate way and which
excludes, by its deterrent effect, any repetitions.
The Commission considers that an amount of ECU
50 million is an appropriate amount as a basis for
the determination of the amount of the fine.

(216) Another factor determining the amount of the fine
is, pursuant to Article 15(2) of Regulation No 17,
the violation. The infringement
the duration of
committed by Volkswagen can be established at
least from 30 December 1987. It has not been
completely terminated at the present date.

(217) The infringement lasted more than 10 years and
was therefore of very long duration. In accordance
with the guidelines on the method of setting fines
imposed pursuant to Article 15(2) of Regulation No
17 and of Article 65(5) of the ECSC Treaty (OJ C 9,
14.1.1998, p. 3), the amount fixed for the gravity of
an infringement can be increased by a percentage
of up to 10 % per year of the infringement. For the
period between 1988 and 1992, and for the year
1997, the Commission considers that an increase of
5 % per year is appropriate. The infringement was
intensified during the period between 1993 and
1996, during which a great number of reinforcing
measures were introduced. For each of those years,
the Commission considers than an increase of the
maximum percentage of 10 % is appropriate. This
justifies an increase of the amount mentioned in
paragraph 215 of ECU 35 million — which results
in a base figure of ECU 85 million.

(218) Further, the determination of the fine must take
into account aggravating and attenuating factors.

(219) With regard specifically to the situation in Italy,
to
the Commission
Volkswagen,
in two letters (letters from DG IV
dated 24 February 1995 (*D/12803) and 2 May 1995
(*D/15797)), that the prevention and/or obstruction

pointed

actually

out

of parallel imports from Italy would be an infringe-
ment of the Community’s competition rules. It is
clear from the memo Reimporte Italien (Reimports
from Italy) dated 24 March 1995, found by the
Commission in the course of the investigation (see
footnote 91), that at least the first letter from the
Commission was the subject of discussions at VW
and Audi, but that the two firms did not draw the
legally necessary conclusions. It is true that Auto-
germa addressed a circular to the dealers dated 16
March 1995 (see footnote 68), of which a copy was
also sent to the Commission, in which the dealers
were reminded of
the provisions of Regulation
(EEC) No 123/85 and of their dealer contracts. In
fact, however, steps were not taken to ensure that
the previously imposed impediments to sales to
final consumers and intermediaries were removed.
In particular, the dealer contracts have not been
modified accordingly. The fact that Volkswagen has
not
following the
letters of the Commission, and at the same time
has given the Commission to believe that the viola-
tions had been ended,
is being regarded as an
aggravating factor in determining the amount of
the fine.

terminated the infringement

resident

(220) A further aggravating factor is that Volkswagen has
used the economic dependence existing between a
motor vehicle manufacturer and its dealers for
obstructing and preventing sales by the dealers to
final consumers who are not
in their
contract territory. Thus, a great number of Italian
contract dealers, who are legally and economically
independent undertakings, have suffered, in some
cases quite substantial, turnover losses. The pressure
exerted on the dealers by Volkswagen and the
companies in the group culminated in more than
50 contract dealers being threatened with the
termination of their contract in the event that they
continued to sell vehicles to foreign customers,
including final consumers. Finally, dealer contracts
were terminated in 12 cases, substantially endan-
gering the existence of the businesses concerned
(see recitals 93, 94, 142 and 177).

(221) With regard to these

an
increase of the basic amount of the fine by 20 %,
i.e. ECU 17 million, appears justified.

aggravating factors,

(222) The Italian lira suffered two major devaluations in

September 1992 and in March 1995.

In its communication (167) concerning the impact of
monetary fluctuations on the internal market, the
Commission noted that the car sector is partic-
ularly sensitive to monetary fluctuations, and that
exporters in countries whose currency has ap-
preciated have faced difficulties in countries whose
currency has been devalued.

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25. 4. 98

in the

However,
communication the
same
Commission clearly established that the implemen-
tation of anti-competitive practices, in the form of
restrictions of parallel
linked to move-
ments in exchange rates, would clearly contravene
Community competition rules.

imports,

Consequently, this devaluation of the Italian lira
did not permit Volkswagen under any circum-
stances to evade competition law.

Consequently this cannot be regarded as a mitig-
ating factor for the calculation of the fine,

HAS ADOPTED THIS DECISION:

Article 1

Volkswagen AG and its subsidiaries Audi AG and Auto-
germa SpA have infringed Article 85(1) of the EC Treaty,
by entering into agreements with the Italian dealers in
their distribution network in order to prohibit or restrict
sales to final consumers coming from another Member
State, whether in person or represented by intermediaries
acting on their behalf, and to other authorised dealers in
the distribution network who are established in other
Member States.

Article 2

Volkswagen AG shall bring to an end the infringements
established in Article 1 immediately upon notification of
this Decision and shall not replace restrictions of that
kind with restrictions having similar objectives. In par-
ticular, Volkswagen AG shall, within two months of noti-
fication of this Decision:

(a) amend the contract with the authorised Italian dealers
so that bonus payments are not granted according to
whether sales are made within the contract territory or
to another Member State;

(b) inform the authorised Italian dealers by circular that
the margins scheme introduced in the circulars of 20
October and 2 November 1994 has been abolished
wherever the margins are smaller for a sale concluded
within the contract territory;

(c) inform the authorised Italian dealers by circular that
all restrictions on cross-deliveries to network dealers
in the other Member States have been abolished,
pointing out that it is no longer necessary to obtain
the prior consent of the importer and that no penal-
ties in the form of restricted supply or termination of
the dealer’s contract need be feared if the dealer sells
to final consumers from other Member States who act
through an intermediary
either
appointed by them;

themselves or

for

(d) inform all authorised dealers in the VW/Audi distri-
bution network in the European Community, by
circular, that all restrictions on cross-deliveries from
Italy to the other Member States are abolished;

(e) instruct

its subsidiary, Audi AG,

to send circulars
setting out points (a) to (d) to its contract dealers in the
European Community and shall instruct its subsidiary
Autogerma SpA to send circulars setting out points (a)
to (c) to its Italian contract dealers.

Article 3

In view of the gravity of the infringement of Article 85(1)
of the EC Treaty a fine of ECU 102 million (one hundred
and two million ecus) is imposed on Volkswagen AG.

Article 4

The fine determined in Article 3 shall be paid in ecus
within months following the date of notification of this
Decision into the following bank account of the Commis-
sion of the European Communities:

310-0933000-43
Banque Bruxelles Lambert
Agence Europ(cid:130)enne
Rond Point Schuman 5
B-1040 Bruxelles.

After the expiry of that period,
interest shall become
payable. The rate applicable shall be that which the Euro-
pean Monetary Institute applies for transaction in ecus.
The interest shall be payable from the first working day of
the month in which this Decision was adopted. A supple-
ment of 3,5 (three and a half) percentage points shall be
charged. In total, the interest rate shall be 7,75 %.

Article 5

With regard to the obligations mentioned in Article 2, a
penalty payment of ECU 1 000 shall be imposed on
Volkswagen AG for each day of delay in implementing
this Decision. Such delay shall start from the expiry of the
two-month period specified for their implementation.

Article 6

This Decision is addressed to Volkswagen AG, D-38436
Wolfsburg.

This Decision shall be enforceable pursuant to Article
192 of the EC Treaty.

Done at Brussels, 28 January 1998.

For the Commission

Karel VAN MIERT

Member of the Commission

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(The documents referred to in these notes marked with * were classified as confidential by the parties and those
marked with ** were classified by them as highly confidential)

Footnotes

(1) OJ 13, 21.2.1962, p. 204/62.

(2) OJ 127, 20.8.1963, p. 2268/63.

(3) Memo, Italien, 19 September 1994 (Audi, AU-MW D 32).

(4) Internal memo, Reimporte, 3 March 1994 (Volkswagen, AU-GK D 3); internal memo, Reimporte Audi, 10 May

1994 (Volkswagen, AU-VE G D 38).

(5) Survey, In Deutschland zugelassene Re-Importfahrzeuge (Italien), 6 April 1995 (Volkswagen, VW-DB B 9
internal memo: Re-Importe Audi, 8 May 1995 (Volkswagen,

file ‘Re-Importe’);

Sekretariat Santelmann,
AU-VE D 106).

(6) Internal memo , Reimporte, 3 March 1994 (Volkswagen, AU-GK D 3); internal memo, Reimporte Audi, 10 May
internal memo, Re-Importe Audi, 9 February 1995 (Volkswagen,
1994 (Volkswagen, AU-VE G D 38);
AU-VE C D 78); internal memo, Re-Importe Audi, 8 May 1995 (Volkswagen, AU-VE D 106); internal memo,
Re-Importe Audi, 21 August 1995 (VW, AU-KS B 6).

(7) Internal memo, Reimporte, 3 March 1994 (Volkswagen, see note 4); internal memo, Re-Importe VW, 8 May

1995 (Volkswagen, AG 000345).

(8) Survey, Graumarkt/Projekt, January 95 (Audi, AU-VE C D 85); survey, Graumarkt Italien, 5 February 1995
(Audi, AU-VE C D 86); survey, Vendite veicoli nuovi fuori territorio, 17 February 1995 (Audi, AU-VE G D 28).

(9) Internal memo, Reimporte, 3 March 1994 (Volkswagen, see footnote 4); survey, In Deutschland zugelassene
Re-Importfahrzeuge (Italien), 6 April 1995, (Volkswagen, see footnote 5); internal memo Re-Importe VW, 8
May 1995 (Volkswagen, see footnote 7).

(10) Internal memo, Reimporte, 3 March 1994 (Volkswagen, see footnote 4); internal memo, Re-Importe Audi, 8 May

1995 (Volkswagen, see footnote 6).

(11) Commission of the European Communities, DG IV — Competition, Car Price Differentials in the European

Union, various editions.

(12) Details of models and calculations are given in the press releases announcing the reports: IP(93) 545, 1 July
1993; IP(93) 1201, 22 December 1993; IP(94) 704, 26 July 1994; IP(95) 50, 19 January 1995; IP(95) 768, 24 July
1995; IP(96) 145, 15 February 1996. Figures for Austria have been available only since Austria’s accession on 1
January 1995.

(13) OJ L 15, 18.1.1985, p. 16, and OJ L 145, 29.6.1995, p. 25).

(14) Letter to Volkswagen, Parallelexporte, 21 September 1994 (Autogerma, AG 000878); translation:

‘There is great concern throughout the whole Italian sales organisation with regard to the achievement of sales
objectives and the need to maintain the sales successes of the past. This necessity has led some of our partners,
under pressure from outside sales organisations, including a number of foreign Volkswagen and Audi dealers, to
sell in places far from those designated in their contracts, and in some cases indeed outside the country.

The steps taken by Autogerma are therefore intended to warn the Volkswagen/Audi dealers to stay in the ter-
ritories designated by their contracts; checks have been carried out on all dealers individually in order to esta-
blish that they are complying with their contract, with particular reference to sales activities outside the contract
territory (six dealers have had their contracts terminatd for breach of contract, subject to the provisons of the
clauses regarding notice, which provide that the contracts are to come to an end between the end of 1994 and
the middle of 1995). With other dealers we intend to raise allegations of breach of contract, on the basis of
certain “audits results” regarding deliveries, in order to obtain more detailed data on the final purchasers of the
vehicles.

We will be developing this approach further in the sales organisation; the plan calls for a new and even more
important margins structure, with a higher percentage for the “maggiori sconti” bonus, which depends on the
achievement of the quantity and quality obligations in the contract, and a lower fixed percentage on vehicle
invoices. This will give a better distribution of the margins . . .

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25. 4. 98

Annex to the letter COMIORG/EP/st. of 21 September 1994

Sales outside contract territory and/or through unauthorised channels

Preventive measures

Monitoring

Penalties

1. General

reference

in every

1. Check on registrations/sales

1. Verbal caution

conversation

2. Direct

reference

in

every

2. Audit

2. Letter of warning

conversation

3. Written caution to comply
agree-

contractual

with the
ments

3. Investigations

outside

the

contract territory

3. Withholding of
sconto bonus

the maggior

4. Notice

of
dealership contract . . .’.

termination

of

(15) Letter ** to Volkswagen, 26 September 1994 (Autogerma AG 000905).

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(16)

(Volkswagen, VW-KH HDK Re-Exporte). The extract quoted here translates as follows:

‘. . .

— written information (trade) on Directive (EEC) No 123/85,

— repeated auditing of various dealers. Cautions, reduced bonuses, 11 terminations (volumes endangered: about

8 800 vehicles in 1995) — see Annex,

— bonus (quarterly) is paid on the basis of vehicle registrations in the contract territory,

— disproportionate list price increases,

— avoidance of excessive stocks at retail level,

— margin splitting for the Polo A 03,

— 8 % immediately upon invoice
— 5 % proof of new registration in contract territory
— 3 % bonus (targets, customer satisfaction, business standards)

— miscellaneous (see letter AG, 26 June 1994)

. . .’.

(17) Memo, Grauimporte Italien, 12 December 1994 (Audi, AU-DH C Doc 1).

(18)

(Autogerma, AG 000253). The indications of time in this memo are to be read as follows: ‘2/F.M.P.94’ means
‘second four-month period 1994’, so that these measures begin on 1 May 1994; ‘3/F.M.P.94’ means ‘third four-
month period 1994’, so that these measures begin on 1 September 1994;

‘1/F.M.95’ means ‘first four months’ — ‘period’ has clearly been omitted — so that these measures begin on 1
January 1995.

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(19) See for example letter to Audi, Ermittlung von Reimporten, 3 May 1994 (KBA, AU-VE D 113).

(20) Letter to Audi, Ermittlung von Reimporten, 20 April 1994 (KBA, AU-VE D 114).

(21) E-mail message,

(Re-) Importe, Herstellerbescheinigungen, 26 January 1995 (Audi, AU-KS B 9).

(22) See for example the survey Reexporte VW 1993, 30 March 1994 (Autogerma, AG 000184).

(23) A manufacturer’s certificate of conformity had to be submitted in order to register a vehicle with the German
authorities; one way in which the chassis numbers could be ascertained was from applications for such manu-
facturer’s certificates made by customers, or by dealers outside the distribution network acting on customers’ be-
half: see for example memo to Autogerma, Von Privatpersonen (Firmen oder verd(cid:132)chtigten Personen) angefor-
derte Herstellerbescheinigungen, undated (Audi, AU-VE G D 19); memos to Autogerma, both entitled Reimpor-
te, 12 January and 17 January 1995 (Audi, AU-MW 11)). A manufacturer’s certificate or what is known as an ‘in-
formation document’ was required for every imported or reimported vehicle from 1 December 1994 onward,
under a rule laid down by the Federal Ministry of Transport: see e-mail message, (Re-) Importe, Herstellerbe-
scheinigungen, 26 January 1995 (Audi, AU-KS B 9); but this rule clearly was not applied in all L(cid:132)nder: fax to
Audi, Verfahren gegen Reimporteure, 24 March 1995 (Volkswagen, AU-GK E 4).

(24) See for example e-mail message to Autogerma, Re-Import, 26 April 1994 (Audi, AU-GK 3); memo, Re-Import
Italien, 19 August 1994 (Audi, AU-GK D 3); memo to Autogerma, Fahrzeug-Kaufvertr(cid:132)ge, 26 January 1995
(Audi, AU-MW D 27); e-mail message to Autogerma, fahrgestellnr, 15 March 1995 (Audi, AU-VE D 63); e-mail
message to Autogerma, fahrgestellnr, 21 March 1995 (Audi, AU-VE G D 62).

(25) Letter (fax) to Audi: Parallel-Markt, 21 March 1995 (Autogerma, AU-VE C D 60).

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(26) Letter to Autogerma, Verkauf von Volkswagen und Audi Fahrzeugen an gewerbliche Wiederverk(cid:132)ufer, 18

January 1995 (Volkswagen, AG 000333).

(27) E-mail message to Audi, A4 Privat, 24 February 1995 (Audi, AU-MW D 3).

(28) Memo, Anschreiben Graumarkt, 16 March 1995, and corresponding circular to dealers, 14 March 1995 (Audi,

AU-GK D 3).

(29) Porsche Austria Gesellschaft m.b.H. & Co. is the main importer for Volkswagen, Audi and Porsche in Austria.

(30) Fax to Audi, Grauimport, 18 May 1995 (Porsche Austria, AU-VE 2).

(31) Fax to Audi, Grauimporte, 27 March 1995 (Porsche Austria, AU-VE 5 and WV-KH K-15 HDK, file Re-exporte);

the extract quoted in recital 145 translates as follows:

‘In recent conversations with the dealers in the areas concerned we have found that the grey imports question
has calmed down. So far not a single A4 has been imported from Italy to Austria.

The measures you have taken jointly with the Italian importer seem to be working. We would like to extend our
warmest thanks to you and all those who have worked along with you . . .’.

See also fax to Autogerma, 5 July 1995 (Porsche Austria, AU-VE D 137).

(32) Memo, Reimporte; Standard-Schreiben, 27 January 1994 (Audi, AU-DH C Doc 7).

(33) See for example letter to Wieser, 17 February 1995 (Audi, AU-KS A 2); letters to Petersen, 3 April and 10 April

1995 (AU-MW D 3).

(34) Memo, Empfehlungen f(cid:129)r Korrespondenzf(cid:132)lle und Ausk(cid:129)nfte bei Anfragen europ(cid:132)ischer Privatkunden,
undated (Volkswagen, VW-KH K 35 and 36); the extract quoted here and in recital 163 translates as follows:

‘under no circumstances should the impression be given that on instructions from VW AG, Autogerma or indi-
vidual people at Autogerma no information can be given to private customers or intermediaries acting on cus-
tomers’ behalf. . .’

(35) Fax message to Autogerma, Kunde N. Lenz, 9 June 1995 (Volkswagen, VW-KH K 26).

(36) See for example letter to Autogerma, Auto Pedross — Verkauf an deutsche Privatkunden, 1 March 1995 (Volk-
swagen, VW-SR R 20); letter to Commission, Beschwerde, 27 April 1995 (Bernhard, VW-DB B 18); memo,
Anruf eines Kunden, 7 July 1995 (Volkswagen, VW-KH K-38); letter to Audi, Kauf eines Audi in Italien, 8
August 1995 (Simon, AU-VE G D 12); fax to Autogerma: Kunde Keppler, 14 August 1995 (Volkswagen, AG
000530).

(37) See for example letter to Autogerma, 7 February 1995 (Friedrich, AG 000202).

(38) Letter to Friedrich, Kauf eines Polo, 24 February 1995 (Autogerma, AG 000200, see footnote 37); writing to
Volkswagen in connection with this letter, Autogerma confirmed the supply situation: ‘we have dramatic shor-
tages for many models, including the Polo and the Audi A4’; Autogerma consequently recommended that the
customer should be referred to a German dealer (fax to Volkswagen, Briefe von H. Dieter Friedrich, 27 January
1995 (Autogerma, AG 000204, see footnote 37).

(39) See for example letter to Baur, Autokauf in Italien, 14 June 1995 (Autogerma, AG 000269).

(40) See for example letter to Volkswagen, Parallelexporte, 21 September 1994 (Autogerma, see footnote 14).

(41) See for example fax message to Autogerma, H(cid:132)ndleraudits Re-Importe Italien, 26 November 1993 (Volks-
wagen, AG 000054); letter to Audi, Export von Parallelfahrzeugen, 30 January 1995 (Autogerma, AG 000195).

(42) Memo, Measures to control and prevent re-export, 15 March 1995 (Autogerma, see footnote 18); letter ** to Audi:
Measures
to control and prevent re-export, 26 September 1994 (Autogerma, see footnote 15); memo,
Maßnahmen der Autogerma zur Unterbindung von Reexporten aus Italien, 31 January 1994 (Autogerma,
VW-SR R 6); report, Besuch bei Autogerma, 10 February 1995 (Audi, AU-MW D 37).

(43) See for example letter ** to Volkswagen, Measures to control and prevent re-export, 26 September 1994 (Auto-

germa, AG 000634).

(44) Internal memo * Auditing sull’attivit(cid:133) di vendita della Concessionaria BRENNER GARAGE BZ sino al 30
novembre 1994, 13 January 1995 (SEVO, AG 000761); internal memo *:
‘Attivit(cid:133) di vendita della Conc.ia
Autosacchetti di Gorizia dall’ 1/1/94 al 20/5/94’, 4 June 1994 (SEVO, AG 000865); internal memo *: ‘Attivit(cid:133)
di vendita della Conc. ia Autosalone Catullo di Trieste dal 16/2/94 al 20/5/94’, 4 June 1994 (SEVO, AG
000867).

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(45) See for example internal memo *: Visita alla Conc. a NECKER di Milano/MI — controllo dell’attivit(cid:133) di
vendita, 17 December 1993 (SEVO, AG 000223); internal memo, Attivit(cid:133) di vendita della Concessionaria
Dorigoni di Trento, 17 December 1993 (SEVO, AG 000480).

(46) Letter to Audi, Attivit(cid:133) di vendita in Paesi esteri, 4 October 1993 (Autogerma, AG 000840).

(47) Report, Besuch bei Autogerma, 10 February 1995 (Audi, see footnote 42).

(48) Letter to Volkswagen, Measures to control and prevent re-export, 26 September 1994 (Autogerma, see footnote

15).

(49) Internal memo, Erg(cid:132)nzung zur R(cid:129)cksprache 027 vom 19.7.94, 12 September 1994 (Volkswagen, see footnote
71); memo Maßnahmen durch Autogerma zur Vermeidung von Re-Exporten, 6 February 1995 (Volkswagen,
see footnote 16).

(50) Internal memo, Grauimporte Polo, 7 February 1995 (Volkswagen, VW-DB B 25); internal memo, Abmahnak-
tion gegen Reimporteure, 13 January 1995 (Volkswagen, AU-GK E 1); Marketingplan Deutschland 1995, Volk-
swagen Pkw, 10 January 1995 (Volkswagen, VW-SD S1 and S2); handwritten memo, Verkauf an europ(cid:132)ische
Privatkunden und ‘echte’ Vermittler, 4 July 1995 (Volkswagen, VW-KH K-37); the extract from this memo
quoted in recital 161 translates as follows:

‘caution: withdrawal of the Block Exemption Regulation possible!’ and the extract in recital 162 as follows: ‘For
political reasons oil will have to be poured on troubled waters.’

(51) Presentation, Vorlage zur Vorstandssitzung am 13.2.1995: Enleitung von Maßnahmen gegen den Grau-
markt/Grauimportmarkt; 9 February 1995 (Audi, AU-MW 1); fax, Beschluß des Vorstands Audi am 13.2.1995,
20 February 1995 (Audi, AU-VE C D 79); extract from minutes, 6/95, meeting of the management board 13
February 1995, Einleitung von Maßnahmen gegen den Graumarkt/Grauimportmarkt (Audi, AU-KS C).

(52) Circular to dealers, Graumarkt, 20 January 1995 (Audi, AU-KS B 14); memo, Information (cid:129)ber H(cid:132)ndlerans-

chreiben, 23 January 1995 (Audi, AU-VE G D 87).

(53) Circular to importers, Graumarkt/Reimport, 6 February 1995 (Audi, AU-VE G D 27); letter to Autogerma,

Graumarkt/Reimport, 15 March 1995 (Audi, AU-VE G D 72).

(54) See for example memo, Projektbeschreibung: Bek(cid:132)mpfung Graumarkt/Reimporte, 14 December 1994 (Audi,

AU-VE C D 49).

(55) Presentation, Vorlage zur Vorstandssitzung am 13.2.1995, 9 February 1995 (Audi, AU-KS C 12); memo, Grau-

markt, undated (Audi, AU-KS B 10).

(56) See for example memo, Bereich Graumarkt Analyse/Unterbindung Reimporte/Graumarkt, 4 October 1995
internal memo, Sachbearbeiter Graumarkt, 9 February 1995 (Audi, AU-VE D 103);

(Audi, AU-VE D 128);
memo, Projektbeschreibung Graumarkt/Reimporte, 14 December 1994 (Audi, AU-VE D 130).

The extract from this memo quoted in recital 166 translates as follows:

‘Project description: measures to combat grey market/reimports

Tasks and objectives

1. Combating reimports

— supply into Germany,
— illegal exports from Germany,
— other countries of the European Union.

2. Prevention of supply to unauthorised dealers. . .’.

(57) Presentation, Vorlage zur Vorstandssitzung am 13.2.1995, 9 February 1995 (Audi, AU-KS C 12); the extract

quoted in recital 167 translates as follows:

‘2. Initial position

Reimports are divided into
(a) cross-purchases abroad by German authorised dealers
(b) supplies to dealers outside the organsiation (=grey market dealers)

. . .’

(58) Handwritten memo, undated (annexed to another memo, Stand Maßnahmen gegen Graumarkt, 25. 11. 1994)

(Audi, AU-VE C D 71).

(59) Minutes of departmental meeting, Maßnahmen gegen Graumarkt/Reimporte, 3 February 1995 (Audi,
AU-KS B 11); presentation, Vorlage zur Vorstandssitzung am 13.2.1995, 9 February 1995 (Audi, see footnote
57).

(60) See for example memo, Re-Import, 29 September 1994 (Audi, AU-KS B 15).

(61) See for example letter to Volkswagen, Measures to control and prevent re-export, 26 September 1994 (Auto-

germa, see footnote 15).

(62) See for example letter * to Baldan Auto, Attivit(cid:133) di vendita organizzata fuori del territorio contrattuale, 20
October 1993 (Autogerma, AG 000293); letter * to Silemotori Negro, Attivit(cid:133) di vendita organizzata fuori del
territorio contrattuale, 9 March 1994 (Autogerma, AG 000296); letter to Audi, Export aus Italien, 13 June
1994 (Autogerma, AG 000852); the extract from this last letter quoted in recital 118 translates as follows:

‘Although the delivery times for the Audi 80, which were up to eight months, have been reduced considerably,
the dealers are still being rationed. A dealer who orders too many Audi 80s will not receive them . . .’

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and the extract quoted in recital 171 translates as follows:

‘Autogerma has repeatedly cautioned these dealers to do business only on the Italian domestic market. Indeed
two dealers have had their contracts terminated . . .’.

Letter to Fantini and others, Vendite fuori zona, 6 March 1995 (Eurocar, EU-GV 249):
‘sono assolutamente
vietate le vendite all’estero (anche di quelle vetture preventivamente immatricolate in Italia)’ (sales to foreign
countries are strictly prohibited) (even where the vehicle is first registered in Italy)); the extract from this letter
quoted in recital 127 translates as follows:

‘We have already had occasion to speak to you on the delicate question of sales outside the dealer’s area. As
Autogerma no longer intends to tolerate excessive sales activities outside dealers’ own areas of responsibility, we
would like to make the following clear: sales to foreign countries are strictly prohibited (even where the vehicle
is first registered in Italy); all sales outside the dealer’s area of responsibility exceeding 15 % of the dealer’s own
deliveries will be penalised.’

(63) Record, Compte rendu de l’inspection men(cid:130)e chez les revendeurs de Bolzano, Trento et Silandro, October 1995

(Commission).

(64) See for example letters * to Brenner Garage: Attivit(cid:133) di vendita organizzata fuori del territorio contrattuale,
20 October 1993 and 15 November 1993 (Autogerma, AG 000724 und 000723); the extract from the letter of 15
November 1993 quoted in recital 175 translates as follows:

‘Subject: Organised sales activities outside contract territory

We refer to our earlier letter on the same subject, ref. ORG/EP/cb of 20 October 1993.

We are somewhat puzzled to see that you have not yet replied to what was said in our letter, which in our view
is extremely important, and vital to a correct approach to your firm’s sales activity.

We would remind you that a failure on your part to reply, and thus a failure on your part to confirm that you
will discontinue any organised sales activity outside the contract territory entrusted to your responsibility, will
have the consequences spelt out in the second-last paragraph in our earlier letter.

In the expectation of a reply confirming your acceptance of the rules referred to . . .’;

separate letters to Autocommerciale SpA., Beikircher srl., and F.lli Zicari SpA., Attivit(cid:133) di vendita organizzata
fuori del territorio contrattuale, 20 October 1993 (Autogerma, AG 000289, 000294, 000838); separate letters to
Dr. Guy Beretich SpA., F.lli Negro srl., Walter Bonazzi, Attivit(cid:133) di vendita organizzata fuori del territorio
contrattuale, 26 November 1993 (Autogerma, AG 000287, 000631, 000836); letter to Brenner Garage SpA.-AG:
Attivit(cid:133) di vendita organizzata fuori del territorio contrattuale, 29 November 1993 (Autogerma, AG 000721);
separate letters to Silvano IOB&C. srl. and Eurocar SpA., Attivit(cid:133) di vendita organizzata fuori del territorio
contrattuale, 9 March 1994 (Autogerma, AG 000285, EU 182); letter to Bemi Auto srl., Attivit(cid:133) di vendita
organizzata fuori del territorio contrattuale, 4 May 1994 (Autogerma, AG 000503); letter to Di Viesto SpA.,
Attivit(cid:133) di vendita organizzata fuori del territorio contrattuale, 18 July 1995 (Autogerma, AG 000502).

(65) Letter to Volkswagen, Parallelexporte, 14 June 1994 (Autogerma, AG 000665 und 000666); letter to 50 dealers,
Attivit(cid:133) di vendita organizzata fuori del territorio contrattuale con diffida a cessare immediatemente l’atti-
vit(cid:133) stessa, 20 October 1993 (Autogerma, see footnote 64), in conjunction with memo, Elenco Concessionari cui
(cid:138) stata inviata la lettera con ogetto ‘Attivit(cid:133) di vendita . . .’, 24 November 1993 (Autogerma, AG 000975) and
memo, Elenco Concessionari . . . , 11 March 1994 (Autogerma, see footnote 62); letter to 20 dealers, Vendita al
di fuori del territorio contrattuale, 24 February 1995 (Autogerma, AG 000263) in conjunction with memo,
Elenco Concessionari ai quali (cid:138) stata inviata lettera del 24.2.1995 per vendita fuori dal territorio contrat-
tuale, 23 February 1995 (Autogerma, AG 000261).

(66) Circular to dealers, Relazione su Riunioni 20.1.1995, 21 January 1995 (UCAV, DO-SG 80 to 84); the quotation

in recital 174 translates:

‘None of these cars may be sold outside Autogerma’s area of responsibility . . .’.

(67) Original Italian minutes Verbale della riunione del gruppo di lavoro marketing UCAV — Autogerma del
27.7.1994, (Autogerma, see footnote 97), German version Protokoll der Sitzung der Arbeitsgruppe Marketing
UCAV — Autogerma/27.7.1994. The extract quoted in rectial 173 translates as follows:

. . .

(page 2)

‘Scarabel:

said that special rebates for sales outside the contract territory had been withheld in the case of some dealers
who would be legally entitled to demand payment, at least in theory. He stressed the need for a fresh discussion
of the 15 % quota for tolerated sales outside the contract territory.

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Dr. Schlesinger:

. . . The special rebate was just a supplementary rebate, something over and above what was customary. It had
been operated very generously, and if now about 20 dealers out of 234 had not received this special rebate, the
reason was that it was not intended as a reward for wholesalers or exporters. In the past we turned a blind eye,
but now we are inclined to refuse the special rebate for sales outside the contract territory, as it is given on the
basis of registrations rather than deliveries.

(page 4)

Dr. Schlesinger:

asked the UCAV to sensitise the base to a good launch for the new Polo (restricted grant of rebates, no
exports). . .’.

The warning was expressly confirmed in letter to Volkswagen, Measures to control and prevent re-export, 26
September 1994 (AG, see footnote 15).

(68) Various circulars to dealers in 1993, Regolamento CEE 123/85, 28 January 1993, 1 July 1993, 11 August 1993 *,
and 12 October 1993 * (Autogerma, AG 000106, 000094, 000977 and 000978, 000080); circular to dealers: Rego-
lamento CEE 123/85 Distribuzione selettiva dei veicoli, 16 March 1995 (Autogerma, EU-1 to 3), memo,
Measures to control and prevent re-export, 15 March 1995 (Autogerma, AG 000620).

(69) See for example memo, esportazioni parallele, 2 May 1995 (Autogerma, AG 000282).

(70) Record of conversation, Collaquio con S.Engmann/Audi, 22 September 1995 (Autogerma, AG 000001); internal
memo, Reimporte Italien, 9 May 1995 (Volkswagen, AU-VE D 23); the extract from this memo quoted in recital
165 translates as follows:

‘. . .The enclosed letter from the European Commission shows that they are not satsfied with our letter of 30
March 1995 or Autogerma’s recent circular. The circular must be put into practice if we are not to run a high
risk of being fined. . .’.

(71) Internal memo,

. . . Ergebnis aus den Maßnahmen zur Unterbindung von Re-Export-Aktivit(cid:132)ten, 12

September 1994 (Volkswagen, VW-UD PC Piening).

(72) See for example e-mail message ** to Audi, Grey market/Measures to control and prevent re-export, 23
September 1994 (Autogerma, AG 000880 and 000881); (handwritten) internal memo, Riesportazioni dall’Italia
alla Germania, undated (Autogerma, AG 000498).

(73) Evidence for example in e-mail message *, Visita Bothe, 22 March 1995 (Autogerma, AG 000388).

(74) See the documents referred to in footnotes 15, 42, 43 and 102 and marked ** or *.

(75) See the documents referred to in footnotes 73, 78, 80, 87, 96 and 97 and marked *.

(76) See the documents referred to in footnotes 44, 45, 62 and 64 and marked *.

(77) See the documents referred to in footnotes 123 and 126 and marked *.

(78) Internal memo *, Condizioni di fornitura per i veicoli Audi A 4 e Volkswagen Polo, 6 October 1994 (Auto-
germa, AG 000026 and 000027); circular to dealers, Fatturazione Nuova Polo, 20 October and 2 November
1994 (Autogerma, VW-KH K-6 and 7, see also footnote 85).

(79) Letter to Volkswagen, Fakturierung des neuen Polo und Einf(cid:129)hrung des ‘Split-Margin’, 24 October 1994, and

circular to dealers, Fatturazione Nuova Polo, 20 October 1994 (Autogerma, VW-SR R 13).

(80) Internal memo *, Reimporte Italien, 23 February 1995 (Volkswagen, VW-SR R 21).

(81) Memo, Maßnahmen zur Reduzierung von Grauexporten (VW PkW-Italien), 6 April 1995 (Volkswagen,
VW-DB B 7 Sekr. Santelmann,
file ‘Re-Importe’, or Volkswagen, VW-DB B 16), and especially memo,
Maßnahmen zur Reduzierung von Grauexporten (VW PkW-Italien), 21 August 1995 (Volkswagen,
VW-SR R 18); both documents include the points ‘Splitting der H(cid:132)ndlermarge beim Polo’
(splitting of the
dealer’s margin for the Polo) and ‘Bonuszahlungen in Abh(cid:132)ngigkeit vom Bestimmungsort des Fahrzeugs (aber:
mit neuer GVO nicht vereinbar)’
(bonus payments dependent on place of destination of vehicle (but: not
compatible with new block exemption)).

(82) Memo, Stand Maßnahmen gegen Graumarkt, 25.11.1994 (Audi, AU-VE D 26); the extract quoted in recital

119 translates as follows:

‘. . . deliveries are being regulated in such a way that only Italian demand is being met. . .’.

(83) Annex to dealership contract, Allegato ‘A’ al Contratto di Concessione Autogerma — Prodotti Volkswagen e
Audi, 31 December 1991 (Autogerma, BR 33 to 44); Eurocar’s dealership contract, Contratto di Concessione per
la Vendita e il Servizio di Assistenza, 30 December 1987 (Autogerma/Eurocar, EU 55-113).

(84) Agreement, Convenzione aggiunta al Contratto di Concessione Autogerma — Prodotti Volkswagen e Audi,

28 December 1993 (Autogerma, DO 26 to 32).

(85) Circular to dealers, Fatturazione Nuova Polo, 20 October 1994 (Autogerma, BR-MF 229) and 2 November
1994 (Autogerma, BR-MF 231); see also the negotiations between the dealers’s association and Autogerma,
Riunione Consiglio Direttivo UCAV., 27 February 1995 (UCAV, EU 48, 49 and 51) and Riunione UCAV./
Autogerma, 27 February 1995 (UCAV, EU 54, 56 and 57). The extract from the circular of 20 October 1994
which is quoted in recital 122 translates as follows:

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‘To:

All authorized dealers

Letter of: 20 October 1994

Page: 2

Their head offices

COM1/ORG/EP/ad

That said, in order to identify valid solutions, of vital interest to us and the whole organisation, to problems
which have arisen repeatedly and have sometimes led some firms into behaviour which is not in line with our
mutual interest (such as sales through unauthorised dealers, unjustified and excessive discounts, sales outside the
dealer’s territory, and the like), there has been discussion, together with the president, vice-presidents and some
members of the council of UCAV, who were in Verona on Tuesday 18 October for the meeting of the ISC
working party, of a new structure for discounts on the New Polo, made up as follows:

(a) Basic/immediate discount on invoice

(b) Short-term deferred discount

Total (as for previous model)

(c) Extra discount (same mechanism)

= 8 %

= 5 %

= 13 %

= 3 %

The short-term deferred discount referred to at point (b) will be given shortly after the sale, and will be based
specifically on the mutual commitment of ourselves and every Autogerma authorised dealer to look after the
contract territory in which both Autogerma and the dealer are responsible for general approach, marketing, and
sales, and for the obligation to make strenuous efforts jointly to attend to the needs of the final consumers res-
ident in the territory.

It remains to be decided whether it is advisable, that is to say whether it is in the interests of all of us, to alter
the present 15 % authorisation for out-of-territory sales, either upward or downward.

Your UCAV area delegates will be contacting you shortly to discuss this matter, and to hear any thoughts,
suggestions and improvements.

They will then consult us urgently so that Autogerma can take a final decision’.

(86) Record, V(cid:130)rification du 23 et 24 octobre 1995 en Italie/Mutschlechner KG, Bruneck, 26 October 1995

(Commission).

(87) See for example internal memo *, Condizioni di fornitura per i veicoli Audi A4 e Volkswagen Polo, 6 October
1994 (Autogerma, see footnote 78); report, Stand Maßnahmen gegen Graumarkt, 12 October 1994 (Autogerma,
AU-VE G D 51); letter to Audi, Splitmargensystem — Audi A4, 10 November 1994 (Autogerma, AG 000661).

(88) Internal memo, Condizioni di fornitura per i veicoli Audi A4 e Volkswagen Polo, 6 October 1994 (Autogerma,

see footnote 78).

(89) Letter to Audi, Splitmargensystem — Audi A4, 10 November 1994 (Autogerma, see footnote 87).

(90) Report, Besuch bei Autogerma am 12.10.1994, Stand Maßnahmen gegen Graumarkt (Audi, AG 000895);

memo, Stand Maßnahmen gegen Graumarkt, 8.11.1994, 14 November 1994 (Audi, AU-VE D 133).

(91) Memo, Reimporte Italien, 24 March 1995 (Volkswagen, VW-KH K-16 and 17); memo, Eingeleitete
Maßnahmen durch Autogerma zur Vermeidung von Re-Exporten, verursacht durch Wiederverk(cid:132)ufer, 22
November 1994 (Volkswagen, VW-KH K-55 HDK file ‘Re-Exporte’).

(92) Circular to dealers, Graumarkt; Margensystem in Italien, 8 December 1994 (Audi, AU-DH C).

(93) Memo, Grauimporte Italien, 23 November 1994 (Audi, AU-VE D 131); the extract from this memo quoted in

recital 138 translates as follows:

‘. . . I enclose Mr Schlesinger’s written confirmation of the supplementary measures (split margins) to prevent
grey imports.

This means that a dealer engaging in grey imports loses the 5 % split margin component plus the 3 % bonus,
equivalent to a further price increase of 8 %.

The dealers’ acceptance of this split margin means that the majority of dealers are prepared to prevent grey
imports, because the distribution costs on the sale of a car amount to more than 10 %.

The dealer would very quickly have a negative cash flow for every car. . .’.

(94) Annex to dealership contract, Convenzione ‘B’ aggiunta al Contratto di Concessione Autogerma — Prodotti
Audi e Volkswagen, 30 December 1987 (Autogerma/Brenner Garage, BR 168 to 171); Annex to dealership
contract, Convenzione ‘B’ aggiunta al Contratto di Concessione Autogerma, 28 April 1994 (Autogerma, BR-MF
160 to 167).

(95) Memo, Measures to control and prevent re-export, 15 March 1995 (Autogerma, see footnote 18); e-mail message
to Audi, Grey market/Measures to control and prevent re-export, 23 September 1994 (Autogerma, see footnote
72).

(96) Letter to Volkswagen and Audi, Parallelexporte, 14 June 1994 (Autogerma, AU-VE C D 53); memo, Measures
to control and prevent re-export, 15 March 1995 (Autogerma, see footnote 18); various letters * to dealers, for
example to Eurocar, Maggior sconto su consegne autoveicoli Volkswagen Audi, 18 October 1994 (Autogerma,
EU-GV 224) and 8 June 1994 (EU-GV 222 ); to Brenner Garage, Maggior sconto su consegne autoveicoli Volks-

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wagen Audi, 8 June 1994 (Autogerma, BR-MF 228) and 31 January 1994 (Autogerma, AG 000713); letter to
Autogerma, Maggior sconto consegne autoveicoli III/ quadr. 93 — Concess. Ancona, 25 January 1994 (Bonazzi,
AG 000013); letter to Bonazzi, Maggio sconto su consegne autoveicoli Volkswagen Audi 3/ quadr.
’93, 15
March 1994 (Autogerma, AG 000014).

(97) Memo *: Elenco nostro fatturato ai Concessionari: totale 1993 e 01/01-30/06/1994, 4 July 1994 (Autogerma, AG
000029); internal memo, Non riconoscimento/trattenuta del Maggior Sconto per vendite fuori zona (compreso
esportazioni parallele), 28 June 1994 (Autogerma, AG 000499); internal memo, Verbale della Riunione del
Gruppo di Lavoro Marketing UCAV. — Autogerma, 27 July 1994 (Autogerma, AG 000023); e-mail message to
Audi, Grey market/Measures to control and prevent re-export, 23 September 1994 (Autogerma, see footnote 72).
The quotation in recital 172 from the internal memo of 28 June 1994 translates as follows:

‘Subject: Non-payment/withholding of the extra bonus for outside-area sales (including parallel exports)

I am writing to confirm what I have already told you verbally, namely that I want every single case of subse-
quent payment of an extra discount that has been suspended or withheld for out-of-area sales/parallel exports to
be submitted to me for approval (initials and date).

This is of vital importance in view of the statistics on sales and registrations published in the press, which apart
from anything else put us in a bad light with the public and make it impossible to evaluate the market position
precisely.

I would remind you once again that our network must sell our vehicles in Italy (above all in order to “survive”)
and must not carry on “distribution” activities outside our area.

As you are aware, Autogerma has for a long time been constantly asking its own parent companies for special
terms for supplies, prices, special equipment, etc.; we cannot “return the favour” by selling our vehicles abroad.

For any further information please refer to me . . .’.

(98) Annex to dealership contract, Convenzione ‘B’ aggiunta al Contratto di Concessione Autogerma, 31 December

1994 (Autogerma, AG 000305 und 000306).

(99) Report, Stand Maßnahmen gegen Graumarkt, 12 October 1994 (Autogerma, see footnote 87).

(100) Memo, Verbali Riunioni UCAV. del 27.2.1995, 27 February 1995 (UCAV, EU 48, see footnote 85).

(101) See for example memo, Stand Maßnahmen gegen Graumarkt, 25 November 1994: ‘die (seit 18. 10. fakturierte)
5 % H(cid:132)ndlermarge, zahlbar alle 2 Monate bei Vorlage der Zulassungsscheine, werden nachtr(cid:132)glich wegge-
nommen’ (5 % dealer’s margins (invoiced since 18 October), payable every two months on presentation of the
registration certificates, are being withdrawn retroactively) (Audi, see footnote 58); report, Besuch bei Autogerma
am 12.10.1994 (Audi, see footnote 90); report: Stand Maßnahmen gegen den Graumarkt, 8.11.1994, 14
November 1994 (Audi, see footnote 90).

(102) See for example letter to Volkswagen, Parallelexporte, 14 June 1994 (Autogerma, see footnote 96); e-mail
message to Volkswagen and Audi, Grey market/Measures to control and prevent re-export, 23 September 1994
(Autogerma, see footnote 72); letter ** to Volkswagen, Measures to control and prevent re-export, 26 September
1994 (Autogerma, AG 000905); memo, Maßnahmen durch Autgerma zur Vermeidung von Re-Exporten, 6
February 1995 (Volkswagen, see footnote 16); memo, Re-Exporte, 1 March 1994 (Volkswagen, VW-SR R 22); the
extract from this last letter quoted in recital 131 translates as follows:

‘. . . 3. Despite the damage to the price of our products in Italy, the falling lira meant that there was now a
considerable price gap with the German and other markets. This situation gave rise to re-exporting, par-
ticularly by dealers in the north of Italy (a total of about 17 000 Volkswagen cars to Germany in 1993).

Position: 20 December 1993, Federal Motor Traffic Office registration, Flensburg.

4. Autogerma S.p.A. and Volkswagen AG exercised influence by means of

— dealer audits,

— cautions,

— targeted allocation,

— bonus discounts,

— terminations of contract (three dealers in 1993). This greatly reduced re-exports . . .’.

(103) Letter * to Auto Herbert Pedross, 6 March 1995 (Autogerma, BR-MF 80); letter * to Auto Officina Lanz, Contri-

buto organizzativo per Sub-Concessionario, 6 March 1995 (BR-MF 81).

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(104) See for example memo, Reimportsituation, 23 October 1995 (Audi, AU-KS B 4): ‘Eingeleitete Maßnahmen . . .
Streichung der Restmarge’ (Measures introduced . . . cancellation of remainder of margin); memo *: Graumark-
tbericht, 11 October 1995,
in conjunction with Graumarktbericht 9/95, 28 September 1995 (Audi,
AU-VE G D 1): 4. Bisherige Maßnahmen und Erfolge, R(cid:129)ckbelastung der zu unrecht erhaltenen Zusch(cid:129)sse
(Measures and successes to date, recovery of undue allowances); the extract from this document quoted in recital
169 translates as follows:

‘. . . Private imports of new vehicles by final consumers are growing constantly. It is not possible to distinguish
between private imports and imports by unauthorised dealers . . .’

Memo, *: Graumarktbericht, 8 September 1995 in conjunction with Graumarktbericht-Statusbericht, 15 May
1995 (AU-KS B 2): ‘Erfolge 4. Konsequente Belieferungssteuerung/Quotierung mit Einf(cid:129)hrung des Audi A4 —
Einf(cid:129)hrung eines H(cid:132)ndlermargensystems in Italien’.
(Successes 4. coherent regulation/quotas for Audi A4
imports — introduction of a dealer’s margin system in Italy); Situationsbericht Grauimporte K-VSK am
6.4.1995, 5 April 1995 (Audi, AU-KS B 7): ‘Auszahlung der Boni an den H(cid:132)ndler nur f(cid:129)r Italien zugelassene
Fahrzeuge’ (payment of bonuses to dealers only on vehicles registered in Italy); the extract from this document
quoted in recital 168 translates as follows:

‘. . . The setting up of an organisational unit in Audi’s distribution department to secure a lasting reduction in
the grey or reimport market. The objective is long-term protection of the exclusive distribution channel and
price and value stability for the products. . .’

(105) Record of discussion, Preisharmonisierung, 30 August 1993 (Volkswagen/Audi, AU-VE D 109); the extract from

this record quoted in recital 147 translates as follows:

‘. . . the purpose is a concerted, balanced approach on the part of the VW and Audi makes. . .’;

see also Protokoll der 7. Konferenz des Europ(cid:132)ischen H(cid:132)ndlerbeirats VW/Audi vom 21. bis 23. April 1994 in
Dublin, 22 April 1994 (European Dealer Council Volkswagen Audi, WV-KH K-58).

(106) Memo: Maßnahmen zur Begrenzung von Re-Exporten aus Italien, 2 November 1993 (Volkswagen,
VW-SR R 23); memo, Gespr(cid:132)ch am 14.12.1993 in Wolfsburg Marken AUDI und VW: Preisplanung Italien /
EG-Preisharmonisierung, 21 January 1994 (Audi, AU-VE D 502).

(107) Minutes, Besprechung am 22.3.1995 in Wolfsburg, 27 March 1995 (Volkswagen/Audi, VW-SR R 2).

(108) Letter to Audi: Liefersituation Italien, 20 March 1995 (Autogerma, AU-DH C); minutes, Protokoll der Sitzung
vom 23.3.1995, 23 March 1995 (Audi/Autogerma, AU-DH C); letter to Audi, Stornos Situation Italien, 11 May
1995 (Autogerma, AG 000267).

(109) Memo, Lieferung von weiteren 8 000 Fahrzeugen f(cid:129)r den italienischen Markt, 6 February 1995 (Audi,

AU-VE G D 82); the extract from this memo quoted in recital 141 translates as follows:

‘Supply of a further 8 000 vehicles for the Italian market

The Italian dealers have asked for another 8 000 Audi A 4 1995s to be supplied in Italy. It is claimed that Auto-
germa has already made them a promise to this effect.

It was originally planned that the Italian market should be supplied restrictively and on the basis of the market.
The promise of a further 8 000 cars puts the Italian dealers in a position to make preparations for the re-export
of Audi A4s even at this stage, and to make commitments to independent importers and dealers. Efforts to sell
the vehicles originally promised on the market might be neglected.

In order to give a signal in Italy that the restricted market-based system of supply that you announced is being
maintained, the importer should be informed at once of the departmental meeting’s agreement that the 8 000
vehicles requested will not be supplied.

Please inform Autogerma of this decision immediately, and see to it that the Italian dealers are informed ac-
cordingly too. . . ’.

Minutes of departmental meeting, Maßnahmen, 3 February 1995 (Audi, see footnote 59).

(110) Memo: Situationsbericht Grauimporte, 4 April 1995 (Audi, AU-VE D 151) or memo: Status report MI-11/
Vertrieb Inland: Grey-market, 7 April 1995 (Audi, AU-VE D 150); confirmed in memo: Graumarktbericht, 8
September 1995 (Audi, see footnote 104).

(111) Letter (fax) to Audi, Volumen Italien 1995, 29 September 1995 (Autogerma, AU); letter (fax) to Audi, Sales

volume for Italy, 1995, with handwritten memo, 6 October 1995 (Autogerma, AU-MW 3.1 4).

(112) Letter to Volkswagen, Reimporte, 26 November 1993 (Autohaus Stadtberg, AG 000848); letter to Audi, 11

February 1994 (Walter Bechheim, Autohaus, AU-GK D 3).

(113) Letter to Autohaus Stadtberg, Reimporte, 7 December 1993 (Volkswagen, AG 000847, see footnote 112); see also
Rede von Herrn Knief zur Plenum-Veranstaltung mit Herrn Dr Pi(cid:137)ch anl(cid:132)ßlich des Europa-Kongresses am
8. September 1993 in Frankfurt (Volkswagen, VW-KH K-61).

(114) Report, H(cid:132)ndlermeinung zu den Vertriebsaktivit(cid:132)ten von Audi, 28 January 1994 (Audi, AU-GK D 4).

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(115) Faxes to Audi, Information, 4 April and 15 May 1995 (Auto-Reichart, AU-VE C D 69).

(116) Fax to Audi, Deutsche Audi H(cid:132)ndler interessiert an Parallelimporte, 5 October 1994 (Autogerma, AU-
MW D 26); Rede von Herrn Knief zur Plenum-Veranstaltung mit Herrn Dr. Pi(cid:137)ch anl(cid:132)ßlich des Europa-
Kongresses am 8. September 1993 in Frankfurt (Volkswagen, see footnote 113).

(117) See for example fax to Autohaus M(cid:129)ller, Autokauf in Italien, 11 September 1995 (Autogerma, AG 000547).

(118) Report, H(cid:132)ndlermeinung (Audi, see footnote 114).

(119) Fax to Volkswagen, Elenco Concessionari, 24 November 1993 (Autogerma, AG 000973 to 000975).

(120) See for example letter to Negro, Vendita al di fuori del territorio contrattuale, 24 February 1995 (Autogerma,
see footnote 65); letter to Muzzatti, Vendite organizzate fuori territorio contrattuale — Audi A8, 12 October
1994 (Autogerma, AG 000651).

(121) Letter to Volkswagen, grey market, 7 June 1994 1994 (Autogerma, AG 000851).

(122) E-mail message, Eccel, 29 May 1994 (Autogerma, AG 000795).

(123) E-mail message * to Volkswagen, Kuendigungen, 6 February 1995 (Autogerma, VW-KH K 52), and fax * to

Volkswagen, Massnahmen programm, 10 February 1995 (Autogerma, VW-SR R 12).

(124) Memo: Graumimporte aus Italien, 20 February 1995 (Volkswagen, VW-SR R 17); internally, however,

‘grey
exports’ were often the main ground of termination cited, for example in the cases of Conti, Beretich and Auto-
sial memo to Volkswagen, grey market, 7 June 1994 (Autogerma, see footnote 121).

(125) Report: Besuch bei Autogerma, 10 February 1995 (Audi, AG 000039); handwritten note on e-mail message,

Italien, 17 March 1995 (Volkswagen, VW-SR R 13).

(126) Letter *: to Eurocar, Risoluzione Contratto di Concessione Volkswagen e Audi, 15 September 1995 (Autogerma,

EU-GV 54).

(127) Circular to dealers: Regolamento CEE 123/85 Accordi distribuzione autoveicoli, 15 October 1993 (Autogerma,

AG 000078).

(128) Circular to dealers: Regolamento CEE 123/85 Distribuzione selettiva dei veicoli, 16 March 1995 1995 (Auto-
germa, VW-SR R 15 ; various contracts of sale, for example Wimschneider, 2 March 1994 (Iob Silvano & C.Srl);
Ebenberger, 27 January 1995 (Iob Silvano & C.Srl, SI-GV A 211); Osina, 2 June 1995 (Iob Silvano & C.Srl,
SI-CM A 57); Prieler, 16 August 1995 (Iob Silvano & C.Srl, SI-CM A 50).

(129) Letter to Autogerma, Graumarkt/Reimport, 15 March 1995 (Audi, AG 000632).

(130) Fax to Audi, 3 April 1995 (Petersen, AU-KS B 8); the extract translates as follows:

‘. . . I was constantly being
told by the dealers there that they would be happy to sell to me but that they would not get a car from the
importer if the buyer was a German.’

(131) Letter to Commission, DG IV, Beschwerde, 27 April 1995 (Bernhard, AG 000343 and 000344); the extract trans-

lates as follows:

‘. . . The boss told me on the telephone that as I was German he would not be allowed to sell me a car (a de-
cision of Volkswagen AG)’.

(132) Letter (fax) to Volkswagen: Exportverbot Hier: Italien, 27 April 1995 (Lenz, VW-KH K-32); the extract trans-

lates as follows:

‘. . . at three VW dealerships I was told that the export of any vehicles whatsoever was not allowed, and that they
had to comply strictly with this rule. Some dealers had already had their concessions withdrawn for failure to
observe it’.

(133) Letter to Autogerma, 23 June 1995 (Schneider, AG 000444).

(134) Letter to Volkswagen, 19 July 1995 (Mosser, AU-KS A 1); the extract translates as follows:

‘I was told in each case that the garage had been prohibited by Audi’s main agents from selling the cars to
foreigners’.

(135) Letter to Audi: Audi A4, 3 August 1995 (Bilogan, AU-VE G D 10); the extract translates as follows:

‘. . . that the Italian dealers could not sell anything to persons from the Federal Republic of Germany and
Austria, allegedly because of an instruction from the manufacturer’.

(136) Letter to Volkswagen, Reimport von Polo und Audi A4, August 1995 (Albrecht, AG 000566 and 000567); the

extract translates as follows:

‘. . . We were told that as we were Germans we would not be able to get any of these models, on instructions
from Wolfsburg’.

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(137) Letter to Audi, Bestellung eines Audi A6 in Italien, 18 May 1995 (Baur, AU-VE G D 8); the extract translates as

follows:

‘The answer was always the same, namely that they could expect reprisals on the part of the main importer if
they sold even one car to a buyer in Austria’.

(138) Letter to Volkswagen, Ankauf eines KFZ in Italien, 23 May 1995 (Gatt Autoreisen, AG 000597 to 000599); the

extract translates as follows:

‘I have been told by various Italian VW/Audi dealers I have contacted in the last few months that the VW/Audi
group does not allow them to sell vehicles to buyers in Austria’.

(139) Letter to Volkswagen, VW-Vento aus Reimport, 24 August 1995 (Bilogan, AG 000434); The extract translates

as follows:

‘I was everywhere told, with a slight edge to the voice, that there was no possibility of selling to customers from
Germany. Sometimes I was told other things too’.

(140) Letter to Autogerma, Letzte Anfrage, 8 September 1995 (Autohaus Jungmann, AG 000691 to 000697); the

extract translates as follows:

‘As soon as we tell the dealers that these vehicles are intended for private individuals in Germany or Austria,
and that we will gladly show them an intermediary’s or purchase order with a signature authenticated by a
notary, the dealers refuse to discuss the matter any further; or reply that that they do not know anything about
what Audi in Ingolstadt in Germany says, but that their main importer Autogerma has imposed an absolute ban
on exports, even to private customers; or that about a month beforehand the Austrian Automobile Club (cid:153)MTC
tried to buy cars of their make in the north of Italy for final customers, and even they had not had a single
vehicle from the dealer’.

(141) Letter to Autogerma, 8 September 1995 (H(cid:129)lsd(cid:129)nker, AG 000527). The extract translates as follows:

‘He told me that he had instructions from the management of Auto Brenner not to send out the contract of sale
until he had express confirmation in writing from them that Mrs. . . was allowed to buy a vehicle’.

(142) Various letters to Autogerma, for example Vendita al di fuori del territorio contrattuale, 6 March 1995
(Negro, AG 000016); Attivit(cid:133) di vendita organizzata fuori del territorio contrattuale, 22 November 1993
(Brenner Garage, AG 000722); Vs. rif. ORG/EP/cb int. n/320 del 20.10.1993, 2 November 1993 (Auto quattro,
AG 000290); Attivit(cid:133) di vendita, 29 October 1993 (Mandolini, AG 000668); Attivit(cid:133) di vendita organizzata
fuori dal territorio contrattuale, 15 March 1993 (Iob Silvano, AG 000284).

(143) For examples of applications for authorisation see letter to Autogerma, Fornitura Volkswagen Passat-Sig.
Hampel Thomas, 22 June 1995 (Dorigoni, AG 000468); letter to Autogerma, Audi 80 Avant 1.6. 19 December
1994 (Brenner Garage, AG 000707); memo, Oggetto: Colloquio con Sig. Beikircher.-BZ., 21 October 1994 (Auto-
germa, AG-RG 000650).

(144) Letter to Autogerma, Audi A8 PRAT.AG 612845/94, 5 September 1994 (Muzzatti, AG 000649); the extract

quoted here translates as follows:

‘We are doing everything possible to have the car brought back to Italy, and to convince the customer to cancel
the registration. We are extremely sorry that this sale has caused you such unfortunate difficulties with the
manufacturer’.

(145) Various letters to customers, for example to Aue, 9 March 1995 (Dorigoni, DO-MF 14); Nowak, 17 May 1995
(Dorigoni, DO-SG 2); Roederer, 18 May 1995 (Dorigoni, DO-SG 10); Rueß, 18 May 1995 (Dorigoni, DO-MF 8);
Kleikamp, 27 June 1995 (Dorigoni, DO-SG 4); Autohaus Nordstadt, 22 August 1995 (Dorigoni, DO-MF 6);
Gerson, 6 October 1995 (Dorigoni, DO-SG 16).

(146) Letter to Deeg, 6 May 1995 (Dorigoni, DO-SG 12).

(147) See for example various letters to customers between July and October 1995 (Auto Brenner, Nos 40, 7, 47, 30,
9, 13, 45, 26, 6, 51, 20, 23, 10, 27, 29, 19, 5, 18, 32, 17, 3, 53, 36, 12, 43, 34, 38, 16, 25, 24, 55, 15, 8, 4, 28, 2, 11,
21, 49, 14); the extract quoted here translates as follows:

‘As we receive only a limited quota of vehicles (VW-Audi) from the works, delivery times are long, over a year
long in some cases. Prices change regularly and the purchase price consequently cannot be guaranteed. For
these reasons you will probably decide not to buy your vehicle from us’.

(148) E-mail message to Audi: Neuwagenverkauf an ausl(cid:132)ndische Kunden, 18 May 1995 (Autogerma, AU-DH A 2);

the extract quoted here translates as follows:

‘. . . As you will see from the monthly sales statistics in your possession, there has been an enormous drop in
sales of new Audi cars to foreign buyers. . . We find that dealers are quoting delivery times on the basis of their
quotas, and serving their traditional clientele’.

(149) Letter to Autogerma, Fahrzeugverkauf an EG-B(cid:129)rger/Endabnehmer, 19 July 1995 (Audi, AG 000336); the

extract quoted here translates as follows:

‘Unfortunately many Italian dealers are still telling customers that the manufacturer or the importer has prohi-
bited them from selling vehicles to foreign final consumers’.

(150) Joined Cases 25 and 26/84 Ford-Werke AG and Ford of Europe Inc. v. Commission [ 1985 ] ECR, p. 2725 and

Case C-70/93 Bayerische Motorenwerke AG v. ALD Auto-Leasing D GmbH [1995] ECR I-3439.

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(151) Case 107/82 Allgemeine Elektricit(cid:132)ts-Gesellschaft AEG-Telefunken AG v. Commission [1983] ECR p. 3151.

(152) See footnote 150.

(153) Commission Decision 82/367/EEC (Hasselblad), OJ L 161, 12.6.1982, p. 18, recital 47.

(154) Commission Decision 85/617/EEC (Sperry New Holland), OJ L 376, 31.12.1985, p. 21, recitals 54 and 55.

(155) Commission Decision 84/405/EEC (Zinc Producer Group), OJ L 220, 17.8.1984, p. 27, recital 71; Commission

Decision 85/79/EEC (John Deere), OJ L 35, 7.2.1985, p. 58, recital 26.

(156) Commission Decisions 84/405/EEC and 85/79/EEC, see footnote 155.

(157) Commission Decision 73/322/EEC (Deutsche Philips), OJ L 293, 20.10.1973, p. 40; judgment of the Court of

Justice in Case 86/82 Hasselblad (GB) v. Commission [1984] ECR p. 883.

(158) See Commission Decision 82/367/EEC (see footnote 153).

(159) Case 319/82 Soci(cid:130)t(cid:130) de Vente de Ciments et B(cid:130)tons de l’Est SA v. Kerpen & Kerpen GmbH & Co. KG [1983]

ECR, p. 4173.

(160) See footnote 13.

(161) See footnote 13.

(162) Case T-9/92 Peugeot v. Commission [1993] ECR II-493.

(163) Letter to the Commission: Attorney’s privilege hinsichtlich der Nachpr(cid:129)fung K(95) 2476/17, (Attorney’s priv-

ilege with regard to investigation K(95) 2476/17), 2.11.1995 (Audi).

(164) Case 155/79 AM & S Europe v. Commission [1982] ECR 1575.

(165) See footnote 151.

(166) ECJ 11 July 1989 S. C. Belasco et al. v. Commission RS 246/86, Rec. 1989, p. 2181, 2191, point 41.

(167) COM(95) 503 final of 31 October 1995.