Notification of distribution agreements (Case COMP/F-2/38 730 — BP Lubricants) (Text with EEA relevance)
Date: 2003-05-28
Institutions: European Commission
Subjects: exclusive distribution agreement, general mechanical engineering, loan, motor car, vehicle parts

28.5.2003

EN

Official Journal of the European Union

C 126/5

Authorisation for State aid pursuant to Articles 87 and 88 of the EC Treaty

Cases where the Commission raises no objections

(2003/C 126/04)

(Text with EEA relevance)

Date of adoption of the decision:

23.4.2003

Member State:

Aid No:

Title:

Objective:

Legal basis:

Budget:

United Kingdom

N 658/02

Aid scheme for export promotion and advertising and for the
regional food

The proposed aid scheme is designed to help companies
producing or processing food or drink in the United
Kingdom to access and develop export markets, both in the
EU and in third countries, and to support the development of
the quality regional food sector. The measures cover partici-
pation in exhibitions and fairs,
information about United
Kingdom products, organisation of competitions and award
ceremonies, marketing of quality products, training and adver-
tising

The Agricultural Marketing Act 1983, as amended, and the
Regional Development Agencies Act 1998

GBP 52,5 million (EUR 79,1 million) for 2002 and 2003 to
2007 and 2008

Aid intensity or amount:

Duration:

Variable

Indefinite

The authentic text(s) of the decision, from which all confidential information has been removed, can be
found at

http://europa.eu.int/comm/secretariat_general/sgb/state_aids

NOTIFICATION OF DISTRIBUTION AGREEMENTS

(Case COMP/F-2/38 730 — BP Lubricants)

(2003/C 126/05)

(Text with EEA relevance)

On 29 April 2003 the Commission received a notification of
standard distribution agreements pursuant to Articles 2 and 4
of Council Regulation No 17, which BP plc or its subsidiary
companies within the BP group have concluded or intend to
conclude with motor vehicle repairers across the European
Union.

These Agreements can be categorised into three different types
of agreement. The first of these is a loan/supply agreement, the
second is an equipment/supply agreement and the third is a
simple supply agreement. The economic effects of the loan/
in
supply and equipment/supply agreements are the same:

both cases, BP takes on a significant degree of risk on behalf
of the repairer, by way of providing a loan or equipment. The
repairer receives the benefit of this support and is obliged to
maintain minimum purchasing levels in return. The third type
of agreement, the simple supply agreement, may or may not
offer the repairer the same kind of support, but the repairer is
free to terminate at any time with notice.

These agreements are usually of a five year duration. Within
each type of agreement, there are some variations and these
differences are outlined below.

C 126/6

EN

Official Journal of the European Union

28.5.2003

Loan/supply Agreement

Equipment/supply agreement

Under this type of agreement, the loans are either provided by
BP directly, or they are provided by a bank, with BP acting as a
guarantor. The size of loans guaranteed or offered by BP under
the loan is generally
this
re-payable over a five year period (either directly through
capital payments or through rebates derived from purchases
of lubricants throughout the term of the agreement).

type of agreement varies but

In terms of the capital, unless a rebate element is present (see
below), the repairer repays the outstanding sum to either the
bank or BP in annual instalments (depending on the variant of
the agreement in question). Depending on the variant of the
agreement in question, interest may be payable by the repairer
either directly to the bank, or directly or through purchases to
BP.

This type of agreement sometimes operates a rebate system.
This means that where BP makes the loan, loan repayments are
paid to BP by way of product purchases (rather than by direct
repayment). When BP sets the price of the contract goods, it
will take account of the cost of the loan. When the repairer
makes its purchases during the year, BP will reserve an amount
equivalent to the capital repayments due. At the end of each
year when the annual repayment is contractually due, BP will
provide payment for the full amount repaid. This means that
repayment of the capital sum loaned will be made entirely
through product purchases. Similarly, where BP acts as a
guarantor of a loan,
it sometimes repays the principal sum
by way of credit note to the customer provided purchasing
obligations are met.

Under this type of agreement, BP is obliged to supply specified
amounts of lubricants to the repairer. Similarly, the repairer is
obliged to take certain minimum volumes of
its lubricants
requirements from BP. In some cases, liquidated damages are
payable by the repairer for failure to comply with minimum
purchasing obligations.

As mentioned above, the economic effect of an equipment/
to a loan/supply agreement.
supply agreement
The
that
sole difference between the
equipment is supplied as opposed to cash.

arrangements

is identical

is

Under this type of agreement, BP grants the repairer free use of
the contract equipment for a five year period in return for
minimum purchasing obligations. There are essentially two
variations with this type of agreement. When equipment is
provided to a repairer, the repairer may or may not have the
possibility to take ownership on expiry of the agreement if
contractual obligations are complied with. As with the loan/
supply agreement, this type of agreement is terminable by BP
only, at any time, and sometimes with notice, depending on
the grounds for termination.

Simple supply agreement

Under the simple supply agreement, BP does not offer a trade
loan or substantial pieces of equipment. Although minimum
purchasing obligations may be imposed, the customer has the
right to terminate the arrangement at any time on notice, and
thus switch supplier.

Upon preliminary examination,
the Commission finds that
the notified agreements could fall within the scope of Regu-
lation 17.

The Commission invites interested third parties to submit their
possible observations on the agreements to the Commission.

Observations must reach the Commission not later than 10
days following the date of
this publication. Observations
to the Commission by fax (No (32-2)
should be sent
reference number Case
296 98 00) and by post under
COMP/F-2/38 730 — BP Lubricants to the following address:

This type of agreement is terminable by BP only, at any time,
and sometimes with notice, depending on the grounds for
termination.

Commission of the European Communities
DG Competition
Antitrust Registry
B-1049 Brussels