PRICES , ARE UNILATERAL ACTS AND DO NOT THEREFORE , AS SUCH , FALL WITHIN ARTICLE 85 ( 1 ), WHICH RELATES ONLY TO AGREEMENTS BETWEEN UNDERTAKINGS , DECISIONS BY ASSOCIATIONS OF UNDERTAKINGS AND CONCERTED PRACTICES .
32 IN ORDER PROPERLY TO APPRECIATE THAT ARGUMENT IT IS APPROPRIATE TO CONSIDER THE LEGAL SIGNIFICANCE OF SELECTIVE DISTRIBUTION SYSTEMS .
33 IT IS COMMON GROUND THAT AGREEMENTS CONSTITUTING A SELECTIVE SYSTEM NECESSARILY AFFECT COMPETITION IN THE COMMON MARKET . HOWEVER , IT HAS ALWAYS BEEN RECOGNIZED IN THE CASE-LAW OF THE COURT THAT THERE ARE LEGITIMATE REQUIREMENTS , SUCH AS THE MAINTENANCE OF A SPECIALIST TRADE CAPABLE OF PROVIDING SPECIFIC SERVICES AS REGARDS HIGH-QUALITY AND HIGH-TECHNOLOGY PRODUCTS , WHICH MAY JUSTIFY A REDUCTION OF PRICE COMPETITION IN FAVOUR OF COMPETITION RELATING TO FACTORS OTHER THAN PRICE . SYSTEMS OF SELECTIVE DISTRIBUTION , IN SO FAR AS THEY AIM AT THE ATTAINMENT OF A LEGITIMATE GOAL CAPABLE OF IMPROVING COMPETITION IN RELATION TO FACTORS OTHER THAN PRICE , THEREFORE CONSTITUTE AN ELEMENT OF COMPETITION WHICH IS IN CONFORMITY WITH ARTICLE 85 ( 1 ).
34 THE LIMITATIONS INHERENT IN A SELECTIVE DISTRIBUTION SYSTEM ARE HOWEVER ACCEPTABLE ONLY ON CONDITION THAT THEIR AIM IS IN FACT AN IMPROVEMENT IN COMPETITION IN THE SENSE ABOVE MENTIONED . OTHERWISE THEY WOULD HAVE NO JUSTIFICATION INASMUCH AS THEIR SOLE EFFECT WOULD BE TO REDUCE PRICE COMPETITION .
35 SO AS TO GUARANTEE THAT SELECTIVE DISTRIBUTION SYSTEMS MAY BE BASED ON THAT AIM ALONE AND CANNOT BE SET UP AND USED WITH A VIEW TO THE ATTAINMENT OF OBJECTIVES WHICH ARE NOT IN CONFORMITY WITH COMMUNITY LAW , THE COURT SPECIFIED IN ITS JUDGMENT OF 25 OCTOBER 1977 ( METRO V COMMISSION , ( 1977 ) ECR 1875 ) THAT SUCH SYSTEMS ARE PERMISSIBLE , PROVIDED THAT RE-SELLERS ARE CHOSEN ON THE BASIS OF OBJECTIVE CRITERIA OF A QUALITATIVE NATURE RELATING TO THE TECHNICAL QUALIFICATIONS OF THE RESELLER AND HIS STAFF AND THE SUITABILITY OF HIS TRADING PREMISES AND THAT SUCH CONDITIONS ARE LAID DOWN UNIFORMLY FOR ALL POTENTIAL RESELLERS AND ARE NOT APPLIED IN A DISCRIMINATORY FASHION .
36 IT FOLLOWS THAT THE OPERATION OF A SELECTIVE DISTRIBUTION SYSTEM BASED ON CRITERIA OTHER THAN THOSE MENTIONED ABOVE CONSTITUTES AN INFRINGEMENT OF ARTICLE 85 ( 1 ). THE POSITION IS THE SAME WHERE A SYSTEM WHICH IS IN PRINCIPLE IN CONFORMITY WITH COMMUNITY LAW IS APPLIED IN PRACTICE IN A MANNER INCOMPATIBLE THEREWITH .
37 SUCH A PRACTICE MUST BE CONSIDERED UNLAWFUL WHERE THE MANUFACTURER , WITH A VIEW TO MAINTAINING A HIGH LEVEL OF PRICES OR TO EXCLUDING CERTAIN MODERN CHANNELS OF DISTRIBUTION , REFUSES TO APPROVE DISTRIBUTORS WHO SATISFY THE QUALITATIVE CRITERIA OF THE SYSTEM .
38 SUCH AN ATTITUDE ON THE PART OF THE MANUFACTURER DOES NOT CONSTITUTE , ON THE PART OF THE UNDERTAKING , UNILATERAL CONDUCT WHICH , AS AEG CLAIMS , WOULD BE EXEMPT FROM THE PROHIBITION CONTAINED IN ARTICLE 85 ( 1 ) OF THE TREATY . ON THE CONTRARY ,