BUSINESS NAME OR SYMBOL . IN THIS JUDGMENT THE COURT IS CONCERNED ONLY WITH THIS THIRD TYPE OF CONTRACT , TO WHICH THE QUESTIONS ASKED BY THE NATIONAL COURT EXPRESSLY REFER .
14 THE COMPATIBILITY OF FRANCHISE AGREEMENTS FOR THE DISTRIBUTION OF GOODS WITH ARTICLE 85 ( 1 ) CANNOT BE ASSESSED IN ABSTRACTO BUT DEPENDS ON THE PROVISIONS CONTAINED IN SUCH AGREEMENTS . IN ORDER TO MAKE ITS REPLY AS USEFUL AS POSSIBLE TO THE BUNDESGERICHTSHOF THE COURT WILL CONCERN ITSELF WITH CONTRACTS SUCH AS THAT DESCRIBED ABOVE .
15 IN A SYSTEM OF DISTRIBUTION FRANCHISES OF THAT KIND AN UNDERTAKING WHICH HAS ESTABLISHED ITSELF AS A DISTRIBUTOR ON A GIVEN MARKET AND THUS DEVELOPED CERTAIN BUSINESS METHODS GRANTS INDEPENDENT TRADERS , FOR A FEE , THE RIGHT TO ESTABLISH THEMSELVES IN OTHER MARKETS USING ITS BUSINESS NAME AND THE BUSINESS METHODS WHICH HAVE MADE IT SUCCESSFUL . RATHER THAN A METHOD OF DISTRIBUTION , IT IS A WAY FOR AN UNDERTAKING TO DERIVE FINANCIAL BENEFIT FROM ITS EXPERTISE WITHOUT INVESTING ITS OWN CAPITAL . MOREOVER , THE SYSTEM GIVES TRADERS WHO DO NOT HAVE THE NECESSARY EXPERIENCE ACCESS TO METHODS WHICH THEY COULD NOT HAVE LEARNED WITHOUT CONSIDERABLE EFFORT AND ALLOWS THEM TO BENEFIT FROM THE REPUTATION OF THE FRANCHISOR ' S BUSINESS NAME . FRANCHISE AGREEMENTS FOR THE DISTRIBUTION OF GOODS DIFFER IN THAT REGARD FROM DEALERSHIPS OR CONTRACTS WHICH INCORPORATE APPROVED RETAILERS INTO A SELECTIVE DISTRIBUTION SYSTEM , WHICH DO NOT INVOLVE THE USE OF A SINGLE BUSINESS NAME , THE APPLICATION OF UNIFORM BUSINESS METHODS OR THE PAYMENT OF ROYALTIES IN RETURN FOR THE BENEFITS GRANTED . SUCH A SYSTEM , WHICH ALLOWS THE FRANCHISOR TO PROFIT FROM HIS SUCCESS , DOES NOT IN ITSELF INTERFERE WITH COMPETITION . IN ORDER FOR THE SYSTEM TO WORK TWO CONDITIONS MUST BE MET .
16 FIRST , THE FRANCHISOR MUST BE ABLE TO COMMUNICATE HIS KNOW-HOW TO THE FRANCHISEES AND PROVIDE THEM WITH THE NECESSARY ASSISTANCE IN ORDER TO ENABLE THEM TO APPLY HIS METHODS , WITHOUT RUNNING THE RISK THAT THAT KNOW-HOW AND ASSISTANCE MIGHT BENEFIT COMPETITORS , EVEN INDIRECTLY . IT FOLLOWS THAT PROVISIONS WHICH ARE ESSENTIAL IN ORDER TO AVOID THAT RISK DO NOT CONSTITUTE RESTRICTIONS ON COMPETITION FOR THE PURPOSES OF ARTICLE 85 ( 1 ). THAT IS ALSO TRUE OF A CLAUSE PROHIBITING THE FRANCHISEE , DURING THE PERIOD OF VALIDITY OF THE CONTRACT AND FOR A REASONABLE PERIOD AFTER ITS EXPIRY , FROM OPENING A SHOP OF THE SAME OR A SIMILAR NATURE IN AN AREA WHERE HE MAY COMPETE WITH A MEMBER OF THE NETWORK . THE SAME MAY BE SAID OF THE FRANCHISEE ' S OBLIGATION NOT TO TRANSFER HIS SHOP TO ANOTHER PARTY WITHOUT THE PRIOR APPROVAL OF THE FRANCHISOR ; THAT PROVISION IS INTENDED TO PREVENT COMPETITORS FROM INDIRECTLY BENEFITING FROM THE KNOW-HOW AND ASSISTANCE PROVIDED .
17 SECONDLY , THE FRANCHISOR MUST BE ABLE TO TAKE THE MEASURES NECESSARY FOR MAINTAINING THE IDENTITY AND REPUTATION OF