Court of Justice of the European Communities (including Court of First Instance Decisions)

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1 . PROCEDURE - PRELIMINARY RULING - JURISDICTION OF THE COURT OF JUSTICE - LIMITS
( EEC TREATY, ARTICLE 177 )
2 . POLICY OF THE EEC - RULES ON COMPETITION BETWEEN UNDERTAKINGS - AGREEMENTS WHICH MAY AFFECT TRADE BETWEEN MEMBER STATE - CONCEPT
( EEC TREATY, ARTICLE 85 )
3 . POLICY OF THE EEC - RULES ON COMPETITION BETWEEN UNDERTAKINGS - EXCLUSIVE DEALING ARRANGEMENTS WITH ABSOLUTE TERRITORIAL PROTECTION - PROHIBITION - POSSIBILITY OF AVOIDING SUCH PROHIBITION BY REASON OF THE WEAK POSITION OF THE PARTIES CONCERNED ON THE MARKET IN THE PRODUCTS IN QUESTION
( EEC TREATY, ARTICLE 85 )

1 . THE COURT IS NOT ENTITLED WITHIN THE FRAMEWORK OF ARTICLE 177 TO APPLY THE TREATY TO A PARTICULAR CASE . IT MAY HOWEVER DERIVE FROM THE WORDING OF THE DECISION REFERRING THE MATTER THE QUESTIONS WHICH RELATE EXCLUSIVELY TO THE INTERPRETATION OF THE TREATY .
2 . IF AN AGREEMENT IS TO BE CAPABLE OF AFFECTING TRADE BETWEEN MEMBER STATES IT MUST BE POSSIBLE TO FORESEE WITH A SUFFICIENT DEGREE OF PROBABILITY ON THE BASIS OF A SET OF OBJECTIVE FACTORS OF LAW OR OF FACT THAT THE AGREEMENT IN QUESTION MAY HAVE AN INFLUENCE, DIRECT OR INDIRECT, ACTUAL OR POTENTIAL, ON THE PATTERN OF TRADE BETWEEN MEMBER STATES, IN SUCH A WAY THAT IT MIGHT HINDER THE REALIZATION OF THE OBJECTIVES OF A SINGLE MARKET BETWEEN STATES .
3 . AN EXCLUSIVE DEALING AGREEMENT, EVEN WITH ABSOLUTE TERRITORIAL PROTECTION, MAY, HAVING REGARD TO THE WEAK POSITION OF THE PERSONS CONCERNED ON THE MARKET IN THE PRODUCTS IN QUESTION IN THE AREA COVERED BY THE ABSOLUTE PROTECTION, ESCAPE THE PROHIBITION LAID DOWN IN ARTICLE 85(1 ).

IN CASE 5/69
REFERENCE TO THE COURT UNDER ARTICLE 177 OF THE TREATY ESTABLISHING THE EUROPEAN ECONOMIC COMMUNITY BY THE OBERLANDESGERICHT, MUNICH, FOR A PRELIMINARY RULING IN THE ACTION PENDING BEFORE THAT COURT BETWEEN
FRANZ VOELK, MERCHANT, KEMPTEN ( GERMANY ),
AND
ETABLISSEMENTS J . VERVAECKE ( SOCIETE DE PERSONNES A RESPONSABILITE LIMITEE ), BRUSSELS,

ON THE INTERPRETATION OF ARTICLE 85(1 ) OF THE SAID TREATY,

1 BY AN ORDER OF 5 DECEMBER 1968, WHICH WAS RECEIVED AT THE COURT REGISTRY ON 28 JANUARY 1969, THE OBERLANDESGERICHT, MUNICH, UNDER ARTICLE 177 OF THE TREATY ESTABLISHING THE EEC REFERRED TO THE COURT OF JUSTICE THE QUESTION WHETHER IN ORDER TO DECIDE WHETHER THE DISPUTED CONTRACT FALLS WITHIN THE PROHIBITION SET OUT IN ARTICLE 85(1 ) OF THE EEC TREATY REGARD MUST BE HAD TO THE PROPORTION OF THE MARKET WHICH THE PLAINTIFF HAS ACTUALLY ACQUIRED OR WHICH HE HAS ENDEAVOURED TO ACQUIRE IN THE MEMBER STATES OF THE EEC, IN PARTICULAR IN BELGIUM AND IN LUXEMBOURG, THE SALES ZONE WITHIN WHICH THE DEFENDANT ENJOYS ABSOLUTE PROTECTION .
2/4 ALTHOUGH THE COURT IS NOT ENTITLED WITHIN THE FRAMEWORK OF SUB-PARAGRAPH ( A ) OF THE FIRST PARAGRAPH OF ARTICLE 177 TO APPLY THE TREATY TO A PARTICULAR CASE, IT MAY NEVERTHELESS DERIVE FROM THE WORDING OF THE DECISION REFERRING THE MATTER THE QUESTIONS WHICH RELATE EXCLUSIVELY TO THE INTERPRETATION OF THE TREATY . THE QUESTION RAISED RELATES TO AGREEMENTS WHICH ARE CHARACTERIZED BY THE FACT THAT A PRODUCER WHO HAS GRANTED A DISTRIBUTOR THE EXCLUSIVE RIGHT OF SALE OF HIS PRODUCTS FOR CERTAIN COUNTRIES IN THE COMMON MARKET HAS UNDERTAKEN TO PROTECT THE DISTRIBUTOR AGAINST DELIVERIES WHICH MIGHT BE MADE IN THOSE COUNTRIES BY THIRD PARTIES AND HAS OBTAINED FROM THE DISTRIBUTOR AN UNDERTAKING NOT TO SELL COMPETING PRODUCTS . THE QUESTION IS THUS REDUCED TO WHETHER, IN DECIDING WHETHER SUCH AGREEMENTS FALL WITHIN THE PROHIBITION SET OUT IN ARTICLE 85(1 ) OF THE TREATY, REGARD MUST BE HAD TO THE PROPORTION OF THE MARKET WHICH THE GRANTOR CONTROLS OR ENDEAVOURS TO OBTAIN IN THE TERRITORY CEDED .
5/7 IF AN AGREEMENT IS TO BE CAPABLE OF AFFECTING TRADE BETWEEN MEMBER STATES IT MUST BE POSSIBLE TO FORESEE WITH A SUFFICIENT DEGREE OF PROBABILITY ON THE BASIS OF A SET OF OBJECTIVE FACTORS OF LAW OR OF FACT THAT THE AGREEMENT IN QUESTION MAY HAVE AN INFLUENCE, DIRECT OR INDIRECT, ACTUAL OR POTENTIAL, ON THE PATTERN OF TRADE BETWEEN MEMBER STATES IN SUCH A WAY THAT IT MIGHT HINDER THE ATTAINMENT OF THE OBJECTIVES OF A SINGLE MARKET BETWEEN STATES . MOREOVER THE PROHIBITION IN ARTICLE 85(1 ) IS APPLICABLE ONLY IF THE AGREEMENT IN QUESTION ALSO HAS AS ITS OBJECT OR EFFECT THE PREVENTION, RESTRICTION OR DISTORTION OF COMPETITION WITHIN THE COMMON MARKET . THOSE CONDITIONS MUST BE UNDERSTOOD BY REFERENCE TO THE ACTUAL CIRCUMSTANCES OF THE AGREEMENT . CONSEQUENTLY AN AGREEMENT FALLS OUTSIDE THE PROHIBITION IN ARTICLE 85 WHEN IT HAS ONLY AN INSIGNIFICANT EFFECT ON THE MARKETS, TAKING INTO ACCOUNT THE WEAK POSITION WHICH THE PERSONS CONCERNED HAVE ON THE MARKET OF THE PRODUCT IN QUESTION . THUS AN EXCLUSIVE DEALING AGREEMENT, EVEN WITH ABSOLUTE TERRITORIAL PROTECTION, MAY, HAVING REGARD TO THE WEAK POSITION OF THE PERSONS CONCERNED ON THE MARKET IN THE PRODUCTS IN QUESTION IN THE AREA COVERED BY THE ABSOLUTE PROTECTION, ESCAPE THE PROHIBITION LAID DOWN IN ARTICLE 85(1 ).

8/9 THE COSTS INCURRED BY THE COMMISSION OF THE EUROPEAN COMMUNITIES WHICH SUBMITTED ITS OBSERVATIONS TO THE COURT ARE NOT RECOVERABLE . AS THESE PROCEEDINGS ARE, IN SO FAR AS THE PARTIES TO THE MAIN ACTION ARE CONCERNED, IN THE NATURE OF A STEP IN THE ACTION PENDING BEFORE THE OBERLANDESGERICHT, MUNICH, THE DECISION ON COSTS IS A MATTER FOR THAT COURT;

THE COURT
IN ANSWER TO THE QUESTIONS REFERRED TO IT BY THE OBERLANDESGERICHT, MUNICH, BY ORDER OF THAT COURT OF 5 DECEMBER 1968, HEREBY RULES :
AN EXCLUSIVE DEALING AGREEMENT, EVEN WITH ABSOLUTE TERRITORIAL PROTECTION, MAY, HAVING REGARD TO THE WEAK POSITION OF THE PERSONS CONCERNED ON THE MARKET IN THE PRODUCTS IN QUESTION, ESCAPE THE PROTECTION LAID DOWN IN ARTICLE 85(1 ).