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

(Competition Agreements, decisions and concerted practices Article 81 EC Exclusive distribution agreement for motor-vehicle fuels and other fuels Exemption Regulation (EEC) No 1984/83 Article 12(2) Regulation (EC) No 2790/1999 Articles 4(a) and 5(a) Period of exclusivity Retail price'fixing)

In Case C-60/07,

REFERENCE for a preliminary ruling under Article 234 EC from the Audiencia Provincial de Barcelona (Spain), made by decision of 13 December 2006, received at the Court on 31 May 2007, in the proceedings

Pedro IV Servicios SL

v

Total España SA,

composed of A. Rosas, President of the Chamber, J. Klučka, U. Lõhmus (Rapporteur), P. Lindh and A. Arabadjiev, Judges,

Advocate General: P. Mengozzi,

Registrar: M. Ferreira, Principal Administrator,

having regard to the written procedure and further to the hearing on 26 June 2008,

after considering the observations submitted on behalf of:

Pedro IV Servicios SL, by A. Hernández Pardo, M. Gaitán Luján and I. Sobrepera Millet, abogados,

Total España SA, by J.A. de Velasco Esteban, C. Fernández Vicién and I. Moreno-Tapia Rivas, abogados,

the Spanish Government, by M. Muñoz Pérez, acting as Agent,

the Commission of the European Communities, by V. Di Bucci and E. Gippini Fournier, acting as Agents,

after hearing the Opinion of the Advocate General at the sitting on 4 September 2008,

gives the following

1. This reference for a preliminary ruling concerns the interpretation of Article 81 EC, Articles 11 and 12 of Commission Regulation (EEC) No 1984/83 of 22 June 1983 on the application of Article [81](3) of the Treaty to categories of exclusive purchasing agreements (OJ 1983 L 173, p. 5, and corrigendum OJ 1983 L 281, p. 24) as amended by Commission Regulation (EC) No 1582/97 of 30 July 1997 (OJ 1997 L 214, p. 27) ('Regulation No 1984/83'), and Articles 4(a) and 5(a) of Commission Regulation (EC) No 2790/1999 of 22 December 1999 on the application of Article 81(3) of the Treaty to categories of vertical agreements and concerted practices (OJ 1999 L 336, p. 21).
2. The reference was made in the course of proceedings between Pedro IV Servicios SL ('Pedro IV') and Total España SA ('Total'), relating to an application brought by Pedro IV for the annulment of the complex contractual relationship between those two companies on the ground that it included clauses which restrict competition.

Community legislation

Regulation No 1984/83

3. Regulation No 1984/83 excluded from the scope of Article 81(1) EC certain categories of exclusive purchasing agreements and concerted practices which normally satisfied the conditions laid down in Article 81(3) EC, on the ground that, in general, those agreements or concerted practices led to an improvement in the distribution of goods.
4. According to recitals 8 and 13 in the preamble to Regulation No 1984/83:

'(8) whereas this regulation must define the obligations restricting competition which may be included in an exclusive purchasing agreement; whereas the other restrictions of competition allowed under this regulation in addition to the exclusive purchasing obligation lead to a clear division of functions between the parties and compel the reseller to concentrate his sales efforts on the contract goods; whereas they are, where they are agreed only for the duration of the agreement, generally necessary in order to attain the improvement in the distribution of the goods sought through exclusive purchasing; whereas further restrictive obligations and in particular those which limit the reseller's choice of customers or his freedom to determine his prices and conditions of sale cannot be exempted under this regulation;

...

(13) whereas [service station agreements] are generally distinguished by the fact that, on the one hand, the supplier confers on the reseller special commercial or financial advantages by contributing to his financing, granting him or obtaining for him a loan on favourable terms, equipping him with a site or premises for conducting his business, providing him with equipment or fittings, or undertaking other investments for his benefit and that, on the other hand, the reseller enters into a long-term exclusive purchasing obligation which in most cases is accompanied by a ban on dealing in competing products'.

5. The specific provisions applicable to service station agreements were laid down in Articles 10 to 13 of Regulation No 1984/83.
6. Article 10 of that regulation stated:

'Pursuant to Article [81](3) of the Treaty and subject to Articles 11 to 13 of this Regulation, it is hereby declared that Article [81](1) of the Treaty shall not apply to agreements to which only two undertakings are party and whereby one party, the reseller, agrees with the other, the supplier, in consideration for the according of special commercial or financial advantages, to purchase only from the supplier, an undertaking connected with the supplier or another undertaking entrusted by the supplier with the distribution of his goods, certain petroleum-based motor'vehicle fuels or certain petroleum-based motor-vehicle and other fuels specified in the agreement for resale in a service station designated in the agreement.'

7. Article 11 of that regulation provided:

'Apart from the obligation referred to in Article 10, no restriction on competition shall be imposed on the reseller other than:

(a) the obligation not to sell motor-vehicle fuel and other fuels which are supplied by other undertakings in the service station designated in the agreement;

(b) the obligation not to use lubricants or related petroleum-based products which are supplied by other undertakings within the service station designated in the agreement where the supplier or a connected undertaking has made available to the reseller, or financed, a lubrication bay or other motor-vehicle lubrication equipment;

(c) the obligation to advertise goods supplied by other undertakings within or outside the service station designated in the agreement only in proportion to the share of these goods in the total turnover realised in the service station;

(d) the obligation to have equipment owned by the supplier or a connected undertaking or financed by the supplier or a connected undertaking serviced by the supplier or an undertaking designated by him.'

8. Article 12 of Regulation No 1984/83 provided:

'1. Article 10 shall not apply where:

...

(c) the agreement is concluded for an indefinite duration or for a period of more than 10 years;

...

2. Where the agreement relates to a service station which the supplier lets to the reseller, or allows the reseller to occupy on some other basis, in law or in facts, exclusive purchasing obligations or bans on dealing in competing products specified in this Title may, notwithstanding paragraph 1(c), be imposed on the reseller for the whole period for which the reseller in fact operates the premises.'

9. Regulation No 1984/83 expired on 31 December 1999. Regulation No 2790/1999 entered into force on 1 January 2000, extending until 31 May 2000 the application of the exemptions provided, inter alia, by Regulation No 1984/83.

Regulation No 2790/1999

10. Article 2(1) of Regulation No 2790/1999 states:

'Pursuant to Article 81(3) of the Treaty and subject to the provisions of this Regulation, it is hereby declared that Article 81(1) shall not apply to agreements or concerted practices entered into between two or more undertakings each of which operates, for the purposes of the agreement, at a different level of the production or distribution chain, and relating to the conditions under which the parties may purchase, sell or resell certain goods or services ('vertical agreements').

This exemption shall apply to the extent that such agreements contain restrictions of competition falling within the scope of Article 81(1) ('vertical restraints').'

11. Article 3(1) of Regulation No 2790/1999 provides:

'Subject to paragraph 2 of this Article, the exemption provided for in Article 2 shall apply on condition that the market share held by the supplier does not exceed 30% of the relevant market on which it sells the contract goods or services.'

12. Article 4(a) of Regulation No 2790/1999 provides that the exemption to the prohibition laid down in Article 81(1) EC is not to apply to vertical agreements which, directly or indirectly, in isolation or in combination with other factors under the control of the parties, have as their object:

'the restriction of the buyer's ability to determine its sale price, without prejudice to the possibility of the supplier's imposing a maximum sale price or recommending a sale price, provided that they do not amount to a fixed or minimum sale price as a result of pressure from, or incentives offered by, any of the parties'.

13. Article 5 of that regulation states:

'The exemption provided for in Article 2 shall not apply to any of the following obligations contained in vertical agreements:

(a) any direct or indirect non-compete obligation, the duration of which is indefinite or exceeds five years. A non-compete obligation which is tacitly renewable beyond a period of five years is to be deemed to have been concluded for an indefinite duration. However, the time limitation of five years shall not apply where the contract goods or services are sold by the buyer from premises and land owned by the supplier or leased by the supplier from third parties not connected with the buyer, provided that the duration of the non-compete obligation does not exceed the period of occupancy of the premises and land by the buyer;

...'

14. Under Article 12 of Regulation No 2790/1999, as has already been pointed out in paragraph 9 above, the exemption provided for, inter alia, by Regulation No 1984/83 is to continue to apply until 31 May 2000. The prohibition provided for in Article 81(1) EC does not apply, during the period from 1 June 2000 to 31 December 2001, in respect of agreements already in force on 31 May 2000 which do not satisfy the conditions for exemption provided for in Regulation No 2790/1999 but which satisfy, rather, the conditions for exemption provided for in Regulation No 1984/83.

The dispute in the main proceedings and the questions referred for a preliminary ruling

15. Pedro IV operates a service station in Spain. According to the order for reference, on 26 October 1989 it entered into four contracts with Total, a supplier of petroleum-based products.
16. The first of those contracts creates a legal right in favour of Total, called a 'right to build', for 20 years on a plot of land owned by Pedro IV. That contract authorises Total, within a period of two and a half years, to build a service station on that land. That service station is to become Total's property in return for a payment to Pedro IV. The amount of the payment is fixed at a monthly rate of ESP 250 000 (approximately EUR 1 500) payable for 20 years. At the end of that 20-year period, the service station built by Total will become the property of Pedro IV. The 20-year period starts to run from the date when the service station is brought into operation. Under the contract, the right to build cannot be transferred without the landowner's consent.
17. The second of those contracts is a lease on the service station to be built. Under that contract, Total grants Pedro IV the right to occupy and operate the service station for one year. That right is, however, renewable and the lessor is required to grant the extension, from month to month, for the duration of the exclusive supply agreement which Total also undertakes to enter into with Pedro IV. In any event, the lease will come to end at the same time as the right to build granted to Total. The monthly rent which Pedro IV has to pay is ESP 600 000 (approximately EUR 3 600).
18. The third contract, which was also agreed for a period of 20 years, is an exclusive supply obligation for fuel under which Pedro IV undertakes to operate the service station from the time when that station is handed over to it, obtaining its supplies exclusively from Total, and using its image, colours, trade mark and logo. Under that contract, the supply is carried out by way of executed sale, so that the distributor acquires ownership of the fuel from the moment at which the supplier delivers it to him at the service station, the distributor undertaking to resell the fuel on his own behalf and at his own risk. In consideration for the exclusivity, Total must pay Pedro IV the monthly sum of ESP 350 000 (approximately EUR 2 100).
19. Furthermore, under that contract, Total undertakes to inform Pedro IV of the recommended retail prices and to ensure competitivity against the prices offered in good faith by other competitors in the area. Total also undertakes to fix the price of the fuel which it supplies to the reseller on the most advantageous terms agreed by it with other service stations which may be established in Barcelona, and the price is never to be higher than the average of the prices fixed by other suppliers with a significant presence on the market who operate in Barcelona.
20. Total and Pedro IV also agree to set off the amounts that they had to pay one another under the three contracts referred to. It follows that, as the amounts which the parties are contractually required to pay cancel each other out in full, neither party is required to pay anything to the other.
21. Lastly, under the fourth contract, Total grants a mortgage loan in the sum of ESP 30 000 000 (approximately EUR 180 300) to Pedro IV, which, as security, gives a mortgage over its land for a period of 20 years on condition that the service station is built.
22. According to the order for reference, once the four contracts were concluded, the service station was actually built on the land owned by Pedro IV and was supplied exclusively by Total for the following 12 years.
23. On 6 December 2004, Pedro IV brought an action before the Juzgado de lo Mercantil (Commercial Court) No 3 of Barcelona, for annulment of the legal relationship established by the four contracts described above on the grounds that, first, they included clauses which seriously restricted competition, that is to say, clauses with a duration in excess of the maximum permitted under Community law for exclusive supply agreements. Second, the third contract provided for the indirect fixing of the sale price, although such a practice is prohibited by the provisions of Article 81 EC. Pedro IV sought, in addition, restitution in respect of the reciprocal obligations performed by the parties, subject to deduction of sums already paid.
24. That action was dismissed in its entirety by judgment of 7 December 2005, and Pedro IV appealed to the referring court.
25. In those circumstances, the Audiencia Provincial de Barcelona (Provincial Court, Barcelona) decided to stay the proceedings and refer the following questions to the Court for a preliminary ruling:

'1. Must Article 12(2) of [Regulation No 1984/83], which provides that 'where the agreement relates to a service station which the supplier lets to the reseller, or allows the reseller to occupy on some other basis, in law or in fact, exclusive purchasing obligations or bans on dealing in competing products specified in this Title may, notwithstanding Paragraph 1(c), be imposed on the reseller for the whole period for which the reseller in fact operates the premises', be interpreted as referring to the situation in which the supplier/lessor initially owned the land and the installations, or on the contrary does the reference to the 'letting' of the service station cover all those titles which by operation of law give the supplier a proprietary right in the service station alone, with the consequence that the supplier can lease it to the owner of the land without being required to comply with the time-limitations which the rules impose in respect of exclusive purchasing agreements?

2. If [Regulation No 2790/1999] is applicable to the present case, must the provision in Article 5 that the exemption [in Article 2 of the regulation] is not to apply if the duration of the exclusive purchasing agreement exceeds five years, although 'the time-limitation of five years shall not apply where the contract goods or services are sold by the buyer from premises and land owned by the supplier or leased by the supplier from third parties not connected with the buyer, provided that the duration of the non-compete obligation does not exceed the period of occupancy of the premises and land by the buyer', be interpreted, where it mentions leasing, as referring to a situation in which the supplier/lessor also initially owned the land and the installations, or on the contrary does the reference to the leasing of the service station cover all those titles which may by operation of law give the supplier a proprietary right in the service station alone, with the consequence that the supplier can lease it to the owner of the land without being required to comply with the time-limitations which the rules impose in respect of exclusive purchasing agreements?

3. Must the prohibition of the indirect fixing of purchase or selling prices laid down in Article 81(1)(a) EC and the statement in recital 8 in the preamble to [Regulation No 1984/83] that 'further restrictive obligations and in particular those which limit the reseller's choice of customers or his freedom to determine his prices and conditions of sale cannot be exempted under this Regulation', resale price fixing not being among the other restrictions on competition permitted in Article 11 of that regulation, be interpreted as including any form of restriction of the reseller's freedom to fix the retail price, such as where the supplier fixes the distribution margin of the operator of the service station, by fixing the price of the fuel which he supplies to the reseller on the most advantageous terms agreed with other service stations that may be established in Barcelona, provided that the price will never be higher than the average price fixed by other suppliers with a significant presence on the market, then adding the minimum margin which is thought appropriate and thus arriving at the [retail price], which the supplier does not expressly impose but which he recommends be charged?

4. Must the prohibition of the indirect fixing of purchase or selling prices laid down in Article 81(1)(a) EC, and the inclusion in Article 4(a) of [Regulation No 2790/1999] of resale price maintenance as a particularly serious restriction on competition, be interpreted as including any form of restriction of the reseller's freedom to fix the retail price, such as where the supplier fixes the distribution margin of the operator of the service station, by fixing the price of the fuel which he supplies to the reseller on the most advantageous terms agreed with other service stations that may be established in Barcelona, provided that the price will never be higher than the average price fixed by other suppliers with a significant presence on the market, then adding the minimum margin which is thought appropriate and thus arriving at the [retail price], which the supplier does not expressly impose but which he recommends be charged?'

The questions referred for a preliminary ruling

Admissibility

26. Total requests the Court to find the reference inadmissible on a number of grounds. First, the referring court omitted to supply the Court with essential information concerning the dispute in the main proceedings, thereby preventing the Court from having a precise and accurate overview of the factual and legal context of the case in which it has to give a ruling. Second, the reference for a preliminary ruling is not justified since the answers to the questions referred follow clearly both from Community case-law and from Spanish case-law. Lastly, the questions referred are not relevant for the purposes of determining the outcome of the dispute in the main proceedings.
27. The Spanish Government also expresses doubts about the admissibility, in part, of the order for reference, claiming that Regulations Nos 1984/83 and 2790/1999 cannot be applied simultaneously. Therefore, the questions concerning, in particular, the interpretation of Regulation No 1984/83, namely the first and third questions, are purely hypothetical and must be declared inadmissible.
28. In that regard, it should be borne in mind that, in the context of the cooperation between the Court of Justice and the national courts provided for by Article 234 EC, it is solely for the national court before which the dispute has been brought, and which must assume responsibility for the subsequent judicial decision, to determine in the light of the particular circumstances of the case both the need for a preliminary ruling in order to enable it to deliver judgment and the relevance of the questions which it submits to the Court (Case C-06/99 BIAO [2003] ECR I-1, paragraph 88, and Case C-17/05 Confederación Española de Empresarios de Estaciones de Servicio [2006] ECR I-11987 ('CEEES'), paragraph 16 and the case'law cited).
29. Also according to settled case-law, the need to provide an interpretation of Community law which will be of use to the national court makes it necessary that the national court should define the factual and legislative context of the questions it is asking or, at the very least, explain the factual circumstances on which those questions are based (Case C-2/03 Carbonati Apuani [2004] ECR I-8027, paragraph 10; Case C-34/03 Viacom Outdoor [2005] ECR I-1167, paragraph 22; and CEEES, paragraph 26).
30. In that regard, it must be noted that, while it is admittedly true that the order for reference lacks certain information relevant to the outcome of the case, it does nevertheless allow the scope of the questions referred, and the context in which they are asked, to be determined. Therefore, despite the gaps, the Court has sufficient information available to it to interpret the relevant Community rules and give a useful reply to those questions. In addition, and in any event, the content of the observations submitted to the Court in the course of the present case confirms that the information on the factual and legal context is sufficient, as it enabled the parties to the main proceedings and other interested parties to state their views effectively on the questions referred.
31. The reference for a preliminary ruling, likewise, cannot be held inadmissible because the answers to the questions referred are clear, as Total alleges, from existing well-established Community and national case'law. Even assuming that the questions referred are materially identical to questions which have already been ruled upon in the context of a reference for a preliminary ruling in an analogous case, that circumstance in no way prevents the national court from referring questions to the Court for a preliminary ruling and does not result in the Court lacking jurisdiction to rule on those questions (see, to that effect, Case 283/81 CILFIT and Others [1982] ECR 3415, paragraphs 13 and 15). However, in such a case, the Court may, pursuant to Article 104(3) of its Rules of Procedure, after hearing the Advocate General, at any time give its decision by reasoned order in which reference is made to its previous judgment or to the relevant case-law.
32. Furthermore, the preliminary ruling procedure established by Article 234 EC has as its objective, inter alia, to ensure the proper application and uniform interpretation of Community law in all the Member States and to prevent a body of national case-law that is not in accordance with the rules of Community law from coming into existence in any Member State (see Case C-95/03 Intermodal Transports [2005] ECR I-8151, paragraph 38, and Case C-58/06 Gourmet Classic [2008] ECR I-4207, paragraph 32).
33. Where questions submitted by national courts concern the interpretation of a provision of Community law, the Court of Justice is bound, in principle, to give a ruling unless it is obvious that the request for a preliminary ruling is in reality designed to induce the Court to give a ruling by means of a fictitious dispute, or to deliver advisory opinions on general or hypothetical questions, or that the interpretation of Community law requested bears no relation to the actual facts of the main action or its purpose, or that the Court does not have before it the factual or legal material necessary to give a useful answer to the questions submitted to it (CEEES, paragraph 17 and the case-law cited).
34. However, that is not the situation in the case in the main proceedings. Suffice it to state that it is clear from the order for reference that an answer to the questions referred by the national court will be necessary for it to determine whether the contractual arrangement at issue in the main proceedings is eligible for the block exemptions established by Regulations Nos 1984/83 and 2790/1999.
35. In that regard, it is also necessary to reject Total's argument that the questions referred are not relevant to the outcome of the dispute in the main proceedings since, to be able to find that an agreement is contrary to the competition rules, it is not enough to demonstrate that the clauses which it contains do not comply with a block exemption regulation, those clauses must also actually be in breach of the provisions of Article 81 EC.
36. While it is indeed true that the block exemption regulations apply in so far as agreements contain restrictions on competition caught by Article 81(1) EC, it is nevertheless often more practical to ascertain first whether those regulations apply to a given agreement, in order to avoid if those regulations do apply a complex economic and legal assessment to determine whether the conditions for the application of Article 81(1) EC are met. In any event, it is clear from the line of case'law established in CILFIT and Others that a referring court, the decisions of which are not subject to appeal in the internal legal order, and which has to apply a provision of Community law to a dispute before it, is not bound to ask the Court for an interpretation of that provision if the point of law at issue has been resolved by established case-law of the Court, whatever the nature of the proceedings which have given rise to that case-law, even if the issues in dispute are not strictly identical.
37. Lastly, the argument of the Spanish Government relating to the inadmissibility, in part, of the reference for a preliminary ruling on account of the hypothetical nature of the two questions, concerning the interpretation of Regulation No 1984/83, must also be rejected.
38. While it is not in dispute that that regulation expired on 31 December 1999, it is still the case that the exemption provided by it continued to apply until 31 May 2000 under Regulation No 2790/1999. The latter regulation established, furthermore, a transitional period expiring on 31 December 2001, during which the prohibition laid down in Article 81(1) EC did not apply to agreements in force on 31 May 2000 which met the conditions for the exemption laid down, not by that latter regulation, but by Regulation No 1984/83. Therefore, given that the disputed contracts were concluded in the course of 1989 and that they continued in force until Pedro IV initiated the action in 2004, it is appropriate to examine whether the conditions for exemption were applicable under both Regulation No 1984/83 and Regulation No 2790/1999, so that the national court may determine, where appropriate, whether those contracts complied with competition law throughout the time that they were in force or whether they were null and void from a certain time onwards.
39. It follows that the reference for a preliminary ruling is admissible.

The first and second questions, concerning the period of exclusivity

40. By its first two questions, the referring court asks, in essence, whether Article 12(2) of Regulation No 1984/83, on the one hand, and Article 5(a) of Regulation No 2790/1999, on the other, must be interpreted as permitting, for the purposes of applying the block exemption, an exclusivity agreement to exceed the time'limit prescribed by those regulations only in the situation where the supplier is initially the owner of both the land on which the service station is built and the service station itself, or whether it is sufficient that the supplier's ownership rights relate solely to the service station which he lets to the owner of the land.
41. Given that the wording of the two provisions in question is not identical, the two regulations must be examined separately.

Interpretation of Regulation No 1984/83

42. It should be recalled that Regulation No 1984/83 provided for the application of Article 81(3) EC to certain categories of bilateral exclusive purchasing agreements liable to be caught by the prohibition in Article 81(1) EC entered into for the purpose of the resale of petroleum products in service stations.
43. Apart from the conditions for applying the exemption, set out in Articles 10 and 11 of Regulation No 1984/83, Article 12(1)(c) of that regulation states that it is not applicable to service station agreements if they are for an indefinite duration or for more than 10 years. Nevertheless, Article 12(2) of that regulation states that '[w]here the agreement relates to a service station which the supplier lets to the reseller, or allows the reseller to occupy on some other basis, in law or in fact, exclusive purchasing obligations or prohibitions or bans dealing in competing products specified [in the provisions applicable to service station agreements] may, notwithstanding paragraph 1(c), be imposed on the reseller for the whole period for which the reseller in fact operates the premises'.
44. It thus follows from the wording of Article 12(2) of Regulation No 1984/83 that the application of that regulation is possible in the case of a service station agreement, the duration of which exceeds 10 years, provided that the supplier has let the service station to the reseller, or has granted him, in law or in fact, occupancy of the service station.
45. However, Pedro IV and the Commission of the European Communities take the view that the benefit of the exceptional arrangement provided for in that provision must be subordinate to the double condition that the supplier owns both the service station and the land on which it has been built.
46. Pedro IV explains its position, first, by recalling the case-law according to which the block exemption regulations must be interpreted restrictively so as to ensure that their effects are not extended to agreements or to situations which they are not intended to cover (see, to that effect, Case C-0/93 Bayerische Motorenwerke [1995] ECR I-3439, paragraph 28, and Case C-06/96 Javico [1998] ECR I-1983, paragraph 32).
47. It considers, second, that the advantages which Total granted to it, namely providing the service station and granting a loan on favourable terms, come within the situations provided for in Articles 10 and 12(1)(c) of Regulation No 1984/83, so that the exclusive purchasing and non-compete agreement cannot be longer than 10 years. The conclusion of several interconnected contracts between the supplier and the reseller, the effect of which leads to foreclosure of the market, seeks artificially to extend the application of Article 12(2) of Regulation No 1984/83 to situations which cannot be equated to the situation covered by that provision.
48. According to the Commission, unlimited exclusive purchase obligations on the reseller, provided for in the context of non-compete or exclusive purchasing agreements, are justified by the consideration given by the supplier, which is not merely 'particularly significant' but also 'absolute', in that the reseller gains access to an activity without making the slightest investment or payment. A situation in which either the land or the premises belong to the reseller is difficult to reconcile with the exceptional arrangement laid down in Article 12(2) of Regulation No 1984/83.
49. The Commission states, furthermore, that having regard to the continuity between Regulations Nos 1984/83 and 2790/1999 they must be interpreted in the same way, even if they are drafted differently, and Regulation No 2790/1999 states clearly that the exemption which it lays down applies only where the supplier is the owner of both the land and the premises from which the contractual goods or services are sold by the reseller.
50. Such reasoning cannot be accepted.
51. While it is true that the provisions containing exceptions in a block exemption regulation cannot be the subject of a broad interpretation, it is nevertheless the case that the provisions at issue are drafted in a clear and unequivocal manner.
52. The double condition that the supplier must own both the service station and the land on which it is built, resulting allegedly according to Pedro IV and the Commission from Regulation No 1984/83, appears neither in the body of the regulation itself, nor in its preamble.
53. Recital 13 in the preamble to that regulation mentions, among the commercial or financial advantages granted by the supplier to the reseller, the provision of a site or premises for operating a service station, but not the provision of both. In any event, as Article 12(2) of Regulation No 1984/83 mentions only the situation in which the supplier lets the service station to the reseller, or allows him to occupy and operate it, in law or in fact, the Court cannot reduce the scope of that provision by adding a further condition which is not contained in it.
54. As regards the special commercial or financial advantages referred to in Article 10 of Regulation No 1984/83, it is clear from Case C-79/06 CEPSA [2008] ECR I-0000, paragraph 54, that they must not only be substantial in order to justify an exclusivity of supply of 10 years, but also such as to lead to an improvement in distribution, to facilitate the establishment or modernisation of the service station and to lower the distribution costs.
55. The advantage laid down in Article 12(2) of Regulation No 1984/83 is of particular importance in that regard since it facilitates greatly the reseller's access to the distribution network while minimising his installation and distribution costs. However, neither the wording of that regulation, nor its purpose, nor its broad logic, allows it to be held, as the Commission claims, that the application of Article 12(2) is subject to an additional condition, namely that the reseller is relieved of making any payment or investment in relation to his economic activity as an operator of a service station.
56. The Commission's argument that the double condition, which is explicitly laid down in Article 5(a) of Regulation No 2790/1999, was already present in the spirit of Article 12(2) of Regulation No 1984/83 must also be rejected.
57. It is apparent that Regulation No 1984/83 had an autonomous scope narrower than that of Regulation No 2790/1999 in that it laid down specific provisions applicable to service station agreements. The conditions for applying Article 81(3) EC to that category of agreements under Regulation No 1984/83 were, therefore, different from those provided for in Regulation No 2790/1999, both in relation to the maximum duration of exclusive supply and in relation to the market power of the undertakings in question.
58. Moreover, it is also clear from the Commission's response to the written question of the Court that the amendment to the exception in respect of the maximum length of a period of exclusivity, which results from Regulation No 2790/1999, was decided upon following a public consultation launched on 24 September 1999, and that the initial version of the proposal for that regulation did not provide for that double condition.
59. In those circumstances, the application of the double condition proposed by the Commission is in no way justified.
60. In the light of the foregoing considerations, the answer to the first question is that Article 12(2) of Regulation No 1984/83 must be interpreted as meaning that, for the purposes of applying the exception which it laid down, that provision did not require the supplier to be the owner of the land on which he had built the service station which he let to the reseller.

Interpretation of Regulation No 2790/1999

61. Regulation No 2790/1999 lays down the conditions under which Article 81(3) EC applies to certain categories of vertical agreements and concerted practices but does not contain specific provisions in relation to service station agreements. In accordance with Article 3(1) of that regulation, the exemption laid down therein applies on condition that the market share held by the supplier does not exceed 30% of the relevant market on which he sells the contractual goods or services.
62. In that regard, it should be noted that it is for the national court, before proceeding to an assessment based on other conditions laid down in that regulation, to ascertain whether Total's market share, from the entry into force of Regulation No 2790/1999, did not exceed 30% of the relevant market, taking account as Pedro IV and the Commission stated before the Court of shares it may have in the capital of other suppliers of petroleum products on the same market.
63. Article 5(a) of Regulation No 2790/1999 provides that the five-year limit for the non-compete obligation is not to apply where the contract goods or services are sold by the buyer from premises and land owned by the supplier or leased by the supplier from third parties not connected with the buyer, provided that the duration of the non'compete obligation does not exceed the period of occupancy of the premises and land by the buyer.
64. It follows from the wording of that provision that the application of the exception for which it provides is possible in relation to service station agreements in two situations, that is to say, the situation where the supplier is the owner of both the service station which he lets to the reseller, and the land on which it is built, and the situation where the supplier leases the land and the service station from third parties not connected with the reseller to sub-let them to the latter.
65. That change in the conditions for applying the exception, as stated in paragraph 58 above, was adopted following observations submitted by interested parties on the proposal for the block exemption regulation submitted for public consultation. The reason for it, according to the Commission, was to counteract abusive practices and, in particular, to try to prevent the maximum duration fixed by the regulation for exclusivity clauses being circumvented.
66. In a situation such as that at issue in the main proceedings, it appears that the conditions for application of Article 5(a) of Regulation No 2790/1999 are not met. However, it is for the referring court to assess Total's argument that the right to build confers on it, not only ownership of the service station, but also ownership of the land on which it is built. As the concept of the 'right to build' is part of the body of property law rules under national law, it is for that court to determine the scope of that concept.
67. In the event that that court reaches the conclusion that the agreements concluded between the parties to the main proceedings met the conditions for exemption laid down in Regulation No 1984/83, but not those laid down in Regulation No 2790/1999, it will be necessary to hold those agreement exempt from the scope of Article 81(1) EC until 31 December 2001 under the transitional scheme provided for in Article 12 of Regulation No 2790/1999.
68. However, where an agreement does not satisfy all the conditions provided for by an exempting regulation, it will be caught by the prohibition laid down in Article 81(1) EC only if its object or effect is perceptibly to restrict competition within the common market and it is capable of affecting trade between Member States. In that latter case, and in the absence of individual exemption pursuant to Article 81(3) EC, that agreement would be automatically void under Article 81(2) EC (see, to that effect, Case C-30/96 Cabour [1998] ECR I-2055, paragraph 48, and CEPSA, paragraph 72).
69. It follows from the foregoing that the answer to the second question is that Article 5(a) of Regulation No 2790/1999 must be interpreted as meaning that, for the purposes of applying the exception which it lays down, that provision requires that the supplier is the owner both of the service station which he lets to the reseller and of the land on which it is built, or, if he is not the owner, that he leases the land and service station from third parties not connected to the reseller.

The third and fourth questions, concerning the fixing of the retail price

70. By its third and fourth questions, which it is appropriate to consider together, the referring court asks, in essence, whether contractual clauses relating to the retail price of the products, such as those at issue in the main proceedings, are prohibited under Article 81(1)(a) EC and cannot benefit from the application of the block exemption scheme under, inter alia, recital 8 in the preamble to Regulation No 1984/83 or Article 4(a) of Regulation No 2790/1999, according to the scope ratione temporis of those regulations respectively.
71. It should be borne in mind that Article 81(1)(a) EC prohibits, inter alia, all agreements between undertakings which may affect trade between Member States and which have as their object or effect the prevention, restriction or distortion of competition within the common market, in particular those which, directly or indirectly, fix purchase or selling prices.
72. Regulation No 1984/83 states, as is clear from the wording of recital 8 in its preamble, that obligations which restrict competition which are not authorised by that regulation, in particular, those which limit the reseller's freedom to determine his sale prices, cannot be exempted under the provisions of that regulation.
73. In relation to Regulation No 1984/83, the Court has already held that Article 11 of that regulation lists exhaustively the obligations that, apart from an exclusivity clause, may be imposed on a reseller, which do not include the imposition of the retail price. Such an obligation is, therefore, not covered by the exemption laid down in Article 10 of that regulation (see CEEES, paragraph 64, and CEPSA, paragraph 65).
74. As regards Regulation No 2790/1999, Article 4(a) states that the block exemption does not apply to vertical agreements which have as their object 'the restriction of the buyer's ability to determine its sale price, without prejudice to the possibility of the supplier's imposing a maximum sale price or recommending a sale price, provided that they do not amount to a fixed or minimum sale price as a result of pressure from, or incentives offered by, any of the parties'.
75. It follows that agreements in which the supplier fixes the retail price or imposes a minimum sale price are ineligible for the block exemptions established by Regulations Nos 1984/83 and 2790/1999. By contrast, under the wording of Article 4(a) of Regulation No 2790/1999, the supplier remains free to recommend a sale price to the reseller, or to impose a maximum sale price on him.
76. According to the referring court, the exclusive supply agreement for fuel provides that Total, first, is to determine the price of the fuel which it supplies to Pedro IV on the most advantageous terms agreed by it with other service stations which may be established in Barcelona and, second, is to guarantee that the price will never be higher than the average of the prices fixed by other suppliers with a significant presence on the market. By adding to that price a distribution margin for the service station operator, which it considers appropriate, Total thus obtains the retail price which it then recommends Pedro IV apply.
77. The first clause of that contract concerns the price that Pedro IV is required to pay for the supply of fuel, the determination of which comes within the competence of the parties and does not distort competition.
78. As regards the retail price, it is clear from the very wording of the second contractual clause that that price is not imposed, but recommended by the supplier, without a maximum sale price even being stipulated. The method for calculating the recommended sale price is, in that regard, irrelevant, provided that a degree of freedom is left to the reseller enabling him actually to determine the sale price. However, there would be no such freedom in the event that the supplier imposed a fixed distribution margin on the reseller from which he could not depart.
79. In the light of the division of jurisdiction between the national courts and the Court of Justice in the context of the cooperation established by Article 234 EC, it is for the referring court, which alone has direct knowledge of the dispute before it, to assess the manner in which the retail price was fixed in the case in the main proceedings. It is for it, in particular, to ascertain, account being taken of all the contractual obligations in their commercial and legal context, and if the conduct of the parties to the main proceedings, whether the retail price recommended by the supplier constitutes, in reality, a fixed or minimum sale price (see, to that effect, CEPSA, paragraphs 67 and 70).
80. It is for the referring court, furthermore, to examine whether it is genuinely possible for the reseller to reduce that recommended sale price. It must, inter alia, ascertain whether such a retail price is, in reality, fixed by indirect or concealed means, such as the fixing of the reseller's margin or the maximum reduction he can make from the recommended sale price, threats, intimidation, warnings, penalties or incentives (see, to that effect, CEPSA, paragraph 71).
81. If the referring court were to reach the conclusion that Pedro IV was bound, in reality, to adhere to a fixed or minimum sale price imposed by Total, the exclusive supply agreement for fuel would be ineligible for the block exemptions, both under Regulation No 1984/83 and Regulation No 2790/1999.
82. However, as pointed out in paragraph 68 above, although the fixing of a retail price constitutes a restriction of competition expressly provided for in Article 81(1)(a) EC, it causes that agreement to be caught by the prohibition set out in that provision only where all the other conditions for applying that provision are met, that is to say, that the object or effect of the agreement is perceptibly to restrict competition within the common market and that it is capable of affecting trade between Member States (see, to that effect, Cabour, paragraph 48, and CEPSA, paragraph 42).
83. As regards in particular exclusive purchasing agreements, it should, moreover, be recalled that, even if those agreements do not have as their object the restriction of competition within the meaning of Article 81 EC, it is nevertheless necessary to ascertain whether they have the effect of preventing, restricting or distorting competition. The effects of an exclusive purchasing agreement have to be assessed in the economic and legal context in which the agreement occurs and where it may combine with other agreements to have a cumulative effect on competition. It is therefore necessary to analyse the effects of such an agreement, taken together with other agreements of the same type, on the opportunities of national competitors or those from other Member States to gain access to the relevant market or to increase their market share (see Case C-34/89 Delimitis [1991] ECR I-935, paragraphs 13 to 15; Case C-14/99 Neste [2000] ECR I-11121, paragraph 25; and CEPSA, paragraph 43).
84. Having regard to the foregoing, the answer to the third and fourth questions is that contractual clauses relating to the retail price, such as those at issue in the main proceedings, are eligible for the block exemptions under Regulations Nos 1984/83 and 2790/1999 where the supplier restricts himself to imposing a maximum sale price or to recommending a sale price and where, therefore, it is genuinely possible for the reseller to determine the retail price. On the other hand, such clauses are ineligible for those exemptions where they lead, directly or by indirect or concealed means, to the fixing of a retail price or the imposition of a minimum sale price by the supplier. It is for the national court to determine whether such obligations constrain the reseller, taking account of all of the contractual obligations in their economic and legal context, and of the conduct of the parties to the main proceedings.

Costs

85. Since these proceedings are, for the parties to the main proceedings, a step in the action pending before the national court, the decision on costs is a matter for that court. Costs incurred in submitting observations to the Court, other than the costs of those parties, are not recoverable.

On those grounds, the Court (Third Chamber) hereby rules:

1. Article 12(2) of Commission Regulation (EEC) No 1984/83 of 22 June 1983 on the application of Article [81](3) of the Treaty to categories of exclusive purchasing agreements, as amended by Commission Regulation (EC) No 1582/97 of 30 July 1997, must be interpreted as meaning that, for the purposes of applying the exception which it laid down, that provision did not require the supplier to be the owner of the land on which he had built the service station which he let to the reseller.

2. Article 5(a) of Commission Regulation (EC) No 2790/1999 of 22 December 1999 on the application of Article 81(3) of the Treaty to categories of vertical agreements and concerted practices must be interpreted as meaning that, for the purposes of applying the exception which it lays down, that provision requires that the supplier is the owner both of the service station which he lets to the reseller and of the land on which it is built, or, if he is not the owner, that he leases the land and service station from third parties not connected to the reseller.

3. Contractual clauses relating to the retail price, such as those at issue in the main proceedings, are eligible for the block exemptions under Regulation No 1984/83, as amended by Regulation No 1582/97, and Regulation No 2790/1999 where the supplier restricts himself to imposing a maximum sale price or to recommending a sale price and where, therefore, it is genuinely possible for the reseller to determine the retail price. On the other hand, such clauses are ineligible for those exemptions where they lead, directly or by indirect or concealed means, to the fixing of a retail price or the imposition of a minimum sale price by the supplier. It is for the national court to determine whether such obligations constrain the reseller, taking account of all of the contractual obligations in their economic and legal context, and of the conduct of the parties to the main proceedings.

[Signatures]

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* Language of the case: Spanish.