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EC signals end of Block Exemption

Mario Monti, the European Competition Commissioner charged with deciding the future legal framework for car distribution and sales in Europe, has given the clearest indication yet of sweeping changes to Block Exemption legislation after 2002.

Speaking at a conference in Brussels organised by ACEA, the European carmakers association, he was highly critical of carmakers and highlighted current investigations by the EC into Opel Netherlands, DaimlerChrysler, Peugeot-Citroen and Renault into alleged infringements of competition law.

Volkswagen has already been fined £60m for restrictions on parallel trade and there is also a case of retail price maintenance outstanding relating to the new VW Passat in Germany.

Mr Monti, referring to block exemption as a kind of trading 'highway code', said: “Car manufacturers at least do not seem to have much respect for the highway code, which is being generous towards them. Such misconduct will of course, also play a role in the evaluation exercise under way.”

Mr Monti made clear his remarks were based on an evaluation of the working of the present system which his department has to complete before the end of this year. The Commissioner said his had been influenced by the recent report of the UK Competition Commission into car pricing and by a presentation of 20,000 “protest notes” from members of the Consumers' Association. “I believe such consumer actions cannot be ignored when we discuss the highway code for vehicle distribution,” he said. (Rupert Saunders. May 26 2000)

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