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Lawyers predict legal battles over block exemption contracts

German lawyers quoted in a feature article on dealer sales and aftersales contracts due to take effect from today, 1 October across Europe in Autohaus, the German trade publication, suggest legal conflict is likely to erupt over the new Block Exemption.

Robert Rademacher, a member of the Nordrhein-Westfalen branch of the German dealer trade association describes many contracts he has seen as reducing or even removing altogether dealers' commercial autonomy as “obligations are increased and rights reduced”.

Lawyer Uwe Brossette claims the imposition of margin systems that impose specific standards compliance on dealers throughirrestible commercial pressure are of dubious legality, while an expert in competition law, Jürgen Ensthaler of the University of Kaiserslautern, suggests that some contracts are so 'anti-dealer', and thus so 'anti-consumer', that the European Commission has already grounds for undertaking the review of the block exemption that it planned for mid-way through its term.

The majority of dealer contracts have apparently been signed without the benefit of legal advice, and not necessarily fully understood, says the article. Robert Rademacher believes the Commission's Competition Directorate is ready to run a red pen through one or more manufacturer contracts, though dealers might have to wait two years for the process of changing them to be completed.

He goes on to suggest that the cost of meeting higher manufacturer standards enshrined in contracts is likely to have to be passed on to consumers in car price increases, and that in the case of aftersales contracts, the franchised workshop's average hourly labour charge could rise by €7. (Source: autohaus-online.de)

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