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EC report sees 'no valid reason' to renew BER

A report from the European Commission (EC) has stated there is "no valid reason" to renew block exemption in 2010.

According to documents seen by Automotive News Europe the EC favours an end to the industry-speficic block exemption, which would leave the automotive franchise system covered by the ‘general exemption’ covering other vertical distribution networks in the EU.

Paolo Cesarini, the head of the commission unit in charge of competition in the automotive sector, said: "There seems no valid reason to envisage a replacement sector-specific regulation.”

The document states: "If maintained in any future regime applicable to the automotive sector, several provisions of the BER would risk constraining contractual parties.”

The European Commission is currently operating a consultation period before the EC makes a proposal concerning the renewal, revision or non-renewal of the block exemption in 2009 – which will involve an impact assessment, referral to MEPs, and the agreement of the Council of Ministers.

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