EEC Proposed Competition Rules for Motor Vehicle Distribution: An American Perspective

The proposed group exemption for motor vehicle distribution by the European Economic Community (EEC) is examined from an American perspective in terms of whether the proposed rules will increase effective competition throughout the EEC and remove rigidities that restrain transborder trade flows. Sev...

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Bibliographic Details
Published in:Antitrust bulletin 1983-12, Vol.28 (4), p.863-882
Main Author: Davidow, Joel
Format: Article
Language:English
Subjects:
Antitrust
Automobile dealers
Common market
Comparative law
Competition
Court decisions
Dealers
European economic community
Legislation
Motor vehicle industry
Regulation
Trusts, Industrial
United States
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Summary:The proposed group exemption for motor vehicle distribution by the European Economic Community (EEC) is examined from an American perspective in terms of whether the proposed rules will increase effective competition throughout the EEC and remove rigidities that restrain transborder trade flows. Several elements of the proposed legislation are considered: 1. the need for selective distribution, 2. the emphasis on reciprocal obligations between manufacturers and dealers, 3. a required exclusivity of at least 5 years, 4. exclusive dealing or tying as to spare parts, 5. the use of a suggested price standard by which to gauge dealer monopolies, and 6. the absence of a rule on dealer cartels. It is hard to see the need for new competition rules in the automobile industry, in light of the increased competitive pressures. Especially difficult to accept is the need for rules which appear to freeze old relationships and patterns rather than facilitating the creation of new ones that reflect the present realities.
ISSN:0003-603X
1930-7969
DOI:10.1177/0003603X8302800404