Société de Vente de Ciments et Bétons de l'Est SA v Kerpen & Kerpen GmbH und Co. KG (319/82)

First question

The plaintiff in the main action takes the view that the contract in issue is not caught by the prohibition in Article 85 because it has only an insignificant effect upon the market by reason of the weak position of the parties on the market in the products in question. The quantity of 40000 tonnes with which this case is concerned is very much lower than the amounts specified by the Commission in its notice of 27 May 1970 concerning agreements of minor importance which do not fall under Article 85 (1) of the Treaty (Journal Officiel 1970, C 64, P.1)According to the plaintiff's information concerning the volume of business done in the areas concerned in the present case, the threshold of 25% specified in that notice would not appear to have been approached. In 1982 the amount of business in Rheinland-Pfalz amounted to some 2.6 million tonnes and in Bad-Württemberg to some 5.2 million tonnes. During 1982 some 330000 tonnes were nevertheless imported from France into the Federal Republic of Germany. In 1978 the figures had tended to be even higher.As a result the 40000 tonnes provided for in the contract is so small that it cannot affect the market.Furthermore, the agreement does not have as its object or effect the prevention, restriction or distortion of competition within the common market.The défendant in the main action bought a total of only 14195.44 tonnes of cernent in 1978. Consequently, it is not possible to say that the contract had any real effect within the common market. Moreover, the contract was not intended to affect competition within the common market. The plaintiff wished to establish commercial relations with the defendant.There is nothing in the contract capable of affecting trade between Member States. Cooperation between undertakings which distorts competition falls within the prohibition contained in Article 85 (1) only if at the same time it may affect trade between Member States. Article 85 (1) is not intended to protect competition for its own sake or to guarantee the freedom of the interested parties but, by means of competition, to abolish barriers to trade. Article 85 (1) is inapplicable in this case since it can in no way be said that complete performance of the contract would adversely affect the “proper functioning of the common market”.Moreover, the examples given in Article 85 (1) (a) to (e) are also inapplicable.Under the contract in issue the defendant undertook not to sell the cement in the Saarland. There are no grounds for objecting to the supplier of goods agreeing with the purchaser that the purchaser should not sell the goods in the area hitherto supplied by the supplier. The obligation “to have regard to the interests” of the plaintiff in the main action in the works in Wössingen is very vague and cannot be understood as an unlawful territorial agreement.The clause in the contract under which the defendant must have regard to the said interests contains no declaration of any legal significance and provides no sanction in the event of breach.The Commission observes first of all that in proceedings under Article 177 the Court cannot rule on the nullity of a specific agreement. It may nevertheless provide the national court with the criteria for assessing the agreement in issue in the light of Article 85.Article 85 provides that 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 are prohibited as incompatible with die common market.Clauses in contracts of sale restricting the freedom of the purchaser to use the goods referred to in the contract without having regard to the interests of third parties and in accordance with his own economic interests so far as allowed by law, in particular the freedom to decide whether, to whom and where he should resell the goods, are restrictions on competition within the meaning of Article 85 of the Treaty. The Court so held expressly in connection with restrictions on resale to certain commercial groups (judgment of 17. 10. 1972 in Case 8/72 Cementbande/aren [1972] ECR 977) and by implication in relation to territorial restrictions (judgment of 16. 2. 1975 in Case 43/73 Suiker Unie [1975] ECR 1663). The same must apply a fortiori to agreements which impose a general restriction on the freedom of the purchaser to resell the goods referred to in the contract, since they prevent him from engaging in any form of commercial competition.Article 85 applies only to agreements which may affect trade between Member States. According to the established case-law of the Court, to satisfy that condition the agreement in question must“on the basis of a set of objective factors of law or of fact” make it “possible to foresee with a sufficient degree of probability that the agreement in question may have an influence, direct or indirect, actual or potential (that is to say, appreciable), on the pattern of trade between Member States” (judgment of 11. 12. 1980 in Case 31/80 L'Oréalv De Nieuwe AMCK [1980] ECR 3775, paragraph 18 at p. 3791).An agreement relating to the supply of goods from France to the Federal Republic of Germany may affect trade between Member States. As the Court has held, the agreement must moreover affect trade“in such a way that it might hinder the attainment of the objectives of a single market between States” (judgment of 6. 5. 1971 in Case 1/71 Cadillonv Höss [1971] ECR 351).The agreement may have that effect even if it “encourages an increase, even a large one, in the volume of trade between States”, if it also contains restrictions on the freedom of the purchaser or third parties which affect trade between Member States (Joined Cases 56 and 58/64 Consten and Grundig y Commission [1966] ECR 299).It is for the national court to consider how far the obligations imposed on the defendant in the main action were likely to have that effect. In doing so it should in particular take account of the following:— The obligation on the defendant to use the goods for its own needs might even have the effect of completely preventing re-export of the goods covered by the contract;— The prohibition on resale in the Saarland prevents any re-export of the goods covered by the contract from that area to France;— The obligation to acquire the cement intended to be sold in the Karlsruhe area from the German works partly owned by the plaintiff after giving it prior notice thereof could have at least an indirect influence on the volume or route of imports from France.The national court must consider whether those obstacles, if indeed they are obstacles, are significant. In that respect the decisive factor is whether, having regard to the position of the parties on the market in the products in question, the quantities which may be affected by the restriction and the existence of any similar agreements made with other purchasers, the agreement in question is likely to hinder the attainment of the objective of a single market between the Member States (judgment of 5. 6. 1971 in Case 1/71 Cadillon v Höss [1971] ECR 351; judgment of 9. 7. 1969 in Case 5/69 Franz Volk v Etablissements J. Vervaecke [1969] ECR 295 and judgment of 25. 11. 1971 in Case 22/71 Béguelin Import Co. and Others v SAGL Import-Export and Others [1971] ECR 949). For that purpose it is not necessary to establish that the agreement in issue has in fact appreciably affected trade; it is sufficient that it is capable of doing so (judgment of 1.2.1978 in Case 19/77 Miller International Schallplatten GmbH v Commission [1978] ECR 131.