EUR-Lex - 31975D0297 - EN

Article 85 (1) prohibits as incompatible with the common market 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.

On the facts at present available, a final ruling on the Agreement of 15 September 1964 is not yet possible, but the following points may be made after a preliminary examination: 1. Les Fils de Louis Mulliez SA and Sirdar Ltd are undertakings for the purposes of Article 85.

1. The Agreement of 15 September 1964 is an Agreement between undertakings for the purposes of Article 85.

1. The object of the Agreement is to restrict competition in the common market, since it reflects the stated intent of the parties to prevent Sirdar Ltd and other firms, particularly dealers and importers, from selling knitting yarn in France under the SIRDAR trademark, and to prevent Les Fils de Louis Mulliez SA and other firms from selling knitting yarn in the United Kingdom under the PHILDAR trademark. The significance of this bar to imports from France to the United Kingdom is underlined by the fact that Sirdar Ltd is seeking through the courts, on the grounds of the Agreement in question, to oblige Les Fils de Louis Mulliez SA to cease importing.

1. It cannot be said that because, under the Agreement, Les Fils de Louis Mulliez SA may import knitting yarn to the United Kingdom under a trademark other than PHILDAR, there is in effect no restriction of competition ; the use of a different trademark would deprive Les Fils de Louis Mulliez SA of the impact of the advertising under its trademark.

It would in any case be financially impossible for other undertakings (for example dealers, importers or mail-order firms) to separate the 50-gramme packs of knitting yarn from the larger packages in which they are put up and to replace each individual wrapper bearing the PHILDAR trademark with a different wrapper.

1. Nor can the existence of a restriction of competition be denied on the ground that the trademarks SIRDAR and PHILDAR are similar and therefore likely to be confused. Even if this were the case, it would not justify market sharing between the parties.

1. As the Agreement raises barriers to trade between France and the United Kingdom, it is liable to affect trade between Member States.

1. On a preliminary examination, therefore, the Agreement of 15 September 1964 is caught by Article 85 (1) of the Treaty establishing the European Economic Community.

1. The Commission leaves aside for the moment the question whether the Agreement has as its object further restrictions of competition ; this concerns paragraph 7 in particular, which limits the parties' freedom to grant licences in respect of trademarks. The answer to this question will depend on the final decision in this case.

III. Preliminary examination under Article 85 (3) of the EEC Treaty

Under Article 85 (3) of the Treaty, Article 85 (1) may be declared inapplicable in the case of any Agreement which contributes to improving the production or distribution of goods or to promoting technical or economic progress, while allowing consumers a fair share of the resulting benefit, and which does not: (a) impose on the undertakings concerned restrictions which are not indispensable to the attainment of these objectives;

Article 1

After preliminary examination, the Commission considers that, on the grounds of the following provisions of the Agreement of 15 September 1964 concluded by the undertakings named in Article 2, Article 85 (1) of the EEC Treaty applies, and application of Article 85 (3) is not justified: 1. the undertaking by Les Fils de Louis Mulliez SA not to sell knitting yarn in the United Kingdom under the PHILDAR trademark or under any similar trademark (paragraphs 1 and 5) ; and

1. the undertaking by Sirdar Ltd not to sell knitting yarn in France under the SIRDAR trademark or under any similar trademark (paragraphs 2 and 6).

Article 2

This Decision is addressed to the following undertakings: 1. Sirdar Limited, Bective Mills, Alverthorpe, Wakefield, Yorkshire, England, United Kingdom.

1. Les Fils de Louis Mulliez SA, 112, rue du Collège, F-59061 Roubaix, France.

Done at Brussels, 5 March 1975.

For the Commission

The President

François-Xavier ORTOLI