EUR-Lex - 31978D0571 - EN

1. For these reasons and also because the agreement brings about a territorial sharing of the parties' manufacturing and selling activities, the agreement may appreciably affect trade between Member States.

1. In respect of Clause 2.2 of the agreement (see paragraph 13 (b) and (c)), SNPE have stated inter alia that this clause "did not aim at a market sharing with an absolute territorial protection. The leading idea behind this clause was that the technical complexity of the products concerned and the necessary exchange of information thereon would require that the parties be bound to maintain a close confidentiality, to provide the preconditions for a joint exploitation which could achieve a reliable cooperation between (1)Judgments in re "Grundig-Consten" of 13 July 1966 (1966) ECR 299 ; "Quinine" of 15 July 1970 (1970) ECR 661, 733, 769 ; "Sugar" of 16 December 1975 (1975) ECR 1663 ; "Frubo" of 15 May 1975 (1975) ECR 563.

technical teams, thus promoting the communication of knowhow between the parties concerned. The two parties, as they each supply their own complementary technological skills for the realization of a complete product, recognize it as legitimate that they should not offer the same product to third-party users in the other party's country" (SNPE letter of 20 December 1977).

1. LEL have similarly stated that the objective of Clause 2.2 is "to ensure the technical interchange takes place to allow a natural and positive development of the products of our joint technologies. The agreement does not limit the opportunities for consumers to purchase the products to which the agreement relates from other sources within the EEC. On the contrary, the agreement enables each party to offer customers a full range of products of both companies which otherwise would not be available within the EEC" (LEL letter of 20 December 1977).

1. These arguments refer in substance to the general purpose of the agreement concerning the sharing between the parties of technical information and do not affect the conclusion that Article 85 (1) applies. Clause 2.2, whether it is considered in isolation or within the general framework of the agreement, has as its object and effect the creation of a territorial partitioning of SNPE's and LEL's respective activities which relate to the products listed in the agreement.

1. On a preliminary examination, therefore, the agreement in this respect infringes Article 85 (1) of the EEC Treaty.

III. PRELIMINARY ASSESSMENT UNDER ARTICLE 85 (3) OF THE EEC TREATY

Under Article 85 (3) of the Treaty, the provisions of Article 85 (1) may be declared inapplicable in the case of any agreement between undertakings 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, nor (b) afford such undertakings the possibility of eliminating competition in respect of a substantial part of the products in question.

1. At this stage of the proceedings, it can be left open whether or not the restrictions on competition which are referred to in paragraph 13 (d) fulfil the requirements for an exemption.

In any event, Clause 2.2 of the notified agreement (paragraphs 5 and 13 (b) and (c)) does not meet the requirements for exemption for the following reasons: (a) Even on the assumption that specialization of manufacturing activities and joint research and development of new products are in principle likely to contribute to improving production, the obligations of each party not to grant licences, or to produce or to sell directly in the other's country cannot contribute to such a development. The question whether the provisions contained in Clause 2.2 are indispensable to the attainment of such benefits does not therefore arise.

(b) In any event, consumers cannot draw any kind of benefit from the territorial allocation of the manufacturing and marketing activities of the parties. The parties themselves are the sole effective beneficiaries of the agreed partitioning of the market.

(c) Because of the limited number of other manufacturers of the products concerned, SNPE's and LEL's reservation to themselves of their respective home markets affords them the possibility of eliminating competition in respect of a substantial part of the products in question.

1. The relevant arguments of the parties, as outlined in paragraphs 15 and 16, do not displace the Commission's conclusion that the obligations of the parties as contained in Clause 2.2 of the agreement cannot benefit from the exempting provisions of Article 85 (1).

1. On a preliminary examination of the notified agreement, the provisions contained in Clause 2.2 do not satisfy the tests of exemption contained in Article 85 (3).

IV. APPLICATION OF ARTICLE 15 (6) OF REGULATION No 17

1. The infringement of Article 85 began with the conlusion of the agreement between SNPE and LEL on 23 February 1977. The sharing of markets is a particularly grave restriction having regard to the fundamental objectives of the EEC Treaty.

1. In accordance with Article 15 (6) of Regulation No 17 this Decision suspends, in respect of the obligations of the parties arising from Clause 2.2 of the agreement and in respect of like obligations, the immunity against the imposition of fines which normally results from the notification of an agreement,

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