Opinion of Mr advocate-general Gand

Mr President,

Members of the Court,

The reference made by the Oberlandesgericht, Munich, for interpretation of Article 85 of the Treaty of Rome presents you with an opportunity to clarify the case-law arising from your judgment in the Société Technique Minière case of 30 June 1966 (Case 56/65, [1966] E.C.R. 235) and in the Grundig case of 13 July 1966 (Joined Cases 56 and 58/64, [1966] E.C.R. 299), in particular with regard to exclusive dealing contracts with absolute territorial protection.

I

I shall first of all review the facts of the case so far as is necessary to understand the question put.

The German firm Josef Erd & Co., owned by Mr Völk, manufactures washing and drying machines sold under the trade-mark Konstant. Its share in the market of those appliances is very small since it amounted to 2361 units in 1963 and 861 in 1966, that is approximately 0.2 % and 0.5 % respectively of the production in the Federal Republic. On 15 September 1963 it concluded a contract with Établissements Vervaecke, which sells domestic electric appliances in Belgium, whereby it granted to the latter the exclusive right of sale of its appliances in Belgium and in Luxembourg. The contract was concluded for a period of three years and it was understood that it would be automatically extended for two years unless notification were given at least nine months before the date of its expiry.

Amongst the clauses of the contract the following may be noted:

Neither the contract of 15 September 1963 nor the amendments made to it were notified to the Commission. It was, moreover, only partially implemented since in one year only 200 washingmachines were sold in Belgium. Erd & Co. then claimed from Vervaecke payment of DM 11560 for delivery of 20 washing-machines and in addition requested compensation for the costs incurred in the fruitless delivery of 50 washing-machines.

Before the German court the problem of the validity of the contract was raised in connexion with Article 85 of the Treaty of Rome, which has led the Oberlandesgericht, Munich, to put the following question to you:

In determining whether the disputed contract of 15 December 1963, as amended on 1 January 1964 and 11 March 1964, falls within the prohibition set out in Article 85(1) of the EEC Treaty, must regard be had for the proportion of the market which the plaintiff in fact acquired or ultimately endeavoured to acquire in the Member States of the European Economic Community, in particular in Belgium and in Luxembourg, the sales sector for which the defendant enjoys absolute protection?

II

You must of course ignore the fact that the court making the reference would like you to express a view on the application of the rules of the Treaty to the contract the validity of which is disputed before it, but subject to that reservation the question is clearly put.

Finally, the reply to be given to that court should be as follows:

Such is my opinion, and I am further of the opinion that the decision as to costs is a matter for the Oberlandesgericht, München.

1 Translated from the French.