Opinion of Mr Advocate General Mischo

Mr President,

Members of the Court,

By a judgment dated 18 December 1985 the Tribunal de grande instance [Regional Court], Paris, requested the Court of Justice under Article 177 of the EEC Treaty to rule on the application of Regulation (EEC) No 123/85 of 12 December 1984 to the agreement concluded on 18 December 1984 for a period of one year from 1 January 1985 until 31 December 1985, without tacit renewal, between VAG France [the plaintiff in the main action] and Établissements Magne [the defendant in the main action], having regard to the submissions of those parties.

Phrased in that manner the question amounts to a request to the Court to rule on the application of Community law to a particular case which it cannot do within the framework of the task assigned to it by Article 177 of the EEC Treaty.

But it is clear from the grounds of the judgment making the reference that the request in fact relates to the interpretation of the aforementioned regulation. The Tribunal de grande instance, Paris, in fact states as follows:

Under Article 5 (2) (2) of Regulation No 123/85, in certain cases where the dealer has assumed obligations referred to in Article 4 (1), the application of the exemption under Article 85 (3) to the obligations not to sell new motor vehicles other than those within the contract programme or not to conclude distribution or servicing agreements covering those vehicles is subject, inter alia, to the condition that:

Since 1975 relations between VAG France and Etablissements Magne have been governed by agreements concluded each time for a fixed period of one year without the possibility of tacit renewal.

Since it considered that the agreement in force at the time did not conform to new Community rules, VAG France suggested to its dealer, Etablissements Magne, the conclusion of a new contract of indefinite duration. However, having discovered a considerable shortfall in the sales effected by that dealer during the early months of the year, VAG France made its proposal conditional upon the attainment of certain sales targets.

Etablissements Magne refused to sign the new contract since it took the view that Article 5 (2) (2) of Regulation No 123/85 obliged its supplier, VAG France, to transform the existing agreement, without altering its nature, into an agreement for a fixed term of four years and it therefore requested that that amendment should be confirmed by means of a simple addendum. In addition, it contested the right of VAG France to make its agreement dependent upon the said condition that sales targets be attained.

As a result of that difference of opinion all commercial relations between the two parties came to an end and each party wishes to show that the other was responsible for the breach of their agreement. They consider that, in the absence of an amendment to their agreement so as to bring it into conformity with the provisions of Regulation No 123/85 and in the absence of an individual exemption under Regulation No 17 of the Council or of exemption by category granted under Regulation No 19/65/EEC of the Council, Article 85 (2) of the EEC Treaty has the effect of rendering their agreement or, at the very least, those clauses which are incompatible with Article 85 (1) automatically void.

The request for the interpretation of Regulation No 123/85 therefore relates, more precisely, to the effect of the entry into force of that regulation on the validity of exclusive dealership agreements of the type before the Tribunal de grande instance, in particular on clauses dealing with their duration and the duties arising by virtue of its entry into force for the parties thereto.

In order to give the Tribunal de grande instance a helpful reply to the problem with which it is faced, it is necessary to recall first of all the scope of the exemptions by category.

1. As Article 85 (3) of the EEC Treaty expressly provides, the effect of any exemption, whether individual or by category, is to declare inapplicable the provisions of Article 85 (1) in relation to the agreement or category of agreements in question. In other words, the grant of exemption renders valid agreements which, in the absence of such exemption, would in principle be prohibited and therefore automatically void under Article 85 (2).

2. If the national court were to find that the conditions for exemption were not satisfied in this case, what conclusions should it draw with regard to the validity of the agreement?

3. If the national court is finally led to find that the requirements of Article 85 (1) are satisfied, it must be pointed out that the automatic nullity which that involves by virtue of Article 85 (2) only applies to those parts of the agreement affected by the prohibition contained in Article 85(1), or to the agreement as a whole if it appears that those parts are not severable from the agreement itself and that consequently any other contractual provisions which are not affected by the prohibition, and which therefore do not involve the application of the Treaty, fall outside Community law.

4. It follows from the foregoing that it is also for the national court to determine, in accordance with its own national law, the possible consequences of a partial nullity for the other parts of the agreement and, a fortiori, the possible consequences partial or total nullity may have in a general manner with regard to the relations between the parties governed by private law and in particular with regard to their liability on breach of their contractual relations.

5. In the light of all the foregoing considerations I propose that the Court should reply to the question posed by the Tribunal de grande instance, Paris, as follows :

1 Translated from lhe French.

2 Commission Regulation (EEC) No 123/85 of 12 December 1984 on the application of Article 85 (3) of the EEC Treaty to certain categories of motor vehicle distribution and servicing agreements (Official Journal 1985, L 15, p. 16).

3 Regulation No 17 of the Council of 6 February 1962 (Official Journal, English Special Edition 1959-62, p. 87).

4 Regulation No 19/65/EEC of the Council of 2 March 1965 on the application of Article 85 (3) to certain categories of agreements and concerted practices (Official Journal, English Special Edition 1965-66, p. 35)

5 Judgment of 3 February 1976 in Case 63/75 SA Fonderia Rouhaix v Société nouvelle Jes fondenes A. Roux [1976] ECR Ul, in particular paragraph 11.

6 Case 1/70 Parfums Marcel Rochas Vertrieks-CmbH \Bitsch [1970] ECR 515.

7 Case 32/65 Italy v Council and Commission [1966] ECR 389.

8 Judgment of 11 December 1980 in Case 31/80 L'Oréal v De Nieuwe AMCK [1980] ECR 3775, in particular paragraph 13.

9 Judgment of 6 February 1973 in Case 48/72 Brasane de Haecht v Wilkin-Janssen [1973] ECR 77, in particular paragraph 12 of the grounds of judgment.

10 Commission Regulation (EEC) No 1983/83 of 22 June 1983 on the application of Article 85 (3) of the Treaty to categories of exclusive distribution agreements (Official Journal 1983, L 173, p. 1).

11 Commission Regulation (EEC) No 1984/83 of 22 June 1983 on the application of Article 85 (3) of the Treaty to categories of exclusive distribution agreements (Official Journal L 173, p. 5).

12 Judgment of 30 June 1966 in Case 56/65 Soditi technique mimen v Maschinenbau Ulm [1966] ECR 235, especially at p. 250.

13 Judgment of 13 Juhi 1966 Établissements Consten and Grundig-Veriaufi-GmbHv Commission [1966] ECR 299.

14 Judgment of 14 December 1983 in Case 319/82 Société de vente de amenti et bétons de l'Est v Kerpen & Kerpen [1983] ECR 4173.

15 First régulation implementing Council Regulation No 17 (Official Journal, English Special Edition 1959-62, p. 132).