Court of Justice 16 December 1997, C-230/96 (Cabour SA and Nord Distribution Automobile SA v Arnor "SOCO" SARL, supported by Automobiles Peugeot SA and Automobiles Citroën SA.)

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Advocate General Tesauro opined in Case C-230/96 that, under Regulation (EEC) No 123/85 and Regulation (EC) No 1475/95, the block exemption does not cover contractual clauses that absolutely prohibit a dealer from selling vehicles of other makes even on separate commercial premises, nor clauses permitting the supplier unilaterally to fix sales targets without provision for third-party dispute resolution. The Advocate General further opined that contractual clauses falling outside the block exemption are not automatically prohibited under Article 85(1) EC Treaty, but must be assessed individually for their restrictive object or effect on competition and capacity to affect inter-Member State trade, with any resulting nullity under Article 85(2) potentially extending to the entire dealership agreement if the offending clauses are inseverable from the exempted provisions. The questions referred by the Cour d'appel de Douai were held to be admissible and relevant, as a finding of nullity under Article 85(2) would deprive the authorised dealers' unfair competition action of its legal foundation under applicable French law.AI