C-250/92

OPINION OF MR TESAURO — CASE C-250/92

OPINION OF ADVOCATE GENERAL TESAURO delivered on 16 Tune 1994 *

Mr President, initiatives taken by competitors not in the Members of the Court, form of cooperatives; in addition, the range of services provided by D L G to its own members gradually widened; at present, as well as supplying various basic products (animal feeds, cereals, fertilizers, pesticides, seeds, and so forth) it provides a wide range of ancillary services: processing and market- 1. Is a clause in the statutes of a cooperative ing of certain agricultural products (cereals), association set up to purchase agricultural financial and insurance services; and research products, under which the association may concerning animal feeds and the quality and expel members who become members of hardiness of vegetable species. competing organizations, compatible with the Treaty competition rules? That, essen- tially, is the issue in these proceedings.

The facts At present DLG's members fall into four categories:

2. Dansk Landbrugs Growareselskab A m b A (hereinafter 'DLG') is a Danish cooperative operating in the agricultural sec- tor. Established in 1969 following the merger — 'A' members: individual farmers (about of three separate agricultural associations, 21 000); D L G initially confined itself to distributing basic products for agriculture to local associ- ations (also cooperatives) which, in turn, resold products to individual farmers. Over the years, D L G progressively diversified its business: its commercial activity expanded to include retailing, partly in response to similar — 'B' members: local farmers' associations (until 1988, that is to say until the con- tested amendments to the statutes, the * Original language: Italian. local associations belonging to D L G

3. The Landsforeningen af Andels Grov- vareforening (National Union of coopera- tives specializing in the distribution of basic products for agriculture, whose name has been, since 1991, 'Landsforeningen af locale andel', hereinafter 'the Landsforeningen'), set up in 1975 by a number of B members of A situation thus came into being in which DLG, is a national association of local farm- interests diverged considerably within the ers' cooperatives specializing in the distribu- Danish agricultural cooperative sector: on tion of basic products for agriculture. the one hand, D L G manifested a tendency towards total integration of the distribution process through the direct takeover of the local associations; on the other, a substantial number of local associations, now large enough to operate independendy in the mar- kets, sought to retain their commercial inde- 4. For a better understanding of the reasons pendence whilst continuing to be B members for the setting up of the Landsforeningen of DLG. and of the events which gave rise to the present proceedings, it is appropriate to out- line certain changes in the structure of the Danish cooperative system. In the 1970s, two trends emerged. O n the one hand, some of the local farmers' associations, already B members of DLG, allowed themselves to be taken over by the cooperative. The number In 1975 (when the obligation of B members of local associations thus progressively to obtain their supplies exclusively from

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— members whose circumstances, after the The national competition authorities — the entry into force of the abovementioned Danish Monopolies Inspectorate (Monopltil- provisions (1 January 1989), did not con- synet) and the Danish Monopolies Board form with the statutes could be expelled (Monopolrad) — did not consider that any from D L G by resolution of its governing national competition rules had been board; infringed, although they observed that the amendments concerned might have an impact on competition between D L G and other independent traders, such as the Landsforeningen, and reserved the right to monitor developments in the markets con- cerned. It should also be noted that after — B and D members would retain the right 31 December 1989, following an amendment to buy fertilizers and pesticides outside to the national legislation, D L G ceased to be DLG, provided, however, that the pur- registered as an undertaking holding a dom- chases were direct and were not made inant position within the meaning and for through organizations competing with the purposes of the Danish anti-monopoly DLG. rules.

At the same time, changes were also made to 9. In March 1989, shortly after D L G was the provisions concerning the right of with- informed of the decisions taken b y the drawal: that right may now be exercised national competition authorities, 37 local every five years rather than every ten. associations (out of 50) — B members of DLG, who had refused to comply with the new requirements of the statutes and had not exercised the right to withdraw — were expelled from DLG.

(1) Whether the exception to the general conditions of competition envisaged in Article 2 of Regulation N o 26/62 x applies to pesticides, in view of the fact that they are covered by Directive (d) the expelled B members were in a 91/414/EEC; 2 position to continue their business in the fertilizers and pesticides sec- tor and, in 1990, achieved an overall share of the Danish market in basic products similar to that of DLG; (2) Whether the amendments to the statutes of D L G described above constitute a

1 — Regulation N o 26/62 of the Council applying certain rules of competition to production of and trade in agricultural prod- ucts (OJ, English Special Edition 1959-1962, p. 129). (e) in the main proceedings, the plain- 2 — Council Directive of 15 July 1991 concerning the placing tiffs maintain inter alia that they are of plant protection products on the market (OJ 1991 L 230, p. 1). entided to a share of the pooled

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assets of DLG, but do not seek to represent about 15% of D L G ' s total resume membership of DLG; turnover;

(1) factual information was, or was not, (h) the amendments to the statutes at placed before the national court issue allow B members to buy fertil- relating in particular to the existence izers and pesticides either on their and sales of substitute products and own behalf or as a purchasing con- the turnover and market shares of sortium formed specifically for each D L G , the Landsforeningen and consignment of goods purchased; competing traders.

As regards the distribution of pesticides, all that is known is that in 1988 D L G held a share of about 32%. 11. It must be emphasized that nowhere in the order for reference or in the other docu- ments before the Court is a clear and com- plete picture given of the situation prevailing in the markets in question. For the purposes of the present analysis — subject to the fur- ther findings incumbent on the national Finally, it should be borne in mind that by court — reference will be made here only to 1990 the Landsforeningen had succeeded in the following matters. achieving, in the distribution of basic prod- ucts for agriculture, a share essentially equal to that of DLG.

The marketing of fertilizers and pesticides accounts for around 15% of the total turn- over of D L G and the Landsforeningen. (1) Do fertilizers and pesticides come within the scope of the derogation provided for in Regulation No 26/62?

At the time of the amendments to the stat- utes (1988), D L G had a market share in the distribution of fertilizers of around 36%. The Landsforeningen had a share of about 12. Pursuant to Article 42 of the Treaty, the 10%. For the rest, the market was divided provisions of the chapter relating to rules on

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The regulation therefore applies only to the products mentioned in Annex II, and 4 — See the judgment in Case 131/86 United Kingdom v Council [1988] ECR 905, in which the Court held that Council Directive 86/113, which governed the dimensions of and other requirements for the cages of layer hens (something 3 — Judgment in Case 61/80 Coöperatieve Stremsel- en Kleursfab- clearly not included in Annex II), could be applied to the riek v Commission [1981] ECR 851. sphere of competition mentioned in Article 43.

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tion. In particular, it is apparent from that case-law and practice that collective purchas ing organizations conform with the competi tion rules, and are thus not caught by Article 85(1), only if their members are guaranteed total freedom of commercial action; 5 a lim 13. The compatibility of the contested ited restriction of that freedom, by consent, clauses with Article 85(1) is, as stated, the may qualify for an exemption under Article central issue in these proceedings.

The fact that a member who buys outside the cooperative, becoming involved with organizations com peting with that cooperative, may be expelled for that specific reason is therefore to be regarded as a logical reaction by t h e association to conduct which is liable to undermine its financial standing and com mercial efficiency, and therefore falls entirely outside the scope of Article 85(1). 5 — See for example the SOCEMAS decision of 17 July 1968 {Journal Officiel 1968 L 201, p. 4) and the Intergroup decision of 14 July 1975 (OJ 1975 L 212, p. 23). 6 — See in particular the National Sulphuric Acid Association decision of 9 July 1980 (OJ 1980 L 260, p. 24), in which the Commission granted an exemption to a consortium for the purchase of sulphur, made up of the main United Kingdom producers of sulphuric acid (the consortium was non-profit- making and withdrawal was possible each year), after assess ing the impact on the various markets concerned and taking account of the fact that the members of the consortium had signed an exclusive purchasing commitment in respect of The plaintiffs in the main proceedings sub only 2 5 % of their requirements. mit, on the other hand, that the contested 7 — See the Coöperatieve Stremsel decision of 5 December 1979 (OJ 1979 L 51, p. 19), confirmed by the Court in the clauses involve a significant and arbitrary judgment of the same name, cited above, and the Hudson's Bay decision of 28 October 1988 (OJ 1988 L 316, p. 43), limitation of the members' freedom of com confirmed by the Court of First Instance judgment in Case mercial activity. That restriction, transpar T-61/89 Dansk PeUdyravlerįoreninį [1992] ECR II-1931. Both cases were concerned with 'loyalty' commitments given ently intended, they maintain, to consolidate by the members of agricultural cooperatives.

— the guiding criteria laid down by the Court regarding the application of Arti- cle 85(1);

Let me say straight away that according to administrative practice and the case-law, of which the plaintiffs give a clear and complete summary, it appears, at least on a first read- ing, that the second interest prevails over the — the compatibility of an agricultural pur- first. Nevertheless, on closer examination, it chasing cooperative such as D L G with seems that a different conclusion is called for. the requirements of protection of compe- In my opinion, in fact, it can be contended tition;

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— the reasons for which the contested requirements and attainment of the objec- clauses are not anti-competitive in intent tives of the Treaty and — in particular — the for the purposes of Article 85(1); creation of a single market achieving condi- tions similar to those of a domestic market; that requirement means that the nature and intensity of competition may vary according to the products or services concerned and the economic structure of the relevant mar- — the circumstances in which the contested ket sectors. 8 clauses might have anti-competitive effects within the meaning of Article 85(1).

16. Furthermore, according to settled case- law, in order to establish whether a particular The guiding criteria laid down by the Court agreement is caught by the prohibition laid regarding the application of Anicie 85(1) down by Article 85(1), it is necessary to carry out a two-stage examination. 9

Where the object is not anti-competitive, the Conversely, agreements capable of perform- analysis must proceed to the second phase, ing a more complex function will not be regarding the impact which the agreement is regarded as having an anti-competitive specifically likely to have on competition. In object. That applies to clauses which form an such circumstances, the agreement will be integral part of a contract and in that way considered prohibited if it appears likely to contribute to defining the basis and the bal- restrict competition appreciably.12 It should ance of the legal relations between the par- also be borne in mind that the general crite- ties. Indeed, according to a fairly well- rion for deciding whether an agreement has defined trend in the case-law, in order to the object or effect of restricting competition establish whether a particular clause is anti- is how competition would have operated in competitive in intent, for the purposes of the market in question in the absence of that Article 85(1), it is necessary to look at its agreement. 13 function in the context of the contractual relationship of which it forms part. Against that background, the Court normally con- cludes that no anti-competitive object is con- tained in clauses which are found in the abstract to be necessary to ensure that a con- tract, which is not in itself harmful to com- petition, can fully discharge the legal and economic function which it pursues. For example, the Court has held that Article 85(1) is not contravened by the following, by virtue of their object (provided of course that, in certain circumstances, they do not engender anti-competitive effects):

— an exclusive-supply clause and a non- in the common market. There is nothing competition clause included in a franchis- therefore to prevent an agreement which is ing contract, in that they were necessary not anti-competitive in intent from being to ensure that that contract could dis- regarded, in a particular market situation, as charge its typical function; 15 incompatible with the common market, whereas the same agreement, in a different market situation, will be regarded as con- forming to the requirements of the protec- tion of competition. For the purposes of such an analysis, account must be taken in — a no-challenge clause in a patent-licence particular , 8 of the level of competition, agreement (granting a free licence) since actual and potential, existing in the relevant — as was made clear in the Advocate market or markets, regardless of any intent, General's Opinion — it was 'crucial for and it must be decided whether or not the the equilibrium of an agreement which agreement contributes significantly to a fur- has neither as its object nor as its effect ther restriction of competition in that mar- the prevention, restriction or distortion ket. of competition'; ' 6

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specific market context in which it is to in an organized way by buying from external operate, appreciably to affect competition in agencies competing with the cooperative. 21 the common market.

Finally, it should be borne in mind that any restrictions of competition deriving from the provisions governing relations between a cooperative and its members are subject to the rules of Article 85 et seq. 20 18. That said, it must also be observed that the setting up of a purchasing cooperative such as D L G brings into play a form of cooperation between undertakings (or asso- ciations of undertakings) which meets typical requirements of the agricultural sector and, The compatibility of an agricultural purchas- for that reason, is looked on favourably both ing cooperative such as D L G with the by national legislation and by the Commu- requirements of protection of competition nity authorities. Such cooperation in pur- chasing promotes the efficiency of undertak- ings and, as a result, workable competition

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between them of the kind referred to in the products might give rise, in this sector, to Metro judgment. any real restriction of competition as between the members of the cooperative. As stated, the fertilizers and pesticides market is dominated, at world level, by a small circle of producers, compared with which individ- ual farmers, and even local associations of farmers, are in an inherently weak contrac- tual position. It follows that, if there were no A cooperative, in fact, by making collective purchasing cooperatives of a substantial size, purchases of basic agricultural products can, like DLG, farmers and local associations, particularly in certain sectors, counterbalance would be in the position of having to accept the contractual strength of producers and the decisions of the producers or indepen- suppliers. That applies especially to sectors, dent commercial distributors; without the such as that of fertilizers and pesticides, in intermediate role of the cooperative, there- which production is concentrated at world fore, they would have to tolerate prices level in the hands of a relatively small num- which on average would be higher, whilst at ber of undertakings and in which it is an the same time not having any real opportu- established fact that selling prices may vary nity to obtain more competitive supplies of considerably according to the volumes of the products in question. products ordered. In such circumstances, the establishment of a purchasing cooperative is the natural response to the contractual strength of suppliers, whereby the terms of trade are improved in favour of the buyers.

19. It must next be emphasized that, in an agricultural purchasing cooperative, the inclusion in the statutes of clauses providing From that point of view, therefore, the for the expulsion of members who make clauses at issue are designed solely to ensure purchases outside the cooperative, in compe- that the association is able to keep as wide a tition with it, is in principle consistent with commercial base as possible and thereby pur- the requirement of ensuring that the associa- sue the communal objectives for which it tion functions properly. was set up. Accordingly, they are simply intended to ensure that a member cannot, at one and the same time, both be a member of the cooperative, enjoying the benefits which he considers most advantageous, and yet engage in conduct (making independent pur- chases) which clearly conflicts with the very The aim of cooperating in buying, giving aim (collective purchases) for which the members an opportunity to benefit, regard- cooperative was established. less of their capital contribution, from the lower supply costs, is likely to be under- mined if individuals operate on their own account outside, and in competition with, the cooperative. Above all, such conduct weakens the financial structure of the associ- ation, since the cooperative does business solely or mainly with its members, not with third parties, which means that its volume of It must therefore be concluded that the business depends on the number of transac- clauses at issue, providing for expulsion of tions between the association and its mem- any member who joins an organization com- bers and, therefore, on the greater or lesser peting with the cooperative, although, of 'loyalty' of the members to the cooperative. course, limiting the member's freedom of Furthermore, such conduct, by eroding the action, constitute a normal way of obtaining cooperative's commercial base, detracts from protection, through the statutes, against situ- the terms of trade available to it in the mar- ations in which there is a conflict of interest ketplace, so that, particularly in the case of and are not therefore anti-competitive in products whose prices vary greatly according intent for the purposes of Article 85(1). That, to the size of the orders placed, higher costs moreover, is the reason for which expulsion have to be borne by the cooperative and, clauses of that kind, or other stipulations consequently, by those of its members who (non-competition or exclusive-supply continue to obtain their supplies from it. clauses) intended to secure the 'loyalty' of There is thus a clear conflict between members, are normally included in the

20. In any case, any other approach would The factual and legal circumstances in which lead to patently absurd results. If it were the clauses at issue could produce anti- acknowledged that the clauses at issue had an competitive effects anti-competitive object, then it would neces- sarily have to be inferred that each member enjoys, under Article 85(1), the right not to be expelled from the purchasing cooperative, even though at the same time being involved in competing purchasing organizations, 21. That having been established, it must which is tantamount to saying that the mem- next be considered whether the contested ber enjoys a genuine right to retain member- clauses have anti-competitive effects which ship despite engaging in conduct prejudicial are incompatible with the common market, to the interests of the association and of the as a result of certain specific legal and factual other members. In other words, Article 85(1) circumstances. would guarantee almost absolute protection (except where the conditions were met for an exemption under Article 85(3)) for members' freedom of commercial action, to the detri- ment of the proper functioning of the asso- ciation. That interpretation, of course, puts 22. In that regard, the first issue is whether the interests of the individual member before the members of the cooperative are able to withdraw from it at reasonable intervals. If that were not the case, they would be con- strained to remain in the cooperative for 22 — This solution also seems to me to be in conformity with the direction taken by the Commission in its recent Notice very long periods of time and, throughout concerning the assessment of cooperative joint ventures their membership, would be unable to pursuant to Article 85 of the Treaty (OJ 1993 C-43, p. 2). Since, in my opinion, a joint venture can also take the form approach competing traders or set up com- of a cooperative whose members are undertakings or asso- ciations of undertakings ('the assessment of cooperative peting organizations. That twofold bond (the joint ventures pursuant to Article 85(1) and (3) does not excessive duration of membership and the depend on the legal form which the parents choose for their cooperation'), it must be observed that, according to the obligation of 'loyalty' to the cooperative Commission, it is not impossible that, at least in certain cir- cumstances (those described in paragraph 17 of this Opin- throughout it) would have the effect of ion might be an example), a buyers' joint venture compris- ing compering undertakings might fall outside the scope of depriving members of any real freedom of Article 85(1) (see in particular paragraph 39 of the Notice). action, with the knock-on effect of prevent- In such a case, a clause of the kind at issue would have to be described as a mere 'ancillary restraint', in other words as a ing third parties from developing effective restriction 'direcdy related to and necessary for the ... oper- ation of the joint venture' (see paragraph 65 of the Nonce), competition against the cooperative. In order and as such not subject to Article 85(1). to avoid excessive inflexibility of the

23. Secondly, it is necessary to establish that In the present case, I consider it significant the competitive relationships (both actual that DLG, when deciding to insert the con- and potential) between the cooperative and tested clauses in the statutes, also decided to third parties are not, on the other hand, reduce the membership period from ten to excessively rarefied. The clauses in question, five years. The five-year period, which coin- as stated, restrict members' freedom of cides with the maximum period provided action, dissuading them from approaching or for in Commission Regulation N o 1984/83 joining competing organizations. However, for exclusive-supply contracts, should be in a situation in which competition is, for regarded as appropriate, under normal mar- other reasons, already very limited, such ket conditions, for the purpose of reconcil- clauses, which are intended to ensure mem- ing, on the one hand, the requirements of bers' 'loyalty' to the cooperative, could have protection of competition and, on the other, the side-effect of preventing third parties the association's need to guarantee adequate from entering the market or at least from stability for itself and continuity of member- competing effectively in it. ship.

the established traders enjoy considerable market and, therefore, the clauses at issue customer loyalty), the entry of new eco- contributed to the maintenance of that posi- nomic agents into the market in question tion of strength, hampering access by com- would be difficult. In such a situation, to fur- peting third parties. 26 ther strengthen the existing bonds between the cooperative and its members (who are also its trading partners) is likely to deprive competitors (actual and potential) of the pos- sibility of finding sufficient commercial out-

I consider, however, that the Court's dicta must necessarily be 'toned down', in other words, they must be essentially understood in relation to the particular market situation prevailing in that case. O t h - erwise, the repercussions would be excessive and difficult to justify. If one starts from the premise that exclusivity clauses or other 'loyalty' clauses contained in the statutes of an agricultural cooperative are, in principle, by reason of their very object, incompatible with Article 85(1), then it follows-again in principfe-that an agricultural cooperative has no opportunity to protect itself against situations in Furthermore, that seems to me, on close which its members conduct themselves in the market in a way which clearly conflicts with the interests of the coop- examination, to be the ratio decidendi of the erative and the other members. In my opinion, on the other hand, the opposite view is the correct one: if the setting up judgments in which the Court of Justice and of the cooperative is in itself in conformity with the protec- Court of First Instance have held to be tion of competition and with other principles laid down in the relevant legislation, the cooperative should also be given incompatible with Article 85(1), certain the freedom to adopt such measures as it considers appro- priate for the protection of its essential interests; Article clauses in the statutes of agricultural cooper- 85(1 ) cannot therefore be interpreted as providing absolute protection for the freedom of commercial action of mem- atives which, although in different forms, bers, to the detriment of the interests of the cooperative and were also intended to secure the total 'loyal- of the other members.

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A similar conclusion would of course have already present in the market, which to be arrived at if the market situation were already acted as commercial intermediar- such as to give the cooperative a dominant ies for the products in question and position within the meaning of Article 86; in therefore already had a large part of the such circumstances, according to the case- infrastructure at their disposal as well as law of the Court, the immediate conclusion the necessary capability to bring a com- would have to be that the 'loyalty' clause peting business into being. was in conformity with the requirements of that provision. 27

That objection seems to me to have no basis. 27 — Judgments in Case 85/76 Hoffmann-La Roche [1979] ECR In the first place, it is normal for departure 461, Case C-62/86 AKZO [1993] 1-3359 and Case T-65/89 BPB [1993] ECR II-389. from a cooperative, for any reason, to entail

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the loss of the (greater or lesser) advantages other form of 'loyalty' clause) would have to deriving from membership. Such a situation, be regarded as prohibited, and void, for the being entirely normal, is not in any respect reasons set out in paragraph 24 of this Opin- caught by Article 85(1). As already empha- ion; (ii) any boycott or discriminatory mea- sized, that provision cannot be interpreted as sures taken by the cooperative against mem- granting the members of a cooperative the bers (refusal to supply goods or services to right to remain members and retain the ben- expelled members or the charging of exces- efits of membership whilst at the same time sive prices for the goods or services pro- acting against the interests of the cooperative vided) could amount to distinct and indepen- and of the other members. It is therefore dent abuses within the meaning of Article 86. incumbent on members to choose, after freely weighing up their interests, whether to withdraw from the association (or take action to bring about their expulsion) or to remain within it and comply with its stat- utes: once that choice has been freely exer- cised, the member cannot complain of any disadvantages arising from his decision.

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ing to supply, also to non-members, the intermediary and was fully capable of com- goods and services in which it deals, even peting with DLG. 28 though, as is right and proper, that would be on an arm's-length basis and not under the obviously more favourable conditions reserved for members.

29. For the sake of completeness, it should also be borne in mind that some of the cir- cumstances to which the national court drew attention in the preliminary questions also indicate that D L G has limited the scope of 28. In conclusion, it may be stated, on the the contested clauses — and therefore the basis of the information before the Court rigor of the 'loyalty' requirement — to what and subject to the findings which it is incum- is strictly necessary to guarantee protection bent on the national court to make, that it for the cooperative in situations where con- appears that the members of D L G enjoy the flicts of interest might arise. In outline, the right to withdraw from it at reasonable inter- points mentioned are as follows: vals, that the structure and characteristics of the market are not such as to give the impression that the introduction of the con- tested clauses carried with it a real risk of restriction of competition, actual or poten- tial, between D L G and third parties and that, — the contested clauses relate solely to fer- consequently, those clauses do not have a tilizers and pesticides (and not the other restrictive effect on competition within the goods and services provided by DLG), in meaning of Article 85(1). other words the only products for which, in view of price elasticity, a reduction in orders by the cooperative, provoked b y

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the independent purchases made by the in which case D L G waives any charge for Landsforeningen, was liable significantly acting as intermediary and the members to detract from the terms of the transac- who took that course lose the right to tion; receive equalization payments at the year end in respect of the goods acquired in that way.

— the contested clauses relate solely to pur- chases made by B and D members (not by the other members), in other words only those members who, by reason of O n the other hand, I do not consider to be their commercial importance, are in a relevant the other matters mentioned by the position to undermine the interests of the national court, namely: cooperative by operating in competition with it;

— the fact that the contested clauses were introduced inter alia for the purpose of ensuring that the management of D L G — the contested clauses relate only to pur- did not include B or D members involved chases made by B and D members on an with competing organizations, since organized basis, that is to say through DLG's business secrets could in any permanent membership of associations or event have been protected by laying other competing organizations, and not down specific grounds disqualifying per- purchases made, outside the cooperative, sons whose interests conflicted with either by individual B or D members or those of the association from manage- by consortia of B or D members estab- ment appointments; lished on an ad hoc basis for a single transaction; in that respect also, it is clear that the cooperative intended only to protect itself against situations which might be particularly harmful to it;

— the fact that the expelled members are placed on the same footing as members who have exercised their right of with- drawal, since, once it is established that the expulsion clause is not in breach of 30. Having regard to the foregoing consider- Article 85(1), there is nothing to prevent ations, it would be poindess to consider the association from applying not the whether the contested clauses are liable to more favourable rules applicable to with- affect trade between Member States. How- drawal but the rules normally applied ever, for the sake of completeness, it is worth upon the expulsion of members, includ- noting in the present case that the products ing any penalties, subject only to the lim- at issue are certainly the subject of intra- itation (discussed in paragraph 21) that Community trade and that, in particular, clearly excessive and disproportionate both D L G and the Landsforeningen have penalties must not be imposed; been and are involved in that trade. In those circumstances, there is no doubt that in the present case the requirement of an adverse effect on intra-Community trade may be considered satisfied.

— the fact that, in the main proceedings, the plaintiffs claimed inter alia that they were (4) Does the national court have jurisdiction entitled to a share of the pooled assets of to apply Article 85(3) of the Treaty where DLG, without however asking to be the agreement has been notified to the readmitted to membership of DLG, Commission with a view to obtaining a since, regardless of the terms in which the negative clearance or an exemption? claim asserted in the national court is for- mulated, the fact remains that the plain- tiffs argued that the contested clauses of the statutes were incompatible with Arti- cle 85(1), and since, in the event of the Court's confirming that incompatibility, it would be incumbent on the national 31. In that regard, suffice it to note that, pur- court to declare those clauses void under suant to Article 9(1) of Regulation N o 17 of

It is incumbent on the national court to apply those criteria in the case before it. It should also be made clear that in this case 32. As the Court has consistently held, 31 the the information in the documents before the dominant position envisaged in Article 86 of Court, relating in particular to: the Treaty consists in a position of economic strength enjoyed by an undertaking which enables it to prevent effective competition being maintained on the market by giving it the power to behave to an appreciable extent independently of its competitors, its custom- ers and consumers. The existence of such a position may derive from a combination of — DLG's small market share at the material several factors which, taken separately, are time,

29 — OJ, English Special Edition 1959-1962, p. 87. 32 — See the judgment in Case 27/76 United Brands [1978] ECR 30 — See also the judgment in Delimiti?, cited above, paragraph 207. 43 et seq. 33 — Judgments in Hoffmann-La Roche and United Brands, 31 — See, recendy, the judgment in Case T-30/89 Hilti [1991] both cited above. ECR II-1439. 34 — Judgment in Hoffmann-La Roche, cited above.

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— the substantial balance between the mar- — and the evolution of the respective mar- ket shares of DLG and those of its com- ket shares of DLG and the Landsforenin- petitors, gen,

indicate that DLG did not hold a dominant position within the meaning of Article 86. A — the Landsforeningens considerable further, albeit not decisive, point in that con- capacity to compete, together with the nection is the fact that, in 1990, DLG was great potential for competition because of removed from the register of dominant the lack of any significant barriers to undertakings provided for by Danish legisla- access, tion.

OPINION OF MR TESAURO — CASE C-250/92

(4) The Commission has sole power to grant exemptions under Article 85(3). However, the national court has jurisdiction to apply Articles 85(1) and (2) and 86 of the Treaty.

(5) Subject to the findings falling to be made by the national court in accordance with the criteria laid down in the Opinion, the documents before the Court disclose nothing to indicate that the D L G cooperative holds a dominant posi- tion within the meaning of Article 86 of the Treaty.

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