A German Court finds an exclusive purchase obligation in breach of Art. 81 EC and replaces a void non-compete obligation in a franchise agreement (The Body Shop)

Background The cosmetics chain The Body Shop (TBS) employs two different types of distribution channels in Germany: On the one hand, it holds a number of proprietary retail outlets and, on the other hand, it distributes its products through a franchise system. Under the franchise system the franchisee (and later claimant) was under the obligation to purchase its entire demand of the contract articles (make-up, shampoos, body lotions, accessories etc.) from TBS and not to sell competing products. The contract had been entered into in 2003 for a duration of seven years. Under a previous contract (1992-2003) the franchisee had been allowed to purchase 35% of its supplies from third parties. Judgement The Higher Regional Court of Düsseldorf (Oberlandesgericht Düsseldorf) found the

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  • Blomstein (Berlin)

Quotation

Max Klasse, A German Court finds an exclusive purchase obligation in breach of Art. 81 EC and replaces a void non-compete obligation in a franchise agreement (The Body Shop), 14 April 2007, e-Competitions Bulletin April 2007, Art. N° 13965

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