Societe Technique Minière v Maschinenbau Ulm (1966)

Contract of exclusive distribution without absolute
territorial protection.
STM had exclusive right to sell in France equipment
produced by MBU, a German company.
However contract did not insulate French territory.
STM could sell the goods outside France, and parallel
imports could be obtained from other countries.
Contract dispute led STM to argue contract invalid
under Article 85.
Three main points from judgment:
1.  ECJ accepted
words of Article 85 (now 81) were to be read disjunctively, ie if object of agreement was
anti-competitive, could be condemned without further inquiry into effect.
2.  ECJ doubted
there will be interference with competition if agreement seems necessary for
penetration of new area by an undertaking.
3.  To
decide whether exclusive right of sale agreement is prohibited due to object or
effect, must take into account:
– Nature and quantity of products covered by agreement
– Position and importance of parties in relevant market
– Whether agreement isolated or part of series
– Opportunities, if any, for competitors by way of
parallel re-exportation and importation