Competition Authority Notification No: CA/82/92E: Rover Ireland Ltd

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COMPETITION AUTHORITY

Decision No. 532

Competition Authority Decision of 15 December 1998 relating to a proceeding under Section 4 of the Competition Act, 1991.

Notification No CA/82/92E - Rover Ireland I Motor Vehicle Loan Agreement

Abstract:

Section 4 of Competition Act 1991 — Motor vehicle loan agreement — Request for licence under section 4(2) of the Act — Agreement between Rover Ireland Ltd, Rover Ireland Finance Ltd and a distributor — Loan for purchase of vehicles by distributor from Rover Ireland — Vehicles were security for the loan — Rover Ireland was subsidiary of British Aerospace Plc — Rover Ireland Finance assisted distributors of Rover Ireland financing the purchase of motor vehicles — Shareholding of Rover Ireland Finance held by Barclays Bank (Ireland) Ltd (75.6%) and Rover Ireland (24.4%) — Market for products notified was market for the financing of motor vehicles — Standard agreement — Loan advanced by Rover Ireland Finance to distributor — Loan secured by taking interest in vehicles purchased by distributor — Agreement contained no restrictions on the operations of the distributor other than those necessary to protect the security interest of Rover Ireland Finance — Distributor not restricted in dealing with other suppliers or in marketing of vehicles.

Introduction

1 Notification was made of a standard loan agreement between Rover Ireland Ltd. (“RI”), Rover Ireland Finance Ltd. (“RIF”) and a distributor on 17 September 1992. RI requests a licence under Section 4(2) of the Competition Act.

1. (a) The Subject of the Notification

   2. This notification concerns an agreement between RIF and a distributor for a loan for the purchase of vehicles by the distributor from RI. The vehicles are security for the loan.

2. (b)The Parties Involved

   3. RI is a company incorporated in the State. It is a subsidiary of British Aerospace PLC a LFK registered company engaged in the manufacture and marketing of aircraft, equipment and motor vehicles. RI is engaged in the marketing of motor vehicles, spare parts and after-sales service in the State.

   4. RIF is a company incorporated in the State engaged in the business of assisting distributors of RI financing the purchase of motor vehicles. The shareholding of RIF is held by RI (24.4%) and Barclays Bank (Ireland) Ltd(75.6%).

   5. The distributor is a...