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

• Court: Competition Authority
• Docket Number: Decision No. 532
• Judgment Date: 15 Jan 1998
• Jurisdiction: Ireland

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.

The notified agreement did not prevent, restrict or distort competition and therefore did not contravene section 4(1) of the Competition Act 1991. The Competition Authority so decided.

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 distributor of RI motor vehicles who operates in the State under a RI motor vehicle distribution agreement.

3. (c)The Product and the Market

   6. The...