Competition Authority Notification No: CA/625/92E and CA/626/92E: Gowan Distributors Ltd

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COMPETITION AUTHORITY

Decision No. 531

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

Notification No CA1625192E and CA/626/92E - Gowan Distributors Ltd/Motor Vehicle Loan Agreement and Mortgage.

Abstract:

Notification under section 4 of the Competition Act 1991 — Standard loan agreement and mortgage between Gowan and distributor — Gowan was importer of Peugeot motor vehicles, spare parts and after—sales service in State — Distributor was distributor of Peugeot motor vehicles in State under agreement with Gowan — Certificate under section 4(4) of Act requested by Gowan — In the event of a refusal by Authority a licence under section 4(2) requested — Market for the products notified was the market for the financing of motor vehicles and the business of motor vehicle distribution — Under agreement Gowan advanced loan to distributor and secured the loan by mortgage — Loan only advanced to distributors who had entered into a separate motor vehicle distribution agreement with Gowan — Finance improvements in premises from which vehicles were sold under terms of that agreement — Monies advanced become outstanding should distributor terminate distribution agreement with Gowan.

Introduction

1 Notification was made of a standard loan agreement (CAJ62S/92E) and mortgage (CA1626/92E) between Gowan Distributors Ltd. (“Gowan”) and a distributor on 30 September 1992. Gowan requests a certificate under Section 4(4) of the Competition Act, 1991 or, in the event of a refusal by the Competition Authority to issue a certificate, a licence under Section 4(2).

1. (a) The Subject of the Notification

   2. This notification concerns an agreement between Gowan and a distributor for a loan and mortgage for the purchase of Peugeot motor vehicles by the distributor. The mortgage is security for the loan.

2. (b) The Parties Involved

   3. Gowan is a company incorporated in, the State. It is the importer of Peugeot motor vehicles, spare parts and after-sales service in the State.

   4. The distributor is a distributor of Peugeot motor vehicles who operates in the State under a motor vehicle distribution agreement with Gowan.

3. (c)The Product and the Market

   5. The market for the products notified here is the market for the financing of...