On 1 October 2014, the Court of Appeal of Ghent handed down its judgment upholding the Commercial Court of Dendermonde's decision of 3 November 2010 to the extent it found Ducati North Europe BV ("Ducati") to have abused its dominant position on the Belgian market for after-sales services for Ducati motorcycles. Ducati was found to have abused its dominant position by preventing one of its former authorised dealers and repairers, DD Bikes, from directly obtaining from Ducati, under the same conditions as Ducati dealers, the parts, equipment, technical information, software and tools necessary to repair Ducati motorcycles.
By way of background, in October 2007, Ducati terminated the contract granting DD Bikes the status of authorised dealer and repairer of Ducati motorcycles. Nevertheless, DD Bikes requested to remain as an authorised repairer so as to keep the right to use the official Ducati logo, to order components and spare parts under the same conditions as other authorised repairers and to carry out repairs covered by the two-year warranty applicable to Ducati motorcycles. However, Ducati refused to grant such status, arguing that only authorised Ducati dealers would be admitted as authorised repairers. As a result, DD Bikes filed a complaint for unfair commercial practices before the Commercial Court of Dendermonde.
In its November 2010 judgment, the Commercial Court first established that the repair of Ducati motorcycles was not part of the same market as the sale of Ducati motorcycles and that, unlike the market for the sale of motorcycles, the repair market was brand-specific. The Court also found the brand-specific market for after-sales services to be national in scope.
The Commercial Court then noted that Ducati's distribution system could not benefit from the Vertical Agreements Block Exemption (as Ducati's market share in the after-sales market exceeded 30%) or from an individual exemption under Article 101(3) TFEU. According to the Commercial Court, Ducati unnecessarily forced repairers to also be dealers in order to be considered as authorised Ducati repairers. Ducati also foreclosed competition from repairers that were not authorised dealers, notably by refusing to apply the two-year warranty on motorcycles repaired by repairers that were not Ducati dealers and by limiting access to technical information, specialised tools, parts and accessories to authorised dealers (independent repairers could only purchase parts and accessories from competing authorised dealers/repairers at a higher price). As a result, the Commercial Court found this system to constitute an anticompetitive agreement prohibited by Article 101 TFEU and Article IV.1 of the Belgian Commercial Code.
In addition, the Commercial Court of Dendermonde noted that Ducati was dominant on the market for after-sales services for Ducati motorcycles in Belgium. It emphasised that the owners of Ducati motorcycles are likely to use the services of authorised Ducati repairers and original Ducati spare parts for various reasons, including the fact that the number of independent repairers is limited. After finding Ducati to be dominant, the Court found that Ducati's decision to only allow its authorised dealers to become authorised repairers constituted an abuse of its dominant position since it prevented independent repairers from competing effectively with official Ducati repairers.
Ducati appealed this judgment before the Court of Appeal of Ghent, which partly upheld the judgment of the Commercial Court.
In its judgment of 1 October 2014, the Court of Appeal followed the Commercial Court's reasoning on the definition of the relevant market. However, the Court of Appeal disagreed with the Commercial Court as regards the infringement of Articles IV.1 of the Belgian Commercial Code and 101 TFEU. According to the Court of Appeal, DD Bikes had not established that Ducati's refusal to recognise DD Bikes as an authorised repairer was based on an agreement between Ducati and its authorised dealers or repairers. Therefore, Ducati's refusal to admit DD Bikes to its authorised repairers' network constituted unilateral behaviour, which falls outside of the scope of Articles 101 TFEU and IV.1 of the Belgian Commercial Code.
Conversely, the Court of Appeal confirmed the existence of an abuse of Ducati's dominant position on the Belgian market for after-sales services for Ducati motorcycles. First, the Court found Ducati to be dominant on this market, and noted that independent repairers could not exert any countervailing market power owing to limitations applied to the manufacturer's warranty and the restricted access to parts, specific tools and technical information. The Court then stated that, although companies are in principle free to choose their business partners and how to dispose of their own property, dominant companies such as Ducati cannot refuse to sell a product - or sell it under unreasonable conditions - in a way that restricts competition. According to the Court, Ducati had abused its dominant position by preventing DD Bikes from directly obtaining from Ducati, under the same conditions as Ducati dealers, the motorcycle parts, equipment, technical information and tools necessary to repair Ducati motorcycles. As a result, DD Bikes could not effectively compete on the market for the maintenance and repair of Ducati motorcycles.
Finally, the Court of Appeal found that Ducati's conduct did not have an effect on trade between Member States as DD Bikes was only active in the Dendermonde region and, as a result, it ruled that only the Belgian competition rules, and not Article 102 TFEU, applied to the present case.
The Court ordered Ducati to enable DD Bikes to repair and maintain Ducati motorcycles under competitive conditions by supplying it with technical information, specialised tools, software and parts on the same terms as authorised dealers, and imposed a conditional fine of € 1,000 per day (with a maximum of € 200,000) in case Ducati would fail to do so.
The case is important as it extends to the motorcycle repair markets a number of the principles aimed at strengthening the competitiveness of independent repairers which have been applied by the European Commission to the motor vehicle repair markets. Unlike the lower court, the Court did not feel itself able to go so far as to order Ducati to appoint DD Bikes as an authorised repairer, and it remains to be seen whether a refusal to appoint a qualified stand-alone repairer to the authorised repair network would itself be held to infringe the competition rules (as the Commission has claimed may often be the case in the motor vehicle sector).
