European Court of Justice says Jaguar Land Rover may limit sales network

Article by Anita Panait, on June 14, 2012

The European Court of Justice has issued a ruling that Jaguar Land Rover, owned by Tata Motors, does not have to abide with specific rules or disclose its reasons for selecting car dealers. The ruling stems from a legal challenge posed by car dealer Auto 24 SARL, which had wanted to distribute Jaguar Land Rover’s vehicles in France.

Jaguar Land Rover sells vehicles in France only through company-authorized dealers. According to the European Court of Justice, it is unnecessary “for such a system to be based on criteria that are objectively justified and applied in a uniform and non-differentiated manner." The Luxembourg-based tribunal also ruled that the company does not need to publish their selection criteria as doing so may compromise business secrets or aid collusion, says Autonews. 

The European Court of Justice’s ruling has far-reaching effects on other luxury goods companies like Louis Vuitton and Chanel that seek to limit some distributors' sales.

These luxury goods companies argue that their brands could be harmed if they are sold by unauthorized retailers, particularly online resellers. It should be noted that rulings from the European Court of Justice are binding on all member-nations of the European Union. While the tribunal rules on points of law, France's highest appeals court, Cour de Cassation, will make the final decisions on the details of the case.

Topics: jaguar, land rover

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