Calor Gas v Express Fuels (Scotland) [2008] ScotCS CSOH 13

Court of Session judgment (about 33 pages) accepting a competition defence by a former Calor Gas dealer who had breached its dealership agreement.

The dealer had failed to give the agreed notice for termination of the dealership (in switching from Calor to Flogas), and had handled Calor cylinders in breach of the agreement and of an interim interdict (injunction) obtained by Calor in November 2006.

The judge accepted the dealer's claim that these restrictive covenants were undue restrictions of competition in breach of Article 81 and therefore void.

On the question of effect on international trade within the EC (which was needed for jurisdiction as the facts occurred before the abolition of the UK vertical exclusion), the judge noted “that cross-border trade in cylinders themselves is not likely to be significant, and that in practice cylinder LPG supply businesses will be organised on a national basis”. But he accepted evidence from Express Fuels that there was a potential effect on upstream LPG trade and on cross-border establishment (noting that Calor and Flogas are both foreign-owned). The conclusion rests largely on the fact that Calor did not present any evidence that there could be no effect on cross-border trade.

For further information or advice please contact Franck Latrémolière.

Filed under UK courts.

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