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New ruling on car sales.

Car dealers across Europe are no longer forced to stick to their own sales territory under European Union rules which came into force at the weekend.

The latest phase of EU measures opening up the car market means showrooms can set up business wherever they like - even on the traditionally sacrosanct "turf" of their neighbouring dealerships.

Under the old carefully-managed distribution networks, dealers in the same brand were allocated their sales territory - allowing vastly different pricing arrangements for the same model in various EU markets.

The change ending the so-called "location clause" allows dealers to compete more widely, said a Commission statement. It would stimulate price competition.

EU Competition Commissioner Neelie Kroes said: "This measure stands to further increase competition. I am pleased that many carmakers have already eliminated location clauses from their distribution agreements with dealers."
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Publication:Huddersfield Daily Examiner (Huddersfield, England)
Date:Oct 3, 2005
Words:137
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