Drafting legal briefing note re competition law for supply of OEM spare parts

Closed Posted 5 years ago Paid on delivery
Closed Paid on delivery

I would need to receive the briefing note by close of play Tuesday at the latest.

I require a 2-3 page concise briefing note setting out the legal position and precedent case law to present to my Client with recommendations of how to mitigate and prevent an OEM with a factory in the Far East and UK subsidiary office from potentially refusing to supply my Client with replacement spare parts for equipment, if during the current re-procurement process, they are unsuccessful in winning the new contract.

The Client and OEM have a B2B contractual relationship where the contract will expire early next year.

The OEM has been supplying equipment to my Client for the last 5 years, much of which holds warranties, extended warranties and further replacement spare parts requirements for equipment out of warranty. The products in question are used by my Client's (members) customers and this is, therefore, an obvious duty of care involved for health and safety and proper preventative planned maintenance, servicing and repair to equipment.

Some components may be trademarked or patented and form part of the core design of the equipment.

It is understood that "Article 81(1) of the EC Treaty prohibits all agreements between undertakings and concerted practices which may affect trade between Member States and which have as their object or effect the prevention, restriction or distortion of competition within the common market, and in particular those which directly or indirectly fix selling prices or any other trading conditions and share markets or sources of supply."

Precedent case law that I can find online includes JCB tractors (2000), passenger lifts, Dyson (2005), Jaeger Lecoultre (2005), motor manufacturer TVR (2006), Hyundai Bulgaria (2012), Confédération européenne des associations d’horlogers- réparateurs (2018) though I'm conscious there will be others there could be more pertinent to this scenario.

A recent case has been experienced by one of my Client’s competitors where the OEM threatened to refuse to supply replacement parts if their new contract for equipment supply was awarded to AN Other, away from the incumbent.

My Client’s current contract with the incumbent OEM is contracted with the UK subsidiary under English law. The contracting party for the new future contracts could be AN Other, the incumbent UK representative or their Far East HQ.

I'm flexible on the format of the briefing note, but reckon it probably needs to ideally cover:

• Exec Summary

• The facts

• What the law and recent case law prescribes

• Whether it would be uncompetitive in law for the OEM to stop/restrict supplying replacement parts

• Legal remedies (if any) with timescales for proceedings/enforcement

• What levers or actions my Client could take in advance of commencing discussions with the OEM

• The pro’s and con’s

• What would be the last resort?

• Other points of note + whether Brexit has any effect on the above

• Legal assessment

The briefing note should be drafted in a form that upon receipt, I can easily find and replace for the CLIENT, OEM, PRODUCT, FACTORY LOCATIONS names etc.

A brief search online has come up with the following precedent cases and guidance by way of a starting point.

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http://www.mondaq.com/x/650200/Antitrust+Competition/EU+General+Court+endorses+selective+distribution+of+spare+parts+for+luxury+watches

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