BRUSSELS - EU competition czar Karel Van Miert said the block exemption that allows carmakers to operate exclusive dealer networks in Europe should not be renewed.
In an interview, Van Miert said sentiment on the European Commission has turned against the auto industry. He said it has violated terms of the block exemption agreement.
'I am astonished at the industry,' said Van Miert, head of the EU's competition arm. 'If block exemption disappears it will be largely because the auto industry did not live up to expectations and requirements.'
The EU has begun asking consumers, dealers and distributors whether to continue the industry's special exemption. The study will be completed by mid-2000.
The block exemption expires in September 2002. In was extended in 1995 for seven years when carmakers agreed not to prevent consumers from crossing borders to buy cars at lower prices. The industry has denied EU allegations that it has failed to observe that agreement.
'I told them when we negotiated the extension, 1/8Gentlemen, you have to live up to the requirements,'' Van Miert said. 'They should not have been too astonished that we took action.'
The EU has fined Volkswagen for obstructing cross-border shoppers and has charged DaimlerChrysler and Opel. It is also investigating Renault. Van Miert said he believes there have been numerous other violations.