No unfair competition. BMW obtains favorable decision from PROCOMPETENCIA
Last June 18, the Superintendency for the Promotion and Protection of Free Competition ("PROCOMPETENCIA") decided in favor of German automotive company BMW in a conflict in which BMW had been engaged with Corporación Eurocars, concerning the refusal by the German company to renew the distribution agreement that had existed between the two. In the conflict, BMW was represented by the Venezuelan Law Firm of Torres Plaz & Araujo.
In 1999, BMW had advised its distributor of the possibility of severing their commercial relations due to the breach by the latter of several clauses of the distribution agreement. Once the advance notice period granted to the authorized distributor in Venezuela had lapsed in May 2000, and as the breaches had not been remedied, BMW informed Corporación Eurocars of its decision not to renew the distribution agreement.
In order to challenge the non-renewal of the agreement, Corporación Eurocars brought legal action against BMW, upon the basis of a series of claims. PROCOMPETENCIA only admitted the unfair competition claim. BMW instructed Torres Plaz & Araujo to act in their defense in the conflict. The Venezuelan Law Firm was successful in obtaining a favorable decision from PROCOMPETENCIA, and in establishing its right to demand proper performance of its distribution agreements.
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