Mario Monti, the EC Competition Commissioner, who has responsibility for reviewing Block Exemption in 2002, has cast doubts over the degree of competition between dealers selling the same makes of car.

He suggested the lack of rivalry could be caused by such factors as standard manufacturer discount, the allocation of exclusive sales territories, the exclusion of independent resellers and the banning of certain types of active marketing.

“The manufacturers' ability to end dealer agreements with only two year's notice seems to make it wise for dealers not to pursue a sales policy which their manufacturers dislike,” he said. “This is all the more the case because dealers cannot easily shift to another brand.”

Mr Monti, also questioned the need to tie sales and aftersales services. “No technical reasons seem to exist for such a link,” he said.