Daimler fined for blocking foreign buyers

THE EUROPEAN Commission yesterday said it plans to fine DaimlerChrysler after finding that the world's fifth biggest car-maker refused to sell cars to customers who crossed European borders seeking lower prices.

A two-year inquiry by the European Union's executive agency found evidence that DaimlerChrysler dealers in Spain, Belgium, the Netherlands and Germany broke EU antitrust rules by refusing to sell to foreigners between 1985 and 1996, said Stefan Rating, an EU spokesman.

"We have evidence of circulars sent to dealers encouraging them not to sell to foreigners,'' Mr Rating said, adding that the commission opened a legal proceeding this month against DaimlerChrysler by sending the company a formal list of its complaints.

The commission fined Volkswagen, Europe's largest carmaker, 102 million euros ($110m) last year, after finding that its Italian dealers refused to sell cars to Germans and Austrians.

Mr Rating said DaimlerChrysler's offenses are "roughly'' as serious as Volkswagen's while "more countries are involved'', suggesting Daimler could face higher fines.

Car prices vary widely within the EU because of tax differences and currency fluctuations, which means people often travel to other countries to get lower prices.

The commission can fine companies a maximum of 10 per cent of their annual sales for antitrust violations, although it has never fined the maximum.