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Merckx v. Ford Motors Co. Belgium SA

C-171/94, C-172/94 (1996)

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Merckx v. Ford Motors Co. Belgium SA

European Court of Justice
C-171/94, C-172/94 (1996)

MJ

Facts

Two salesmen (plaintiffs) worked for Anfo Motors SA (Anfo), where they sold vehicles in the Brussels area. Ford Motors Company Belgium SA (Ford) (defendant) was the main owner of Anfo. Anfo informed the salesmen that it planned to cease operations and that Ford would instead work with an independent car dealership in the Brussels area covered by Anfo. The independent dealership would hire some of the employees that Anfo employed, and these employees would retain their existing contractual rights (such as seniority). At the same time, Anfo informed its customers of the change and recommended the new independent dealer. The salesmen refused to accept the transfer to the new independent dealership. According to the salesmen, Anfo could not require them to work for another company under different conditions without a guarantee that their client bases would follow. European Union law contained a requirement that if a business entity was transferred, the new entity took on the old entity’s contractual obligations. These requirements regarding contractual obligations applied if a transfer resulted in the business entity retaining its identity. The national court referred the question of whether these provisions of European Union law applied to this transfer.

Rule of Law

Issue

Holding and Reasoning ()

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