Mike at C&M Posted January 9, 2014 Share Posted January 9, 2014 The headline clause is contained within the section for Internet Sales: "Retailers are granted permission to only sell within the territories classified as the United Kingdom and Eire". There will be many retailers, such as myself, who have built up a valuable customer base outside the UK, and in an instant, it would appear that we have to simply let this business disappear. There had been talk of a ban on using Ebay and Amazon. Hornby have told us that we need to register any details of Internet trading outlets with them, and that they then have to give us permission to use these outlets for Hornby products. It is hoped that they will simply rubber stamp whatever is already in place. 'Breaking of boxes' has also been has been banned. Therefore we will be unable to split train sets and sell the individual items contained there-in as new items. Retailers will need to read the terms carefully, as there appear to be a number of things that we have taken for granted in times past where we now need written permission. For example, my internet shop is illustrated using the same pictures that appear on Hornby.com , I hope that I can gain the required permission to continue using these pictures, rather than having to revise hundreds of items on my website. On the whole, the terms are very much a modern day suppliers contract, but there are minor details that will require the retailer to liaise with Hornby to maintain the 'status quo'. As yet, we have not yet received the "Guidelines and Benefits of recognition as a "Hobby" retailer" [Hornby's word], which we believe will be released next week. Link to post Share on other sites More sharing options...
gordon s Posted January 9, 2014 Share Posted January 9, 2014 Within the EU (at least) isnt that an illegal restraint on trade? was my first thought I'm not a lawyer, but possibly…. http://europa.eu/legislation_summaries/competition/firms/cc0006_en.htm Link to post Share on other sites More sharing options...
Mike at C&M Posted January 9, 2014 Author Share Posted January 9, 2014 Within the EU (at least) isnt that an illegal restraint on trade? was my first thought Mickey, I would take this further. Once I have paid for the goods, title passes to me. Within reason, should I not be able to sell them to whoever I want, wherever they may be? Link to post Share on other sites More sharing options...
gordon s Posted January 9, 2014 Share Posted January 9, 2014 There is some more light reading here. I would be surprised if Hornby had not taken legal advice before introducing new contracts. Page 45. http://ec.europa.eu/competition/antitrust/legislation/guidelines_vertical_en.pdf Edit: Any agreement is a two way arrangement and should protect/benefit both parties. If you have any concerns then the first thing to do would be to discuss the situation with Hornby to allay any fears you may have. It is not in their interest to alienate their Distributor network. Link to post Share on other sites More sharing options...
Kal Posted January 9, 2014 Share Posted January 9, 2014 Hi I am assuming this applies to products supplied in relationship with Hornby directly, as opposed to through a distributor / wholesaler? Link to post Share on other sites More sharing options...
Kal Posted January 9, 2014 Share Posted January 9, 2014 Within the EU (at least) isnt that an illegal restraint on trade? was my first thought Edit for clarity: This is simply a section cut and pasted from the EU Block Exemption Regulation, and publicly available. It is in reply to the question quoted and I am not suggesting it either supports or denies anything Hornby or any other party have said, written, discussed or published about the subject posed by the OP. (51) There are four exceptions to the hardcore restriction in Article 4( of the Block Exemption Regulation. The first exception in Article 4((i) allows a supplier to restrict active sales by a buyer party to the agreement to a territory or a customer group which has been allocated exclusively to another buyer or which the supplier has reserved to itself. A territory or customer group is exclusively allocated when the supplier agrees to sell his product only to one distributor for distribution in a particular territory or to a particular customer group and the exclusive distributor is protected against active selling into his territory or to his customer group by all the other buyers of the supplier inside the Union, irrespective of sales by the supplier. The supplier is allowed to combine the allocation of an exclusive territory and an exclusive customer group by for instance appointing an exclusive distributor for a particular customer group in a certain territory. This protection of exclusively allocated territories or customer groups must, however, permit passive sales to such territories or customer groups. For the application of Article 4( of the Block Exemption Regulation, the Commission interprets «active» and «passive» sales as follows: – «Active» sales mean actively approaching individual customers by for instance direct mail, including the sending of unsolicited e-mails, or visits; or actively approaching a specific customer group or customers in a specific territory through advertisement in media, on the internet or other promotions specifically targeted at that customer group or targeted at customers in that territory. Advertisement or promotion that is only attractive for the buyer if it (also) reaches a specific group of customers or customers in a specific territory, is considered active selling to that customer group or customers in that territory. – «Passive» sales mean responding to unsolicited requests from individual customers including delivery of goods or services to such customers. General advertising or promotion that reaches customers in other distributors' (exclusive) territories or customer groups but which is a reasonable way to reach customers outside those territories or customer groups, for instance to reach customers in one's own territory, are passive sales. General advertising or promotion is considered a reasonable way to reach such customers if it would be attractive for the buyer to undertake these investments also if they would not reach customers in other distributors' (exclusive) territories or customer groups. Link to post Share on other sites More sharing options...
RMweb Premium Andy Hayter Posted January 9, 2014 RMweb Premium Share Posted January 9, 2014 Anyone got Simon K's email address? I would like confirmation of this before taking this further since I now have no supplier (unless Hornby appoint one) from whom I can purchase - except for Hornby itself. This represents a significant hindrance to free trade and may need to be taken further. Link to post Share on other sites More sharing options...
Kal Posted January 9, 2014 Share Posted January 9, 2014 So glancing at the Passive Sales clause. a retailer such as model shop that advertises its wares in open literature (eg RM) can sell as it sees fit There is another section on Internet sales, that goes into more details, but I didn't want to overload this thread. Link to post Share on other sites More sharing options...
andyman7 Posted January 9, 2014 Share Posted January 9, 2014 There is some more light reading here. I would be surprised if Hornby had not taken legal advice before introducing new contracts. Page 45. http://ec.europa.eu/competition/antitrust/legislation/guidelines_vertical_en.pdf Edit: Any agreement is a two way arrangement and should protect/benefit both parties. If you have any concerns then the first thing to do would be to discuss the situation with Hornby to allay any fears you may have. It is not in their interest to alienate their Distributor network. I would agree that (especially given their pan-European product range) it would be amazing if Hornby hadn't ensured a legal basis for their terms. If it works properly it should be to both parties' benefit (i.e. whilst as a licensed retailer there are restrictions, you should also benefit). It does appear that this is a concerted attempt to ensure that some sort of level playing field exists for official Hornby retailers to try and avoid a situation where the high street stockists are routinely avoided by modellers in favour of box shifters. In theory this this should also protect 'local' model shops. I am curious as to whether trading outside of UK and ROI can still be agreed additionally on an individual basis - I am thinking of many overseas RMWebbers that use Hattons instead of their local agent because of the savings they make. Link to post Share on other sites More sharing options...
andyman7 Posted January 9, 2014 Share Posted January 9, 2014 Anyone got Simon K's email address? I would like confirmation of this before taking this further since I now have no supplier (unless Hornby appoint one) from whom I can purchase - except for Hornby itself. This represents a significant hindrance to free trade and may need to be taken further. Where are you based? Link to post Share on other sites More sharing options...
Kal Posted January 9, 2014 Share Posted January 9, 2014 sorry I meant RM is in the Modeller (or Model Rail or BRM) or any other "real life" advertising mdium that is not directly marketed to a potential comsumer IE I see an advert in a magazine and wish to purchase the goods advertised therin. It is a big document so there may be other clauses, sub clauses etc., but to my untrained eye, I would tend to agree with you Link to post Share on other sites More sharing options...
oOld Harry 666 Posted January 9, 2014 Share Posted January 9, 2014 There is some more light reading here. I would be surprised if Hornby had not taken legal advice before introducing new contracts. Page 45. http://ec.europa.eu/competition/antitrust/legislation/guidelines_vertical_en.pdf Edit: Any agreement is a two way arrangement and should protect/benefit both parties. If you have any concerns then the first thing to do would be to discuss the situation with Hornby to allay any fears you may have. It is not in their interest to alienate their Distributor network. I was not going to post again on here, however I feel that there are some important points regarding soley to this issue upon which I would like to comment. I would assume Hornby have taken legal advice, however that does not prevent them from trying to incorperate items which could be open to legal challange although given the cost of liitigation being a rather substantial barrier to your average modelsop persuing the matter through the courts. I can, at first reading see a couple of clauses which I feel could be unenforcable. The sale of items outside the U.k. is one area, although potentially there are severa aspects to it. I cannot see why you cannot sell, say a Locomotive as the packaging says it needs a 12v D. C. supply (of the equivelent for D.C.C.) but selling a Trainset with a UK 13 amp socket style transformer to either the E.U. or U.S.A. would probably be illegal (i.e. criminal) as you would be selling something that would not comply with local regulations or electricity supply. I suggest that this is what the relevant paragraphs are really designed to cover, or at least to cover Hornby if something went wrong in such an instance. There are a couple of other areas where, as I have indicated, I feel Hornby would find difficult to enforce, there are also a couple of sentences, including that where they state that "Hornby will at all times act in a professional manner". that I feel border on the comic. All in all, very much a Curates egg and something I shall be thinking long and hard about before signing. I also think I shall be asking an old school friend who is now a Barrister specialising in commercial law to give the documents the once over before putting pen to paper. At the end of they day the model trade is only a small part of my business interests and if any supplier whishes to impose conditions which I feel are unfair of smack of sharp pratice then I shall just walk away and invest my money elsewhere. I fully appreciate that for a lot of small model stores they may not have this option . Link to post Share on other sites More sharing options...
Fenman Posted January 9, 2014 Share Posted January 9, 2014 "Restraint of trade" is an international legal nightmare (one I professionally encounter quite often by virtue of spending big chunks of my employer's money on hiring expensive lawyers scattered over three continents). It's not helped by, for example, each US state having its own legislation operating alongside federal law. Even within the EU, things may not be as simple as the principles of a free market might suggest. There is also now lots of case law supporting some companies which have successfully argued that they require additional control over the supply chain in order to protect a "premium brand" (sic). ... but selling a Trainset with a UK 13 amp socket style transformer to either the E.U. or U.S.A. would probably be illegal (i.e. criminal) as you would be selling something that would not comply with local regulations or electricity supply. ... [my emphasis] I agree with much of what you wrote, but a super-pedantic point: not everything which is unlawful is also criminal. Many breaches of regulations are simply civil or administrative matters. Paul Link to post Share on other sites More sharing options...
RMweb Gold PhilH Posted January 9, 2014 RMweb Gold Share Posted January 9, 2014 "Retailers are granted permission to only sell within the territories classified as the United Kingdom and Eire". The cynic in me wonders if Hornby want this market, ie outside of the British Isles, for themselves via internet sales from their website - at a price decided by them of course.. Link to post Share on other sites More sharing options...
RMweb Premium Andy Hayter Posted January 9, 2014 RMweb Premium Share Posted January 9, 2014 Where are you based? I am in France. Hornby have a distributor near Paris, but I doubt they would supply individual items as private sales - but SK can confirm or deny that. It could be worse. I could be in Guadeloupe or French Guyana, where Hornby have no distributer - but these are still within the EU. Link to post Share on other sites More sharing options...
G-BOAF Posted January 9, 2014 Share Posted January 9, 2014 Presumably 'internet sales' covers exactly that. Work around is to get overseas customers to phone or email through their order? So it merely restricts sales channels, but does not prohibit overseas trade. Are these terms applied to overseas retailers? A few years ago I purchased a limited edition Australian Scotsman from an Aussie retailer over the phone: only 300 were allocated to UK retailers and they were all spoken for. Under these new trading terms would I have missed out all together? Conversly where does this leave overseas customers after limited editions that are even more 'limited' in their allocation to overseas distributors? Link to post Share on other sites More sharing options...
oOld Harry 666 Posted January 9, 2014 Share Posted January 9, 2014 "Restraint of trade" is an international legal nightmare (one I professionally encounter quite often by virtue of spending big chunks of my employer's money on hiring expensive lawyers scattered over three continents). It's not helped by, for example, each US state having its own legislation operating alongside federal law. Even within the EU, things may not be as simple as the principles of a free market might suggest. There is also now lots of case law supporting some companies which have successfully argued that they require additional control over the supply chain in order to protect a "premium brand" (sic). I agree with much of what you wrote, but a super-pedantic point: not everything which is unlawful is also criminal. Many breaches of regulations are simply civil or administrative matters. Paul Certainly within both the E.U. and the U.S.A supplying an electrical item not to local sopecification is illegal. Link to post Share on other sites More sharing options...
Butler Henderson Posted January 9, 2014 Share Posted January 9, 2014 What if the customer bought from an exporter and the exporter bought the item from the retailer, who just happened to own the exporter? Link to post Share on other sites More sharing options...
gordon s Posted January 9, 2014 Share Posted January 9, 2014 Despite making two posts on this subject I am feeling increasingly uncomfortable about how this may develop. Supplier/Distributor contracts are often complex and can vary considerably even within EU rules and guidelines. It is normal that any contracts between two parties are confidential and I would hate to see any Distributor being penalised for discussing a contract or trading terms on a public form. My recommendation still stands. Talk to Hornby first and try to understand their thoughts and reasons for introducing the changes. I would be amazed that they won't have taken legal advice beforehand and whilst you are free to take legal advice also, a supplier/Distributor relationship can be terminally damaged once you head down the legal route. The success of any agreement is dependant on benefits and protection to both parties and should not be seen as a weapon to beat Distributors into submission. Equally so, Distributors should be seen to act professionally and support the aims of the Principal at all times. This is your job and your living that is being discussed. Personally I would discuss this with Hornby and be very careful about any discussion on a public forum. Link to post Share on other sites More sharing options...
andyman7 Posted January 9, 2014 Share Posted January 9, 2014 Presumably 'internet sales' covers exactly that. Work around is to get overseas customers to phone or email through their order? So it merely restricts sales channels, but does not prohibit overseas trade. Are these terms applied to overseas retailers? A few years ago I purchased a limited edition Australian Scotsman from an Aussie retailer over the phone: only 300 were allocated to UK retailers and they were all spoken for. Under these new trading terms would I have missed out all together? Conversly where does this leave overseas customers after limited editions that are even more 'limited' in their allocation to overseas distributors? Thanks. Certainly were I in France my question to Hornby would be how they envisage I should obtain their (UK range) products. Presumably Jouef products are freely distributed in France - do they plan to use those channels for all Hornby Group sales? Link to post Share on other sites More sharing options...
Matabiau Posted January 9, 2014 Share Posted January 9, 2014 Hornby International products are available all over continental Europe. Although products branded Jouef are exclusively french the Rivarossi brand is used to cover models of trains from the Netherlands, Germany, Italy and others, they couldn't impose the same constraints there. People buying Hornby UK image trains from outside the UK must be very small in number compared to the total market, it would seem strange to put so much effort into stopping such a small part of their trade. Link to post Share on other sites More sharing options...
RMweb Premium The White Rabbit Posted January 9, 2014 RMweb Premium Share Posted January 9, 2014 Hornby International products are available all over continental Europe. Although products branded Jouef are exclusively french the Rivarossi brand is used to cover models of trains from the Netherlands, Germany, Italy and others, they couldn't impose the same constraints there. People buying Hornby UK image trains from outside the UK must be very small in number compared to the total market, it would seem strange to put so much effort into stopping such a small part of their trade. I deal with modellers in Australia quite a bit for my business and many of them have UK outline models. I don't know what % it is, but I think it is a significant number. Link to post Share on other sites More sharing options...
Fat Controller Posted January 9, 2014 Share Posted January 9, 2014 Might this attempt to restrict sales of Hornby UK models to the UK be a somewhat ham-fisted reaction to the number of locos they've had returned from foreign parts (and the resultant transport costs) since they started having serious QC issues? Link to post Share on other sites More sharing options...
M.Riddell Posted January 9, 2014 Share Posted January 9, 2014 May I also point out that these terms aren't exclusive to the Hornby Trains part of the group? These also cover Airfix kits as well. Over on Britmodeller there have been howls of protest from some the non-UK guys who now face having to wait months for any new kits to appear in their part of the world as they'll no longer be able to import from the UK. http://www.britmodeller.com/forums/index.php?/topic/234953208-airfix-to-restrict-international-sales/ So these terms cover the entirety of the Hornby Group. Mike. Link to post Share on other sites More sharing options...
OFFTHE RAILS Posted January 9, 2014 Share Posted January 9, 2014 "Retailers are granted permission to only sell within the territories classified as the United Kingdom and Eire" Does this mean my son who lives in Jersey (Channel Islands) will not be able to buy Hornby items mail order from the UK as surprise presents for when I visit Jersey? As I'm sure you know, the Channel Islands are not part of the UK or the EU..... Link to post Share on other sites More sharing options...
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