Originally from American Review of International Arbitration - ARIA

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I. FACTS

On January 3, 1992, the Gerechtshof te Arnhem (Court of Appeal of Arnhem) referred two questions concerning the interpretation of the EEC Treaty to the European Court of Justice in Luxembourg for a preliminary ruling under Ar­ticle 177 of the Treaty. Those questions arose in proceedings between the Municipality of Almelo and a num­ber of local distributors of electric power on the one hand and Ener­giebedrijf IJsselmij N.V. (hereinafter "IJsselmij"), a regional distributor of electric power, on the other hand.

The local distributors supply electric power to con­sumers within the municipalities, whereas IJsselmij, the supplier of the distributors, also supplies consumers in rural areas directly. On the basis of an exclusive pur­chasing provision con­tained in the general conditions of IJsselmij, local dis­tributors were prohibited from im­por­ting electricity. Fur­thermore, an import ban also applied at the level of producers and regional distributors. Finally, as of Jan­uary 1, 1985 IJsselmij charged local distributors an equalization sup­plement, that is to say, a surcharge intended to offset the difference between the higher costs incurred by IJsselmij in distributing electricity to con­sumers in rural areas and the lower costs incurred by the local distributors in distributing electricity to consumers in urban areas.