The Commission has decided to pursue proceedings against the German government over its restrictions on sales promotions in connection with an Article 169 complaint by PolyGram. The accusation is that German rules on discounting are blocking the free provision of advertising services in the EU single market. The Commission will send Germany a reasoned opinion asking it to change its regulations; if it fails to do so the Commission could refer the matter to the EU Court of Justice. This decision follows a complaint lodged in April 1994 by the European entertainment company PolyGram, which wanted to offer its record club distance selling services to German consumers. PolyGram was prevented from offering the service because it includes introductory offers and loyalty bonuses, which are not generally permitted under German laws despite being legal in other EU MS. Price discounting was the main issue discussed at the first meeting of the new Expert Group on commercial communications.
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