The European Commission has approved sweeping new rules to increase competition in the sale of cars and car parts.

However, the most controversial clause, giving dealers the right to open showrooms anywhere in the 15 EU nations, has been delayed.

The liberalisation of dealership rules had been due to take effect in October 2004 but has been put back by a year.

The new rules reduce restrictions imposed by manufacturers on dealers and repair garages and allow dealers to sell more than one brand in the same showroom.

Although most changes take effect on 1 October this year, car makers have a one-year transition period.

The rules are designed to narrow the gap in pre-tax car prices, which vary by as much as 50% for the same model.