In addition to Article 102 of the Treaty on the Functioning of the European Union (TFEU), French law provides for specific rules applicable to dominant firms. Article L420-2 of the French Commercial Code provides for the prohibition of abuses of a dominant position, as well as abuses of economic dependence. A dominant position is characterised on a relevant market, whereas a situation of economic dependence is characterised with regards to a trading partner. Article L420-4 of the Commercial Code provides for a possible exemption from the prohibition of Article L420-2 when the practices at stake result from a regulation or if they have the effect of achieving economic progress – including creating and maintaining employment – while reserving for consumers a fair share of the resulting benefits and without allowing an undertaking to eliminate competition in respect of a substantial part of the products in question. The exemption is rarely applied in practice. Another relevant provision is Article L420-5 of the Commercial Code, which prohibits abusively low prices to consumers. Abusively low pricing, as defined by Article L420-5, can only be applied to products and services sold to final consumers, but may be found to exist even when the infringing company is not in a dominant position and the victim is not in a situation of economic dependence. Article L420-5 has only been applied in rare cases.
The French Competition Authority (FCA) has jurisdiction over abuses of dominance practices. As an independent administrative body, the FCA may investigate abuse of dominance cases and impose fines of up to 10 per cent of the infringing companies' worldwide turnover. The FCA has not issued formal guidance on the way in which it applies Article L420-2 of the Commercial Code. The European Commission's guidance on Article 102 TFEU (formerly Article 82 of the EC Treaty), however, provides useful indications as to how Article L420-2 is applied in France.2 French judges can also directly apply the relevant provisions of the Commercial Code concerning abuses of dominance, or abuse of economic dependence, in the context of civil or commercial litigation.
II Year in Review
In 2018, the FCA issued 10 decisions on the basis of Article L420-2 of the Commercial Code (and none on the basis of Article L420-5 of the Commercial Code). The FCA imposed fines in two cases, which amounted to a total of €204,000.3 None of these fines were the result of a settlement. The FCA also accepted commitments in one case.4 Four claims were rejected in 2018 at a preliminary stage owing to lack of supporting evidence,5 and the FCA dismissed three other cases following an investigation on the merits.6 The FCA did not grant any interim measures in 2018, but it has already done so in early 2019 in the Amadeus case.7 Overall, 2018 was quieter than 2017 where the FCA issued 19 decisions on the basis of Article L420-2 of the Commercial Code, among which, four led to fines of a total of €125.4 million being imposed.8
The most noteworthy decisions in the past year are the following.
In Sanicorse,9 the FCA imposed a €199,000 fine on Sanicorse, the only infectious medical waste treatment company in Corsica, for having abused its dominant position through excessive price increases. Following a referral by the Minister of Economy, the FCA found that Sanicorse had abruptly, significantly and durably increased the waste disposal prices it charged hospitals and clinics in Corsica between 2011 and 2015 without any objective justification. Although the amount of the fine is relatively small, the FCA considered that the practices at stake were particularly serious. Sanicorse's behaviour aimed at preventing the development of competition and impacted healthcare establishments that are legally obliged to manage infectious medical waste under strict conditions and that, for some of them, experienced financial difficulties. This is only the second time that the FCA has imposed a fine for an exploitative abuse of dominance through excessive prices. The FCA's decision clearly follows the recent renewed interest of European competition authorities for excessive pricing.
In Satellite TV Decoders,10 the FCA closed the abuse of dominance proceedings opened against French pay-TV operator Groupe Canal Plus (GCP) following a complaint of a third-party satellite decoder manufacturer, by making commitments offered by GCP binding. Specifically, GCP committed to allow its subscribers to freely use third-party decoders in order to watch Canal+ programmes. Owing to piracy concerns, GCP had decided to terminate its 'Canal Ready' partnerships with third-party satellite decoder manufacturers. However, the FCA found that this decision was likely to exclude decoder manufacturers from the market and to deprive consumers from having the option to choose between different decoders. In light of these concerns, GCP essentially agreed to allow third-party decoder manufacturers to manufacture and distribute decoders compatible with its satellite programs, provided these decoders include a software access module called 'myCanal' (that users can download) designed, monitored and updated directly by GCP. The FCA notably considered that such commitments answered GCP's piracy concerns while providing an alternative offer to GCP decoders.
In Vendée Sea Crossings¸11 the FCA ended a 17-year abuse of dominance saga involving a public provider of sea transport services, the Régie départementale des passages d'eau de la Vendée (RDPEV). The RDPEV is a state-owned entity operating for the whole year as part of its public service mission maritime transport services between continental France and the Île d'Yeu in the Vendée region (western France) to the benefit of the local municipality, except during the peak summer season where it offers commercial transport services in competition with private operators. In 2004, the FCA rejected a complaint from a competitor that claimed that the RDPEV abused its dominant position by offering commercial transport services at predatory prices.12 However, the FCA's decision was ultimately annulled by the Paris Court of Appeal in 2012 (after several proceedings before the French jurisdictions, including two rulings of the Paris Court of Appeal and two annulment decisions of the French Supreme Court),13 notably on the ground that the FCA did not correctly define the relevant costs to determine the existence of predatory prices (i.e., whether the common costs incurred for RDPEV's public service mission should be taken into account). In 2018, following a new investigation, the FCA again rejected the predatory pricing allegations. After precisely defining incremental costs attributable to its commercial activity carried out during the peak summer season, the FCA found that the RDPEV's profits resulting from this commercial activity actually exceeded its average incremental costs.
Finally, in IT Maintenance,14 the FCA rejected a third-party maintainer's claim that IBM, HP and Oracle each abused their individual dominant position on the market for the sale of firmware updates by implementing a global strategy to exclude third-party maintainers from the downstream markets for the maintenance of server and storage systems by restricting access to firmware updates that are necessary for maintenance services. The FCA found that the complainant, Econocom, had failed to provide evidence of any abuse of market power for any of the possible commercial relationships corresponding to the sale of maintenance services. First, in all cases where the maintenance contracts are purchased alongside the server or storage system, the FCA found that the secondary maintenance market could not be distinguished from the primary hardware market and that any risk of abuse of dominance regarding maintenance had therefore to be excluded. Second, where customers purchase maintenance solutions for mature systems, the FCA noted that the access to firmware updates is rarely required – or not required at all – since the hardware and software are stabilised and manufacturers offer long-term maintenance contracts that enable customers to cover the entire life-time of the server or storage system from the moment of the purchase of the system. Third, where customers issue tender offers for multi-brand maintenance contracts, the FCA considered that server manufacturers effectively give access to their firmware updates – including to third-party maintainers, such as the complainant – and do not prevent competitors from bidding. Finally, the FCA acknowledged that manufacturers were under no obligation to supply firmware updates for free, and that it was legitimate for suppliers to monetise access to firmware updates given that such updates necessitate development costs and contain software innovation.
III Market Definition and Market Power
Under French law, as under EU law, regulators and judges must typically start their analysis by defining the relevant markets where the alleged practices took place. They then analyse whether a situation of dominance (single or collective dominance) or of 'economic dependence' can be established in the relevant market before assessing the existence of an abuse.
i Market definition
In situations where there are complementary products (e.g., hardware and consumables or maintenance services), the FCA determines, based on a combination of qualitative and quantitative criteria, whether a single market exists for both or whether the products form distinct product markets. In Nespresso,17 the FCA defined a primary market for espresso pod coffee machines, and a distinct secondary market composed only of coffee capsules compatible with Nespresso coffee machines. The FCA found that espresso pod coffee machines and coffee capsules did not belong to the same product market because coffee machines and coffee capsules are not necessarily bought simultaneously or at the same shops, and are not manufactured and marketed by the same firms. In addition, a Nespresso internal document considered that the two products were separate. The FCA also found that the secondary market should be narrowly defined as only including coffee capsules compatible with Nespresso machines because users of Nespresso machines were not in a position to use any other kind of capsule. On the contrary, in Photocopiers,18 pursuant to the Pelikan v. Kyocera EU case law,19 the FCA refused to define a separate secondary market for the maintenance of photocopiers because, when buying photocopiers, purchasers also take into account the price of maintenance services. The FCA also found that the intense competition at the primary level and the short life cycle of photocopiers (three to five years) exerted a sufficient competitive constraint on the conditions of maintenance services at the secondary level. The FCA applied the same reasoning in IT Maintenance 20 where it refused to identify a secondary maintenance market in all cases where maintenance contracts are purchased alongside a server or storage system, given that customers take into account maintenance conditions when purchasing a server or a storage system and the primary market for servers and storage systems is very competitive.
Supply-side substitutability also constitutes a relevant criterion for market definition. In Mobile Telephony,21 the FCA found that each operator held a monopoly in the wholesale market for the termination of voice calls on its own network because of, inter alia, the lack of supply-side substitutability, as only the terminating operator is capable of localising the recipient of the call. The Court of Appeal followed the same reasoning.22 In Sanicorse,23 the FCA distinguished waste collection services and waste disposal services as these two types of services are not provided by the same suppliers and are invoiced separately.
As regards the geographic dimension of the market, the FCA typically determines the area where the conditions of competition are homogeneous. The FCA also analyses, for example, the applicable legal framework, transportation costs, logistical constraints and the way tenders are structured to delineate geographic markets. In Termite Traps,24 the insular nature of the department of Réunion Island led the FCA to limit the relevant market to that department alone. In Sanicorse,25 the FCA found that the infectious medical waste treatment market was limited to the Corsican territory, as transportation costs are high, Corsican healthcare establishments are legally required to manage infectious medical waste in Corsica and none of the waste management companies active in mainland France had participated in a call for tenders in Corsica. The FCA also uses a small but significant and non-transitory increase in price test approach (i.e., the relevant geographic market is defined as the area in which a company can use its market power or monopoly power to, for example, raise prices profitably without being constrained by other players located in other areas or from other product lines).26 In Online Advertising,27 the FCA also recalled that the existence of cultural and linguistic barriers can be taken into account to determine the geographic scope of a relevant market, and in that case, found that the search-related online advertising market had a national dimension.
ii Single dominance
Dominance is achieved when a company can determine its pricing policy in the relevant market independently from its competitors and customers.28 The FCA typically considers that market shares above 50 per cent are a strong indicator of market power.
To establish single dominance, the FCA also examines the following criteria in addition to market shares:
- the countervailing market power of competitors;
- the intensity of competition on the market;
- the existence of potential new entrants; and
- the specific advantages of the leading firm (e.g., brands, organisation, better products or services).
In Pet Food,29 Royal Canin, which held a market share limited to 40 per cent, was considered to be a dominant player, because the second and third-largest competitors respectively held a 12 and 7 per cent market share; Royal Canin had a very good brand image bolstered by high advertising expenses and regular contact with prescribers; and the relevant market was characterised by high barriers to entry. In Satellite TV Decoders,30 the FCA considered that despite the recent evolutions of the distribution of linear and catch-up pay TV services that led to the deterioration of GCP's market position over the years, GCP still held a market share of 70 to 80 per cent in value and of 50 to 60 per cent in volume, which is significantly higher than that of its competitors.
In Termite Traps,31 the FCA also essentially relied on Emeraude's very high market share (more than 80 per cent) to find that the operator was dominant in the market for the distribution of termite traps with hexaflumuron biocide.
Finally, in Sanicorse,32 the FCA relied on evidence gathered during its investigation to conclude that Sanicorse held a de facto monopoly on the infectious medical waste treatment market in Corsica since 1997, and considered that the existence of significant barriers to entry (in particular, owing to the substantial investments necessary to comply with legal standards and to develop a logistic network adapted to the island) made potential entry by new operators difficult.
iii Collective dominance
Collective dominance may result from structural links between undertakings, whether capitalistic or contractual, from the market structure, or from both. In the absence of structural links, the FCA applies the cumulative Airtours criteria (i.e., oligopolistic market, significant market transparency, possibility to engage in retaliation and absence of countervailing power from the fringe players).33
In Saint-Pierre-et-Miquelon,34 the FCA imposed a total fine of €381,400 on companies active in the aggregates market in the archipelago of Saint Pierre and Miquelon for anticompetitive agreement and abuse of a collective dominant position. In particular, the FCA found that four undertakings held a collective dominant position as:
- they together held a market share in excess of 80 per cent in the relevant markets;
- they had structural links through the operation of a common quarry and had adopted a common strategy;
- deviation would be unlikely given their historical links;
- entry barriers were high; and
- there were no alternative competitors.35
Although collective dominance cases are rare,36 the FCA's decisional practice shows that it tends to resort to collective dominance when it lacks evidence to support a claim of explicit collusion.
iv Economic dependence
Economic dependence is a specific infringement under French competition law, which has no equivalent in EU competition law. Pursuant to Article L420-2(2) of the Commercial Code, abuse of economic dependence of a customer or supplier is prohibited when it is likely to affect competition on the market. This provision was originally drafted to protect suppliers from large retail chains (i.e., supermarkets), but is rarely applied in practice.
According to established case law, economic dependence arises when a company is forced into a commercial relationship with another company because it cannot purchase substitutable products under similar terms and conditions, or sell its products to other customers. The FCA examines the following cumulative criteria:
- the commercial partner's brand notoriety;
- the commercial partner's market share;
- the commercial partner's share in the turnover of the dependent company; and
- the possibility for the dependent company to find an alternative commercial partner.37
In 2018, in Take-away and Home Delivery of Pizzas I, 38 the FCA rejected, for lack of evidence, a complaint from franchised undertakings in the pizza sales sector, which claimed to be victims of an abuse of economic dependence by Domino's Pizza, after the latter acquired the franchisees' network, Pizza Sprint. The franchisees claimed that they were forced to switch from their previous network's brand to Domino's Pizza's one, which is allegedly less advantageous. The FCA found that economic dependence could not be established in practice, either at the individual level (for each franchisee) or at the collective level. Specifically, the FCA found that the franchisees had alternative solutions since they could either adopt the new brand or continue to operate under the original conditions until their contracts expired.
Article L420-2 of the Commercial Code specifically mentions a number of abuses, including refusal to supply or deal, tying, or discriminatory practices. However, the list is not exhaustive.
The FCA can find that a company's behaviour is abusive by object or by effect. In past cases, the FCA found that abusive conduct could be established even in the absence of an actual effect on the market. Attempts to abuse a dominant position may, thus, in certain cases also be challenged. In SNCM,39 the Court found that a ferry line operator between Corsica and Marseilles abused its dominant position by submitting a global and indivisible offer (i.e., island-to-continent) to the call for tenders launched by the Corsican Transport Office, while its competitors submitted point-to-point (i.e., harbour-to-harbour) bids as required by the request for proposals. By doing so, SNCM did not allow the tendering authority to compare bids on a point-to-point basis, and to allocate the contract between several ferry operators. Although the bidding procedure was ultimately declared void by the administrative courts and therefore the practice did not have any effect, the FCA fined SNCM for its attempted abuse of a dominant position.
ii Exclusionary abuses
Predatory pricing is a pricing strategy whereby a dominant firm offers below-cost prices, thereby incurring losses or forgoing profits in the short term in order to eliminate actual or potential competition. The FCA relies on the EU Akzo test and considers that the following two situations create a presumption of predatory pricing:40
- when the dominant company's prices are lower than the average variable costs (unless a company can convincingly explain that its behaviour did not result from a predatory strategy aimed at eliminating competitors); or
- when the company's prices are between average variable costs and average total costs, and there is clear and convincing evidence that its behaviour is part of a predatory strategy aimed at eliminating competitors.
French authorities use a slightly stricter, economics-based, test compared to the European Commission's approach: in particular, the FCA has to show that there is a realistic possibility of the dominant player recouping its losses. This may explain why, to date, there has been no successful precedent of predatory pricing where the FCA imposed a fine.41 While predatory pricing concerns were raised by the FCA in several cases, the FCA's investigations were ultimately closed, or generally ended with injunctions or commitments taken by the dominant undertaking to remedy those concerns.42
In SNCF,43 the FCA held that the French rail operator pursued price-based exclusionary practices for its freight services activity by full-trainload because SNCF's prices, although higher than direct average variable costs, were lower than the costs that would be avoided over a three-year period if SNCF terminated its freight services activity by full-trainload. Although SNCF's pricing policy was not considered predatory, as the losses incurred by SNCF were sustainable and predated the opening-up of the sector to competition, the FCA nevertheless considered that it was abusive. The Paris Court of Appeal, however, overturned this part of the decision, considering that charging prices superior to average variable costs but inferior to average total costs could only be considered abusive based on evidence that the dominant firm had made specific plans to exclude competitors from the market.44 The Court found that the FCA had not sufficiently established the existence of an exclusionary strategy. However, in a second judgment after the case was referred back by the Supreme Court,45 the Paris Court of Appeal ultimately confirmed SNCF's abusive pricing policy, noting in particular that the FCA had applied a relevant cost test and had characterised an eviction strategy.46
In Bottin Cartographes,47 following an opinion by the FCA, the Paris Court of Appeal dismissed a predatory pricing claim against Google. Bottin Cartographes, a competitor of Google in online mapping services, claimed that offering mapping services free of charge constituted an abusive predatory strategy. In its opinion,48 later confirmed by the Court, the FCA reaffirmed that for multi-product companies, the predation test to be conducted is a modified Akzo test, where only the incremental cost attributable to a given product should be taken into account (to the exclusion of common costs). In practice, average variable costs are to be replaced by average incremental costs, and average total costs by long-run average incremental costs. The FCA found that the relevant costs were the costs specifically associated with the allegedly abusive activity to the exclusion of common costs supported by Google in its capacity as a multi-service firm (in particular, the costs associated with the acquisition of the underlying maps were not relevant because Google would bear them in any event for its search engine activity). Conversely, the FCA and later the Court confirmed that where a product is offered in different versions (one basic, free version, and one premium, paid-for version), the revenues to be taken into account are those associated with all versions of the product. On this basis, the FCA and the Court of Appeal found that Google's revenues exceeded the total relevant costs, and even if Google's revenues could have been exceptionally lower than the corresponding average total costs, there was no evidence of a predatory strategy. On this last point, the FCA and the Court emphasised that it would have been impossible for Google to recoup the potential losses, and as such no predatory strategy could be found.
More recently, in Vendée Sea Crossings¸49 the FCA recalled that, when implementing the Akzo test, and save for exceptional circumstances, the costs to be taken into account are, in principle, those that are actually incurred by the dominant undertaking itself, not those incurred by potential or actual competitors of the dominant undertaking.50 Following the Paris Court of Appeal's ruling of 2012,51 the FCA clearly identified incremental costs incurred by the RDPEV and compared the RDPEV's profits resulting from its commercial activity during the peak summer season with its average incremental costs, which correspond to the costs that could have been avoided had the transporter not operated any competitive activity during the peak summer season (including, for example, salaries, fuel and other costs related to marketing services, but excluding the owner's insurance premiums and the major repairs). The FCA concluded that the transporter's profits resulting from its commercial activity during the peak summer season actually exceeded its incremental costs. In any event, the FCA noted that RDPEV's pricing practice did not lead to any foreclosure effects on competitors, as one of its competitors was still active and had actually opened a new transport line since 2001, while the two other competitors exited the market almost 15 years after the practices at stake.
Leveraging practices consist of a dominant firm taking advantage of its superior market position in a 'dominated' market to expand its position in another related market.
In PMU,52 the FCA expressed concerns that the French legal monopolist for offline horse race betting leveraged its position to exclude competitors from the competitive market for online horse race betting. In particular, the FCA was concerned that by pooling together its online and offline bets, PMU could attract more bettors, discourage potential new entrants and, in time, drive competitors out of the market, since a greater pool of bets allows for more complex and diversified bets. The winnings on successful bets can also be significantly higher because there would be a greater pool of debts. The FCA accepted commitments from PMU to stop pooling its online and offline bets, and that online and offline activities would be kept separate. Although this could be interpreted as coming close to 'an efficiency offence', because horse racing bettors precisely look for the highest possible winnings (as in any lottery), the FCA justified its preliminary findings by stating that its decision was consistent with the public policy objective of limiting the risk of addiction to online betting.
In Passenger Transport,53 the FCA accepted the commitments offered by SNCF to prevent its subsidiary Keolis from leveraging SNCF's monopoly in the railway passenger transport market into the competitive market for the urban transport of passengers (i.e., bus, metro, tram). More specifically, the FCA was concerned that Keolis could rely on its parent company's railway expertise to submit bids that are not replicable by competitors for the supply of advice and technical assistance to urban transport operators. To alleviate the FCA's concerns, SNCF committed, in particular, to the fact that only its subsidiaries that are fully independent from its railway passenger transport activities would respond to calls for tender regarding technical assistance to urban transport operators.
In Engie,54 the FCA found that Engie abused its dominant position by leveraging its position as the incumbent gas operator in order to obtain more contracts in the competitive gas and electricity markets. In particular, the FCA found that Engie used its historical customer database for regulated tariffs for gas to convert customers to market-based contracts for gas and electricity; used the business infrastructure and resources developed for its regulated tariff activity in order to offer new market-based contracts and win former customers back; and provided misleading sales arguments according to which Engie guaranteed a better security of gas supply than its competitors. The FCA considered that these practices were particularly harmful to competition as they were implemented at a time when the market was opening up to competition. Engie did not challenge the objections and settled the case against a €100 million fine.
In Funeral Services in the Ain Department,55 the FCA found that the funeral company Comtet, which was at the time running the only crematorium in Viriat, a town in the east of France, by virtue of a public service delegation agreement, had abused its dominant position by generating confusion about, on the one hand, its public service cremation mission and, on the other, its funeral product and service supply activities for which it competes with other funeral operators. In particular, the FCA took the view that advertising materials used by Comtet to promote its commercial services while also referring to its role as the Viriat crematorium sole manager aimed at leading grieving families to believe that Comtet was the only provider in the Ain department able to organise funerals that included a cremation service.
Margin squeeze is a strategy whereby the dominant vertically integrated firm applies excessive prices on upstream products or services that make downstream customers' or rivals' activities unprofitable. French courts consider that margin squeezes restrict competition only if a potentially as-efficient competitor would be unable to enter the downstream market without incurring losses. Such restriction of competition may be presumed only when the products or services supplied to its competitors by the dominant firm are indispensable to enable them to compete on the downstream market.56
In Eiffel Tower,57 the FCA found that TDF had implemented a margin-squeeze strategy in the market for the renewal of the national occupancy contract for audiovisual and radio broadcast from the Eiffel Tower site. Among other practices, the FCA found that the offers made by TDF to alternative operators for hosting services (which were indispensable to compete on the downstream market for the broadcasting of radio programmes from the Eiffel Tower) constituted a margin squeeze that did not allow alternative operators as efficient as TDF to submit competitive offers for the operation of the Eiffel Tower facilities. The FCA imposed a fine of €660,000 on TDF on these grounds.
Exclusive dealings entered into by a dominant firm do not constitute a per se abuse under French law, provided that the dominant firm's behaviour does not result in additional foreclosure of its competitors. To assess whether exclusivity clauses may restrict competition, the FCA examines the clauses' scope and duration, the existence of a technical justification and the economic consideration granted to the customer.58
In Mobile Telephony Equipment,59 the FCA was concerned about the duration (20 years) and the restrictive early termination terms of the agreements between mobile operators and TDF for the hosting of their antennae (in particular, early termination was possible only for very few sites each year), which created de facto exclusivity. To address these concerns, TDF offered commitments designed to allow mobile operators to obtain better conditions for the hosting of their antennae and in cases where they were to switch to alternative operators. TDF committed in particular to limit the duration of new hosting agreements to 10 years, to cap the penalties generated by early termination, and to increase the number of sites (or quota) for which early termination was possible.
In Sugar Beet,60 Saint-Louis Sucre claimed that Tereos, the number one sugar producer in the French market (and owner of the Beghin Say brand), abused its dominant position by entering into long-term exclusive contracts with sugar beet growers in the Picardy region, which represents about 40 per cent of French sugar beet production. The FCA found that the contractual terms offered by Tereos raised a number of concerns, especially in light of the opening up to competition of the French sugar procurement market following the abolition of sugar production quotas in October 2017:
- Tereos could potentially lock in all its growers until 2022 as it had introduced a five-year exclusivity commitment for producers willing to increase their beet production by 20 per cent, in addition to the 10-year commitment initially undertaken by Tereos' growers to cover usual beet tonnage;
- the articles of association of Tereos' cooperative did not expressly indicate that cooperative partners could supply part of their beet production to other sugar groups, such as Saint-Louis Sucre; and
- Tereos had required cooperative partners that wished to leave the cooperative to give a 12-month notice period (instead of three months), making it even more difficult to switch to Tereos' competitors.
In light of these concerns, Tereos offered a number of commitments that led the FCA to close its investigation.
Under French law, loyalty rebates granted by a dominant firm may be considered abusive when a discount tends to remove or restrict a buyer's freedom to choose its sources of supply absent a legitimate economic quid pro quo.61 The FCA considers that forward-looking quantitative rebates (as opposed to rebates based on historical sales) conditional upon individual orders, volumes or turnover as generally valid, because they tend to reflect efficiency gains and economies of scale. Other forms of loyalty rebates may be considered abusive.
In DTT Broadcasting,62 the FCA found that TDF had abused its dominant position by granting loyalty rebates to channel editors that hired TDF for a substantial share of their broadcasting sites. The FCA found that TDF generally granted rebates only if channel editors assigned TDF at least 70 per cent of their sites, which prevented other competitors from developing their activity, even though they also offered rebates to channel editors.
Tying and bundling
Tying and bundling consist of tying or bundling two distinct products that typically belong to two different markets, either by forcing consumers to buy the tied products together or by providing them an incentive to buy the products together. The FCA considers that tying by a dominant firm may be abusive if the following two conditions are met: the tying and tied products are distinct products; and the tying practice is likely to lead to anticompetitive foreclosure.63
In Golf Insurance,64 the FCA expressed concerns with respect to the inclusion of insurance products – which are theoretically optional – in the licence delivered by the French Golf Federation. The FCA was particularly concerned that the French Golf Federation used its legal monopoly on the delivery of licences to foreclose its rivals from the golf insurance market through tied selling. To address these concerns, the French Golf Federation accepted giving commitments to prevent tying practices. In 2015, the FCA adopted another decision, finding that these commitments were no longer justified given the developments in the market.65
In Nespresso,66 the FCA accepted commitments addressing its concerns that Nespresso needlessly modified its coffee machines in order to discourage consumers from buying its competitors' coffee capsules, and falsely implied that only Nespresso coffee capsules were compatible with its own machines, so as to favour tied sales of its own capsules with its Nespresso machines and exclude its competitors' capsules. Nespresso committed to inform competing manufacturers of Nespresso-compatible coffee capsules of future technical changes in Nespresso machines so that they have time to adapt their own production and their communication towards consumers. Nespresso also committed to stop commenting on its competitors' capsules.
In Schneider Electric,67 the FCA was concerned that Schneider Electric had abused its dominant position by refusing to sell a significant number of spare parts necessary for the in-depth maintenance of its electric equipment to third-party maintenance providers unless they agreed to have Schneider Electric's own employees perform the associated maintenance services. Schneider Electric argued before the FCA that this restriction aimed at ensuring the safety of property and people as well as at protecting its business model, in particular its brand image, know-how and the expertise of its technicians. However, the FCA found that Schneider Electric's current policy was not necessary to achieve these objectives, as it was likely to constitute an unlawful tied sale by potentially preventing other maintenance providers from carrying out a full range of maintenance services on Schneider Electric's high voltage and low voltage equipment, which respectively account for around 70 and 60 per cent of equipment sales in France. The FCA found that it was also likely to deprive customers of services that might be cheaper and of higher quality. Schneider Electric offered commitments to address the FCA's concerns.
Refusal to deal
The concept of refusal to deal is regularly used by the FCA. It covers a broad range of practices, such as the refusal to grant access to an essential facility or network, the refusal to supply products to existing or new customers, and the refusal to license intellectual property rights. The FCA's test is similar to the test adopted by the European Commission. Refusal to grant access to an essential facility is abusive if the following five conditions are met:
- the facility belongs to a dominant firm;
- access to the facility is necessary to compete in a related market;
- competitors cannot duplicate the facility at reasonable costs;
- the dominant firm unduly refuses access to the facility (or imposes unduly restrictive conditions); and
- access to the facility is possible.68
The same principles apply mutatis mutandis for refusal to supply a product or service. Concerning intellectual property rights, French courts consider that software may constitute an essential facility only if it is proved that the software is indispensable to operate on a market, and a competitor could not develop an alternative software under economically reasonable conditions (even if such economic conditions were less favourable than those under which the dominant undertaking operates).69 In practice, the following facilities have been considered essential under French law: transport facilities, the electricity network, the telephone network, and certain databases or software.
In SNCF,70 the FCA and the Paris Court of Appeal considered that SNCF abused its dominant position by restricting access to the railway infrastructure:
- delaying the release of information concerning access to freight yards, thereby preventing its competitors from accessing rail capacities essential to their business activity;
- retaining exclusive use of certain railway cars that are used for large tonnage transportation and constitute an essential part of the infrastructure; and
- pursuing a train path overbooking policy that prevented its rivals from participating in certain calls for tenders or honouring certain contracts.
In Cegedim,71 the FCA fined Cegedim, a company active both in the provision of healthcare databases and customer relation management (CRM) software for refusing access to its database of medical information to pharmaceutical laboratories that used the CRM software of one of its competitors, Euris. The FCA considered that Cegedim's database was not an essential facility because there were alternative, albeit inferior, rival databases. However, such a refusal to deal nevertheless amounted to an abuse of a dominant position, since Cegedim was found to discriminate against customers using Euris' CRM software in order to foreclose Euris from the CRM market (the FCA pointed out that the practice had caused Euris to lose 70 per cent of its customers between 2008 and 2012). In 2015, the Paris Court of Appeal upheld the FCA's decision and considered in particular that the practices implemented by Cegedim had unjustifiably disadvantaged Euris in terms of costs and reputation.72 The French Supreme Court validated the Court's reasoning.73
Termination of a contractual relationship
The termination of on-going commercial relationships may also be sanctioned on the basis of Article L420-2 of the Commercial Code; in particular, in cases of sudden termination of an established commercial relationship, if it has an anticompetitive object or anticompetitive effects, whether actual or potential.74
In Satellite TV Decoders,75 the FCA expressed concerns about GCP's decision to terminate its Canal Ready partnership with third-party decoder manufacturers. Up until July 2014, in order to receive GCP linear programs by satellite, consumers had to use one of the decoders rented out by GCP or insert a card in a decoder that they could purchase from an authorised third-party decoder manufacturer that had concluded a Canal Ready partnership agreement with GCP (the card-only system). However, in July 2014, GCP decided to put an end to its card-only system and to terminate its Canal Ready partnership agreements owing to content piracy affecting third-party decoders. While the FCA noted that a company, even when it holds a dominant position, is free to modify its strategic model or its business plan as long as these changes do not have an anticompetitive object and can be justified by legitimate reasons, it also clearly stated that a rapid and sudden change can, in some circumstances, amount to an abuse of dominance, depending on the justification brought forward for this decision, the conditions in which it takes place and the effects such decision has on competitors or third parties. In this case, according to the FCA's preliminary assessment, GCP's plan necessarily led to the exclusion of third-party decoder manufacturers from the market and could deprive actual and potential consumers from having the option to purchase decoders that were potentially cheaper or offered different features. While taking into account GCP's piracy concerns, the FCA therefore held that the termination of the card-only system had to be surrounded by appropriate measures to remedy the FCA's concerns, which led GCP to offer commitments.
Under French law, disparagement consists of publicly discrediting an identified competitor or its identified products or services. The FCA considers that disparagement is distinct from criticism as it originates from an economic player seeking to benefit from an unjustified competitive advantage by discrediting its competitor or products, and may constitute an abuse of dominance (when disparagement originates from a dominant player).
In Sanofi76 and Schering-Plough,77 the FCA fined two pharmaceutical companies for disparagement that consisted of widely publicising differences between their originator drug (or the generic manufactured by the producer of the originator drug) and other generic drugs at the time of the entry of the generic drugs into the market. Irrespective of whether such differences were verified or not, the companies could not prove that they had therapeutic consequences. Although neither Sanofi nor Schering-Plough had explicitly presented generic drugs as being inferior, but only pointed at factual differences, the very fact of shedding doubts without scientific supporting evidence was found to be abusive by the FCA. Sanofi was fined €40.6 million and Schering-Plough was fined €15.3 million.
In Janssen-Cilag,78 the FCA imposed a fine of €25 million on Janssen-Cilag for having first prevented and then restricted the development of the generic versions of its Durogesic drug in France, following the expiry of the patent protection for fentanyl. In particular, the FCA found that Janssen-Cilag had submitted legally unfounded arguments to the National Agency for the Safety of Medicines and Health Products (AFSSAPS)79 aimed at casting doubts on the innocuousness and effectiveness of the generic drug. This led the French authority to temporarily refuse to recognise the generic status of Ratiopharm's fentanyl drug. The AFSSAPS ultimately granted generic status to Ratiopharm's drug after a delay of more than a year, but added a warning to this authorisation, recommending careful medical supervision of some patients switching from one fentanyl drug to another. In addition, the FCA found that once the authorisation had been granted, Janssen-Cilag started a massive disparagement campaign of the generic drugs among health professionals, using different media and channels, with the aim of discrediting the generic drugs' reputation by highlighting quantitative, qualitative and size differences from the Durogesic patch. The FCA also considered that Janssen-Cilag distorted the content of the warning issued by the AFSSAPS by providing an inaccurate and incomplete presentation of the risks associated with substitution. The FCA concluded that Janssen-Cilag's practices constituted a single and continuous infringement that had significant foreclosure effects on competitors by delaying the arrival of generics, and then contributing to their low penetration rate, on a market already characterised by the reluctance of healthcare professionals to prescribe generics.
However, in 2018, the FCA recalled in IT Maintenance80 that commercial brochures and letters sent by server manufacturers to their customers, be they more or less aggressive, in order to put forward their main 'selling points' compared with third-party maintainers cannot be considered as a disparagement practice. The FCA noted that the same conclusion applies to confidential letters exchanged between a customer and its suppliers competing for a contract: at most, excessive statements contained in these confidential communications could amount to unfair business practices, not to an abuse of dominance.
Most-favoured nation clauses
In Booking.com,81 the FCA accepted commitments addressing its preliminary concerns that the most-favoured nation (MFN) clauses imposed by Booking.com could have exclusionary effects. MFN clauses prevented hotels from offering to rival reservation platforms or other distribution channels (including through their own sales channels) lower prices or better commercial conditions (i.e., availability, services) than to Booking.com. In particular, the FCA considered that these clauses could prevent smaller platforms and new entrants from gaining market shares by offering lower prices or better services to customers, including by offering lower commission rates to hotels.
iii Exploitative abuses
Exploitative abuses consist of a dominant firm imposing 'unbalanced' conditions on its trading partners, and, in particular, imposing excessively high prices. The imposition of high prices by a dominant undertaking might infringe Article L420-2 of the Commercial Code when prices charged are excessive because they have no reasonable relation to the economic value of the product or service supplied; in particular, where the difference between the costs actually incurred and the price actually charged is excessive and where the price imposed is either unfair in itself or when compared with competing products.82 Relying on EU case law, the FCA recently recalled that if the price difference is significant and persistent, it will be indicative of an abuse. It is then for the dominant undertaking to show that its prices are fair by reference to objective factors.83
In 2009, the FCA fined Orange in the Telecommunication in Overseas Départements case.84 In this case, the FCA investigated the rates applied by Orange for connection services between Réunion Island and the mainland, and found that 'there existed a clear disproportion between these rates and the value of the services', which resulted in the imposition of excessive pricing on consumers (residential and professional), and hindered the development of the high-speed market on Réunion Island, and the development of Orange's competitors.
More recently, in 2018, the FCA fined Sanicorse, the only infectious waste treatment company in Corsica, for having abused its dominant position by imposing excessively high price increases on healthcare establishments.85 While recalling that the role of competition authorities is to protect the competitive conditions that allow market players to freely determine market prices and not to be a price regulator, the FCA also noted that it can intervene to assess and sanction a pricing policy when a dominant company implements an exploitative strategy on captive clients, taking into consideration the market conditions and the economic and legal context in which this pricing policy takes place. The FCA found that Sanicorse implemented significant price increases for more than four years and without any prior notice. Sanicorse also threatened to terminate its contracts with healthcare establishments or refrain from bidding in tenders, leaving its customers with no choice but to accept its new pricing conditions. The average price imposed by Sanicorse increased by around 60 per cent over the period and some hospitals reported individual price increases of up to 194 per cent. The FCA found that such price increases could not be justified by Sanicorse's increased costs and additional investments.
In Petanque Balls,86 the FCA imposed a fine of €320,000 on Obut for imposing resale prices on some of its distributors. The FCA considered that Obut was in a dominant position in the market for the production of petanque balls for competitions and abused its dominant position in the market for the distribution of petanque balls, in which Obut was also active, by imposing resale prices so as to reduce price competition with other retailers. In addition, Obut's sales forces monitored compliance with the suggested list prices, and threatened distributors with delayed deliveries, blocked orders and delisting in cases of deviation. In its decision, the FCA noted that such practices are also prohibited under Article L420-1 of the Commercial Code, but decided to rely on Article L420-2 of the Commercial Code.
Abusive discrimination basically consists of the application by a dominant company of dissimilar conditions to trading partners in equivalent transactions, thereby placing certain trading partners at a competitive disadvantage.87 The FCA considers that discriminatory practices may restrict competition when the dominant firm competes on the downstream market and discriminates against rivals (first-line discrimination); or the dominant firm is not active downstream but discriminates between its customers, thereby altering competition between them (secondary-line discrimination). While first-line discrimination is an exclusionary abuse, second-line discrimination is considered by the FCA as an exploitative abuse (although it results in the exclusion of a trading partner rather than in any exploitation by the dominant firm).
In Electronic Communications,88 the FCA found that Orange gave access to more comprehensive information regarding the operation of the copper local loop to its own commercial entities than to third-party operators. The FCA considered that the (first-line) discrimination in the access to information had artificially strengthened Orange's dominant position, and affected third-party operators by making them appear less reactive and less informed than Orange.
In 2018, in Photovoltaic Electricity,89 the FCA dismissed a first-line discriminatory claim concerning favouritism practices carried out by EDF in favour of its subsidiaries (Enedis and RTE) that were likely to unduly foreclose downstream competitors. The core of the allegations was based on EDF's discriminatory treatment with regard to the filing date of applications for connection to the photovoltaic electricity grid.90 Relying on the EU MEO precedent,91 the FCA pointed out that it is necessary, based on concrete market conditions, economic and legal context and having regard to the circumstances of the case, to demonstrate that the discriminatory conduct in question is likely to produce a competitive disadvantage through a distortion of competition among business partners. The FCA also recalled that setting a de minimis threshold in order to determine the existence of an abuse of dominance was not justified,92 but specified, however, that for discrimination to be likely to create a competitive disadvantage, it must affect the interests of the operator concerned. Therefore, in Photovoltaic Electricity, the FCA held that EDF's behaviour, though it may have caused an individual prejudice to Enedis and RTE's business partners,93 did not tend, having regard to the circumstances of the case, to lead to a distortion of competition between undertakings on the downstream market.
In NavX, the FCA took a strict approach towards secondary-line discrimination, suggesting that dominant firms have an obligation to treat all of their customers equally, even when the dominant undertaking is not active in the downstream market.94 In particular, the FCA found that the rules defined by Google for the operation of its AdWords (now Google Ads) advertising platform should be applied to all advertisers in an 'objective, transparent and non-discriminatory manner', and that discriminatory treatments could be considered abusive. The FCA ultimately accepted commitments from Google to clarify certain rules applicable to advertisers; in particular, in respect of the conditions of suspension of their AdWords account.
V Remedies and Sanctions
Article L464-2 of the Commercial Code provides that the FCA can impose fines on infringing undertakings of up to 10 per cent of the firms' worldwide turnover. The FCA can also order undertakings to terminate anticompetitive practices within a specified time limit, impose remedies, or both. As an alternative to sanctions, the FCA may accept commitments offered by the dominant firms being investigated in response to the FCA's competition concerns. In the event that an undertaking does not comply with the FCA's decision to terminate anticompetitive practices or with the FCA's orders, or does not implement their commitments, the FCA may impose penalty payments of up to 5 per cent of the undertaking's average daily turnover.
According to Article L464-2 of the Commercial Code, fines should be proportionate to:
- the gravity of the infringement;
- the importance of the damage to the economy;
- the group or company's individual situation; and
- the possible recidivism.
In any event, fines cannot exceed 10 per cent of the highest consolidated worldwide turnover achieved since the fiscal year preceding the starting date of the anticompetitive practices.
In 2011, the FCA issued guidelines on the methods for determining fines.95 The basic amount of the fine is calculated as a proportion of the value of sales affected by the infringement, taking into consideration the gravity of the infringement and the damage to the economy. The proportion of the value of sales is between zero and 30 per cent. The basic amount of the fine is then adjusted taking into account the duration of the infringement, and the existence of aggravating circumstances (e.g., if the undertaking has a specific ability to influence) or mitigating circumstances (e.g., if the infringement was authorised or encouraged by public authorities). Other factors that might also be taken into account are the size and the economic power of the undertaking or its group, the fact that the undertaking is a single product company and recidivism.
With respect to repeat offenders, the French Supreme Court ruled in 2016 in the SNCF case96 that recidivism can be established even though the two infringements were implemented on two different markets.97 More recently, the Paris Court of Appeal confirmed a 2013 decision imposing a €13.5 million fine imposed on EDF,98 including a 25 per cent increase for reiteration.99 The FCA had found that EDF, as the incumbent electricity supplier, had unfairly favoured its subsidiary, EDF ENR, operating in the competitive market for photovoltaic solar power offered to individual customers; in particular, by making various resources available to its subsidiary that could not be replicated by competitors, notably for prospecting, promoting and marketing photovoltaic offers. The FCA had applied a 25 per cent fine increase for recidivism on EDF on the ground that EDF had been previously sanctioned in 2000 for abusive practices consisting of (a) bidding at very low prices in response to calls for tenders organised by municipalities, behaviour that then discouraged municipalities from maintaining any tendering process, EDF thereby being automatically attributed the market; and (b) concluding agreements with municipalities for an excessive period of time with termination clauses that made it more difficult to end the commercial relationship.100 On appeal, the Paris Court of Appeal held that recidivism was not established and reduced the amount of the fine by half.101 However, in 2017, the French Supreme Court quashed this analysis and referred the case back to the Paris Court of Appeal.102 In a new ruling in late 2018, the Paris Court of Appeal essentially found that the 25 per cent fine increase was justified and proportionate since:
- the two infringements that led to the FCA's decisions of 2000 and 2013 were very similar both in terms of object and effects (in both cases, EDF restricted competition on markets related to the electricity supply market where it holds a dominant position owing to its former legal monopoly through methods falling outside the scope of competition on the merits);
- the practices sanctioned in the 2013 decision were neither unprecedented nor innovative and EDF was fully aware of applicable competition rules; and
- the seven-year period that had elapsed between the 2000 decision and the beginning of the new practices represented less than half of the 15-year period after which the FCA typically waives recidivism.103
Since the issuance of the FCA's fining guidelines, fining decisions have been issued in 23 abuse of dominance cases:104
- Mobile Telephony;
- Ordre des Experts Comptables;
- Photovoltaic Solar Power;
- Mobile Telephony at Réunion Island and Mayotte (residential customers);
- Antilles Dairy Products;
- Overseas DDT Deployment;
- Eiffel Tower;
- Mobile Telephony at Réunion Island and Mayotte (non-residential customers);
- Electronic Communications;
- DTT Broadcasting;
- Pétanque Balls;
- Funeral Services in the Ain Department;
- Termite Traps; and
In 2015, the FCA imposed a record-breaking fine of €350 million on Orange in the Electronic Communications case (after settlement).106 More recently, in Sanicorse,107 the FCA not only imposed a fine on Sanicorse but also ordered the infectious medical waste treatment company to publish, pursuant to the provisions of Article L464-2, Paragraph 5 of the Commercial Code, a summary of the FCA's fining decision in the print and online editions of three newspapers so as to inform Sanicorse's customers, and in particular healthcare establishments, of the infringement sanctioned by the FCA.
ii Behavioural remedies
The FCA can impose behavioural remedies either as an interim measure or as a sanction imposed in decisions on the merits.
Pursuant to Article L464-1 of the Commercial Code, the FCA may grant interim measures in the event that the reported practices cause serious and immediate damage to the general economy, the economy of a sector or the interests of either consumers or the complainant. Since 2010, interim measures have been granted in six abuse of dominance cases.108
Pursuant to Article L464-2 of the Commercial Code, the FCA may also order undertakings to terminate anticompetitive practices within a specific time frame or impose behavioural remedies in addition to fines in its decision on the merits.
In SNCF,109 the FCA used behavioural remedies as an alternative to sanctions in relation to exclusionary pricing objections. The FCA ordered SNCF to:
- implement an analytical accounting system for its freight services activity by full-trainload separate from its wagon-load freight services activity, so as to clearly identify costs that are common to the two types of activities;
- prepare a report identifying the costs that could be avoided over a three-year period in the event that the SNCF were to abandon its freight services activity by full-trainload; and
- guarantee, within three years of the FCA's decision, that prices offered to shippers for full-trainload freight services covered the average avoidable costs related to this activity over a three-year period.
The Paris Court of Appeal, however, annulled the third injunction in late 2018 as it found that such an injunction unduly interfered with SNCF's power to determine its pricing policy.110
In Electronic Communications,111 the FCA ordered Orange to provide competitors with equal access to the information it collects as the operator of the local loop, and to put an end to the loyalty and exclusivity policy subject to the investigation.
In Cegedim,112 the FCA ordered Cegedim to stop any form of discrimination among its customers based on the CRM software they were using (i.e., Cegedim's or competitors' CRM software). Similarly, in Funeral Services in the Ain Department,113 the FCA ordered the funeral company Comtet to modify its pricing forms so as to clearly show the services that are covered by the public tariff.
iii Structural remedies
Pursuant to Article L430-9 of the Commercial Code, the FCA can order an undertaking or a group of undertakings that abused either their dominant position or the state of economic dependence of a commercial partner to alter or terminate any agreement that gave rise to the underlying dominant position, including a merger agreement previously authorised by the FCA in the context of a merger review. This provision enables the FCA to undo a transaction or an agreement for abuse of dominance. The FCA has used this power on only one occasion. In the Water Market case,114 the FCA found that the Compagnie Générale des Eaux and the Lyonnaise des Eaux, which had created several joint ventures, were abusing their collective dominance by deciding not to compete against their joint ventures for certain calls for tenders. The FCA found that the termination of the joint ventures was necessary to remedy the behaviour and, ultimately, the Compagnie Générale des Eaux and the Lyonnaise des Eaux voluntarily terminated their joint venture agreements.
The FCA is also empowered to order structural remedies in case of abuse of dominance or of economic dependence in the retail sector (see Article L752-26 of the Commercial Code).
As an alternative to sanctions and remedies, the FCA may also accept commitments offered by undertakings pursuant to Article L464-2 of the Commercial Code. The FCA can make such commitments binding in exchange for the closing of an investigation on the merits without making any finding of an infringement or imposing any sanction, provided the commitments are accepted before the FCA issues a statement of objections. The FCA uses the commitments procedure in order to intervene more quickly and avoid the administrative costs and legal constraints of establishing an abuse of dominance. The FCA issued one commitment decision in 2018, compared with five in 2017.
In Satellite TV Decoders,115 in response to the FCA's competition concerns, GCP agreed to allow third-party decoder manufacturers to manufacture and distribute decoders compatible with GCP satellite programs, provided these decoders include a software access module called 'myCanal' (that users can download) designed, monitored and updated directly by GCP. The FCA notably considered that such commitments, which will apply until December 2021, answered GCP's piracy concerns while providing an alternative offer to GCP decoders. Interestingly, GCP's commitments go beyond the competition concerns formulated by the FCA, as they extend to non-linear satellite content, to the benefit of GCP's subscribers.
The French Minister of the Economy, certain other public entities and any company may refer practices falling within the scope of Article L420-2 of the Commercial Code to the FCA. The FCA may also initiate investigations ex officio into alleged abuses of a dominant position. The FCA cannot investigate facts that took place more than five years prior to the investigation unless a procedural act interrupts this statute of limitations (see Article L462-7 of the Commercial Code). If the FCA considers that a complaint is unsubstantiated, it can issue a reasoned decision rejecting the complaint at a preliminary stage.
i Interim measures
Claimants may request interim relief. A request for interim relief must be filed concurrently with the action on the merits and lasts approximately six months. The FCA will order interim measures if the following cumulative criteria are met:
- the FCA has jurisdiction over the relevant practices on the merits;
- the alleged practices are susceptible of breaching competition rules; and
- the alleged practices may have serious and immediate effects on consumers, the sector or the interests of the plaintiff.
In practice, interim measures are ordered mainly in situations where the defendant's actions threaten to foreclose a competitor from a market. The interim measure investigation is followed by a hearing and a decision whereby the FCA decides whether interim measures are justified and whether an investigation on the merits is required. The FCA generally issues a decision within one or two months of the hearing, although it sometimes issues its decision within a very short time frame (for instance, within one week of the hearing in the Amadeus case).116 The parties may appeal the interim measure decision before the Paris Court of Appeal within 10 days of the notification of the decision.
In both 2017 and 2018, the FCA did not grant any interim measures, while in 2016, the FCA ordered interim measures against Engie in the gas market to ensure that the price of some of its offers to business customers reflected its costs.117 The FCA considered that Engie's practices could have serious and immediate anticompetitive effects on the sector and justified interim measures pending a decision on the merits.
More recently, in 2019, in Amadeus,118 the FCA considered that Google's decision to suspend the accounts of paid phone directory services operator Amadeus and to refuse to display its ads on the Google Ads advertising platform (formerly known as AdWords) may amount – at the interim measure stage – to a sudden termination of its commercial relationship under conditions that are not objective, not transparent and discriminatory. In particular, the FCA noted:
- the absence of prior notice before any account suspension or clear indication in the suspension notices of the violations justifying such suspensions; and
- the fact that Google's sales teams were involved in Amadeus' advertising campaigns that were deemed non-compliant with the Google Ads rules.
The FCA found that the practices had a serious and immediate impact on Amadeus, which lost approximately 90 per cent of its revenues, and therefore justified granting interim measures pending a decision on the merits. The interim measures, however, go beyond the individual situation of Amadeus and extend more generally to all companies operating in the sector of paid phone directory services. Specifically, the FCA ordered that Google:
- clarify the Google Ads rules applicable to this sector;
- provide, save in exceptional circumstances, a prior warning referring to the clarified Google Ads rules and specifying the alleged violation before suspending an account;
- organise face-to-face training on the content and scope of the clarified rules for Google's sales teams in charge of providing personalised support to companies operating in this sector; and
- review manually the compliance of Amadeus' ads with the clarified rules.
On appeal, the Paris Court of Appeal annulled the measure related to the sales teams' training as it considered that it was not necessary to respond to the emergency situation but confirmed the other three measures.119
ii Investigation on the merits
If the FCA considers that a complaint is well grounded, it appoints case handlers to investigate the case. The case handlers have wide investigative powers and may conduct dawn raids if they are authorised to do so by a court, or request information from undertakings. They can also interview employees. The investigation period typically lasts from six months to three years (or sometimes more), until the case handler notifies the companies involved of its objections. The companies have two months to respond to the objections. This is followed by a second exchange of written briefs and a hearing. The exchange of written submissions generally lasts one to two years, until a hearing is scheduled.
The parties are invited to a hearing before the FCA Board, where the case handlers provide an oral presentation of their observations. The parties may also present their observations orally.
The FCA generally issues a decision within three months of the hearing. It may find that the alleged practices are not established, or impose a fine on the undertakings and order remedies. The parties may appeal the decision before the Paris Court of Appeal within a month. Paris Court of Appeal's rulings may in turn be challenged before the French Supreme Court, which only has jurisdiction over matters of law.
If the FCA intends to implement the commitment procedure as an alternative to an infringement procedure, the case handlers inform the undertakings of the FCA's preliminary competition concerns at an early stage during the investigation (before a statement of objections has been issued) and invite them to offer commitments that adequately address the identified concerns.120 Once the proposed commitments have been received, the case handlers carry out a market test, which is published on the FCA's website, to ensure that the proposed commitments are considered adequate by the main stakeholders. The FCA may either accept or reject the commitments. The FCA may also require amendments. If the FCA finally considers that the commitments offered address its competition concerns, it makes the commitments binding in its final decision.
The settlement procedure was recently modified by Law No. 2015-990 of 6 August 2015. Under the new regime, settling companies commit to not challenging the objections notified by the FCA and, in exchange, can negotiate a fine range with the investigation services. Companies may also offer behavioural commitments. The FCA board takes the ultimate decision but will comply with the fine range negotiated with the investigation services.
In December 2018, the FCA adopted its procedural notice on the new settlement procedure.121 While not containing any major change, the notice provides some welcome clarifications, notably concerning the possibility for companies to file written comments before the FCA board on the fining determinants and implement the settlement procedure in conjunction with the leniency procedure. The notice also reaffirms the FCA's preference for cases in which all parties opt in to the procedure, thereby avoiding 'hybrid' scenarios. From the point of view of the FCA, the use of the settlement procedure enables companies to save procedural costs and to obtain a fine reduction (that can sometimes be substantial). In addition, the settlement procedure is likely to facilitate the adoption of shorter decisions in a shorter time frame than the ordinary procedure, and saves on resources consumed by any contentious appeals. However, the inability to negotiate the scope of the statement of objections received prior to settling remains at odds with the European Commission's settlement process and significantly reduces the scope of the negotiations.
In Electronic Communications,122 although the new regime was not yet applicable, the FCA's investigation service anticipated the reform of the settlement procedure and negotiated with Orange a €350 million cap on the fine in exchange for Orange's commitment not to challenge the objections and to implement behavioural remedies. The FCA's board eventually imposed the maximum fine on Orange.
In addition, the FCA has adopted two settlement decisions in abuse of dominance cases since the entry into force of the new settlement regime (before the publication of the settlement notice). In Petanque Balls, the FCA settled a fine of €320,000 with Obut, as well as receiving their commitment to implement an antitrust compliance programme.123 In Engie,124 Engie did not challenge the FCA's objections, and the FCA imposed a €100 million fine following a settlement procedure.
VII Private Enforcement
Private enforcement claims may be brought under general tort law provisions (Article 1240 of the Civil Code) within five years of the day the victim becomes aware or should have become aware of the wrongdoing.
Private enforcement claims require the defendant to prove a fault, a damage and a causal link between the two. Since the implementation into French law of the EU Damages Actions Directive,125 an FCA decision sanctioning anticompetitive practices creates an unrebuttable presumption before civil and commercial courts provided that all appeals against the FCA's decision are exhausted. Establishing a fault is significantly more difficult in stand-alone actions. Proving the existence and the amount of the damage is also difficult in dominance cases, which explains why claimants often have to rely on expert economic and accounting reports. The principle of full compensation for the damage suffered applies (both material and non-material damage but there are no punitive damages).
Antitrust class actions have been available in France since 2014 under the following conditions:
- the claim is a follow-on action after a sanction decision by the FCA or the European Commission;
- the action is brought within five years of the final sanction decision (no longer subject to an appeal);
- the claim is brought by a consumer association on behalf of consumers; and
- consumers have opted in to join the class action.
Private enforcement has been limited in France, as there has not yet been any antitrust class action; the majority of cases are settled out of court; and there is no easy access to evidence for claimants who bear the burden of proof (although the implementation of the EU Damages Actions Directive under French law will be helpful for claimants). Further, although specific district courts and commercial courts have exclusive jurisdiction over antitrust claims, the judges are not specialised in antitrust matters, and often do not have independent means to assess the existence of dominance and the effects of the alleged abuses on the markets. Private claimants in France, therefore, essentially rely on decisions issued by the FCA.
For instance, in Outremer Telecom v. Orange,126 Outremer Telecom brought an action before the Paris Commercial Court based on a 2009 FCA decision.127 Outremer Telecom alleged that Orange's abuses of its dominant position (and anticompetitive agreements) on the mobile telephone market in the Antilles and Guyana (French overseas territories) prevented it from expanding on this market. The Paris Commercial Court awarded Outremer Telecom €7.9 million to compensate for the damage resulting from Orange's abusive loyalty rebates and excessive prices policy on off-net calls. However, the Paris Court of Appeal recently cut the damages granted to Outremer Telecom to €2.6 million after reviewing the calculation of the damage estimate.128 In December 2017, in Digicel v. Orange,129 the Paris Commercial Court ruled on a separate follow-on damages action against Orange in relation to the same FCA decision. The Paris Commercial Court found that Digicel had been harmed by Orange's abusive loyalty rebates and discounts applied on calls from fixed phones to Orange mobiles in the Caribbean overseas territories. In the ruling, the Court acknowledged that Orange's practices had significant restrictive effects on Digicel's development since its entry into the Caribbean market in 2000 and therefore awarded Digicel €180 million based on an expert calculation of lost revenues, plus 10.4 per cent interest per year starting from 2009, leading to a total of €346 million in damages to be paid by Orange and its affiliate, Orange Caraïbe. The judge, however, rejected Digicel's claims in relation to Orange's other infringements, having found that Orange's exclusivity clauses with distributors and repairers did not have any impact on Digicel's development, as the latter had deliberately chosen a single-brand distribution network and had decided to undertake the reparations in mainland France.
In addition, in Betclic v. PMU,130 the Paris Court of First Instance ruled that a commitment decision that led the FCA to close the investigation on the merits without making a finding of infringement does not prevent ordinary courts from finding that the company having taken these commitments has engaged in abusive conduct, and noted that courts are free to rely on information contained in the commitment decision and use it as an indication or even prima facie evidence of the anticompetitive nature of the practices. The Court clearly stated that a company cannot invoke a commitment procedure to claim that it did not commit a fault so as to avoid compensating victims for the damage they suffered. In practice, the Paris Court of First Instance relied on the FCA's PMU commitment decision131 to find that PMU held a dominant position on the offline and online horse racing betting markets. The Court also relied on feedback during the market test when the PMU offered commitments in 2014 to find that the PMU had indeed abused its dominant position by pooling together its online and offline bets to gain an unfair competitive advantage offer. The Court ultimately decided to stay the proceedings, and ordered an expert to evaluate what could have been Betclic's market share had the PMU not pooled together its online and offline bets to determine the amount of damages to award to Betclic. On appeal, the Paris Court of Appeal confirmed the judgment of the court of first instance and extended the expert's mission.132
Purely stand-alone actions (not based on a previous FCA decision) are rare. Nevertheless, in Bottin Cartographes v. Google,133 the Paris Commercial Court granted Bottin Cartographes €500,000 in damages in the first instance, based on a stand-alone claim alleging that Google implemented predatory prices by offering its Google Maps application programming interface (API) service, which enables third-party website operators to display a map on their website, free of charge. On appeal, however, the Paris Court of Appeal overruled the first instance decision and dismissed all the plaintiff's claims.134 The Court of Appeal decided to support its decision by asking the FCA for its opinion on the existence of a dominant position and the question of predation.135 The FCA found that irrespective of Google's market position, Google's behaviour with regards to Google Maps API could not be deemed predatory because the economic analysis submitted to the FCA showed that Google always covered at least its average incremental costs, and in any event, there was no evidence of a predatory strategy, especially as there were a significant number of competitors in the market, many of them offering their products for free or on a 'freemium' basis, like Google. On the basis of the FCA's opinion, the Court of Appeal found that Google's behaviour could not be deemed abusive and dismissed all claims.
In SFR v. Orange,136 the Paris Commercial Court granted €51.4 million in damages against Orange following a stand-alone claim made by SFR. SFR claimed that Orange had implemented a margin-squeeze strategy by allowing secondary residence owners to suspend their landlines while they were away from their secondary residence.137 On this upstream market, Orange, however, refused to offer suspendable telephone access to telecom operators. The Commercial Court found that this practice constituted a margin squeeze because as a result, SFR was not in a position to propose to its downstream customers to have suspendable landline access. On appeal, however, the Paris Court of Appeal annulled the Paris Commercial Court's judgment. The Court of Appeal found that the market for secondary residences was not a relevant product market because from the demand-side perspective, 90 per cent of secondary residence owners considered that the suspendable line was substitutable with other telephone lines; and from the supply-side, the data used by SFR to demonstrate the cost difference as compared with other telephone lines was not sufficiently reliable.138 In 2016, the French Supreme Court overturned the Court of Appeal's ruling.139 The Supreme Court found that the Court of Appeal should have conducted a more detailed analysis on demand-side substitutability, notably by making a distinction between secondary residence owners that purchased a simple fixed line and those that purchased multi-service fixed lines and mobile lines. The Supreme Court also found that the Court of Appeal should have ignored the unreliability of the data on supply-side substitutability and should have discussed the relevance of the criteria used by SFR. The Supreme Court referred the case back to the appellate court. The Paris Court of Appeal ultimately awarded SFR €53 million in damages.140
In purely stand-alone actions, claimants may be exposed to a risk of conviction for abusive proceedings. Very recently, the Paris Court of Appeal imposed a civil fine (€3,000) and damages (€20,000) on Avi Charente for abusive proceedings consisting of bringing a stand-alone action for abuse of dominance without having sufficient evidence to prove its claims.141 On the contrary, in another case, the Paris Court of Appeal reversed the judgment of the court of first instance, which had ordered Inforad to pay €60,000 in damages to Coyote for abusive proceedings, on the grounds that such an abuse requires an intention to harm, the proof of which was not provided in this case.142
Private enforcement is expected to continue developing as the EU Damages Actions Directive is now implemented under French law.143
VIII Future Developments
The FCA has shown increasing interest in the online advertising sector over the past few years. In particular, following an in-depth sector-specific investigation, the FCA published an opinion regarding the use of data in the online advertising sector in March 2018.144 In this Opinion, the FCA describes the dynamics and mechanisms of this sector and notes that online advertising has become the leading form of advertising in France. The FCA also considers that Google and Facebook are the two leaders of the online advertising sector and that their success is based on their ability to collect and process large volumes of information, while also noting that the two players have several significant competitive advantages, including a strong popularity among internet users, vertical integration and powerful targeting capabilities. The FCA furthermore lists a number of concerns that were brought to the FCA's attention by the various stakeholders that participated in this investigation; in particular, concerning strategies involving bundling or tied sales, low prices and exclusivities, discriminatory treatment practices, impediments to interoperability and restrictions on the possibilities to access and collect certain data. Given such concerns, the FCA has announced that its investigation services will examine the information collected during this investigation to determine whether it is necessary to initiate one (or more) investigations. More recently, in a press release of January 2019 announcing its priorities for 2019,145 the FCA confirmed that the digital sector, including the online advertising sector, will remain a priority for this year, and that it will, in particular, carefully analyse the use of data, as the German Federal Cartel Office did in the Facebook abuse of dominance case.146 In this regard, the interim measure decision of the FCA against Google in Amadeus,147 in early 2019, clearly shows that the FCA intends to take action quickly in this sector.
In June 2018, the FCA also launched a joint project on algorithms and their implications on competition with the German Federal Cartel Office that is planned to be completed in 2019 and that should result in a joint working paper analysing the challenges raised by algorithms (which can facilitate collusion but also increase the market power of companies that use them), and identifying conceptual approaches to meet these challenges.148
1 Antoine Winckler and Frédéric de Bure are partners at Cleary Gottlieb Steen & Hamilton LLP. The authors gratefully acknowledge the brilliant contribution of Sarah Aït Benali and Martha Smyth of the Paris office of Cleary Gottlieb Steen & Hamilton LLP.
2 Guidance on the Commission's enforcement priorities in applying Article 82 of the EC Treaty to abusive exclusionary conduct by dominant undertakings, OJ C45 of 24 February 2009, p. 7. See also the European Union chapter.
3 FCA Decisions No. 18-D-03 of 20 February 2018 regarding practices implemented in the sector of the distribution of termite traps with biocide in Réunion Island, French Antilles and French Guiana, which imposed a fine of €5,000 on Emeraude Environnement for abusing its dominant position (while also imposing fines of €5,000 on Emeraude, €60,000 on Dow Agrosciences and €5,000 on Carib Termite Control for violating the prohibition of exclusive import duties provided by Article L420-2-1 of the Commercial Code); and No. 18-D-17 of 20 September 2018 regarding practices implemented in the infectious medical waste management sector in Corsica, which imposed a €199,000 fine on Sanicorse (an appeal is pending before the Paris Court of Appeal).
4 FCA Decision No. 18-D-14 of 24 July 2018 relating to practices implemented in the marketing of satellite TV decoders sector.
5 FCA Decisions No. 18-D-13 of 20 July 2018 relating to practices implemented by Google in the online advertising sector; No. 18-D-20 of 5 October 2018 on practices implemented in the publishing and marketing of management information technology solutions for the agricultural profession; No. 18-D-22 of 17 October 2018 on practices implemented in the take-away and home delivery of pizzas sector (I); and No. 18-D-25 of 6 December 2018 on practices implemented in the take-away and home delivery of pizzas sector (II).
6 FCA Decisions No. 18-D-07 of 31 May 2018 on practices implemented in the sector of maritime passenger crossing services between the mainland and the Island of Yeu; No. 18-D-10 of 27 June 2018 concerning practices implemented in the IT maintenance sector; and No. 18-D-11 of 4 July 2018 relating to practices implemented by EDF in the photovoltaic electricity sector.
7 FCA Decision No. 19-MC-01 of 31 January 2019 regarding a request for interim measures from Amadeus, partially annulled by the Paris Court of Appeal on 4 April 2019. Also, in 2019, see FCA Decisions Nos. 19-D-03 of 16 January 2019 regarding practices implemented in the cross-Channel transport of day-old chicks and 19-D-04 of 21 February 2019 regarding practices implemented in the field of online air ticket booking services, in which the FCA refused to impose interim measures, owing to lack of sufficient supporting evidence.
8 FCA Decisions No. 17-D-02 of 10 February 2017 concerning practices implemented in the competitive petanque balls sector, which imposed a €320,000 fine on Obut; No. 17-D-06 of 21 March 2017 concerning practices implemented in the gas and electricity supply sector, which imposed a €100 million fine on Engie; No. 17-D-13 of 27 July 2017 of 27 July 2017 concerning practices implemented in the funeral sector in the Ain department, which imposed a €80,000 fine on Comtet; and No. 17-D-25 of 20 December 2017 concerning practices implemented in the fentanyl transdermal patches sector, which imposed a €25 million fine on Janssen-Cilag and its parent company, Johnson & Johnson.
9 FCA Decision No. 18-D-17; see footnote 3.
10 FCA Decision No. 18-D-14; see footnote 4.
11 FCA Decision No. 18-D-07; see footnote 6.
12 FCA Decision No. 04-D-79 of 23 December 2004, relating to practices implemented by the RDPEV.
13 In a first ruling of 28 June 2005, the Paris Court of Appeal dismissed the predatory pricing claim made by the same competitor, confirming, in particular, the scope of the relevant costs to be taken into account in determining the incremental costs (Paris Court of Appeal, 28 June 2005, Vedettes Vendéennes). The French Supreme Court, in June 2008, held, however, that the Court of Appeal should have examined whether the RDPEV could have avoided the costs linked with the operation of its summer fleet in order to carry out its public service mission (French Supreme Court, 17 June 2008, No.05-17.566). The case was thereby referred back to the Court of Appeal. Again in June 2009, the Court of Appeal confirmed the 2004 FCA decision by ruling that the RDPEV had not abused its dominant position since the traditional predatory pricing test could not be applied to the allegedly infringing company because of its public service mission (Paris Court of Appeal, 9 June 2009, Vedettes Vendéennes). The French Supreme Court, in July 2010, overruled the Court of Appeal and held that the standard competition law test for predatory pricing should be applied in the present case since the RDPEV, alongside its public service mission, also carries out competitive activities (French Supreme Court, 13 July 2010, No.09-67.439). The Court of Appeal, to which the case was then referred, ultimately overturned the 2004 FCA decision (Paris Court of Appeal, 20 December 2012, Vedettes Vendéennes).
14 FCA Decision No. 18-D-10; see footnote 6.
15 FCA Decision No. 18-D-03; see footnote 3.
16 FCA Decisions Nos. 18-D-20 (see footnote 5) and 19-D-03 (see footnote 7).
17 FCA Decision No. 14-D-09 of 4 September 2014 concerning practices in the espresso coffee machines sector.
18 FCA Decision No. 16-D-29 of 19 December 2016 concerning practices implemented in the after-sales market of photocopiers.
19 European Commission, Case No. IV/34.330 of 22 September 1995. According to this case law, any dominant position on the secondary market for the sale of consumables or services of an operator active on the market for primary goods may be ruled out if adequate competition is shown to exist in the primary market and if the primary and secondary markets are closely associated in the eyes of customers at the time of their purchasing decision.
20 See footnote 14.
21 FCA Decision No. 12-D-24 of 13 December 2012 concerning practices in the mobile telephony sector.
22 Paris Court of Appeal, 19 May 2016, Mobile Telephony, upheld by French Supreme Court, 5 April 2018, Nos 16-19.186 and 16-19.274.
23 See footnote 9.
24 See footnote 15.
25 See footnote 9.
26 FCA Annual Report for 2011, p. 118.
27 FCA Decision No. 18-D-13; see footnote 5.
28 FCA Decision No. 04-D-48 of 14 October 2004 concerning practices implemented by France Telecom, SFR Cegetel and Bouygues Telecom.
29 FCA Decision No. 05-D-32 of 22 June 2005 concerning practices in the pet food sector.
30 See footnote 10.
31 See footnote 15.
32 See footnote 9.
33 General Court Decision of 6 June 2002, Case No. T-342/99, Airtours.
34 FCA Decision No. 12-D-06 of 26 January 2012 concerning practices implemented in the civil engineering sector in Saint-Pierre-et-Miquelon.
35 In addition to FCA Decision No. 12-D-06 (see footnote 34), see FCA Decisions Nos. 05-D-49 of 28 July 2005 concerning practices in the sector of hiring maintenance for postage machines; and 02-D-44 of 17 July 2002 concerning the water market sector. See also FCA Decision No. 07-D-08 of 12 March 2007 concerning practices in the supply and distribution sector of cement in Corsica, which was partially dismissed by the Paris Court of Appeal with respect to collective dominance.
36 The FCA also found in some circumstances that companies held a collective dominant position without finding any abuse (see, for instance, FCA Decisions No. 00-D-83 of 13 February 2001 concerning practices implemented during the 1998 Football World Cup, upheld by the Paris Court of Appeal on 30 October 2001 and by the French Supreme Court on 8 July 2003; No. 01-17.015; No. 06-D-02 of 20 February 2006 concerning practices in the roadworks sector for the manufacture of bituminous asphalt in the Ardennes department; and No. 06-D-18 of 28 June 2006 concerning practices implemented in the film advertising sector).
37 Paris Court of Appeal, 4 May 2004, CNPA v. Honda Motor ea. See also FCA Decisions No. 14-D-07 of 23 July 2014 on practices implemented in the distribution of brown goods, upheld by the Paris Court of Appeal on 3 December 2015; No. 10-D-08 of 3 March 2010 on practices implemented by Carrefour in the general food retail sector; No. 04-D-26 of 30 June 2004 on practices implemented by Champagne Ardenne, upheld by the Paris Court of Appeal on 25 January 2005 and by the French Supreme Court on 28 February 2006; No. 05-12.138; No. 02-D-77 of 27 December 2002 relating to a complaint from Daniel Grenin SA; and No. 01-D-49 of 31 August 2001 on a complaint and a request for interim measures from Concurrence against Sony.
38 FCA Decision No. 18-D-22; see footnote 5.
39 Paris Court of Appeal, 9 March 2010, SNCM.
40 See the European Union chapter.
41 In 2007, the FCA imposed a fine of €10 million on GSK for having applied predatory prices in relation to an injectable antibiotic called cefuroxime sodium sold by GSK under the name Zinnat in order to appear as an aggressive player and deter generic manufacturers from entering the market on which GSK held a dominant position through the sale of its injectable antiviral Zovirax (FCA Decision No. 07-D-09 of 14 March 2007 on practices implemented by GSK). However, this decision was annulled by the Paris Court of Appeal on the ground that the FCA had not established the necessary link between GSK's behaviour on the non-dominated market for cefuroxime sodium and its dominant position on the injectable Zovirax market (Paris Court of Appeal, 8 April 2008, GSK). The French Supreme Court upheld the position of the Court of Appeal by noting that the assumption under which there is a link between the anticompetitive practice and the dominated market should not come into play when the prohibited practice is implemented in a market other than the dominated market (French Supreme Court, 17 March 2009, No. 08-14.503). In this case, the French Supreme Court recalled that there must be 'particular circumstances' establishing (a) that it was to strengthen its dominant position in a market that a company decided to implement a prohibited abusive practice in another market in which it has no dominant position; or (b) that the two concerned markets are so closely related that a company is placed in a situation comparable to that of holding a dominant position in the markets in question as a whole, which was not the case here.
42 See, in particular, FCA Decisions No. 17-D-16 of 7 September 2017 concerning practices implemented by Engie in the energy sector; No. 17-D-26 of 21 December 2017 concerning practices implemented in the collection and recycling of non-hazardous office waste; and No. 17-D-09 1 June 2017 concerning practices implemented by the National Institute of Preventive Archaeological Surveys in the preventive archaeology sector.
43 FCA Decision No. 12-D-25 of 18 December 2012 concerning practices implemented in the railway freight sector. A fine was imposed on SNCF but not in relation to the dominant company's pricing practices.
44 Paris Court of Appeal, 6 November 2014, SNCF.
45 French Supreme Court, 22 November 2016, Nos. 14-28.224 and 14-28.862.
46 Paris Court of Appeal, 20 December 2018, SNCF. The Court, however, annulled one of the three injunctions ordered by the FCA upon the SNCF. An appeal is currently pending before the French Supreme Court.
47 Paris Court of Appeal, 25 November 2015, Bottin Cartographes v. Google.
48 FCA Opinion No. 14-A-18 of 16 December 2014 concerning a dispute between Bottin Cartographes and Google.
49 See footnote 11.
50 See, in this regard, Paris Court of Appeal, 12 October 2017, Société TDF.
51 Paris Court of Appeal, 20 December 2012, Vedettes vendéennes.
52 FCA Decision No. 14-D-04 of 25 February 2014 concerning certain practices in the online horse race betting sector.
53 FCA Decision No. 15-D-05 of 15 April 2015 concerning certain practices in the passenger urban transport sector.
54 FCA Decision No. 17-D-06; see footnote 8.
55 FCA Decision No. 17-D-13; see footnote 8.
56 French Supreme Court, 3 March 2009, No. 08-14.435.
57 FCA Decision No. 15-D-10 of 11 June 2015 concerning practices implemented by TDF on the Eiffel Tower site, upheld by the Paris Court of Appeal on 12 October 2017 (an appeal is pending before the French Supreme Court).
58 FCA Decision No. 08-D-16 of 3 July 2000 concerning practices in the ID photos sector.
59 FCA Decision No 15-D-09 of 4 June 2015 on practices implemented in the mobile telephony equipment sector.
60 FCA Decision No. 17-D-12 of 26 July 2017 on practices implemented in the sugar beet supply sector.
61 FCA Decision No. 04-D-65 of 30 November 2004 concerning practices in the postal services sector. See also FCA Decision No. 05-D-32 (see footnote 29).
62 FCA Decision No. 16-D-11 of 6 June 2016 on practices implemented in the terrestrial television broadcasting sector. The Paris Court of Appeal reduced the amount of the fine on 21 December 2017, considering that the disparagement charge was not established (Paris Court of Appeal, 21 December 2017, TDF. An appeal is pending before the French Supreme Court).
63 FCA Decision No. 11-MC-01 of 12 May 2011 concerning practices in the delivery of parcels to collection points sector.
64 FCA Decision No. 12-D-29 of 21 December 2012 concerning practices in the the distribution of insurance products to golfers sector.
65 FCA Decision No. 15-D-16 of 27 November 2016 concerning the revision of the commitments of the French Federation of Golf.
66 FCA Decision No. 14-D-09; see footnote 17.
67 FCA Decision No. 17-D-21 of 9 November 2017 concerning practices implemented in the medium and low-voltage electrical distribution equipment maintenance sector.
68 FCA Decision No. 03-MC-04 concerning a request for interim measures filed by Messageries Lyonnaises de Presse.
69 Paris Court of Appeal, 31 January 2006, NMPP.
70 FCA Decision No. 12-D-25, upheld by the Paris Court of Appeal on 6 November 2014; see footnote 43.
71 FCA Decision No. 14-D-06 of 8 July 2014 concerning practices in the medical information database sector, upheld by the Paris Court of Appeal on 24 September 2015 and by the French Supreme Court on 21 June 2017, No. 15-25.941.
72 Paris Court of Appeal, 24 September 2015, Cegedim.
73 French Supreme Court, 21 June 2017, No. 15-25.941.
74 FCA Decision No. 13-D-07 of 28 February 2013 concerning a complaint filed by E-Kanopi, upheld by the Paris Court of Appeal on 24 June 2014 and by the Supreme Court on 19 January 2016, No. 14-21.670. Absent the demonstration of an anticompetitive object or effect, the sudden termination of a commercial relationship may be sanctioned under commercial law on the basis of Article L442-1 II of the Commercial Code.
75 See footnote 10.
76 FCA Decision No. 13-D-11 of 14 May 2013 concerning practices in the medicinal products sector, upheld by the Paris Court of Appeal on 18 December 2014 and by the French Supreme Court on 18 October 2016, No. 15.10-384.
77 FCA Decision No. 13-D-21 of 18 December 2013 regarding practices implemented in the French market for high-dosage buprenorphine sold in private practices, upheld by the Paris Court of Appeal on 26 March 2015 and by the French Supreme Court on 11 January 2017, No. 15-17.134.
78 FCA Decision No. 17-D-25; see footnote 8.
79 On 1 May 2012, the AFSSAPS became the ANSM.
80 See footnote 14.
81 FCA Decision No. 15-D-06 of 21 April 2015 concerning practices implemented in the online hotel booking sector.
82 CJEU, Case 27/76, United Brands, judgment of 14 February 1978. See also the European Union chapter.
83 FCA Decision No. 18-D-17 (see footnote 9), referring to CJEU, Case C-177/16, Autortiesību un Komunicēšanās Konsultāciju Aģentūra, judgment of 14 September 2017. See also the European Union chapter.
84 FCA Decision No. 09-D-24 of 28 July 2009 concerning practices implemented in the telecommunications sector in overseas departments.
85 See footnote 9.
86 FCA Decision No. 17-D-02; see footnote 8.
87 FCA Decisions No. 06-D-23 of 21 July 2006 concerning practices in the map editing and tourist information sector; No.o. 07-D-28 of 13 September 2008 concerning practices implemented by the Havre Port authority; and No. 09-D-02 of 20 January 2009 concerning practices in the press distribution sector.
88 FCA Decision No. 15-D-20 of 17 December 2015 concerning practices implemented in the telecommunications services sector.
89 FCA Decision No. 18-D-11; see footnote 6.
90 This discriminatory treatment included delays in the connection and commissioning of competitors' production units, delaying strategies and backdating strategies for accepting technical and financial proposals necessary for connection to the grid, which allegedly benefited the production units proposed by EDF and its subsidiaries.
91 CJEU judgment, Case C-525/16, MEO – Serviços de Comunicações e Multimédia v. Autoridade de la Concorrência of 25 May 2018.
92 CJEU judgment, Case C-23/14, Post Danmark of 6 October 2015.
93 If backdating practices do not raise a competition problem, they may, however, fall within the jurisdiction of criminal, civil or administrative courts.
94 FCA Decisions Nos. 10-MC-01 of 30 June 2010 concerning the practices of Google in the online advertising sector and 10-D-30 of 28 October 2010 concerning the practices of Google in the online advertising sector.
95 Notice of 16 May 2011 on the Method Relating to the Setting of Financial Penalties.
96 See footnote 43.
97 French Supreme Court, 22 November 2016, Nos. 14-28.224 and 14-28.862 (partially quashing Paris Court of Appeal, 6 November 2014, SNCF).
98 FCA Decision No. 13-D-20 of 17 December 2013 concerning the practices implemented by EDF in the photovoltaic solar power sector.
99 Paris Court of Appeal, 27 September 2018, Photovoltaic Solar Power.
100 FCA Decision No. 00-D-47 of 22 November 2002 concerning the practices implemented by EDF and its subsidiary, Citélum, on the public lighting sector.
101 Paris Court of Appeal, 21 May 2015, EDF.
102 French Supreme Court, 22 November 2016, No 14-28.224.
103 In its fining guidelines, the FCA indeed indicates that it will typically waive recidivism when a period of 15 years (or more) between the practices has elapsed (Paragraph 51).
104 The FCA did not apply its fining guidelines in all cases (see for instance, FCA Decisions No. 15-D-20 (see footnote 88); No. 17-D-02 (see footnote 86); No. 17-D-06 (see footnote 54); No. 17-D-13 (see footnote 55); and No. 18-D-03 (see footnote 15).
105 FCA Decisions No. 12-D-06 (see footnote 34); No. 12-D-24 (see footnote 21); No. 12-D-25 (see footnote 43); No. 13-D-06 of 28 February 2013 on practices implemented in the sector of online transmission of tax and accounting data in EDI format to the tax administration, upheld by the Paris Court of Appeal on 26 February 2015 and by the French Supreme Court on 8 February 2017; No. 15-15.005; No. 13-D-11 (see footnote 76); No. 13-D-20 (see footnote 98); No. 13-D-21 (see footnote 77); No. 14-D-02 of 20 February 2014 concerning the practices implemented in the sports press sector, upheld by the Paris Court of Appeal on 15 May 2015 and by the French Supreme Court on 1 March 2017; No. 15-19.068; No. 14-D-05 of 13 June 2014 on practices implemented in the mobile telephony sector for residential customers in Réunion Island and Mayotte; No. 14-D-06 (see footnote 71); No. 14-D-08 of 24 July 2014 regarding practices implemented in the sector for the sale of fresh dairy products in the French West Indies (the Paris Court of Appeal reduced the amount of the fine on 24 September 2015); No. 15-D-01; No. 15-D-10 (see footnote 57); No. 15-D-17 of 30 November 2015 on practices implemented on the mobile telephony market for non-residential customers in Réunion Island and Mayotte; No. 15-D-20 (see footnote 88); No. 16-D-11 (see footnote 62); No. 16-D-14 of 23 June 2016 on practices implemented in the rolled zinc sector (the Paris Court of Appeal reduced the amount of the fine on 17 May 2018 and 5 July 2018 (an appeal is pending before the French Supreme Court)); No. 17-D-02 (see footnote 86); No. 17-D-06 (see footnote 54); No. 17-D-13 (see footnote 55); No. 17-D-25 (see footnote 78); No. 18-D-03 (see footnote 15); and No. 18-D-17 (see footnote 9).
106 See footnote 88.
107 See footnote 9.
108 FCA Decisions No. 10-MC-01 (see footnote 94); No. 11-MC-01 (see footnote 63); No. 14-MC-01 of 30 July 2014 concerning practices in the pay TV sector, partially quashed by Paris Court of Appeal on 9 October 2014; No. 14-MC-02 of 9 September 2014 in the gas and electricity sector, partially quashed by Paris Court of Appeal on 31 October 2014 (an appeal is pending before the French Supreme Court); No. 16-MC-01 of 2 May 2016 on a request for interim measures filed by Direct Energie, upheld by Paris Court of Appeal on 28 July 2016; and No. 19-MC-01 (see footnote 7).
109 See footnote 43.
110 See footnote 46.
111 See footnote 88.
112 See footnote 71.
113 See footnote 55.
114 See footnote 35.
115 See footnote 10.
116 See footnote 7.
117 FCA Decision No. 16-MC-01; see footnote 108.
118 See footnote 7.
119 Paris Court of Appeal, 4 April 2019, Amadeus.
120 See Notice of 2 March 2009 on the commitment procedure (engagements).
121 See Notice of 21 December 2018 on the settlement procedure. The FCA is bound by its provisions.
122 See footnote 88.
123 See footnote 86.
124 See footnote 54.
125 Law No. 2016-1691 of 9 December 2016 (Article 148); Order No. 2017-303 of 9 March 2017 on damages actions relating to anticompetitive practices; and Decree No. 2017-305 of 9 March 2017 on damages actions relating to anticompetitive practices.
126 Paris Commercial Court, 16 March 2015.
127 FCA Decision No. 09-D-36 of 9 December 2009 concerning practices in the mobile telephony sector in the Antilles and Guyana, ultimately confirmed by the French Supreme Court on 6 January 2015, Nos. 13-21.305 and 13-22.477.
128 Paris Court of Appeal, 10 May 2017, Outremer Telecom v. Orange.
129 Paris Commercial Court, 18 December 2017.
130 Paris Court of First Instance, 22 February 2018.
131 See footnote 52.
132 Paris Court of Appeal, 12 September 2018, Betclic v. PMU.
133 Paris Commercial Court, 30 January 2012.
134 Paris Court of Appeal, 25 November 2015, Bottin Cartographes v. Google.
135 FCA Opinion No. 14-A-18; see footnote 48.
136 French Supreme Court, 12 April 2016, No. 14-26815.
137 Paris Commercial Court, 12 February 2014, SFR v. Orange.
138 Paris Court of Appeal, 4 October 2014, SFR v. Orange.
139 French Supreme Court, 12 April 2016, No. 14-26815.
140 Paris Court of Appeal, 8 June 2018, SFR v. Orange.
141 Paris Court of Appeal, 13 March 2019, Avi Charente v. Lactalis.
142 Paris Court of Appeal, 19 December 2018, Inforad v. Coyote.
143 Law No. 2016-1691 of 9 December 2016 (Article 148); Order No. 2017-303 of 9 March 2017 on damages actions relating to anticompetitive practices; and Decree No. 2017-305 of 9 March 2017 on damages actions relating to anticompetitive practices.
144 FCA Opinion No. 18-A-03 of 6 March 2018 concerning the use of data in the online advertising sector.
145 FCA press release of 11 January 2019, published on the FCA's website: www.autoritedelaconcurrence.fr/user/standard.php?id_rub=697&id_article=3329&lang=en
146 German Federal Cartel Office Decision No. B6-22/16.
147 See footnote 7.
148 FCA and the German Federal Cartel Office joint press release of 19 June 2018, published on the FCA's website: www.autoritedelaconcurrence.fr/user/standard.php?id_rub=684&id_article=3197&lang=en.