Business Contracts

Talks can be an opportunity to engage in unfair behavior, insofar as the parties may commit resources or provide sensitive information in the course of negotiations. For example, a manufacturer is guilty of unfair competition against its client when, in talks with the latter to launch a new product on the supermarket circuit, it secretly enters into a partnership with a competitor of the latter to …

Acts of unfair competition

Talks can be an opportunity to engage in unfair behavior, insofar as the parties may commit resources or provide sensitive information in the course of negotiations. For example, a manufacturer is guilty of unfair competition against its client when, in talks with the latter to launch a new product on the supermarket circuit, it secretly enters into a partnership with a competitor of the latter to market a similar product .

Since the reform of the law of contracts, the Civil Code has targeted a particular type of behavior. Under Article 1112-2 of the Civil Code, “anyone who uses or discloses without authorization confidential information obtained in the course of negotiations incurs liability under the conditions of ordinary civil law” . Reflecting the principle of good faith contained in the new Articles 1104 and 1112, this rule already applied in practice regardless of the outcome of negotiations, because anyone making use of confidential information in the course of talks is liable to commit a tort based on unfair competition. 

For example, the misuse of confidential information following talks between a distributor and an undertaking with a view to acquiring a holding , or a company canvassing customers using the client file of the undertaking with which it was negotiating after the talks had broken down , constitute acts of unfair competition.

As a general rule, an undertaking which appropriates the know-how of another during talks which it has not followed up on, is guilty of unfair competition . The same applies to an undertaking which, by using information gathered during unsuccessful pre-contractual talks, reproduces the essential characteristics of a competitor's network, thereby committing parasitic business practices (parasitisme)  or when an undertaking, in the course of negotiations to acquire a competitor's business, takes over the restaurant concept (name, table layout and pizzas offered) and seeks to mislead the consumer by suggesting a link between the two establishments .

CA Versailles, 11 May 2006, LawLex200800000242JBJ.

Given its general scope, this article leaves the negotiating parties free, where appropriate, to include a confidentiality clause to govern their contractual negotiations.

T. com. CA Paris, 13 June 2003, LawLex200400001731JBJ.

Cass. com. 4 December 2001, LawLex200200000578JBJ.

Cass. com. 3 October 1978, LawLex202200001306JBJ.

CA Paris, 3 October 2002, LawLex200300001295JBJ.

Cass. com, 16 February 2016, LawLex201600000358JBJ. See Also see CA Nîmes, 17 April 2008, LawLex200800002193JBJ, where it is stated that even in the absence of direct competition, a prospective franchisee who, after breaking off negotiations, continues to operate an establishment, with the clientele created during the pre-contractual test phase according to a similar concept, commits an act of parasitic conduct.

Business Contracts

63. Acts of unfair competition

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Les décisions de justice citées dans ce paragraphe :

Les notions juridiques connexes

63. Acts of unfair competition

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Les décisions de justice citées dans ce paragraphe :

Les notions juridiques connexes

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au contenu exclusif Livv – juristes d’entreprise