This book provides a wide-ranging review of the European rules relating to distribution: exclusive purchase and exclusive supply, exclusive and selective distribution, motor vehicle distribution, franchises, commercial agents.

French Distribution Law

Enforceability is not always absolute. A jurisdiction clause, even if valid, might not be enforceable against certain persons or in some types of litigation. Thus, the clause contained in a concession contract entered into between a car importer and a dealer is not applicable as part of an action relating to quasi-delict brought by the latter against the manufacturer who is a third party to the co …

Enforceability.

Where there is no mandatory jurisdiction rule , the trading parties are free to depart from the territorial or assigned jurisdiction rules by providing for a jurisdiction clause. According to Article 48 of the Code of Civil Procedure, “any clause that departs, directly or indirectly, from the rules of territorial jurisdiction will be deemed non-existent unless it has been agreed between parties to a contract entered into as merchants and the same has been provided for in an explicit manner in the undertakings of the party against whom it will be enforced”. Where these conditions are met, case law unreservedly upholds clauses provided for in motor vehicle distribution contracts . Thus, a jurisdiction clause which evicts the commercial court in favor of the tribunal judiciaire is held valid where the dealer is a merchant and the clause has been accepted in full knowledge of the facts . Regarding the presentation of the clause, the use of a font identical to that of the other clauses makes it irrefutably enforceable to the dealer .

See Commercial Code, Article L. 420-7, designating the courts specialized to apply competition rules. See, for an application to motor vehicle distribution, TGI Hazebrouck, 7 November 2007, LawLex200900003629JBJ: litigation on the termination of a service agent contract, where it is likely to entail the application of Articles L. 420-1 of the Commercial Code and [101 TFEU] falls within the jurisdiction of the Commercial Court designated pursuant to Article L. 420-7 of the French Commercial Code. - See also, CA Aix-en-Provence, 15 May 2001, LawLex200200004750JBJ: a jurisdiction clause provided for in a concession contract must be applied where the parties are traders, and the dispute, relating to the performance of the contract, does not fall within the jurisdiction of an exceptional court.

TGI Paris, 15 December 1994, LawLex200300002848JBJ; T. com. Orléans, 22 September 2004, LawLex200400002147JBJ.

CA Versailles, 18 June 1998, LawLex200200005134JBJ.

T. com. Angers, 30 June 1999, LawLex200400000226JBJ.

Validity and scope.

Enforceability is not always absolute. A jurisdiction clause, even if valid, might not be enforceable against certain persons or in some types of litigation. Thus, the clause contained in a concession contract entered into between a car importer and a dealer is not applicable as part of an action relating to quasi-delict brought by the latter against the manufacturer who is a third party to the contract . Some decisions have also dismissed the enforceability of the clause against the interim relief court . Others, more balanced, will distribute allocation of the jurisdiction rules: thus, a clause granting jurisdiction to the Tribunal de grande instance in Paris, even for a commercial dispute, has been deemed to be mandatory for the summary court at least regarding the allocation of material jurisdiction, and the jurisdiction of the Paris court has been set aside in favor of the local tribunal de grande instance . Lastly, others consider that the clause is purely and simply enforceable to the interim relief court where it has been accepted in full knowledge of the facts by the motor vehicle distributor . 

Where a liability suit is brought by one party against the other for sudden termination of an established commercial relationship, the effect of the jurisdiction clause no longer gives rise to any doubt since the commercial chamber of the Court of Cassation has accepted that an action on the basis of Article L. 442-1, II (former Article L. 442-6, I, 5°) of the Commercial Code, which relates to tort, remains subject to the conditions of the jurisdiction clause if it covers not only the contractual relationship but also the termination of commercial relations . The first civil chamber had moreover ruled that a jurisdiction clause in an international distribution agreement providing for the termination of said agreement should be implemented even where mandatory French public policy provisions such as Article L. 442-1 et seq. were applicable . This solution applies all the more importantly in domestic law .

However, by virtue of Article R. 662-3 of the French Commercial Code, a jurisdiction clause must be set aside where the dispute due to the termination of the distribution contract is related to the distributor's bankruptcy proceedings . One may wonder about the unfortunate consequences of that relationship, which leads to entrusting to the bankruptcy proceedings court, whose main objective is to guarantee the continuation of the undertaking undergoing judicial reorganization, a series of issues that a court that is less involved in the procedure could review with more distance and with the guarantee of a perfect neutrality. The trial courts have however limited the scope of the exception. Thus, the action aimed at acknowledging the existence of a wrongdoing by the supplier causing a cessation of payments by the distributor does not fall within the jurisdiction of the court referred to of the bankruptcy proceedings where it relies on facts external and prior to it , neither do those whose purpose is the termination of a contract that has been carried on after the decision opening the bankruptcy proceedings . The same goes for the action aimed at establishing the abusive nature of the contract termination , except where there is a link between the termination and the bankruptcy proceedings .

Lastly, the specialization of jurisdictions instituted for the application of competition law  and for the application of Article L. 442-1 et seq. of the Commercial Code  may modify the allocation of jurisdiction provided by the parties in favor of a specialized court competent for the place chosen by the parties, bearing in mind that these mandatory rules of jurisdiction also apply in matters of interim relief .

The case law shows a keenness to preserve the specialized courts' jurisdiction so as to protect the quality of decisions rendered. After apparently restricting those courts to hearing actions based on competition law , the courts have extended the application of Article L. 420-7 whether competition law was relied on by the claimant or in defense since it is applicable to all disputes “in which those provisions are relied upon” , without any need to take account of substance of the plea . Likewise, Article L. 442-1 of the Commercial Code only needs to be invoked in defense, even incidentally, for the jurisdiction of the specialized court to be recognized . Are all jurisdiction clauses automatically set aside in that case as being contrary to mandatory provisions of public policy? Nothing could be less certain. If the clause designates a non-specialized court, it would appear logical that it should be set aside. On the other hand, where such clauses do designate a specialized court they must be enforced. This was the position of the Paris Court of Appeal which set aside an interim relief order issued by the Commercial Court in the city of Meaux and upheld the allocation of jurisdiction to the former Paris “Tribunal de grande instance” whereas the specialized court which would normally have been competent where there was no jurisdiction clause would have been the Paris Commercial Court .

CA Metz, 18 October 2000, LawLex200200004751JBJ.

T. com. Mirecourt, 9 July 2004, LawLex200400002090JBJ: urgency authorizes the setting aside of the application of a jurisdiction clause included in a motor vehicle distribution contract.

Cass. com., 17 January 1995, LawLex200200005435JBJ.

Cass. com., 6 June 1995, LawLex200200005472JBJ; 20 February 1996, LawLex200200005539JBJ; CA Rouen, 11 December 2008, LawLex200800002243JBJ: the opening of the judicial liquidation proceedings, five years after the termination of the motor vehicle concession contract, is not sufficient to exclude the application of the jurisdiction clause.

Articles L. 420-7 and R. 420-3 Commercial Code; Cass. com., 9 November 2010, LawLex201000001248JBJ; Montpellier, 14 March 2011, LawLex201100000838JBJ; T. com. Versailles, 16 December 2016, LawLex201700000052JBJ, an authorized repairer contesting a termination notified by the manufacturer on the basis of Article L. 420-1 of the Commercial Code must bring the claim before the Commercial Court in Paris, not Versailles, even if the jurisdiction clause in the contract stipulates the latter.

Articles L. 442-4, D. 442-2 and D. 442-3 Commercial Code.

T. com. Albi, 28 October 2009, LawLex200900003286JBJ; Mont-de-Marsan, LawLex201100000839JBJ.

CA Versailles, 24 May 2007, LawLex200700001334JBJ, ruling out the jurisdiction of the specialized courts where the rules of Articles L. 420-1 and L. 420-5 of the Commercial Code are relied on on the merits.

CA Poitiers, 27 October 2009, LawLex201000003657JBJ.

Cass. com., 9 November 2010, LawLex201000001248JBJ.

CA Douai, 4 April 2012, LawLex201200000585JBJ; Cass. com., 26 March 2013, LawLex201300000481JBJ.

CA Paris, 4 June 2013, LawLex201300000927JBJ; see also T. com. Paris, 7 February 2017, LawLex201700000277JBJ. Contra CA Paris, 25 October 2017, LawLex201700001717JBJ.

CA Dijon, 25 February 2005, LawLex200500004357JBJ.

T. com. Paris, 28 March 2008, LawLex200800000835JBJ.

Cass. com., 9 March 2010, LawLex201000000373JBJ and 8 July 2010, LawLex201000000840JBJ.

Cass., 1re civ., 22 October 2008, LawLex200800001850JBJ. See also CA Paris, 1 October 2014, LawLex201400001010JBJ.

E.g. CA Aix-en-Provence, 8 February 2012, LawLex201200000377JBJ; T. com. Paris, 21 February 2013, LawLex201300000226JBJ.

CA Rennes, 12 January 2000, LawLex200200004740JBJ: non-applicability of the jurisdiction clause to a dispute regarding the action for abusive support initiated against the supplier; T. com. Bobigny, 24 January 2003, LawLex200300001195JBJ: non-enforceability of the clause to the tort action for making good the liabilities brought against the supplier.

CA Aix-en-Provence, 15 May 2001, LawLex200200004750JBJ. 

T. com. Paris, 13 October 2000, LawLex200500003785JBJ.

French Distribution Law

329. Enforceability.

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Les décisions de justice citées dans ce paragraphe :

Les notions juridiques connexes

329. Enforceability.

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Les décisions de justice citées dans ce paragraphe :

Les notions juridiques connexes

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