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

The status of non-salaried manager set forth in Articles L. 7322-1 et seq. of the Labor Code refers to any person who operates a branch of retail food business or consumer cooperatives, in return for discounts proportional to sales, whose contract does not indicate the working conditions and who has latitude to hire staff or be replaced (Labor Code, Article L. 7322-2) . Pursuant to the recitals of …

Constituent elements.

The status of non-salaried manager set forth in Articles L. 7322-1 et seq. of the Labor Code refers to any person who operates a branch of retail food business or consumer cooperatives, in return for discounts proportional to sales, whose contract does not indicate the working conditions and who has latitude to hire staff or be replaced (Labor Code, Article L. 7322-2) . Pursuant to the recitals of the national collective agreement of 18 July 1963, the specific characteristics of the contract of a managing agent result from the fact that he acts as a merchant with respect to customers. Thus two conditions must be fulfilled for him to benefit from the status: independence in the management of the shop, which results in the fact that he has autonomy in organizing his work with no legal subordination; direct incentive in the business of the shop by virtue of commissions in proportion to the level of sales.

According to the Court of Cassation, a relationship of legal subordination exists between the principal and his manager where the latter does not enjoy freedom in the operation of his business, is regularly and frequently controlled by inspectors from the company empowered to give him orders and verify the details of how he manages outlets, and is subject to obligations that cannot be differentiated from those imposed on an employee . Thus, an operator subject to unilateral decisions concerning supplies, having no freedom to determine his working hours or days off, and whose activity is closely monitored, is an employee an not the manager of a branch of a food retail store . On the other hand, where he is remunerated by commission, free to organize his management and to substitute other persons for himself and to hire staff, and receives no instruction on the organization of his work, the managing agent is independent . Documents addressed to the non-salaried manager to assist in both the administrative and commercial management of the branch are not evidence of the monitoring of his activity or of the hindrance of his freedom of organization which characterize an emloyer/employee relationship .

Neither the clause requiring the manager to open the shop at normal hours , nor the exclusive supply of goods at imposed prices with a display obligation, or the supply of premises and accomodation characterize a relationship of legal subordination capable of classifying the manager of a food business branch as a salaried manager . In effect, the contract of non-salaried manager may provide for a clause of exclusive supply of goods with sale at imposed prices without the nature of the contract being challenged (Labor Code, Article L. 7322-2). Article 34 of the national collective agreement on the conditions of participation of managers to the commercial policy of the business owner therefore provides that managers sell at imposed price only goods necessary for their trade that are supplied on an exclusive basis. They follow the commercial policy of their undertaking, in particular advertising and promotional operations, and comply with the use of the transferred documents. Thus, the contract may impose obligations on the manager (achieving the highest turnover with as little stock as possible, not changing the nature or quality of the goods, not providing credit, providing receipts, accepting the supplied goods, keeping the branch clean), without undermining his management independence . Similarly, controls which do not constitute the exercise of a disciplinary power, but are a mere verification of the compliance of managers'with their contractual obligations do not reflect the existence of a relationship of subordination . The classification of non-salaried manager is also not called into question due to the lack of profitability of the activity or the fact that it is impossible to make the minimum guaranteed remuneration .

Likewise, supplying premises and accommodation is ancillary to the management contract pursuant to the collective national agreement which provides for the free supply of accommodation to the manager (Article 30) and of premises ready for the sale of goods and material and equipment that comply with the rules in force, the maintenance and repair of which are borne by the undertaking (Article 26).

CA Montpellier, 5 June 2013, LawLex201300000944JBJ, ruling that all waiver in advance of the benefit of Article L. 7321-2, which is a public policy provision, is devoid of effect

Cass. soc., 31 October 1989, LawLex201000000775JBJ.

CA Versailles, 12 June 2013, LawLex201300001006JBJ.

Cass. com., 11 March 2009, LawLex200900001598JBJ, which quashes and annuls on another issue CA Lyon, 15 December 2006, LawLex200900001646JBJ. Cass. soc., 6 October 2010, LawLex201000001099JBJ, which excludes the benefit of the labor law rules for managers whose business organization has been defined by the principal but within the limits of the framework inherent in a parent company/manager relationship, but who have freely defined the division of working hours between opening and closing, the relationships with customers and with staff hired or kept on: Cass. soc., 19 January 1999, LawLex201000000767JBJ: a management-agency contract must be re-characterized as a salaried management where the clause granting the manager all latitude to hire staff has never been applied and that he enjoys no independence in the performance of his work.

CA Amiens, 20 September 2011, LawLex201100001487JBJ.

The national collective agreement mentions that hours are set forth by the manager according to usual local practices (Article 31). 

Cass. soc., 15 December 1993, LawLex200200004522JBJ.

CA Orléans, 2 April 1998, LawLex200200004429JBJ.

Cass. soc., 5 October 2016, LawLex201600001639JBJ.

French Distribution Law

567. Constituent elements.

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Les décisions de justice citées dans ce paragraphe :

Les notions juridiques connexes

567. Constituent elements.

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Les décisions de justice citées dans ce paragraphe :

Les notions juridiques connexes

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