Global Competition Law is primarly a practitioner's guide presenting the most salient aspects of the major competition laws country by country, giving an overview of their structure and most charasteristic elements.
Global Competition Law also provides insight into possible future developments in the field.

Global Competition Law

Sales below cost are prohibited by Article L. 442-5 CC and are considered a criminal offense. Maximum resale price maintenance is lawful provided that the prices are not similar to imposed prices or do not amount to disguised minimum prices. Direct or indirect minimum price-fixing is, on the other hand, considered a criminal offense (Article L. 442-6 CC). However, both infringrements have very rar …

Price fixing and sales below cost

French law defines as unfair several practices, so-called restrictive practices (as distinguished from anticompetitive practices) that may constitute a restraint on competition, although not falling under the heading of restrictive agreements or abuse of dominance. Such practices are prohibited per se without any reference being made to market effect. The provisions are mainly enforced before specialized civil courts although some violations may give rise to criminal sanctions or administrative fines. The Competition Authority has no jurisdiction as regards unfair practices. By contrast, the Minister of the Economy and/or the General Director for Competition have the same investigatory powers with regard to restrictive practices than those they have with respect to anticompetitive practices.

Definition and regime

Sales below cost are prohibited by Article L. 442-5 CC and are considered a criminal offense. Maximum resale price maintenance is lawful provided that the prices are not similar to imposed prices or do not amount to disguised minimum prices. Direct or indirect minimum price-fixing is, on the other hand, considered a criminal offense (Article L. 442-6 CC). However, both infringrements have very rarely been sanctioned in the past years.

Before Ordinance No 2019-359 of 24 April 2019, a large list of behaviors were sanctioned as abuses of dependence, each giving rise to a per se civil tort action. Ordinance No 2019-359 reduced this list to three items:  obtaining a benefit without consideration or which is manifestly disproportionate to the service rendered (Article L. 442-1(I)(1)); imposing or attempting to impose on the other party obligations creating a significant imbalance in the rights and obligations of the parties (Article L. 442-1(I)(2)) and sudden termination of established commercial relationships (Article L. 442-1(II)). 

A tort action may be brought before a specialized civil or commercial court by any interested party, by the public prosecutor's department, by the Minister of the Economy or by the President of the Competition Authority, when the latter becomes aware that such a restrictive practice has occurred with regard to matters that come within its jurisdiction.

The prohibition set in Article L. 442-1(I)(2), instigates a real control over abusive clauses in contracts between professionals. The significant imbalance in the rights and obligations of the parties is the criterion for the existence of abuse, as in consumer law. And in fact, the judgments rendered on the basis of that provision mainly borrow from consumer law when defining the criteria characterizing a significant imbalance by assessing each clause from the point of view of reciprocity. However, contrary to consumer law, the provisions of Article L. 442-1, as construed by the Court of Cassation allow the control of price fixing  between partners (Court of Cassation, 25 January 2017, LawLex200700000176JBJ).

Global Competition Law

274. Price fixing and sales below cost

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Les notions juridiques connexes

274. Price fixing and sales below cost

Demandez un accès gratuit au contenu exclusif Livv – juristes d’entreprise

Les notions juridiques connexes

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