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

According to Article L. 430-2 CC, the authorities can only review operations involving undertakings that together achieve a consolidated worldwide pre-tax turnover of EUR 150 million, provided that at least two of the entities involved have an individual turnover of at least EUR 50 million. The aforementioned thresholds must be calculated pursuant to the provisions of Article 5 of EC Merger Regula …

Thresholds

Merger review is governed by Title III of the Commercial Code. It provides for an administrative review of concentrations exceeding certain defined thresholds. Unlike EU law, French law did not in the past require prior notification. The NRE Law significantly changed the rules in force before May 2001, by introducing pre-merger control by way of compulsory notification by the parties. The thresholds have also been modified. The LME Law of 4 August 2008 amended the merger control provisions of the Commercial Code in two ways. In terms of substance, new Article L. 430-2  lays down specific rules for mergers in the supermarket distribution sector. The new provisions also revise the conditions under which overseas operations are controlled. Previously limited to the distribution sector, their scope of application is now extended to all operations reaching the appreciability thresholds, irrespective of the sector involved.

In terms of form, all merger control proceedings now fall under the jurisdiction of the Competition Authority. Prior, the power of decision belonged to the Minister of the Economy. He/she does however retain one important power; after being informed of the Authority's decision, the Minister has 5 days in which to request an in-depth review of the transaction if one has not already been carried out, and 25 days to address undecided points on public interest grounds other than those relating to maintenance of competition, e.g. industrial development, the competitiveness of the undertakings in question or the creation or protection of jobs (Article L. 430-7-1).

Furthermore, the 2015 Macron Law introduced a new pre-notification obligation for agreements between central purchasing or listing agencies (Article L. 462-10 ). This obligation does not give rise to merger control, as it covers transactions which do not necessarily come under the scope of Article L. 430-1 et seq. but rather constitutes a tool to inform the Competition Authority of transactions which may give rise to competition concerns and justify ex-officio proceedings.

Finally, Decree No 2019-339 of 18 April 2019 reduced red tape in the context of the notification obligation and an online tool was established in October 2019 for the notification of mergers following simplified proceedings.

The provisions of the Commercial Code are supplemented by Merger Guidelines, drafted by the Competition Authority. The latest were adopted on 23 July 2020, based on its own decision-making practice, and on information gained from its active involvement in the European Competition Network. The guidelines “constitute, for the Authority, a directive which is enforceable both against and by undertakings” and the Authority has undertaken to apply them to each merger review from 23 July 2020, unless some circumstance specific to the case or some issue of general interest justifies departing from them.

Context

In order to fall within the scope of the provisions, the merger must constitute a concentration, which is defined by Article L. 430-1 CC (which is similar to Article 3 of EC Merger Regulation No 139/2004): a concentration is deemed to arise where two or more previously independent undertakings merge, or one or more persons already controlling at least one undertaking, or one or more undertakings acquire, whether by purchase of securities or assets, by contract or by any other means, direct or indirect control of the whole or parts of one or more other undertakings. The creation of a joint-venture exercising for a lasting period all the functions of an autonomous economic entity also constitutes a merger pursuant to Article L. 430-1, II CC.

Concept of concentration

According to Article L. 430-2 CC, the authorities can only review operations involving undertakings that together achieve a consolidated worldwide pre-tax turnover of EUR 150 million, provided that at least two of the entities involved have an individual turnover of at least EUR 50 million. The aforementioned thresholds must be calculated pursuant to the provisions of Article 5 of EC Merger Regulation No 139/2004.

Merger control in the French overseas territories (DOM/COM - overseas departments / overseas communities) is now wider in scope. It is no longer only limited to operations predominantly concerning the retail sector but now applies to all operations which fulfill the following conditions:

- the combined aggregate worldwide turnover exclusive of tax of all the undertakings or groups of natural persons or legal entities involved in the merger is greater than EUR 75 million,

- the combined aggregate turnover exclusive of tax achieved in France by at least two of the companies or groups of natural persons or legal entities concerned is greater than EUR 15 million or EUR 5 million in the retail sector, with no requirement  that this threshold be reached by all the undertakings concerned within the same department or territorial collectivity,

- the operation does not come within the scope of Council Regulation No 139/2004.

However, Book IV of the Commercial Code does not apply to two overseas collectivities, New Caledonia and French Polynesia, which have adopted local competition laws. 

The role of the Competition Authority is to analyze whether the operation falls within the scope of the law and its effect on competition. Article L. 430-6 of the Commercial Code provides for a kind of rule of reason, according to which the harm to competition may be compensated for by a sufficient contribution to efficiency. The harm to competition may be inter alia the creation or strengthening of a dominant position or, since May 2001, the creation or strengthening of buyer power putting suppliers in a state of economic dependency.

Global Competition Law

292. Thresholds

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

Les notions juridiques connexes

292. Thresholds

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

Les notions juridiques connexes

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