Spotlight: restrictive agreements and dominance in France

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Antitrust: restrictive agreements and dominance

The FCA’s antitrust enforcement activity, other than cartel enforcement, covers restrictive agreements under Article L.420-1 of the French Code of Commerce or Article 101 of the TFEU, and abuse of dominance under Article L.420-2 of the French Code of Commerce or Article 102 of the TFEU. In addition, the FCA is also in charge of sanctioning unjustified exclusive imports in the French overseas territories.

i Significant cases

In February 2022, the FCA fined a company for abusing its dominant position in the air freight transport of pets to Polynesia sector.¹⁵ In this case, Goldenway International Pets (GIP) had linked its quarantine services with its transport and chartering organisation ones. More precisely, any person wishing to send its pet to French Polynesia from mainland France is de facto obliged to have it undergo quarantine in the GIP station, as it is the only mainland quarantine station authorised by the Polynesian authorities. This fact was not, of course, the objection notified to GIP: the notified objection was indeed the fact that the latter linked this obligation with (1) its road transport services from the quarantine station to Roissy-Charles de Gaulle airport and (2) its flight organisation services, so that pet owners had no choice but to use GIP for these three services. Historically, GIP had always refused to separate these three different services, despite repeated requests from customers and competing companies (i.e., freight forwarders). According to the FCA, this tying practice created a leverage effect that allowed GIP to experience no competition either in the transport of animals to Roissy-Charles de Gaulle airport and in the organisation of air freight transport to French Polynesia. GIP did not dispute the facts and benefited from the settlement procedure, which led the FCA to issue a €65,000 fine (taking into account the fact that GIP had proposed a commitment to publish and distribute a summary of the FCA’s decision to customers, air carriers, freight forwarders and Polynesian authorities to recall the illegality of tying practices, at its own expense).

In the same month, the FCA fined EDF for having abused its dominant position in the electricity sector from 2004 to 2021.¹⁶ In this case, the FCA considered that EDF used the data from its customer files eligible for the regulated electricity tariffs (TRV), as well as the commercial infrastructures dedicated to the management of the TRV contracts, in order to develop the marketing of gas market offers and energy services, and to convert a large part of its customers at the pivotal moment of the end of TRV for part of the professional customers. The FCA stated that ‘the objective pursued was to maintain its market share in the electricity supply sector and to strengthen its position in the related gas supply and energy services markets’. As regards the procedural aspects of the case, EDF requested and benefited from the settlement procedure, which led the FCA to impose a fine of €300 million. In order to determine this quantum, the FCA took into account the fact that EDF had offered two commitments: (1) making available its TRV Bleu customer file to alternative electricity suppliers requesting it and (2) separating telephone subscription paths of customers and prospects at TRV Bleu and customers and prospects at market offers.

In October 2022, the FCA fined EssilorLuxottica for having implemented discriminatory trade practices in the optical lenses sector from 2009 to 2020.¹⁷ In this case, the FCA found that Essilor had abused its dominant position by implementing a discriminatory commercial policy aimed at hindering the development of online sales websites in France, primarily those offering a mixed or fully online offer. More precisely, to prevent online sales websites from offering its branded lenses to consumers, Essilor refused to deliver branded lenses to them, and prohibited them from using its trademarks and logos, and from communicating on the origin of the lenses. Essilor also implemented warranty limitations on online sales operators, by stipulating in its general terms of sale that its assumption of responsibility for the adaptation warranty was conditional on the retailer’s compliance with a measurement protocol designed exclusively for in-shop sales. According to the FCA, these practices ‘limited consumer access to an alternative sales channel and kept prices high’. In light of these elements (and especially taking into account the lengthy period of the infringement and the fact that Essilor is a global group that is the leader in its field), the FCA fined Essilor €81 million for discriminatory trade practices.

In the same month, the FCA fined Gaz de Bordeaux for having abused its dominant position on the gas supply market in Bordeaux.¹⁸ In this case, the FCA considered that Gaz de Bordeaux abused the resources at its disposal as a public service to develop its competitive activity. In other words, the FCA found that Gaz de Bordeaux abused its infrastructures and the commercial resources linked to its public service activity in its capacity as a supplier of natural gas at the regulated sales tariff (RST), to develop its market offers. More precisely, during the three years preceding the end of the RST, Gaz de Bordeaux used the technical and human resources resulting from its public service activity to systematically direct consumers towards market offers, deliberately not disclosing the existence of the RST offer (e.g., from 2019, the RST offer was no longer available on the Gaz de Bordeaux website and Gaz de Bordeaux’s sales teams concealed its existence, thus leading almost all new customers to subscribe to market offers). According to the FCA, Gaz de Bordeaux created confusion between its public service activity and its competitive activity in a sector in which consumers were not well informed, and, as a consequence, distorted the competitive functioning of the market. In view of all these elements, the FCA fined Gaz de Bordeaux €1 million, and ordered the latter to publish a summary of its decision on its website for three months.

In December 2022, the FCA fined a provident institution for having abused its dominant position on the markets for collective supplementary social protection for entertainment workers.¹⁹ In this case, the FCA fined Audiens Santé-Prévoyance (Audiens SP) for using its brand image and the resources and data available to it in connection with its activities of supplementary social protection for entertainment workers to develop the activity of its subsidiary Movinmotion, which is active on the market for payroll management services for entertainment workers. More precisely, the FCA found that Audiens SP abused its dominant position by implementing two types of abuses: (1) by enabling its subsidiary Movinmotion to use its brand image and reputation, it created confusion in employers’ minds between its quasi-monopoly activities and its other competitive activities; and (2) by using the data available to it in relation to its quasi-monopoly activities to facilitate the marketing of its subsidiary’s offer of payroll management services for entertainment workers (cross-usage of clientele databases), it gave the latter a competitive advantage that its competitors could not replicate. As for the procedural aspects of the case, Audiens SP did not dispute the facts and benefited from the settlement procedure, which led the FCA to impose a fine of €800,000.

In the same month, the FCA fined a company for having abused its dominant position on the market for roadworthiness tests for heavy-duty vehicles in Guadeloupe.²⁰ The FCA fined two different kinds of anticompetitive practices: (1) discriminatory practices against companies in the related market for the preparation of roadworthiness tests for heavy-duty vehicles in Guadeloupe, to the benefit of its sister company active on this market; and (2) excessive pricing practices implemented thanks to the monopoly position it held between 2010 and 2018 on the market for roadworthiness tests for heavy-duty vehicles in Guadeloupe (being specified that the excessive pricing practices themselves were implemented between 2013 and 2018 only). With regard to the discriminatory practices, the FCA found more specifically that the fined company had introduced two prices for its services (i.e., a normal price and a discounted one, the latter being conditional on criteria that only its sister company was able to meet). It had also granted longer payment instalments and shorter appointment times to its sister company, which it did not grant to the latter’s competitors. As for the procedural aspects of the case, the prosecuted company did not contest the facts and benefited from the settlement procedure, which led the FCA to impose a fine of €25,000.

As for the courts, this year saw the Paris Court of Appeal ruling in the Apple case. Originally, the FCA issued a decision in 2020, by which it fined Apple €1.1 billion for having implemented three anticompetitive practices within its distribution network: (1) products and customers allocation between its two wholesalers; (2) resale price maintenance; and (3) abuse of a situation of economic dependency.²¹ The main question arising from this case was whether the FCA’s demonstration of the existence of a resale price maintenance practice was sufficiently strong with regard to the standard of proof required by the Paris Court of Appeal. The latter indeed overturned the FCA’s decision in this regard, judging that ‘the body of evidence on which the FCA relied did not establish unequivocally, in light of the factual, economic and legal context, the existence of a price recommendation of a binding nature’. In this way, the Paris Court of Appeal strongly recalled that the standard of proof as regards resale price maintenance practices is quite high, as both the supplier’s invitation to implement its pricing policy and the acceptance of such policy by its distributors must be proved without any ambiguity. The Paris Court of Appeal found that the resale price maintenance practice was not established, and the amount of the fine handed out by the FCA was accordingly divided by three.²²

ii Trends, developments and strategiesRejection of a complaint for lack of sufficient evidence

The reawarding to Amazon of the broadcasting rights for Football League 1 previously held by Mediapro led Canal+ Group (GCP) and beIN Sports France to lodge a complaint before the FCA. The complainants maintained that by granting the rights in question to Amazon for the 2021–2022 to 2023–2024 seasons for €250 million per season, the Professional Football League (LFP) had committed discrimination as, at the same time, they remained constrained to broadcast batch 3 matches, acquired in 2018 for €332 million per season. The FCA, however, found that the information provided by GCP and beIN was not, in this case, sufficient to conclude that the LFP had abused its dominant position by treating them differently from Amazon in the procedure for reawarding the Mediapro batches and not selecting their bid over that of Amazon. The FCA recalled, as it had already indicated in its 2021 decision,²³ that beIN and GCP could not claim that they had been discriminated against as they held batch 3 of the 2018 call for tender, which had been divested correctly for a four-year period with a duly executed contract. The FCA thus rejected the latter’s complaints on the merits of the case and, as a result, their associated requests for interim measures.²⁴

Accepting commitments from GAFAM companies

2022 was marked by increased negotiation between the FCA and the five ‘big tech’ companies (Google (Alphabet), Apple, Facebook (Meta), Amazon, Microsoft – GAFAM), to end practices implemented by some of them that might be anticompetitive. The FCA accepted Meta’s commitments to cease some practices on the French market for non-search-related online advertising.²⁵ This was the first time that a competition authority accepted commitments from Meta in antitrust proceedings. In addition, the FCA accepted Google’s commitments to create a framework for negotiating and sharing information necessary for the transparent assessment of related rights’ remuneration.²⁶ According to Benoît Cœuré, these commitments will, for the first time in Europe, ‘provide a dynamic framework for negotiation and sharing of the necessary information for a transparent assessment of direct and indirect related rights’ remuneration’.²⁷

iii OutlookAntitrust and digital regulation

The Digital Markets Act (DMA) takes effect in May 2023. As it provides that ‘the coherent, effective and complementary enforcement of available legal instruments applied to gatekeepers requires cooperation and coordination between the Commission and national authorities within the remit of their competences’,²⁸ it is clear the FCA will have to assist the EC with the exercise of its powers under the Act. It remains to be seen how this will take place in practice.