Cartels & Leniency In France
This article first appeared in the second edition of The
International Comparative Legal Guide to: Cartels &
Leniency; published by Global Legal Group Ltd, London www.iclg.co.uk
1 The Legislative Framework of the Cartel
1.1 What is the legal basis and general nature of the
cartel prohibition, e.g. is it civil and/or criminal?
Anticompetitive agreements and practices are prohibited by
Article L. 420-1 of the French Commercial Code (the
"Code"). It applies to any undertakings, in the form of
either companies or individuals, and may lead to
civil/administrative and, in certain cases, to criminal sanctions
(see the answer to question 3.2).
1.2 What are the specific substantive provisions for the cartel
The cartel prohibition applies to any concerted practices,
agreements and alliances, express or tacit, which have as their
object or may have as their effect to prevent, restrict or distort
competition in a market, and in particular with the aim to:
limit access to markets by, or competition from, other
interfere with price setting by market forces, by artificially
increasing or decreasing prices;
limit or control production, markets, investment or technical
share markets or sources of supply.
However, under the so-called "de minimis" rules, the
French competition authority may decide not to instruct cases
concerning agreements or practices:
between actual or potential competitors ("horizontal
agreements") whose combined market share does not exceed 10
per cent; or
between companies that are not actual or potential competitors
("vertical agreements") whose respective market shares do
not exceed 15 per cent.
1.3 Who enforces the cartel prohibition?
The competition authority in charge of generally enforcing
anticartel measures is now the French Competition Authority
(Autorité de la concurrence) (the "Competition
The law on the modernisation of the economy (the
"LME"), enacted on 4 August 2008 and implemented by an
ordinance of 13 November 2008, creates the Competition Authority to
replace the Competition Council (Conseil de la
Concurrence) (the "Council"), an independent
authority set up in 1986.
Investigations may be carried out either by the Competition
Authority or by the Directorate General for Competition, Consumer
Policy and Repression of Fraud (Direction
Générale de la Concurrence, de la Consommation et de
la Répression des Fraudes) ("DGCCRF"), an
administrative agency under the authority of the Ministry of
The Competition Authority has wider means and powers than the
Council, in particular as regards investigations, while the
Minister of Economy is now entitled to settle and order measures as
to socalled "micro anticompetitive practices" (see the
answer to question 6.1).
The members of the Competition Authority have not been appointed
yet and the Competition Authority is thus not yet active at the
time of drafting this article. The first meeting is planned to be
held at the very beginning of January 2009.
1.4 What are the basic procedural steps between the opening of
an investigation and the imposition of sanctions?
The Competition Authority may be in charge of a case following
either a referral from the Minister of Economy, or a complaint from
a company or even acting ex officio, at the instigation of
the head reporting officer (rapporteur
Pursuant to Article L. 463-2 of the Code, if it results from the
investigation that the practices at stake may be anticompetitive,
the head reporting officer issues a statement of objections, by
letter with acknowledgment of receipt, to the complainant, the
ministers concerned by the affected sector of activity, the
concerned parties and the State Commissioner (Commissaire du
Gouvernement). The notified parties can then consult the file
and present any observations within two months.
An official report is then sent to all notified parties, along
with the documents which the head reporting officer relies on and
the observations, if any, made by said parties. Each party can in
turn submit its observations in reply within two months. Finally,
the matter is brought before the Competition Authority which will
a decision declaring that there are no grounds for
a decision adjourning the proceedings in case another national
competition authority is dealing with the same facts; or
a decision pronouncing on the anticompetitive nature of the
facts and possibly imposing a sanction.
1.5 Are there any sector-specific offences or exemptions?
Article L. 420-4 of the Code provides for a specific exemption
in the agricultural sector. Practices consisting for undertakings
in organising agricultural or agriculturally-based products under a
single trademark or trade name, setting common production volumes
and quality as well as common business policy, including agreements
on a common sale price, may be exempted, provided they (i) ensure
economic progress, (ii) provide users a fair share in the resulting
profit, (iii) do not allow the undertakings involved to eliminate
competition for a substantial part of the products concerned, and
(iv) are indispensable to achieve said economic progress.
In addition, certain agreements, especially when their purpose
is to improve the management of small or medium-sized enterprises
may be exempted by decree, upon obtaining the Competition
Finally, pursuant to Article 90 of Act No. 82-652 of 29 July
1982, agreements between cinema enterprises to ensure programming
of films in cinema houses can be allowed by the director of the
National Cinematographic Industry (Centre National de la
Cinématographie) under certain conditions.
1.6 Is cartel conduct outside France covered by the
The French cartel prohibition covers any anticompetitive
agreements and practices which may distort competition in a market
located in France, regardless of the place of signature of the
agreement, the head office of the parties, or even their
nationality. In addition, in decision No. 04-D-45 of 16 September
2004, the Council held jurisdiction to examine anticompetitive
agreements entered into by French firms acting in France, but with
effects outside of France.
2 Investigative Powers
2.1 Summary of general investigatory
Table of General Investigatory Powers
Please Note: * indicates that the
civil/administrative investigatory measure requires the
authorisation by a court or another body independent of the
2.2 Specific or unusual features of the investigatory
powers referred to in the summary table.
French civil/administrative procedure comprises ordinary and
In ordinary investigations, the officers of the Competition
Authority or the DGCCRF may access business premises to request
copies of business documents, while judicial investigations enable
said officers to conduct searches and seize any documents from
either business or domestic premises under the warrant of a
2.3 Are there general surveillance powers (e.g.
This is not applicable under French civil/administrative
2.4 Are there any other significant powers of
The investigators may ask the authority to which they are
answerable (i.e. either the Competition Authority or the DGCCRF) to
appoint an expert to conduct any necessary expert assessment
involving all the parties, such as an analysis of the relevant
market or a study of documents.
2.5 Who will carry out searches of business and/or
residential premises and will they wait for legal advisors to
Ordinary searches inside business premises are carried out by
(i) investigators of the Competition Authority, or (ii) by
authorised public officers under the supervision of the Ministry of
Economy, while judicial investigation inside residential premises
may be performed by both types of officers under the supervision of
the judge who authorises such measures.
The ordinance implementing the LME (see the answer to question
1.3) allows companies subject to unannounced investigations to call
an external lawyer, whose presence was previously merely tolerated.
However, investigators remain under no obligation to wait for legal
advisors to arrive.
2.6 Is in-house legal advice protected by the rules of
Only communications between a member of the Bar and its client,
such as legal opinions sent by an attorney to its client or
exchanges of correspondence between them, are covered by
attorney-client privilege, and do not thus have to be surrendered
to investigators. Therefore, in-house legal advice is not protected
by the rules of privilege, even if an internal memorandum merely
restates an advice given by the company's attorney.
2.7 Other material limitations of the investigatory
powers to safeguard the rights of defence of companies and/or
individuals under investigation.
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