Undertakings can be submitted to the Authority at any time from the notification of the case, during the first 25 working days in the first phase and 65 working days in the second phase. Where the parties submit undertakings in the first phase, the review period of 25 working days is extended by 15 additional working days. Parties may also ask for a ‘stop the clock’ of up to 15 working days to finalise undertakings. During the second phase, where undertakings are submitted or modified more than 45 working days after the opening of the second phase, such in-depth review period is extended by 20 working days from the date when such remedies are proposed. On a few occasions, the Authority required ‘fix-it-first’ commitments requiring the notifying party to identify, prior to the adoption of the decision, a suitable acquirer to take on the asset that it has committed to divest.
Undertakings imposed on the parties by the Authority (ie, injunctions) aim at remedying anticompetitive effects of the operation. Moreover, remedies can be imposed by the Minister for the Economy to deal with other negative consequences of the operation (see question 22).
Failure to implement a remedy can result in the imposition of fines:
- for corporate entities - up to 5 per cent of their turnover in France in the previous financial year (plus, where applicable, the turnover in France over the same period of the acquired party); and
- for individuals - up to €1.5 million.
Moreover, the Authority may also:
- withdraw the decision authorising the operation. In such case, and except where the situation that existed prior to the concentration is restored, the parties will be bound to notify the transaction a second time within one month of the withdrawal of the decision;
- enjoin the parties to comply, within a certain deadline, with the orders, injunctions or undertakings provided for under its decision, under periodic penalty; and
- enjoin the parties, subject to periodic penalty, to comply with new injunctions or orders that will replace the initial commitments that were not complied with.
In 2007, a company was sanctioned for the first time for a breach of its commitments with a fine of €100,000. A divestment was also required.
In 2008, a breach of merger remedies was sanctioned in the TF1/AB Group/TMC case. TF1 and AB were enjoined to comply with the unimplemented commitments within one month, under a daily penalty of €5,000. The companies were also fined a total amount of €265,000 for breach of remedies.
In 2011, further to remedies agreed by Canal Plus in the 2006 Vivendi Universal/CanalSat/TPS case, the Authority considered in the course of a monitoring process that Canal Plus had breached several remedies and therefore decided to withdraw its authorisation and to fine the company €30 million. Vivendi and Canal Plus then re-notified the operation and the Authority opened a second-phase investigation in March 2012. In July 2012, the Authority finally cleared the operation subject to several injunctions. The case was confirmed on appeal. The Authority’s decision provided that the injunctions, taken for five years (until July 2017), could be renewed for five additional years (2017-2022), should the circumstances warrant it. Against this background, the Authority launched in July 2016 a public consultation to determine whether these obligations in force since 2012 should be lifted, adapted or renewed. The Authority’s analysis revealed that Canal Plus’s position is increasingly challenged, leading the Authority to modify on 22 June 2017 the injunctions initially imposed: certain injunctions have been lifted, or adapted to take into account the evolution of the markets, while others have been maintained. The new framework shall be applicable until 31 December 2019.
In April 2016, the Authority imposed a fine of €15 million on Altice/Numericable group for breach of remedies agreed in the 2014 Numericable/SFR case, relating to the divestment of Outremer Telecom. The Altice/Numericable group had undertaken to maintain the viability, market value and competitiveness of this business to favour its acquisition by a competitor. It subsequently appeared that Outremer Telecom’s tariffs rose by 17 to 60 per cent, giving customers the opportunity to terminate their subscriptions without incurring cancellation fees. As a result, cancellation rates were three times higher in January 2015 than in January 2014. This constituted a reversal in Outremer’s business strategy aiming at capturing new customers through aggressive competitive pricing. The Authority considered that this new strategy put the competitiveness of Outremer Telecom’s offer at considerable risk, thus breaching the commitments.
In addition, in March 2017, the Authority jointly fined Altice and SFR Group €40 million for breach of other remedies made binding under the same 2014 Numericable/SFR decision. In this case, SFR had basically committed to continue to perform the contract it had entered into with Bouygues Telecom for their co-investment in the development of optical fibre infrastructure in high-density areas. However, the Authority held that Altice/SFR Group had only very partially fulfilled this commitment. This case was also the first in which the Authority imposed injunctions subject to periodic penalty payment, to further secure their implementation.
In July 2018, the Authority for the first time fined a company for non-compliance with structural commitments consisting of divesting assets within a given deadline. It fined Fnac Darty Group €20 million for failing to divest three stores, as per the commitments, and ordered it to divest two specific stores in lieu of those that were not disposed. The Authority notably considered that, confronted with difficulties in finding a buyer for these three other stores, it was Fnac Darty’s responsibility to take the appropriate measures to fulfill its commitments (eg, by asking the Authority to substitute other stores for those it wasn’s able to sell).
It is also possible for the Authority to review remedies adopted for clearance of an operation in view of changes in circumstances. The Authority used this possibility for the first time in the Bigard/Socopa case (2011) where it authorised the enforcement of a review clause included in the clearance decision, changing a trademark licence remedy into a trademark sale remedy. However, in this case, the Authority also fined Bigard €1 million for various practices aimed at reducing the value of the trademark and at discouraging candidates.
As part of the re-examination of the commitments submitted in relation to the acquisition by Vivendi and Groupe Canal Plus (GCP) of Direct 8 and Direct Star, the Authority had to decide upon a proposal of modified commitments formulated by GCP. The Authority’s investigation revealed that Canal Plus’s position is increasingly challenged, leading the Authority to modify in June 2017 the initial commitments: certain of them have been lifted, or adapted to take into account the evolution of the markets, while others have been maintained. The new framework applies until the end of 2019. This review was made in parallel to the re-examination of the injunctions imposed by the Authority on GCP in the context of the Vivendi Universal/CanalSat/TPS case.
Likewise, in 2019 the Authority had to review remedies made binding in 2014 for the acquisition of Mediaserv (now Canal + Telecom) by Canal Plus Overseas (now Canal + International) for an initial duration of five years after which a new competitive analysis would be performed to examine whether or not they should be maintained. The Authority reviewed the new commitments proposed by Canal + and market tested them, concluding that certain existing obligations should be maintained, while others could be eased. All the commitments maintained or modified were renewed for a period of five years (ie, until 2024).
The Authority is clearly minded to exercise a more systematic ex-post control of the implementation of undertakings.
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