First insights of the French Competition Authority on the conditions for a cooperation between undertakings due to the COVID-19 pandemic to conform to competition law
On 22 April 2020, the French Competition Authority (hereinafter the “Authority“) published a press release stating that it had informally provided to the Rassemblement des opticiens de France (hereinafter the “ROF“), an association of undertakings representing opticians, details on the support that the latter would like to supply to its members regarding the payment of commercial rents for their business premises.
1. The ROF had informally requested the assistance of the Authority in order to find out whether, without infringing competition law, it could send a letter to the landlords of the business premises of its members which had discontinued their business due to the pandemic of COVID-19. This letter would request the addressees to agree to a reorganization of the payment of commercial rents for these premises.
2. The Authority first notes that this initiative does not fall within the scope of the European Commission’s communication of 8 April 2020 establishing the conditions under which European undertakings can cooperate to respond to emergency situations arising from the current pandemic of COVID-19 without infringing Article 101 of the Treaty on the Functioning of the European Union, which prohibits anticompetitive agreements. This communication was presented in our post of 9 April 2020.
Despite this, the Authority mentions that it agrees to respond to informal requests for clarification on competition law in the current period.
3. Second, the Authority continues by recalling its decisional practice according to which an association of undertakings can forward to its members information intended to help them in the conduct of their business on the double condition that this action
- participates to the defense of the business interests of the members of the association; and
- does not result in a market intervention by inviting its addressees to adopt a specific market behavior, in particular in the form of warnings or instructions. Such intervention may be anticompetitive and thus constitute an infringement of competition law, depending on the case.
Applying its decisional practice to the current situation, the Authority notes that prima facie, an association of undertakings remains within the boundaries of the mission of information, advice and defense of business interests of which it is responsible when it limits to provide its members with general advice in the context of the COVID-19 pandemic on the application of measures adopted by public authorities or on the interpretation of existing contracts and to express its position in writing.
4. In the present case, the ROF disclosed to the Authority that they only intend to provide general recommendations to its members and to present them with legal and factual arguments in support of their requests. They also specified that they would not determine the behavior of their members on the market. According to the ROF, their action aims at preventing the risks of business failures due to the prolonged shutdown of their members’ points of sale and do not seem to allow a significant coordination of the concerned undertakings’ costs.
In view of the elements provided by the ROF, the Authority concludes that the approach contemplated by this association of undertakings does not result in an anticompetitive intervention on the market.
5. Finally, the Authority recalls that it is ready to provide legal certainty to the virtuous initiatives of association of undertakings and to give them informal advice as quickly as possible on the compatibility with competition law of a draft cooperation that would be presented to it.
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