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French Competition Authority Fines a Pharmaceutical Laboratory EUR 25 Million for Anti-Generic Practices

On 20 December 2017, the French Competition Authority (the FCA) imposed a EUR 25 million fine on a pharmaceutical laboratory, for delaying entry onto the market of the generic version of Durogesic, and for hindering its development through a disparagement campaign. No public version of the decision is available yet, nonetheless the FCA has already published a detailed press release (available in French). WHAT HAPPENED Durogesic is a powerful opioid analgesic, which active substance is fentanyl, usually prescribed in the form of transdermal patch for the treatment of severe pain, including chronic cancer pain. In 2007, a competing pharmaceutical company launched its generic equivalent. After receiving a market authorization in Germany, the competing pharmaceutical company started a mutual recognition procedure in the European Union. The European Commission (the Commission) granted the market authorization in October 2007 and instructed the other Member States...

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Three Things To Know About French Merger Control

Jurisdictional thresholds French merger control applies if the turnovers of the parties to a transaction (usually the acquirer(s) including its (their) group(s) of companies, and the target) exceeded, in the last financial year, certain (cumulative) thresholds provided in Article L. 430-2, I of the French Commercial Code (the “Code”): Combined worldwide pre-tax turnover of all concerned parties > €150 million; and French turnover achieved by at least two parties individually > €50 million euros; and The transaction is not caught by the EU Merger Regulation. Specific (and lower) thresholds exist for mergers in the retail sector or in French overseas departments or communities[1]. In the situation of an acquisition of joint control, a transaction can be notifiable where each of the acquirers meets the thresholds even if the target has no presence or turnover in France. There is no exception applicable to foreign-to-foreign transactions. Acquisitions of...

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Significant Fine Imposed by the French Competition Authority in Floor Coverings Cartel

On October 19, 2017, the French Competition Authority (the “FCA”) imposed a EUR 302 million fine on the three leading companies in the PVC and linoleum floor coverings sector; Forbo, Gerflor and Tarkett, as well as the industry’s trade association, SFEC (Syndicat Français des Enducteurs Calandreurs et Fabricants de Revêtements de Sols et Murs), for price-fixing, sharing commercially sensitive information, and signing a non-compete agreement relating to environmental performance advertising. The FCA said the significant fine reflected the gravity of the offence and the long duration of the anticompetitive behavior, which for one company lasted 23 years. WHAT HAPPENED The proceedings were originally initiated by unannounced inspections carried out in the floor coverings industry in 2013 by the FCA, acting on information submitted by the DGCCRF (Directorate General for Competition Policy, Consumer Affairs and Fraud Control), which resulted in the discovery of...

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Model Management Services, Italian Competition Authority Fines 8 Modelling Agencies and Their Trade Association for Price Fixing

On 11 November 2016, the Italian Competition Authority (the Authority) fined eight modelling agencies (B.M. S.r.l. – Brave, D’management Group S.r.l., Elite Model Management S.r.l., Enjoy S.r.l., Major Model Management S.r.l., Next Italy S.r.l., Why Not S.r.l. and Women Models S.p.a.) and their trade association (Assem) of € 4.5 million for alleged price collusion. According to the Authority, the modelling agencies would have agreed on the applicable prices on the market with the aim of avoiding any form of competition. In particular, the alleged price collusion would have concerned all the components of the prices applied to the major maisons and other clients (e.g., fees for models, wages for the modelling agencies and other additional costs). Furthermore, a practical role would have been played by the trade association, Assem, where the modelling agencies had held frequent meetings to develop the alleged concerted practice. In calculating the fine, the...

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French Competition Authority Imposes Its First Ever Fine for Gun-Jumping

For the first time ever, on 8 November 2016 the French Competition Authority (FCA) sanctioned companies for implementing a transaction that had been notified to the FCA but not yet received a clearance decision, behaviour commonly known as “gun-jumping”. The FCA has imposed a hefty fine of €80 million on Altice Luxembourg and SFR Group jointly and severally for implementing two proposed acquisitions in the telecommunications industry before obtaining the FCA’s clearance. The FCA has previously imposed fines on companies for failing to notify a concentration, but never for gun-jumping, and the fines imposed up till now were relatively low. The high profiles enjoyed by the sanctioned companies, the very large amount of the fine, and the fact that there are only few previous gun-jumping cases in the world, all contribute to making the FCA’s decision in this case historic. Background In France, companies notifying a concentration to the FCA are required to wait...

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E-Commerce: National Competitions Authorities Weigh In on Sales Restrictions Regarding Online Marketplaces

In May 2015, the European Commission launched a two-year, industry-wide inquiry into the e-commerce sector to gather data on the functioning of e-commerce markets, so as to identify possible competition concerns. This sector inquiry focuses particularly on potential barriers erected by companies to cross-border online trade in goods and services where e-commerce is most widespread (e.g. electronics, clothing and shoes), as well as in digital content. While the European Commission intends to provide specific guidance on European e-commerce issues when it publishes its final report in 2017, early insights can be found in national competition authorities' recent decisions, particularly in France and Germany. In France, the French Competition Authority (FCA) announced on 18 November 2015 the closure of an investigation into the contractual practices of the sporting goods manufacturer Adidas, as a result of Adidas’ change in its online sales policy. This FCA...

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The Case of Ophthalmic Drugs in Italy and France: A Lesson to Learn – Parallel Antitrust Investigations and Cooperation Between National Competition Authorities

The recent investigations into two pharmaceutical companies active in the ophthalmic drugs market in Italy and France serve as a reminder of the cooperation that takes place between national competition authorities. International groups should therefore take into account all the jurisdictions where they have a presence or do business when developing their antitrust audit and compliance programmes. Read the full article.

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French Competition Authority Opinion on Car Repair and Maintenance

by Jacques Buhart and Lionel Lesur The French competition authority (FCA) released on 8 October 2012 an opinion in relation to the car repair and maintenance sector.  The opinion is the result of a public consultation that was launched in Spring 2011. The opinion, which is more than 200 pages long and available only in French, contains several statements and proposals aimed at increasing competition in the car repair and maintenance sector that may have substantial implications for market participants. In response to the opinion, the French Minister of Industrial Renewal, Arnaud Montebourg, said that while the French Government will consider the FCA’s proposals, keeping prices low for consumers is not currently a top priority.  It can therefore be assumed that the French Government will not be making significant changes to legislation imminently.  The opinion may, however, have some immediate implications for the sector. To read the full...

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FCA’s New Policy Provides Strong Incentives For Compliance Program Adoption

by Lionel Lesur and Louise-Astrid Aberg Following up on our prior post, on February 10, 2012, the French Competition Authority (FCA) published the final version of its framework document on compliance programs and of its Notice relating to settlements. First, the FCA decided that the Notice of Settlement would have the legal status of a "directive" under French administrative case law. Consequently, the Notice of Settlement is legally binding on the FCA and fully enforceable against it, except if the FCA explains in its decision the specific circumstances or any reason of general interest commanding it to adopt another solution. Second, for the Notice of Settlement, the FCA decided to relax its initial rule preventing the cumulating of a settlement reduction and a leniency reduction. The FCA adopted this principle, first put forward in the laundry detergents cartel decision (December 8, 2011), that states companies may cumulate both reductions when...

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European Developments: French Competition Authority Launches Public Consultation on Settlement and Compliance Programs and Italy’s Prime Minister Announces New Cabinet

Public Consultation on Settlement and Compliance Programs Launched by the French Competition Authority by Louise-Astrid Aberg and Lionel Lesur On October 14, the French Competition Authority (FCA) launched a two-month public consultation for guidelines on settlement and compliance programs.  Both these guidelines have been highly anticipated since they were first announced last May. The draft settlement guidelines contain details on the FCA's approach and decisional practices which were developed under the control of the French courts.  Among the guidelines, the FCA determined that settlement is possible in all cases where infringement on competition law has taken place, including cartels, vertical restraints and single firm conduct.  In the event of infringement, settlement becomes an option only after the parties have been formally charged.  Once parties fully acknowledge their participation in anticompetitive conduct, the casehandler in...

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