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France: Competition Authority Ordinance

(Dec. 4, 2008) Law 2008-776 on the Modernization of the Economy, which was passed by the French legislature on August 4, 2008, established a new single competition authority, the Autorité de la concurrence.The creation of the Competition Authority was recently implemented by Ordinance 2008-1161 of November 13, 2008. The Ordinance sets forth the investigation powers of the Authority and its organization. It also includes transitory provisions.

The Competition Authority is an independent administrative agency, replacing the former Council on Competition. It has wider powers than the Council had. The new Authority centralizes the powers and resources that previously were shared by the Council and the Ministry of the Economy; more specifically, the Ministry's Competition Directorate. The Authority consists of 17 members, each appointed for five years. It has full jurisdiction to investigate proposed mergers, both in stage I (initial investigation) and in stage II (in-depth investigation). It has its own investigating service and may sanction any enterprise obstructing the investigations it conducts.

The Ministry of the Economy still has the power to request that the Authority carry out a stage II investigation with respect to a merger, even if the Authority has already authorized the merger after a stage I investigation. In addition, a transaction that has already been investigated in depth and either authorized or prohibited by the Authority may be reviewed by the Ministry “for general interest purposes other than the protection of competition and which may, if applicable, compensate the harm to competition resulting from such transaction.” “General interest purposes” include, for example, creating or maintaining jobs, industrial development, and the competitiveness of a company in the international market.

Finally, in order to allow the Authority to concentrate on the most complex cases, the Ministry of the Economy also retains investigative, injunctive, and settlement power with respect to anti-competitive practices of lesser importance. This power concerns enterprises whose sales individually do not exceed €50 million (about US$63.3 million) or whose sales do not exceed €100 million as a group for all enterprises participating in the anti-competitive practices. (Loi 2008-776 du 4 aôut 2008 de modernisation de l'économie, JOURNAL OFFICIEL (J.O., France's official gazette), Aug. 5, 2008, at 12471 & Ordonnance 2008-1161 du 13 novembre 2008 portant modernisation de la régulation de la concurrence, J.O., Nov. 14, 2008, at 17391, available at http://www.legifrance.gouv (file: les autres textes législatifs et réglementaires).)