Sunday, December 1, 2013

Resale Price Maintenance in France

Charles Saumon (Hogan Lovells) discusses Resale Price Maintenance in France.

ABSTRACT: On October 10, 2013, the Paris Court of Appeals confirmed a landmark decision of the French Competition Authority condemning three leading manufacturers active in the dog and cat food sector to a EUR 35.3 million fine for having imposed resale prices and territorial restrictions on their distributors in France during five years. Between 2004 and 2008, two of these manufacturers directly negotiated the resale prices of the pet food products with specialist retailers (pet shops, farmers, and vets), even though these retailers purchased their products from wholesalers. The wholesalers were therefore not free to set their own prices, preventing them from gaining competitive prices.

This recent decision of the Paris Court of Appeals illustrates the particular attention the French authorities are paying to the issue of minimum or fixed resale price maintenance. For this purpose, they can rely on two co-existing sets of rules prohibiting minimum RPM: those applicable to unfair commercial practices and those based on competition law.

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