When we think of competition law, we often think of the major cases handled by the Autorité de la concurrenceThese involve national and international companies, with potentially very high penalties. However, the economic fabric is also made up of many small and medium-sized enterprises (SMEs) whose activities, although more local or modest, are not immune from competition rules. A price agreement between local craftsmen or an abuse of a dominant position on a very specific market can also distort competition.
Aware that the traditional procedure before the AMF can prove cumbersome and disproportionate in such cases, the legislator has introduced an alternative, lighter procedure for so-called "minor" or "micro" anti-competitive practices (Micro-PACs). This specific procedure, managed directly by the Minister for the Economy (via the DGCCRF), offers a potentially faster and less costly way of resolving disputes, with capped penalties. This article explains when and how it applies.
What is an "anti-competitive micro-practice" (Micro-PAC)?
For a case to be dealt with under this exceptional procedure provided for in Article L. 464-9 of the French Commercial Code, two cumulative conditions must be met:
- A purely national (or even local) dimension: The practice in question must not not be likely to affect trade between Member States of the European Union. It must therefore fall outside the scope of Articles 101 or 102 of the Treaty on the Functioning of the European Union (TFEU). In practical terms, this refers to practices whose effects are confined to French territory, and often on a limited geographical scale (regional, departmental, local).
- Economic players of limited size: Strict turnover thresholds must be met. Taking into account the last financial year ended :
- Sales generated in France by each companies or organisations involved in the practice must not exceed €50 million.
- Sales figures cumulative produced in France by all the companies or organisations concerned must not exceed €200 million.
If one of these conditions is not met (for example, if the practice has a potential cross-border impact, however small, or if only one of the companies exceeds the €50m threshold), the case falls within the jurisdiction of the Competition Authority and cannot be dealt with via the ministerial Micro-PAC procedure. These criteria make the scheme particularly suitable for situations involving SMEs, craftsmen, self-employed traders or self-employed professionals whose activity is mainly local or regional.
How does the ministerial procedure work?
The procedure for Micro-PACs is separate from that before the AMF. It is conducted by the authorities, under the authority of the Minister for the Economy, represented in practice by the Directorate General for Competition, Consumer Affairs and Fraud Control (DGCCRF).
- The initial survey : The process generally begins with an investigation by the DGCCRF (often the departmental or regional directorates), which may act in response to a local complaint, to reports or on its own initiative if it detects evidence of anti-competitive practices (local price-fixing agreements, sharing of customers between craftsmen, etc.).
- Ministerial communication : If the DGCCRF's investigation establishes facts likely to constitute a Micro-PAC (meeting the conditions of thresholds and non-affectation of intra-EU trade), the Minister (or his delegated services) sends a formal communication to the companies concerned. This document is similar to a "simplified notification of grievances". It typically contains :
- The DGCCRF investigation report detailing the facts found.
- The legal classification envisaged (e.g. unlawful agreement within the meaning of Article L. 420-1 of the French Commercial Code).
- The measures proposed by the authorities: these may include injunction to cease the practice and/or a proposal to financial transaction.
- Company rights : On receipt of this communication, the company has procedural guarantees:
- It may consult the investigation file held by the authorities (while respecting the business confidentiality of other companies that may be involved).
- It has a period of two months to submit written observations in response. This period may be extended by the administration for a maximum of two additional months if justified by the circumstances.
- She has the right to be assisted by a lawyer throughout this phase.
- The Minister's decision : After considering any comments from the company, the authorities (acting on behalf of the Minister) take a final decision. It may :
- Close the case if it considers that the facts have not been established or do not constitute an offence.
- Confirming your intention prosecute and notify the company of a decision ordering it to cease the practice within a given period and/or offering it a financial settlement (the amount of which is fixed).
- Acceptance or refusal by the company : The company then has a period ofone month from notification of this decision to formally accept the injunction and/or settlement. Please note: failure to respond within this period is considered to be a refusal. Acceptance must be explicit.
What are the advantages and consequences of this procedure?
Opting to accept the ministerial proposal as part of a Micro-PAC is a major advantage, but refusal or failure to do so has major consequences.
- If accepted :
- Capping the penalty : This is the main attraction. If the company accepts the proposed transactionthe amount it will have to pay is necessarily capped. It may not exceed 150,000 euros OR 5% of last known sales in Francewhichever is lower. This ceiling is considerably lower than the penalties that can be imposed by the Autorité de la concurrence (up to 10% of sales). global).
- Final closure of the case : If the company complies with the injunction within the time limit set and pays the agreed settlement, the public prosecution for these acts is extinguished. The case can no longer be referred to the Autorité de la concurrence (French competition authority), or it can be referred to it on its own initiative, for the same practice. The case is now definitively closed from an administrative point of view.
- Fast and simple: The procedure is generally quicker and less formalistic than a full investigation by the Autorité.
- In the event of refusal or non-performance :
- Mandatory referral to the Authority : If the company refuses the Minister's proposal (explicitly or through silence) or if, after having accepted, it does not comply with the injunction or does not pay the transaction within the time limit, the Minister is obliged to refer the matter to the Competition Authority.
- Back to the standard procedure: The case is then investigated by the AMF in accordance with the usual rules. The company loses the benefit of the reduced penalty ceiling. It is then exposed to the potentially much heavier penalties that the AMF may impose, without prejudice to the injunctions that the AMF may also issue. The "gamble" of refusal may therefore prove costly if the infringement is ultimately confirmed by the Authority.
Relationship with the Authority's procedures
It is useful to understand how this ministerial procedure fits into the overall landscape of competition regulation. The Competition Authority and the Minister's departments (DGCCRF) work together.
The Autorité is informed of investigations conducted by the DGCCRF that may fall under this procedure. Conversely, when it receives a complaint directly, the Autorité de la concurrence may decide not to investigate it itself if it finds that the facts potentially fall within the scope of the Micro-PAC procedure. In this case, it may reject the referral and invite the complainant to contact the services of the Minister (DGCCRF), as provided for in Article L. 462-8 of the French Commercial Code. There is therefore a form of initial "one-stop shop", but with possible referral to the procedure best suited to the scale of the case.
When is the Micro-PAC procedure relevant?
This procedure makes sense in specific situations:
- Agreements or practices implemented by small or medium-sized companies.
- Practices with a limited geographical impact (local or regional market).
- Situations where the sales figures of the companies concerned are clearly below the legal thresholds (€50m individually / €200m combined in France).
- Cases where the effect on trade between EU Member States can reasonably be ruled out.
For a company meeting these criteria, accepting the ministerial procedure may be an advantageous strategy for obtaining a rapid resolution, less costly in terms of procedural fees, and above all with a capped and predictable financial penalty, thus avoiding the risk of a more cumbersome procedure before the Autorité. The publication of these decisions on the DGCCRF website ensures a degree of transparency in the application of this system.
Is your company an SME and do you suspect that you are involved in a practice that could fall under the Micro-PAC scheme, or are you the subject of an investigation by the DGCCRF on this basis? It's important to understand the issues and the options. Our firm can use its expertise to analyse your situation in the light of the Micro-PAC criteria and help you to advise on the best strategy to adopt in the face of the Minister's possible proposal.
Sources
- French Commercial Code: article L. 464-9 (Micro-PAC procedure), article L. 462-8 paragraph 3 (possibility of rejection by the Authority), article L. 450-5 (information of the Authority on ministerial investigations), articles R. 464-9-1 to R. 464-9-3 (regulatory details of the procedure).
- DGCCRF website (for publication of Micro-PAC settlement/injunction decisions).
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