Abuse of dominant position

Your business is the victim of an abuse of dominant position

A supplier imposes unfair commercial terms. A competitor engages in predatory pricing to drive you from the market. A dominant operator refuses to grant you access to an essential facility, or applies a margin squeeze that renders your business unviable. Under both French and EU competition law, these practices constitute forms of abuse of a dominant position.

A company holding a dominant position does not infringe the law merely because of its market power. What the law prohibits is the abusive exploitation of that position – conduct that distorts competition by means unrelated to competition on the merits. The Court of Justice of the European Union established this principle in the Hoffmann-La Roche judgment: abuse is an objective concept, independent of intent. The French Supreme Court (Cour de cassation) applies the same reasoning under domestic law.

Two broad categories of abusive practices are targeted. Exclusionary abuses seek to eliminate competitors or prevent new entrants: predatory pricing, abusive exclusivity clauses, refusal to deal, tying arrangements, margin squeeze. Exploitative abuses extract undue advantage from the dominant position at the expense of trading partners or consumers: excessive pricing, discriminatory terms, supplementary obligations unrelated to the subject of the contract. The distinction between unfair competition and abuse of dominance lies in the source of market power: unfair competition law sanctions disloyal conduct between competitors regardless of any dominance; Article L. 420-2 of the French Commercial Code applies only to undertakings holding a dominant position on a relevant market.

How we assist you

• Legal characterisation of the anti-competitive practice under Article L. 420-2 of the French Commercial Code and Article 102 TFEU
• Definition of the relevant market and analysis of the dominant position, based on market shares, barriers to entry and the economic power of the group
• Building the evidentiary case: factual elements, economic data and contractual documents
• Filing a complaint with the French Competition Authority (Autorite de la concurrence) or bringing a damages action before the civil or commercial courts
• Monitoring the proceedings and defending your interests at each stage of the investigation

The sanctions regime combines administrative and criminal penalties. The French Competition Authority may impose fines of up to 10% of worldwide turnover (excluding tax). The European Commission has the same power for cases affecting the EU internal market. Under French criminal law, Article L. 420-6 of the Commercial Code provides for penalties against any individual who has played a personal and decisive role in implementing anti-competitive practices: four years’ imprisonment and a fine of EUR 75,000.

You are under investigation for abuse of dominant position

The French Competition Authority has notified you of its statement of objections, or a competitor has brought a civil liability action against you. The financial stakes are considerable and the proceedings demand a rapid, structured and legally sound response.

We intervene from the moment objections are notified to organise your defence. Strategy depends on the context: challenging the existence of a dominant position on the relevant market, demonstrating that the practices amount to normal competition on the merits, or negotiating commitments in the context of settlement proceedings before the Authority.

Our lines of defence

• Critical analysis of the relevant market definition adopted by the case handler, both product and geographic dimensions
• Challenging the criteria for dominance: market shares, barriers to entry, countervailing buyer power
• Demonstrating that the contested practices constitute normal competition, efficiency-based rebates or objectively justified conditions
• Preparing for Authority investigations, including dawn raids (operations de visite et saisie)
• Drafting submissions in response to the statement of objections and representing you before the Board of the Competition Authority
• Appealing to the Paris Court of Appeal if the decision must be challenged

Anticipating competition risks

A company whose market share exceeds 40% enters a zone of heightened scrutiny. Above 50%, EU case law presumes a dominant position. At this level of market power, ordinary commercial practices – conditional rebates, exclusivity arrangements, differentiated pricing – may be reclassified as abusive. The risk is particularly acute in concentrated or regulated sectors where the Competition Authority exercises increased oversight.

Our firm advises dominant undertakings on the structuring of their commercial practices. The objective is to reconcile economic performance with compliance with French and EU competition law, without constraining business development.

Our preventive advisory services

• Competition compliance audit of your commercial practices under French and EU law
• Review of your distribution agreements, general terms and conditions of sale and rebate policies
• Analysis of your relationships with trading partners to identify risks of reclassification as exploitative abuse or abuse of economic dependency
• Training your teams on competition compliance best practices
• Strategic advice ahead of sensitive commercial decisions: product launches, pricing policy, exclusivity agreements

Frequently asked questions

What are the penalties for abuse of dominant position in France?

The French Competition Authority may impose fines of up to 10% of the undertaking’s worldwide turnover. Individuals who played a personal and decisive role in implementing the anti-competitive practices face up to four years’ imprisonment and a EUR 75,000 fine under French criminal law. The victim may also bring a civil action for damages before the courts.

How is abuse of dominant position proved?

Three cumulative conditions must be met: the existence of a dominant position on a relevant market, abusive exploitation of that position, and an anti-competitive object or effect, even if only potential. Evidence relies on economic data (market shares, barriers to entry, the group’s economic power) and factual elements (contracts, commercial exchanges, pricing policy). Our firm assists you in building this case.

What is the difference between abuse of dominance and economic dependency under French law?

Abuse of dominant position targets an undertaking that dominates an entire market. Abuse of economic dependency, provided for in the second paragraph of Article L. 420-2 of the Commercial Code, targets an undertaking that exploits a partner who has no equivalent alternative. The conditions are different: economic dependency is harder to establish and rarely upheld by the courts.

Do you appear before the French Competition Authority?

Yes. Our firm represents complainants in proceedings before the Authority and defends undertakings under investigation, both in France and in proceedings before the European Commission. We act at every stage: investigation, statement of objections, submissions, hearing before the Board, and where necessary, appeal before the Paris Court of Appeal.

How long does a case typically take?

Timescales vary depending on the procedural route chosen. A civil liability action before the Commercial Court may be resolved within twelve to eighteen months. Proceedings before the Competition Authority take longer: investigations typically last two to three years. The limitation period is five years from the cessation of the practices. An initial consultation allows us to assess the likely timeframe for your case.