The French Administrative Supreme Court asserts jurisdiction to review a non-legally binding opinion of the French Competition Authority

Published on 7th Apr 2016

Under French law, it is generally accepted that only legally binding decisions by public authorities may be challenged before administrative courts. However, in landmark decision, the Conseil d’Etat (the French Administrative Supreme Court) has accepted jurisdiction to review a non-legally binding opinion of the French Competition Authority (FCA). The decision could set a precedent for further actions against public statements made by competition authorities where that statement is “likely to have significant economic impact” upon a private party.

In 2012, Groupe Canal Plus (GCP) and Vivendi Universal acquired TPS and CanalSatellite. The FCA approved the deal, subject to a number of conditions designed to prevent GCP inhibiting competition by securing exclusive distribution rights for certain pay-TV services. 

In a further decision in 2013, pursuant to the merger clearance conditions, the FCA forbade GCP from proceeding with a proposal that would have enabled GCP to acquire exclusive distribution rights over certain cable TV channels. The decision was based on the FCA’s finding that the proposal would have precluded Numericable, a competing provider of cable TV, from offering those channels to its subscribers. 

Subsequently, in 2014, Numericable secured alternative access to the cable TV market through its acquisition of SFR – meaning that GCP’s proposed acquisition no longer presented a risk of exclusion for Numericable. This position was accepted by the FCA in a letter dated 31 March 2015, which recognised that the GCP’s proposal would no longer have the effect of excluding Numericable from the market. The letter merely expressed the views of the FCA and was not legally binding. 

Numericable appealed to the Conseil d’Etat seeking rescission of the FCA’s (non-legally binding) letter. What is interesting about the Conseil d’Etat’s decision is not the fact that it rejected the Numericable’s appeal but rather that it accepted, for the first time, jurisdiction to review the FCA’s non-legally binding opinion. 

The Conseil d’Etat considered that it had jurisdiction to review non-legally binding views of public authorities (such as the FCA), in two situations: 

  • when the relevant non-legally binding statement lays down a prohibition which could become legally binding at a later date; or
  • when the relevant non-legally binding statement is “likely to have significant economic impact” upon a private party. 

In this case, the Conseil d’Etat considered that the FCA’s letter had could have economic effects on Numericable, since the letter was intended to modify the behaviour of operators on the market for cable TV distribution. 

In our view, this liberal approach to jurisdiction adopted by the Conseil d’Etat is to be positively welcomed since it allows private parties to challenge the legality of statements made by the FCA (and potentially, more widely, of other French public authorities), which could have significant economic effects on businesses active on the relevant markets. 

Further clarification of the meaning of the expression “acts which are likely to have significant economic impact” is awaited. The FCA issues regularly issues press releases and notices and these views can influence the businesses active on the relevant markets. If the Conseil d’Etat is minded to adopt a wide definition of the notion of “significant economic impact“, the validity of these press releases and notices, whilst not legally-binding, might also be subject to challenge. 

At the European level, might the General Court align with the position taken by the French Supreme Court and challenge the non-binding views published by the European Commission? This would constitute a significant development towards greater protection of the rights of companies affected by the non-binding views of the European Commission.

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* This article is current as of the date of its publication and does not necessarily reflect the present state of the law or relevant regulation.

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