On 4 July 2011, the French Competition Authority announced the
launch of two sector-wide inquiries concerning, respectively, the
motor vehicle after-market and the e-commerce market.
Motor vehicle after-market
As regards the motor vehicle after-market, the French
Competition Authority made two main observations in deciding to
initiate the inquiry. First, it noted that vehicle repair and
maintenance prices have increased by 35% since 1998 (i.e., 2.5
times the rate of inflation) and that the price of spare parts
alone climbed by 30% between 2000 and 2009 (compared to a price
increase for new motor vehicles of 8%). According to the
Competition Authority, this price inflation can only be partly
explained by the rise in raw material and labour costs. Second, the
Competition Authority recalled that the previous Motor Vehicle
Block Exemption Regulation (Commission Regulation 1400/2002)
guaranteed equal terms of access for independent and authorised
repairers alike to spare parts and technical information and that
the new block exemption regime applicable to the motor vehicle
after-market (in force since 1 June 2010) similarly confirms the
importance of unrestricted access of independent repairers to spare
parts and technical information. Yet, according to the Competition
Authority, in the majority of cases vehicle owners still seem to
have their car repaired and maintained in a garage which belongs to
a network authorised by the manufacturer (these networks having
over 80% market share for cars under two years old in 2006).
By means of the sector inquiry, the Competition Authority will
seek to determine the causes of this situation. In particular, the
Competition Authority will first examine whether the conditions of
access to manufacturers' spare parts and to technical
information permit proper and effective competition between
independent and authorised repairers. Second, the Competition
Authority will examine whether all spare parts manufacturers have
access to spare parts distribution networks under equivalent
conditions. Finally, the Competition Authority will examine the
market impact of the monopoly rights of vehicle manufacturers
stemming from the design rights over visible parts (i.e., windows,
lighting or bodywork components) granted to them under French IP
Turning to the initiation of the inquiry into the e-commerce
market, the French Competition Authority noted that online sales
only account for 6% of the retail market in France (compared to 8%
in Germany and 10.7% in the UK). Nonetheless, the Competition
Authority conceded that online sales are growing very fast in
France (sales grew by 29.5% between 2008-2010 compared to 19% in
all European countries).
Against this backdrop, the sector inquiry aims at examining how
competition works in the e-commerce sector and will focus on two
main issues. First, the inquiry will evaluate the impact of online
sales on traditional distribution channels (notably with respect to
prices). To this end, the Competition Authority has announced that
it will examine the price differences between online sales and
sales in physical stores for certain product categories. Second,
the inquiry aims at examining the various factors which are likely
to reduce the competitive pressure of online sales on traditional
distribution channels. According to the Competition Authority,
these factors may include:
The fact that some online distributors may have market power.
In the Competition Authority's view, practices which would have
the object or effect of maintaining such market power, by impeding
the emergence of competing online websites, are likely to create
competition law issues.
The commercial relationships between manufacturers or
distribution networks, on the one hand, and online distributors on
the other hand. In this respect, the Competition Authority
announced that it will examine restrictions on online sales imposed
by manufacturers or by distributors.
The behaviour of the various online intermediaries (such as
online intermediaries providing electronic payment, delivery or
price comparison services). In particular, the Competition
Authority announced that it will carefully examine the way price
comparators work to ensure that the comparison of products and
services is transparent and objective.
The Competition Authority will invite the main players in the
e-commerce sector to attend hearings during the investigation.
In each sector inquiry, the Competition Authority will
ultimately make the recommendations which it deems appropriate to
ensure effective competition in the respective sectors.
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
To print this article, all you need is to be registered on Mondaq.com.
Click to Login as an existing user or Register so you can print this article.
By 27 December 2016, the Croatian Parliament needs to implement the Directive 2014/104/EU on antitrust damages actions, which is expected to streamline the procedure for private individuals and businesses to sue for damages...
The European Commission recently published its preliminary report on the E-commerce Sector Inquiry, identifying potential competition concerns in cross-border e-commerce of digital content and consumer goods.
The German government has recently published a bill that would significantly amend the criteria for determining whether an M&A transaction is subject to German merger control.
Some comments from our readers… “The articles are extremely timely and highly applicable” “I often find critical information not available elsewhere” “As in-house counsel, Mondaq’s service is of great value”
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).