• Banking

France - Hong Kong cooperation on Undertakings for Collective Investment (UCI)

Publication in the French Official Journal of 16 April 2019 of the Memorandum of Agreement between the Hong Kong Securities and Futures Commission (SFC) and the Autorité des Marchés Financiers (AMF) on the mutual recognition of covered funds, management companies and associated cooperation dated 10 July 2017

This agreement between the AMF and the SFC, entered into on 10 July 2017 (AMF - SFC MoA, NOR : AMFP1910156X, JO 16 apr.), the first of its kind between a member of the European Union and Hong Kong, provides for:

  • a fast-track authorisation procedure for the marketing of eligible French or Hong Kong UCITS to retail investors on each of the French and Hong Kong markets; and
  • cooperation between the AMF and the SFC in the supervision of covered entities that may offer, market and distribute shares of UCIs on a cross-border basis, including in particular consultation, exchange of information and cross-border on-site visits.
  • Commercial

France – Egalim Act : publication in the Official Journal of the five ordinances adopted by the Council of Ministers

Five ordinances related to the provisions of Act No. 2018-938 of 30 October 2018 on the balance of trade relations in the agricultural and food sector and healthy, sustainable and accessible food for all (the "Egalim" Act) were published on 25 April 2019 in the Official Journal.

The first three ordinances were submitted by the Minister of Agriculture and Food. The ordinance No 2019-361 concerns the independence of advisory activities on the use of plant protection products and the system of certificates for the saving of plant protection products. The ordinance 2019-362 concerns agricultural cooperation. Finally, the ordinance No. 2019-363 concerns the extension of the judicial police powers of the officers mentioned in Article L205-1 of the Rural and Maritime Fisheries Code and Article L511-3 of the Consumer Code.

The two other ordinances are specifically related to commercial relations. The ordinance 2019-359 is a recast of Title IV of Book IV of the French Commercial Code on transparency, restrictive practices and other prohibited practices. The ordinance No. 2019-358, on the other hand, deals with liability claims for abusively low prices.

The purpose of the ordinance No. 2019-359 is to redraft and simplify the thirteen restrictive business practices listed in Article L442-6 of the French Commercial Code on the three main concepts: 1) significant imbalance between business partners, 2) advantage without compensation and 3) sudden termination of established business relationships.

Concerning the sudden termination of established business relationships, the system is modified. Indeed, the author of the termination can no longer be held liable for insufficient notice if a notice period of at least eighteen months has been granted.

In addition, the new Article L442-4 increases the cap of a civil fine for a restrictive practice which is the highest of the following three amounts: 5 million euros, 5% of turnover or three times the amounts unduly collected or obtained.

Finally, the numeration of the articles relating to payment terms and invoicing has been modified. The amount of the penalty for the violation of invoicing rules has officially increased to €375,000 for legal entities and is doubled in the event of a reoccurrence.

Ordinance No. 2019-358 deals with the prevention of predatory prices. The ordinance amends the provisions of Article L442-9 of the French Commercial Code and now authorizes a supplier of agricultural products or foodstuffs to hold the buyer liable if the latter imposes a price considered to be unfairly low.

To become law, the ordinance must be ratified by the parliament. The Bill ratifying the ordinance must be submitted within 3 months in accordance with Article 17.III of the Egalim Act.

  • Competition

France – Adoption of decree simplifying the notification form which has to be submitted to the French Competition Authority ("FCA")

Decree No. 2019-339 simplifying the notification form which has to be submitted to the FCA came into force on 21 April, 2019.

The decree removes the obligations to submit four copies of notification forms, one copy being now sufficient. In addition, by the end of the first semester of 2019, notifications to the FCA under the simplified procedure may be submitted solely electronically.

The decree also increased, from 25% to 30% of the parties' combined market shares, the threshold above which a market is deemed to be affected for the analysis of the vertical effects of an operation.

Finally, the decree significantly reduced the data which must be provided by the parties in financial data tables. Parties to an operation now only have to provide information relating to their turnover and net income.

France - Egalim Act : publication in the Official Journal of an ordinance on liability proceedings for unfairly low prices and of an ordinance recasting Title IV of Book IV of the French Commercial Code on transparency, practices restricting competition and other prohibited practices

Please refer to the alert above from the Commercial Law Department.

France - FCA sectorial opinion on the functioning of competition in the pharmaceutical sector

Following a wide public consultation, the FCA delivered on April 4, 2019, its opinion No. 19-A-08 on the functioning of competition in the pharmaceutical sector. As this sector is facing major changes, the FCA recommends various solutions in order to maintain a high level of public health protection and the quality of the pharmaceutical network. Hogan Lovells has published a client alert on this opinion.

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