The wait is over. Well, almost. It was beginning to seem that the project to issue guidelines on the control of concentrations (the "Guidelines"), which had been announced on 13 December 2002, would remain just a proposal. The Guidelines were finally published on the DGCCRF’s website last July. Although the DGCCRF (the French Competition Authority) acknowledged that a delay of two and a half years was inexcusable, it hoped to be able to explain and present the content of these Guidelines.
Following the example of the guidelines published by the European Commission and by competition authorities in the EU Member States, the Guidelines provide above all else an insight into the manner in which the DGCCRF intends to assess a merger or acquisition coming under its remit. These Guidelines present the procedure (for notification and clearance) and reiterate the requirements upon the DGCCRF to determine the risk of the creation, or strengthening, of a dominant market position and the prevention of the distortion of competition upon the market.
The Guidelines are formidable: 162 pages in all! However, the DGCCRF has thankfully inserted at the beginning of the document a succinct 16 pages summary to the Guidelines. The relevant French legislation has also been attached as an annex.
This said, the DGCCRF has deliberately taken an academic role preferring a long document with concrete examples and analysis of decisions to that of a short and dense text (as preferred by our American cousins or certain factions of the European Commission).
In a recent presentation for the journal, “Competition”, the deputy head of the DGCCRF, Madame Caroline Montalcino, stated that two important events took place from the original announcement in December 2002 which caused the delay in publication of the Guidelines: First, far more decisions have been taken by the DGCCRF than had previously been the case (600 decisions; 300 of which were in 2002). Although the relaxing of the individual threshold has led to a reduction in notifications, there are still on average 150 notifications to the DGCCRF per annum. These decisions have had to be made without an increase in budget. Many of the problems faced in these decisions are replicated in the Guidelines. Second, the adoption of the new Merger Regulation by the European Commission (Regulation 139/2004) resulted in a change to the manner in which the European Commission and the Member States are bestowed jurisdiction to assess a merger or acquisition (and may refer issues amongst themselves). The Guidelines provide numerous references to issues referred to the DGCCRF by other EU competition authorities.
A regret: the Guidelines are sadly lacking in real information on the conditions under which a merger or acquisition can be reversed (i.e. de-merger) on the basis of Article L.430-9 of the Commercial Code which outlines the possibility for the Competition Council to ask the Minister to order the dismantling of a merger or acquisition that contributes to an abuse of a dominant market position.
That said, the Guidelines are to be commended for the useful information provided in the annexes to the Guidelines, most notably on: the treatment of capital investment transactions (Annex 1); questions relative to distribution contracts (Annex 2); agricultural co-operatives (Annex 3); and questions relevant to enterprises in difficulty (Annex 4).
So the delay in publishing the Guidelines has arisen, ironically, from the constant changes and evolution of competition conditions on the market.