In an opinion dated September 21, 2017 and released in early November, the Commission d’examen des pratiques commerciales (Commercial Practices Review Committee) ruled on the lawfulness of the payment of year-end rebates provided for in an annual agreement between a supplier and a distributor whereas the requirements applicable for such payment were not met.
With a view to tightening digital platforms’ transparency and loyalty towards consumers, three Decrees published on September 29, 2017 have clarified the information requirements imposed on the operators of such platforms.
Some of the measures introduced by the Decrees must be implemented by January 1, 2018.
In a decision dated June 21, 2017, the Cour de Cassation (French Supreme Court) ruled that the termination of a distribution agreement during the contractual trial period could not be considered as abusive.
It follows from this decision that the parties are free to include in a distribution agreement a trial period during which each of them has a unilateral termination right.
On February 23, 2016, the Direction Générale de la Concurrence, de la Consommation et de la Répression des Fraudes (General Directorate for Competition, Consumer Protection and Frauds, hereinafter “DGCCRF”) released it 2016 activity report.
In this report, the DGCCRF – which monitors the proper operation of the markets to the benefit of consumers and businesses – highlights the salient facts of 2016 concerning inter alia the balance of business relationships, the fight against late payments and the fight against anti-competitive practices. It also provides a status report on its activity concerning the rules on economic protection of consumers and the fight against abusive practices.
Adopted by the Parliament on November 8, 2016, the “Sapin II Law” is primarily designed to strengthen the French anti-corruption arsenal and introduces new measures to prevent and penalize corruption.
This Law also brings a number of changes to the legislation governing business relationships between economic operators, including with respect to practices that restrict competition, so-called “single commercial agreements” and payment terms.
The provisions set forth in Ordinance n°2016-131 of February 10, 2016 for the reform of contract law, the general regime of obligations and proof of obligations (the “Ordinance”) will come into force on October 1, 2016 and apply to all contracts entered into on or after said date.
This major overhaul of French contract law will entail practical changes in contractual practices with respect to distribution agreements. This Article provides a few examples of anticipated changes regarding the formation, performance and substance of distribution agreements.
After two years of waiting, the implementing Decree setting forth the threshold above which the conclusion of a written agreement in the context of outsourcing of production activities is mandatory under Article L. 441-9 of the French Commercial code has finally been published.
The conclusion of a written agreement is henceforth mandatory for any purchase of manufactured goods, produced at the buyer’s request in order to be included in his own production, wherever the amount of such purchase exceeds 500,000 euros.
Regularly singled out for criticism for lack of efficiency of its anti-corruption arsenal, France finally seems committed to catch up in this field.
The so-called “Sapin II” Bill, which should be debated in the French Parliament at the beginning of June 2016, heralds significant changes in the fight against corruption.
In a judgment dated November 10, 2015, the Cour de Cassation (French Supreme Court) confirmed that late penalties provided for under Article L. 441-6 of the French Commercial Code are to be considered as default interest.
As such, these penalties can bear interest, as per Article 1154 of the French Civil Code.
Neither the public policy nature of the provisions set forth in Article L. 442-6 of the French Commercial Code nor the exclusive jurisdiction granted to judicial courts to hear restrictive trade practices related cases – including cases concerning the sudden breach of an established business relationship – precludes the use of arbitration to settle disputes in connection with this Article.
As such, insofar as it falls within the scope of application of the arbitration clause agreed upon by the parties, a claim for compensation for the loss suffered as a result of the sudden breach of an established business relationship can validly be brought before an arbitration tribunal.
This is the finding of the Cour de Cassation (French Supreme Court) in a decision rendered on October 21, 2015.
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