The Law on the modernisation of the economy (LME), passed on 4th August 2008, transformed the Conseil de la concurrence into a new Autorité de la concurrence, the Competition Authority. This reform shows a firm political determination: to endow a single agency with strengthened power and means will improve its efficiency for the benefit of businesses and consumers.
Like in other European countries, the French Competition Authority will, from now on, in a modern and consolidated way, carry out all activities of competition regulation (inquiries, antitrust activities, merger control, publication of opinions and recommendations).
A single Competition Authority for a more efficient and coherent system
The Authority's investigation services will now handle both preliminary inquiries and full investigations, which had been previously split between two different organizations (the DGCCRF and the Conseil de la concurrence). Entrusting both procedures to a single body will result in important benefits in terms of quality, efficiency and effectiveness during the phase of investigation and analysis of cases.
Moreover, the Authority is now responsible for merger control. It will assess the competition implications of the mergers, taking into account the possible efficiency gains. The executive power may, nonetheless, have the final say in the situations where the country's fundamental interests are at stake.
A more prominent role in French economic life
The reform has granted the Authority the power to issue, at its own initiative, opinions concerning the competitive functioning of markets. Acting as an "advocate of competition", it may, whenever it deems appropriate, express the point of view of a competition expert. It has the possibility, for example, to contribute to drawing up of legal texts or, furthermore, to recommending measures or actions in order to improve the competitive functioning of markets.
This new possibility is highly important, since it will allow the new Authority to develop “competition pedagogy” in order to educate public and economic players about the importance of competition. Hence, the Authority will be in a position to advise and to warn, in addition to its existing repressive mission, which it will, of course, continue to exercise.
Strengthened and modernized means
When dealing with cartels and some extremely damaging forms of competition infringement, enforcement remains the only truly effective response. In order to complete the range of tools available to the Conseil de la concurrence up to now, the reform gives the new Authority the power to influence not only the way companies behave, but also the structure of the market itself.
In the retail industry, for example, the Authority might be approached by the mayors of local municipalities, who feel that a company or group of companies running retail stores abuse their dominant position or a state of economic dependence. If behavioural injunctions and/or fines prove insufficient to resolve the problem, the Authority may impose "structural" measures, which may go as far as ordering the sale of retail space in order to restore competition.
Likewise, if the Authority notices that an economic player abuses a dominant position acquired after a merger, it will be able, from now on, to call that operation into question (dismantling, sale, etc.).
> For more details, please consult the original texts about the reform