COMPETITION • FRENCH LAW • PROCEDURE
The liberalization of the European economies carried out at the instigation of the European authorities has led to the emergence of a new type of administrative authority – regulatory agencies responsible for ensuring the transition from monopolies previously classified as natural, and which for this reason had been entrusted to incumbent operators, to competitive markets. As well as acting as sector watchdogs and providing technical expertise to the competition authorities, the regulatory bodies carry out a specific mission located upstream or downstream of the intervention of the competition authorities. Operating directly within the economic and legal spheres in which competition plays out, the bodies monitor entries to and maintenance on the market of new entrants and act as mediators in potential conflicts between customers and suppliers. The regulatory authorities obviously intervene primarily in the sectors newly opened up to competition and generally in their supervisory capacity. Regulated sectors include the network industries (telecommunications, audiovisual and energy sectors), banking and financial markets. The legislature has thus created: the “Autorité de régulation des télécommunications” (ART), which later became the “Autorité de régulation des communications électroniques et des postes” (ARCEP), the audiovisual watchdog – “Conseil supérieur de l’audiovisuel” (CSA), the “Commission nationale d’urbanisme commercial” (CNUC) – commercial urban planning – which then became the “Commission nationale d’équipement commercial” (CNEC), the “Commission de régulation de l’énergie” (CRE), the “Autorité de contrôle prudentiel et de résolution” and the financial markets watchdog – the “Autorité des marchés financiers“. The allocation by the legislature of the status of legal entity to some of the agencies is a way of equipping them with genuine independence from the executive in order to avoid conflicts of interest in the sectors where the State has an economic stake.
The ARCEP, the CSA, and the CRE are required to refer any abuses of dominance or cartels they know of in their area of responsibility to the Competition Authority and the Authority to be able to seek the opinion of the ARCEP or the CSA when applying competition law in their specific sector. Article L. 511-4 of the Monetary and Financial Code makes it mandatory to seek the opinion of the “Autorité de contrôle prudentiel” for merger control in the banking sector and matters relating to restrictive agreements and abuse of dominance. Under Article L. 37-1 of the Postal and Electronic Communications Code, the ARCEP defines the relevant markets in the electronic communications sector and analyses the state of competition on each of those markets. If it finds that the play of competition is inadequate – notwithstanding any corrections made on application of Articles 101 and 102 TFEU, it identifies, after obtaining the opinion of the Competition Authority, which operators are in a position of power according to the criteria of dominance, and if necessary, requires them to comply with regulatory obligations. The ARCEP, the CSA and the CRE also have the power to settle disputes that may affect the competitive balance of the sectors under their control. Lastly, the “Autorité de régulation des activités ferroviaires et routières” (ARAFER) – regulatory authority for rail and road activities – is in charge of the administrative supervision of motorway concession undertakings in order to curb excessive pricing practices (Art. L. 122-30 of the French Highways Code). Article L. 122-34 of the Highways Code provides, by reference to Article L. 2135-13 of the Transport Code, that ARAFER may refer to “the Competition Authority any abuses of dominant position and practices hindering free competition of which it is aware […], in particular when it deems that these practices are prohibited by Articles L. 420-1 and L. 420-2 of the Commercial Code [and], for an opinion, any other matter falling within its competence”. Reciprocally, the Competition Authority communicates to ARAFER any referral falling within the scope of the latter’s competence and may refer to it, for an opinion, any matter relating to the rail and road transport sector.