COMPETITION • FRENCH LAW • PROCEDURE
Appeals to the Paris Court of Appeal have no suspensory effect, decisions of the Competition Authority are immediately enforceable. However, Article L. 464-8, paragraph 2, of the Commercial Code allows the First President of the court to order a stay of enforcement of the decision if said decision is likely to have manifestly excessive consequences or if new facts of exceptional gravity have occurred subsequent to its pronouncement.
Pursuant to Article R. 464-22 of the Commercial Code, applications are brought by summons before the First President of the Court of Appeal in accordance with the terms of Article 485, paragraph 2, of the Code of Civil Procedure (hearing takes place at the time indicated, even on public holidays or non-work days). The summons shall include, on penalty of being declared null and void, the information required in bailiffs notices (in particular: date; surname, first names, address, nationality and date of birth for natural persons who are applicants, and for legal persons – legal form, name, registered office and legal representative of the applicant), and the statement of pleas relied on in support of the application. The summons must also be served on the Competition Authority and the Minister of the Economy, failing which it will lapse automatically.
A stay of enforcement may only be requested against a decision issuing an injunction or a pecuniary sanction pursuant to Article L. 464-2. It is subject to the condition that the sanction is likely to seriously and lastingly, if not irreversibly, affect the operation of the undertaking and thus jeopardize the maintenance of jobs. The stay of enforcement may be only partial. The applicant undertaking must provide proof of the manifestly excessive consequences it claims: it must provide tangible and quantified proof of the clear excesses that the enforcement of the injunctions would effectively entail.
The excessive consequences likely to result from the application of the financial penalty must be assessed in the light of the consolidated turnover, where the company sentenced belongs to a group of undertakings. More generally, the fact that the sanctioned entity belongs to a group of undertakings is an factor which the court must take into account when assessing whether the immediate enforcement of the decision is likely, in the circumstances of the case, to lead to manifestly excessive consequences. However, since there is no cause for distinction where the law does not do so, the Paris Court of Appeal has stressed that the “manifestly excessive consequences” referred to in Article L. 464-8 need not necessarily be strictly financial in nature: harm to image may in itself justify a stay of enforcement.
The condition relating to new facts of exceptional seriousness – also laid down in Article L. 464-8 – is construed narrowly by the courts. It must be a totally unpredictable fact specific to the undertaking concerned. Poor cash flow due to changes in the characteristics of the undertaking’s sector of activity, the unforeseeable duration of the procedure and the uncertainty of its outcome do not constitute exceptionally serious facts.