The Paris Court of Appeal stays the execution of a Competition Council decision imposing a fine to Eiffage

26 March 2007

Romain Ferla

On 23 January 2007, the Paris Court of Appeal temporarily suspended a Competition Council decision of 21 March 2006 (decision n° 06-D-07) which ordered the Eiffage Construction Company and its affiliated company to pay a fine of €1 million. The applicant had appealed the decision before the Paris Court of Appeal to rule on the merits of the case and had simultaneously requested a stay of execution of that decision.

The Competition Council’s decisions may be appealed before the Paris Court of Appeal (article L. 464-8 of the Code of commerce). The appeal does not in itself suspend the Council’s decision. However, the Court of Appeal may order a stay of execution, if the consequences of the decision are deemed excessive or if new evidence has arisen. Generally, this implies, for the companies concerned, to show that paying the fine would lead them into bankruptcy.

Here, the company Eiffage, which is one of the most important groups in France, could not argue that the level of the fine was intrinsically excessive. It rather argued that the excessive consequences of the requested payment derived from the Competition Council’s failure to follow the procedure and to respect Eiffage’s fundamental right. Indeed, Eiffage claimed the report on the basis of which the Competition Council had given its infringement decision had not been communicated to it. It claimed that this constituted a clear breach of the principle of due process, under which a party has the right to be adequately notified of the charges against it. The Court of Appeal accepted this argument, thereby agreeing to a broad interpretation of the notion of “excessive consequences”, and stayed the execution of the Council’s decision until the appeal decision on the merits is given.

Source: Decision of the Court of Appeal of Paris, No 1, 23 January 2007 (in french only) -