New FCA’s study on professional bodies in the run-up to ECN+ Directive transposition
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While the ECN+ Directive is about to be transposed into French law, which will result in exposing professional bodies to potentially much heavier sanctions than under the current legal framework, the French Competition Authority (FCA) recently published a study on how competition rules apply to these specific bodies. The publication of this study is intended to raise awareness of the professional associations and their members on the importance of complying with competition law and offers practical guidance on practices or activities of professional associations which may be contrary to competition law, as was part of the FCA’s priorities.
The “professional bodies” concerned are all organisations whose purpose is to bring together and represent companies from the same profession or sector, including trade unions. The purpose of these professional bodies is to defend the interests of an entire profession or sector and to represent their members in the context of interactions with other stakeholders such as public authorities or employees’ organisations.
Professional bodies are not exempt from competition rules and their activity is conducive to risks in this regard as it involves the exchanges of information or joint initiatives between competitors. Professional bodies could therefore be held responsible as instigators or facilitators of anti-competitive practices.
The transposition of the ECN+ Directive into French law, which is expected to take place before June 2021, will lead to a significant increase of the maximum fine that the FCA can impose on professional bodies. Under French law, professional bodies infringing competition law are currently exposed to a maximum amount of fine of €3 million, regardless of their size or importance. As a result of the transposition of the ECN+ Directive, this cap will be increased to 10% of the aggregate worldwide turnover of the members of the association.
Another significant change concerns the recovery of fines imposed on professional bodies. Indeed, if the professional association is unable to pay the amount of the fine, the FCA will have the possibility to order the association to call for contributions from its members and, in case of absence of payment, to request payment from any company which is a member of the decision-making body of the association.
As Isabelle de Silva, the President of the FCA stated: “the antitrust risk has now been increased tenfold for professional bodies if they engage in agreements or other anticompetitive practices”. It is in this context that the FCA has decided to publish this study which is intended to be an “educational” study helping professional associations to prevent the antitrust risks. The study identifies the most common anti-competitive practices which may be carried out by professional bodies e.g. facilitation of exchange of competitively sensitive information, facilitation of market sharing etc. The study also provides an overview of the FCA’s decision-making practice involving professional bodies, as well as that of the Commission and other National Competition Authorities.
The study also contains a Dos & Don'ts section which is also available as a separate interactive document available on the FCA’s website. This document is intended to enable professional bodies to quickly and easily understand what they can and cannot do from a competition law perspective. With such a publication, the FCA wishes to ensure that professional associations will not act as facilitators or catalysts for anti-competitive practices, but rather as promotors of competition compliance.
For more information, you can consult the FCA’s press release here (in English), the full study here (in French) and the Dos & Don’ts here (in French).
For more information please contact Thomas Oster and Eliott Costet.
