The French Leniency programme

Unlike many other jurisdictions where leniency programmes are the result of notice issued by competition authorities, the French leniency programme was introduced by law. This procedural tool was introduced into French law as part of the modernisation package contained in the Loi sur les Nouvelles Régulations Économiques of 17 May 2001 and was codified in Articles L. 464-2, IV and R. 464-5 of the French Commercial Code.

The French Competition Authority (“FCA”) issued a procedural notice relating to the French leniency programme on 11 April 2006 (“Leniency Notice”), which was revised on 17 April 2007 in order to comply with the 2006 Model Leniency Programme adopted by the European Competition Network (“ECN”).

The 2015 revision: background

Since its entry into force on 17 May 2001, according to data provided by the FCA, 69 leniency applications have been submitted to the FCA. To date, the FCA adopted ten cartel decisions which were initiated through leniency applications, and in only four out of these ten decisions partial immunity (type 2 leniency) was granted. These cartel decisions represent an overall fine of approximately 2.5 billion euros, despite some of the fines being reduced on appeal.

In February 2013, more than ten years after its introduction into French law, the FCA consulted the market in order to gather feedback from practitioners on the French leniency programme and the practical difficulties that it may raise. The results of this study, which are available on the FCA’s website, were released on 15 April 2014. Based on these results the FCA published, on 27 February 2015, a press release whereby it announced its intention to review the leniency programme and in particular to: (i) clarify the practical implementation of the leniency programme; (ii) reflect more significantly the FCA’s and controlling jurisdictions’ case law on leniency; and (iii) further align the French leniency programme with the revised 2012 Model Leniency Programme of the ECN.

In its press release the FCA also pointed out that it was particularly interested in any suggestions in order to strengthen the attractiveness of type 2 leniency applications. The FCA launched a public consultation on a revised version of its Leniency Notice. A&O Paris submitted its observations on 20 March 2015.

On 3 April 2015, after having reviewed stakeholders’ observations on its draft Leniency Notice, the FCA released a revised version of its Leniency Notice (the “Revised Leniency Notice”).

Revised Leniency Notice – Main features

Even though the FCA only made minimal amendments to its Leniency Notice, the following features are to be noted.

Press release following a dawn raid

In its Revised Leniency Notice, the FCA commits to systematically publish a press release each time it carries out dawn raid operations so that any company involved in the sector of activity under investigation that has not been inspected has a chance to consider, in due time, submitting a leniency application. The FCA undertook the following commitments in order to safeguard companies’ fundamental rights, which are now enshrined in the Revised Leniency Notice:

• firstly, the FCA’s press release will not reveal the name of the companies inspected;
• secondly, the wording of the press release will be carefully considered in order to safeguard companies in respect of the presumption of innocence; and
• thirdly, the FCA commits to issue, when appropriate, a press release indicating that the FCA has decided not to pursue a case.

Leniency advisor

The Revised Leniency Notice strengthens and clarifies the role of the leniency advisor ("conseiller clémence"). Even though this position has existed since 2011, its role remained to some extent unclear. The Revised Leniency Notice now makes it clear that the leniency advisor will be the first point of contact for each leniency applicant.

Anticompetitive practices that may give rise to a leniency application – extension of the scope

Along with cartels which are likely to remain the core candidate for leniency, the Revised Leniency Notice now indicates that leniency will also be available notably for "hub and spoke" practices. Hub and spoke practices are defined as follows by the European Commission in its 2011 guidelines on horizontal co-operation agreements: "data […] shared indirectly through a common agency (for example, a trade association) or a third party such as a market research organisation or through the companies’ suppliers or retailers". The exact reach of this extension, which could potentially encompass other types of vertical arrangements, remains to be tested and determined before the FCA in the context of upcoming leniency applications.

Additional condition to benefit from leniency type 1 and type 2 – a reinforced obligation of cooperation

The Revised Leniency Notice contains a new provision adding a general condition to benefit from any kind of leniency (type 1 or 2). To be granted immunity or a fine reduction, a leniency applicant must not "call into question at any time before the FCA and until the end of the proceedings the factual elements that it revealed in the context of the leniency proceedings […], the materiality of the facts that the applicant revealed, as well as the very existence of the practices" (para. 23 (ii)).

Summary applications

In accordance with the revised ECN’s model leniency programme, the Revised Leniency Notice provides for the possibility of filing any kind of summary applications before the FCA, including type 2 leniency applications. A summary application allows a leniency applicant to the European Commission - in case where the Commission is "particularly well placed" to deal with a case - to secure its place in the leniency queue before other well placed competition authorities.

Sliding scale fine reductions for type 2 leniency

Stakeholders’ contributions, including A&O’s, urged the FCA to design a more predictable mechanism, as regards type 2 leniency applications, through the introduction of a predetermined band of fine reductions in order to provide more incentives to leniency candidates. The FCA took these demands into account and the Revised Leniency Notice now expressly sets out the following band of fine reductions (knowing that the first leniency applicant is given full immunity from fines):

• the second leniency applicant to provide significant added value shall expect, depending on the circumstances, a fine reduction ranging from 25% to 50%;
• the third leniency applicant to provide significant added value shall expect a fine reduction ranging from 15% to 40%; and
• any subsequent leniency applicant shall expect a fine reduction which will not exceed 25%.

‘Leniency plus’ and additional incriminating evidence brought by type 2 leniency applicants

In the context of type 2 leniency applications, the Revised Leniency Notice provides that if such evidence allows the FCA to prosecute and establish additional facts which have a direct incidence on the amount of fines, this additional incriminating evidence will not be taken into account by the FCA in the determination of the fine of the company that brought this evidence. This incentive should in particular apply if the applicant provides evidence which extends the duration of the infringement period.

Temporal application of the Revised Leniency Notice

The Revised Leniency Notice replaces the 2009 Leniency Notice and will therefore apply to any leniency application filed after 3 April 2015.