FRANCE Law and Practice Contributed by: Malik Idri and Mathieu Relange, FTPA Avocats
2.13 Penalties for the Implementation of a Transaction Before Clearance Under Article L. 430-8, I FCC, premature implementa - tion of a transaction prior to obtaining FCA clearance (commonly referred to as “gun-jumping”) may result in: • a fine of up to 5% of the turnover achieved in France during the last financial year by the party responsible for the notification (which may be increased by the amount of the turnover achieved by the target in France during the same period); and • a fine up to EUR1.5 million for individuals. The FCA actively enforces gun-jumping sanctions – although, to date, never on a foreign-to-foreign trans - action. For example, Altice was fined EUR80 million for implementing two transactions ahead of regulatory approval (Decision No 16-D-24 of 24 November 2016). Gun-jumping sanctions may be cumulated with those for failure to notify (see 2.2 Failure to Notify ). In Deci - sion No 22-D-10 of 10 April 2022, COFEPP was sanc - tioned on both grounds. The FCA imposes sanctions for gun-jumping after sending an adversarial procedure and after hearing the companies involved in a formal hearing. The pen - alty decisions are published on its website. Because the FCA considers that gun-jumping consti - tutes a continuous infringement, the five-year limita - tion period runs from the clearance decision, not the implementation date (Article L. 462-7 FCC). Gun-jumping may also expose parties to competition law sanctions, including for anti-competitive agree - ments or abuse of dominance. 2.14 Exceptions to Suspensive Effect Firms may benefit from an exemption in two circum - stances. • Under Article L. 430-4 FCC, the FCA may grant an exemption upon request in duly justified cases, such as takeover offers involving firms in insol - vency proceedings (Guidelines, § 147). For exam -
ples of derogations granted on grounds of financial difficulties, see FCA decisions Nos 22-DCC- 78, 24-DCC-02, 24-DCC-255, 24-DCC-288 or 25-DCC-65. • For mergers carried out through the purchase or exchange of securities on a regulated market, the transfer of securities may be completed prior to FCA clearance, as it does not itself constitute implementation of the concentration (Guidelines, § 157). However, the exercise of voting rights by the acquirer remains prohibited until clearance is granted (Article R. 430-5 FCC). 2.15 Circumstances Where Implementation Before Clearance Is Permitted For all such circumstances, see 2.14 Exceptions to Suspensive Effect . 3. Procedure: Notification to Clearance 3.1 Deadlines for Notification There is no fixed statutory deadline for notifying a transaction. Notification may be submitted as soon as the project is sufficiently advanced to allow the FCA to conduct a substantive review. This is typically the case once the main contours of the deal are defined (key terms of the envisaged trans - action, identity of the parties, scope of the concentra - tion, indicative timetable, etc). The FCA assesses readiness for notification on a case-by-case basis, based on the evidence provided by the notifying party. 3.2 Type of Agreement Required Prior to Notification Notification does not require a signed, binding agree - ment. Parties may file based on a preliminary agree - ment, a signed letter of intent or the announcement of a public offer, provided they can demonstrate a genuine intention to enter into a binding commitment. 3.3 Filing Fees The notification of a merger to the FCA is not subject to any filing fee.
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