French law no. 2012-1270 of 20 November 2012 relating to economic regulation in the French overseas territories

The French law passed on 20 November 2012 is intended to tackle the "high cost of living" in  the French overseas territories by adopting a number of regulatory measures, including the following key measures:

  • the possibility to adopt following consultation with the French Competition Authority ("Autorité de la concurrence"), regulatory measures for wholesale markets (new Article L.410-3 of the French Commercial Code) dealing with access to these markets, the absence of price discrimination, fair trading, operating margins and the management of essential facilities;
  • the obligation for large retailers to reserve shelf space to regional products;
  • the prohibition of clauses granting exclusive import rights;
  • the possibility for the French overseas local authorities to refer cases to the Autorité de la concurrence;
  • a lowering of the merger control threshold from €7.5m to €5m in the French overseas territories retail markets;
  • the introduction of a power to issue structural injunctions (Article L.752-27 of the French Commercial Code): in the case of a dominant position held in the retail sector, giving rise to "competition concerns due to high prices or margins" as compared to average levels generally noted, the Autorité de la concurrence may now, after having raised its concerns with the undertaking and if such undertaking has not subsequently proposed commitments, issue an injunction "to amend, supplement or cancel" within a specific period "any agreements or actions founding economic power which make the pricing and margin practices possible". This power to grant structural injunctions has raised numerous questions and harsh criticism both in terms of its principle and its practical application, especially regarding the rights of the undertakings involved.

These provisions are applicable to the French overseas Départements and regions as well  as to overseas Collectivités.