On February 21, 2013, Charles André, a company operating particularly in the road haulage sector, signed an agreement to take over exclusive control of Novatrans, an intermodal transport operator. The agreement contained certain conditions for its conclusion, one of which was an agreement for the exclusive supply of rail haulage services entered into for a term of five years.
In accordance with the merger control rules, the transaction was notified to the French Competition Authority, which reviewed the exclusive supply agreement to determine if it could be covered by the merger control authorization, as the exclusive supply was said to be directly linked to and necessary for the completion of the merger.
The notifying party considered that the exclusivity and term of the supply agreement were “a sine qua non condition for the completion of the transaction”. However, this kind of assessment has to be made objectively and not in light of what the parties deem to be indispensable. The Authority followed the European Commission’s guidelines and was of the opinion that while a supply obligation may be necessary during a transitional period, the exclusivity was not justified to guarantee continuity of supplies.
The Authority therefore concluded that the exclusive supply agreement of haulage services was not a restriction directly linked to and necessary for the completion of the transaction. Consequently, although the transaction as such was authorized, the Authority nevertheless reserved the right to review the supply exclusivity ex officio from the anti-competitive practices angle.