On August 28, 2020, the FCA prohibited for the first time a proposed transaction following an in-depth Phase 2 review.[1] The FCA concluded that Soditroy and the E. Leclerc’s proposed acquisition of joint control over a Géant Casino hypermarket around the city of Troyes raised serious competition concerns.

Serious competition concerns

The FCA found that the acquisition would create a duopoly between Carrefour and E. Leclerc in the Troyes local area and lead to significant risks of harm to competition in the retail distribution of food products for hypermarkets.

In particular, the FCA found that the proposed acquisition would lead to a significant loss of diversity for consumer since only two E. Leclerc hypermarkets and two Carrefour hypermarkets would remain in the local area. The FCA also found that the proposed acquisition would increase the risk of higher prices charged to consumers and the risk of coordination between the Carrefour and E. Leclerc hypermarkets.

Finally, the FCA noted that regulatory barriers to entry made the arrival of a new competing hypermarket highly unlikely.

Insufficient remedies

The FCA concluded that the parties’ proposed remedy (i.e., the reduction of the Géant Casino store’s surface area from 8,210 m2 to 6,000 m2) was insufficient to alleviate its serious competition concerns. The FCA also found that this remedy would actually reduce the diversity of products offered to consumers.

[1]              FCA, Decision 20-DCC-116 of August 28, 2020 (not yet published). See also FCA’s press release of August 28, 2020, available here: https://www. autoritedelaconcurrence.fr/en/press-release/first-time-ever-autorite-de-la-concurrence-blocks-merger