On September 22, 2021, the Cour de cassation upheld the 2018 judgement of the Paris Court of Appeals which had confirmed the French Competition Authority (the “FCA”)’s infringement findings nonetheless reducing the amount of the financial penalties imposed on 21 companies in 2015. This ruling closes a 13-year saga and provides a deep-dive analysis into the FCA’s fine calculation methodology.
Following leniency applications filed by Deutsche Bahn and its subsidiaries in 2008 and by Alloin Transports in 2010, the FCA found evidence of two cartels in the French market for courier services, which several major companies and one trade association TFL had implemented between 2004 and 2010.
The first cartel took place from September 2004 to September 2010 between TLF and 20 providers of courier services and consisted in the exchange of commercially sensitive information on individualized, forward-looking, annual price increases during secret roundtables as well as in the context of bilateral communications (the “first cartel”). As cartel participants accounted for almost all of the French courier sector, the practices gave raise to increased price transparency and allowed participants to harmonize their pricing policies and strengthen their bargaining power vis-à-vis customers. The FCA found this cartel to be particularly serious due to its secret nature, its objective which was to coordinate commercial negotiations, and the actual harm caused to the economy (as the cartel was national in scope and had adverse effects on several industrial and business players, in particular SMEs). In order to determine the basic amount of the fines, the FCA took into account the companies’ significant turnover in the French courier market to establish the value of the sales relating to the infringements. However, it eventually reduced the amount of the fines by more than 90% to reflect the financial difficulties faced by seven companies. Having applied for leniency, the Deutsche Bahn and Kuehne+Nagel groups obtained additional reductions applied to their penalties. All in all, the FCA issued total fines amounting to €670.9 million for the first cartel.
The second cartel related to the joint implementation, from May 2004 to January 2006, of a “diesel surcharge” designed to pass on fuel price increases to customers (the “second cartel”). Fifteen companies implemented this practice, under the auspices of TLF, in response to a sharp rise in the price of diesel fuel and numerous statements from public authorities related to the need to reflect this increase in the price of courier services. Interestingly, given that the second cartel took place “in a very specific economic context” that “may have created some confusion in the companies’ minds,” the FCA decided to depart from its 2011 Notice on the setting of financial penalties (the “Notice on fines”) by applying fixed fines instead. It also found the second cartel to be unsophisticated and to have caused limited harm to the economy. The FCA eventually fined the participants to the second cartel €1.4 million in total.
In July 2018, following an appeal lodged by 16 cartel participants, the Paris Court of Appeals upheld the FCA’s finding of competition law infringement but nonetheless ordered a €56.1 million reduction in the fines imposed due to (i) calculation errors in setting their amount; (ii) the limited involvement of certain cartel participants; and (iii) the implementation of compliance programmes.
The Cour de cassation ruling
On September 22, 2021, the Cour de cassation handed down a final ruling, upholding the reduced fines set by the Court of Appeals and dismissing the nine appeals lodged, the bulk of which related to the FCA’s fine calculation methodology.
The first set of claims related to the value of sales taken into account by the FCA for the purposes of calculating the fine. First, the applicants claimed that the FCA wrongly included subcontracting, international, and intra-group activities which were unrelated to courier services, in the value of the sales taken into account to calculate the base amount of the fine. Second, the applicants considered that the Court of Appeals had erred in confirming the FCA’s decision to take into account not only sales affected by the infringement but sales of all products or services “related to the infringement”, i.e., all courier services supplied on the French market.
On these points, the Cour de cassation upheld the Court of Appeals’ finding that the FCA correctly used the turnover related to the companies’ courier activities in France as the basis for calculating the fines imposed for the first cartel. The Court found that neither the Notice on fines nor the FCA’s decisional practice provided that the amount of the fine should only reflect the sales of goods or services directly affected by the infringements.
Instead, the Cour de cassation noted that, insofar as goods or services of a given category are “related to the infringement”, the calculation must take into account the corresponding value of sales, even if the infringement did not directly affect all such goods or services.
In addition, the applicants also challenged the proportion of sales to be retained for fine calculation purposes, i.e. 9% as being too high given that the FCA had acknowledged that the damage to the economy was limited. The Cour de cassation held that even though the first cartel did not constitute a price-fixing agreement, which is one of the most serious infringements, the information exchange tended to increase future prices and indirectly contributed to fixing these prices, thus constituting a serious infringement nevertheless, thereby justifying the 9% ratio.
Finally, the Cour de cassation rejected Deutsche Bahn and Schenker France’s claim that they be granted full immunity. Both applicants argued that the FCA had unduly denied them full immunity and had imposed a disproportionate €3 million fine after finding that they had not informed the FCA that they had continued to participate to the infringements after their leniency application. The Cour de cassation, however, found that the reduction in the fine, set at 95.63% by the FCA, was sufficiently proportionate, as the final fine represented only 4.37% of the sanction the FCA would have otherwise imposed, and that a further reduction would have mitigated the fine’s deterrent effect.
The Cour de cassation’s ruling is now final and marks the end of this long-running and high- profile French cartel case.
 See, Judgment of the Paris Court of Appeals of July 19, 2021, no. 16/01270.
 See, judgment of the Cour de cassation of September 22, 2021, no. X 18-21.436, Y 18-21.437, A 18-21.485, J 18-21-493, D 18-21.580, R 18-21.591, E 18-21.719, C 18.21.763 and Y 18-21.805, available at https://www.autoritedelaconcurrence.fr/sites/default/files/appealsd/2021-09/cass_15d19.pdf. (the “Judgment of the Cour de cassation”). See, FCA Decision no. 15-D-19 of December 15, 2015, relating to practices implemented in the standard and express delivery industry, available at https://www.autoritedelaconcurrence.fr/sites/default/files/commitments//15d19.pdf (the “Decision”).
 Namely Schenker AG, Schenker S.A., and Schenker-Joyau S.A.S.
 Namely Alloin Holding (Kuehne+Nagel Group), BMVirolle, Chronopost, DPD France, Ciblex France, Dachser France, DHL Express France, FedEx Express, Gefco, Geodis, General Logistics Systems France, Heppner Société de Transports, Lambert et Valette, XP France, Norbert Dentressangle Distribution (now XPO Distribution), Normatrans, Schenker France, TNT Express France, Transports H Ducros, and Ziegler France.
 Decision, paras. 513– 515.
 Decision, para. 516.
 Decision, paras. 1221–1225, 1228, 1245. Strikingly, the eight biggest cartel participants alone accounted for 71% of the market at the time of the infringements (Decision, paras. 1262–1266).
 Decision, paras. 1197–1211.
 Decision, paras. 1389–1400.
 Decision, paras. 1321 et seq.
 Namely Alloin, Chronopost, Exapaq (now known as DPD France), Dachser, DHL, Gefco, GLS France, Heppner, Lambert et Valette, XP France, Normatrans, Schenker-Joyau (now known as Schenker France), TNT Express, Henri Ducros, and Ziegler.
 Decision, paras. 196, 313–323, and 517. The then-applicable regulatory framework did not however impose such a pass-on requirement on courier companies.
 Decision, paras. 1168 and 1171.
 Decision, paras. 1171–1173.
 Decision, paras. 1179 and 1188.
 Heppner, Transports Henri Ducros, Ziegler, Ciblex, and TLF did not appeal the Decision.
 See, Judgment of the Paris Court of Appeals of July 19, 2021, no. 16/01270, available at https://www.autoritedelaconcurrence.fr/sites/default/files/docs/ca_15d19. pdf (the “Judgment of the Paris Court of Appeals”).
 Judgment of the Cour de cassation, para. 42.
 Judgment of the Cour de cassation, paras. 44 et seq.
 Judgment of the Cour de cassation, paras. 50– 51.
 Judgment of the Cour de cassation, para. 67.
 Judgment of the Cour de cassation, para. 76.
 Judgment of the Cour de cassation, paras. 73 and 79.