On January 21, 2025, the French Competition Authority (“FCA”) issued its first opinion on a collective agreement in the private-hire vehicle (“PHV”) services sector.[1] Signed on December 19, 2023 by a trade organization representing two ride-hailing platforms and two driver trade unions, the agreement requires platforms to implement a system allowing drivers to set a minimum income per kilometer for the trip requests they receive. If approved by the Autorité des relations sociales des plateformes d’emploi (“ARPE”), the agreement would be extended across the entire sector. The FCA, asked to assess whether the extension of such system could raise competitive concerns, could not rule it out, notably because only the market leader, Uber, is currently capable of implementing it.
The FCA notes that, given the involvement of the ARPE, State liability could be incurred in the event of a competition law violation and recommends that the legislator provides the ARPE with the necessary legal and financial resources to assess the agreement’s economic, financial, social, and technological implications.
Background
The rise of digital platforms as intermediaries, like the platforms connecting drivers with passengers, has challenged traditional employment models, leading to a subcontracting system that competes with the classic employer/employee model. This shift has made it difficult to apply conventional labor law and social protections derived from it.
To address these new challenges, the French government introduced various laws granting self-employed PHV drivers rights comparable to those of salaried workers, such as access to continued professional training and the right to form trade unions.[2] The Loi d’orientation des mobilités (“LOM”) of December 24, 2019,[3] and subsequent Order No. 2021-484,[4] further established a sectoral social dialogue framework,[5] which mandates annual negotiations between organizations representing both platforms and self-employed PHV drivers to improve working conditions and provide guarantees to drivers similar to those of salaried employees. These negotiations are carried out under the supervision of the ARPE and can result in collective agreements, which the ARPE can approve and then extend to the entire sector.
Since 2023, seven drivers’ unions[6] and two organizations representing the platforms—the Association des plateformes d’indépendants (the “API”), representing Uber and Caocao, and the Fédération française du transport de personnes sur réservation (the “FFTPR”), representing other market players[7]—participated in these negotiations, and several agreements have been signed.
The agreement submitted to the FCA for its opinion was signed by the API and two of the seven driver trade unions involved in the negotiations and requires platforms to implement a system allowing drivers to set a minimum income per kilometer for trip requests they receive. If approved by the ARPE, it will be extended across the entire sector.
When deciding whether to approve an agreement signed under the sectoral social dialogue framework, the ARPE can refuse on grounds of public interest, particularly if it causes excessive harm to competition.[8] Due to concerns about the proposed system’s unclear definition and implementation, and fears from competing platforms that it could give Uber an advantage, the ARPE requested that the Minister of the Economy, Finance, and Industrial and Digital Sovereignty refer the matter to the FCA on the basis of Article L. 7343-50 of the French Labor Code.
The FCA’s Competitive Risk Assessment
Exemption of the agreement under Article 101 TFEU
The FCA first assessed whether the agreement was exempt from Article 101 TFEU. Traditionally, collective agreements between employers’ and employees’ organizations are exempt from Article 101 TFEU if they result from collective bargaining and aim to improve employees’ working conditions.[9] The application of this exemption to agreements entered into by self-employed workers nevertheless remains uncertain. Indeed, in a 2014 ruling, the Court of Justice stated that agreements involving self-employed workers are not automatically exempt.[10] However, the European Commission issued its Guidelines on collective agreements for self-employed persons in 2022,[11] in which it indicates that genuinely self-employed workers who depend on digital platforms and face an “imbalance in bargaining power” vis-à-vis these platforms are in a situation comparable to employees, and, therefore, collective agreements by such workers fall outside the scope of Article 101 TFEU.[12]
Considering that the agreement in question falls within these guidelines, the FCA concludes that it is exempt from Article 101 TFEU.[13]
The agreement does not appear to increase the risk of collusion among PHV drivers
The FCA also examined whether the system created by the agreement would facilitate collusion among drivers because it would encourage them to inflate ride prices by collectively agreeing to accept rides only at a certain price. The FCA concluded that such risk is not likely to increase compared to the current situation, because drivers already have the freedom to accept or reject ride proposals based on their own criteria, and thus to coordinate with other drivers to accept or decline rides below a certain price.[14]
Assessing the potentially exclusionary nature of the agreement
The FCA acknowledges that the agreement could potentially disadvantage platforms unable to quickly and easily acquire the necessary technology to comply with the new obligation, given that the market leader, Uber, had already developed such technology.[15]
The FCA acknowledged that a single market operator possessing a technology that its competitors do not have, or that would be costly to acquire, does not inherently violate competition law. However, this changes if a law or regulation mandates that all operators must acquire and use that technology. Therefore, the FCA acknowledges that the agreement could act as a barrier to entry or exclude platforms unable to obtain the required technology quickly and easily,[16] although it is careful not to draw any definitive conclusion.
The FCA further notes that the risk of raising barriers to entry and expansion is particularly serious when the State mandates the use of a specific technology exclusively controlled by a dominant undertaking. As the originator of the obligation, the State can be held liable for requiring all other market participants to use this technology, creating what the FCA calls an “automatic abuse of dominance” [17]—a situation in which a regulatory or administrative measure places a dominant firm in a position to exploit its power, effectively compelling others to comply under disadvantageous conditions.
Such conduct is addressed through the combined application of Article 102 TFEU, which prohibits the abuse of a dominant position, and Article 106(1) TFEU, which prohibits Member States from adopting or maintaining measures that conflicts with the Treaty’s provisions, including Article 102. In a recent judgment[18], the Court of Justice clarified that in applying Articles 102 and 106 TFEU jointly, it is unnecessary to show that the dominant undertaking has committed or could commit a specific abuse; it suffices to establish that the State’s action undermines the principle of equality among competitors.
The FCA’s Conclusion and Recommendations
Although the FCA’s findings were not entirely conclusive, it urged the ARPE to remain vigilant about the potential anti-competitive risks associated with the agreement. The FCA could not rule out the possibility that extending the agreement to the entire sector could undermine competition.[19] It recommended conducting an in-depth impact study to assess the economic, social, and financial consequences of the agreement.[20] This study would ensure that the agreement balances its social objectives with potential competition risks before being approved and extended to the entire PHV sector.[21]
Since the FCA is not equipped with the necessary resources to carry out such a study, it calls on the French government to provide the ARPE with the necessary legal and financial resources to do so.[22] This support would enable the ARPE to assess the economic, financial, social, and technological impact of the agreement, thereby limiting the risk of the State being held liable for infringing competition law.[23]
Takeaways
The FCA’s opinion on the collective agreement in the PHV sector underscores the ongoing challenges of applying traditional competition law principles to this sector. Specifically, it highlights the difficulty of ensuring that agreements aimed at improving labor conditions for PHV drivers do not inadvertently restrict competition or create barriers to entry that could disadvantage smaller market participants. Going forward, greater regulatory scrutiny can be expected as authorities seek to balance social objectives with the need to maintain competitive, open markets.
[1] FCA Opinion No. 25-A-03 of January 21, 2025 pertaining to the agreement of December 19, 2023 reinforcing the freedom of choice of trips by PHV drivers using a ride-sharing platform.
[2] Ibid., para. 25 et seq. See also, Article L. 1326-2 and Article L.1326-4 of the French Transport Code; Loi n° 2016-1088 du 8 août 2016 relative au travail, à la modernisation du dialogue social et à la sécurisation des parcours professionnels, Articles L. 7342-1 et L. 7342-2.
[3] Loi n° 2019-1428 du 24 décembre 2019 d’orientation des mobilités.
[4] Ordonnance n° 2021-484 du 21 avril 2021 relatives aux modalités de représentation des travailleurs indépendants recourant pour leur activité aux plateformes et aux conditions d’exercice de cette représentation.
[5] The LOM introduced additional rights specifically for transport by PHV drivers, including the right to refuse transport service requests, set their own working hours, use multiple platforms, and disconnect during working hours without penalty.
[6] The Association des VTC de France (“AVF”), Union-Indépendants, l’Association des chauffeurs indépendants lyonnais (“ACIL”), Force Ouvrière (“FO”), the Fédération nationale des autoentrepreneurs (“FNAE”), the Confédération française des travailleurs chrétiens (“CFTC”), and the Union nationale des syndicats autonomes (“UNSA”). FCA Opinion No. 25-A-03, paras. 44-45.
[7] Bolt, Freenow, Heetch, Allocab, Le Cab, and Marcel.
[8] Article L.7343-51 of the French Labor Code. Ibid., paras. 73-74,
[9] Albany International BV v Stichting Bedrijfspensioenfonds Textielindustrie (Case C-67/96) EU:C:1999:430, Hendrik van der Woude v Stichting Beatrixoord (Case C-222/98) EU:C:2000:475.
[10] FNV Kunsten Informatie en Media v Staat der Nederlanden (C-413/13) EU:C: 2014:2411.
[11] European Commission Guidelines on the application of Union competition law to collective agreements regarding the working conditions of solo self-employed persons, OJ 2022 C 374/02.
[12] See Para. 8-10.
[13] FCA Opinion No. 25-A-03, para 22.
[14] Ibid., para 130.
[15] Ibid.
[16] Ibid., para 135.
[17] Ibid., para. 136.
[18] CJUE, Judgement of July 17, 2024, C-553/12 European Commission vs Dimosia Epicheirisi Ilektrismou AE (DEI).
[19] Ibid., Summary, p. 2.
[20] Ibid., paras. 150-157.
[21] Ibid.
[22] Ibid.
[23] Ibid., paras. 136-138.