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2 November 2020
Litigation | France | La Réunion | Competition & International Trade
On 26 October 2020, the French Competition Authority informed the parties involved of its decision to close its ex officio referral in the rated hotel case on Reunion Island, relating to indications of information exchanged between hotel owners within the UHR (Union des Hôteliers de La Réunion) union. Within a very tight timeframe (two months for a simplified procedure), the professional association and the companies concerned managed, drawing on economic studies, to convince the Authority's College that the elements of the case file did not make it possible to establish the existence of an anti-competitive practice by object, or to characterise effects on the market likely to distort competition.
The Authority notes in particular that the evidence gathered during the investigation "does not make it possible to establish the existence of collusion between hoteliers to the requisite legal standard".
Furthermore, given the characteristics of the hotel market on Reunion Island, the Authority's College considered that the exchange of information in question had not had the effect of reducing the degree of uncertainty as to the operation of the market or of weakening the autonomy of hotel owners in establishing their commercial policy.
In contrast with the Paris luxury hotels (Palaces parisiens) case of 2005, in which several establishments were convicted, the Authority's decision shows that exchange of information on past data relating to average room prices and occupancy rates does not make it possible to characterise an infringement by object and that an effects-based approach necessarily depends on the characteristics of the market, in particular its level of concentration and the homogeneity of supply, which were lacking in the present case.
The UHR and several of the hotels accused (Le Bellepierre, L'Austral, Le Relais de l'Hermitage and Le Vieux Cep) were represented by Gide with partner Franck Audran (competition law), counsel Hélène Vey-Morit, Julie Bureau-Ockrent and Eléonore Denis.
Iloha Seaview Hotel and Palm Hotel & Spa were represented by Baker McKenzie. Côté Sun Hôtels and the hotels in its network as well as Blue Margouillat Hotels, Boucan Canot and Tsilaosa were represented by Cynthia Picart, the Diana Dea Lodge by Aramis and the SARL Tropiclub by Solferino Associates.
Firms RBB Economics and Extent Economics acted on the economic aspects of the case in support of the hotels in question.
