France's Merger Notification Thresholds Under Article L.430-2 of the Code De Commerce

France’s merger control thresholds under Article L. 430-2 of the Code de commerce sit at the centre of any M&A process touching the French market. The turnover thresholds that trigger mandatory notification to the Autorité de la concurrence determine which transactions require clearance before completion. Deal teams, in-house counsel and advisers must test live transactions against the applicable figures, address conditions precedent, and coordinate parallel filings across France, the EU and other jurisdictions.

Because merger control has been a persistent focus of policy debate in France and across Europe, including discussion of whether and how to recalibrate turnover thresholds and how to deal with so-called “killer acquisitions” that fall below the numeric limits, anyone advising on French concentrations should treat threshold analysis as a live, evolving discipline rather than a settled arithmetic exercise.

Introduction, why merger thresholds matter

Article L.430-2 of the Code de commerce is more than a technical provision. Deal timing and filing strategy hinge on which turnover figures apply and how they are calculated for a given transaction. The statute sets the turnover levels at which a concentration must be notified, within the Autorité de la concurrence’s supervisory architecture. For advisers, the practical message is direct: do not assume a deal is notifiable (or not notifiable) without a careful, current calculation, and do not assume that falling below the thresholds removes all regulatory exposure. Because thresholds and enforcement priorities can change, any process should be checked against the rules and figures in force at the time of notification.

The threshold structure under Article L.430-2

Article L.430-2 establishes turnover thresholds for two coexisting regimes: a general regime for most concentrations and a special regime for the retail sector. A concentration is notifiable where the cumulative conditions of one of these regimes are satisfied. Broadly, the tests combine a worldwide turnover limb (covering all undertakings party to the concentration) with a French turnover limb (which must be achieved in France by at least two of the parties). Both limbs of a regime must be met for notification to be mandatory.

The specific figures set out in Article L.430-2 are set by statute and may be revised over time. Because a precise, current figure is essential and any misstatement could mislead, deal teams should verify the exact thresholds directly against the consolidated text of Article L.430-2 on Legifrance, or via the Autorité de la concurrence’s published guidance, before relying on them. The structural principles below apply regardless of the precise numbers in force.

In practical terms, the general regime requires both a minimum combined worldwide turnover and a minimum turnover achieved in France by each of at least two parties; both limbs must be satisfied cumulatively. The retail regime works the same way but at lower, sector-specific levels, reflecting the sensitivity of local competition in consumer-facing markets.

How turnover is calculated under Article L.430-2

Getting the threshold answer right depends entirely on how turnover is calculated. The figures are meaningless without a rigorous approach to attribution, group aggregation and the treatment of the French component of sales. French practice follows principles broadly aligned with EU merger control, and the Autorité de la concurrence publishes guidance on the calculation of turnover.

Definition of “turnover achieved in France”

Turnover achieved in France is not simply the turnover of a French-registered entity. It is generally the turnover derived from products sold and services supplied to customers located in France, regardless of where the selling entity is incorporated. For goods, this generally follows the location of the customer to whom the goods are delivered; for services, it follows the place where the service is provided to the customer. The distinction matters for cross-border groups where a single legal entity books revenue from multiple markets, only the French-attributable portion counts towards the French limb.

Group and attributable turnover rules

Turnover is assessed at group level, not at the level of the specific target entity. The calculation aggregates the turnover of the whole group to which a party belongs, including parent companies, subsidiaries and other entities under common control. Intra-group sales are eliminated to avoid double counting, so only turnover generated with third parties is included. Where a target is being carved out of a larger group, the acquirer must combine its own group turnover with the target’s attributable turnover, and where only part of a business is acquired, only the turnover of the acquired part is attributed to the seller side.

These consolidation principles mirror the approach familiar from EU merger control and are essential to determining whether a given deal is within scope.

Worked examples (illustrative methodology)

The following examples illustrate the method of applying the two-limb test; they use placeholder figures and are not statements of the current statutory thresholds, which must be verified separately.

Example 1, cross-border industrial group. Assume a general regime with a worldwide limb of “W” and a French limb of “F” per party. Acquirer A has worldwide turnover well above W, of which its French turnover exceeds F. Target T has substantial worldwide turnover but its French turnover falls just below F. Although the combined worldwide limb is comfortably satisfied and one party clearly exceeds the French limb, the second party does not. Because the general regime requires at least two parties each to exceed the French limb, the second limb is not met and the transaction is not subject to mandatory notification under the general regime.

This shows how a single party falling below the French limb can take a deal out of scope even where combined worldwide turnover is very large.

Example 2, retail chain acquisition. Assume a retail regime with a worldwide limb and a lower French limb. Retailer R has worldwide turnover above the retail worldwide limb, all achieved in France. Chain C has smaller worldwide turnover, also all in France, exceeding the retail French limb. If the combined worldwide turnover exceeds the retail worldwide limb and both parties exceed the retail French limb, both limbs are satisfied and the transaction is notifiable under the retail regime. Had Chain C’s French turnover fallen below the retail French limb, the second limb would fail and the deal, on those figures, would fall outside the mandatory retail regime.

Which deals fall outside the mandatory regime, and where risk remains

A defined band of transactions sits below the mandatory line, most commonly mid-market domestic deals and cross-border transactions with a moderate French footprint. But sitting below the thresholds is not the same as being immune from scrutiny.

Below-threshold review and market-test triggers

The Autorité de la concurrence monitors market developments and takes an interest in concentrations that, despite modest turnover, may raise competition concerns, particularly in concentrated local markets, sensitive sectors, or situations that build economic power incrementally through a series of small acquisitions. Third parties, including competitors, customers and suppliers, can bring transactions to the regulator’s attention, and sector inquiries can surface problematic deals. Businesses should also be aware of the ongoing European debate on whether below-threshold “killer acquisitions” should be caught, and should keep abreast of guidance from the Autorité on referral and voluntary-notification options.

Scenarios where re-assessment is recommended

• High local market share. Where the merged entity would hold a strong position in a defined local catchment area, a numeric exemption offers limited comfort.
• Serial acquisitions. Roll-up strategies that individually fall below the thresholds may collectively distort a market and draw discretionary attention.
• Sensitive sectors. Media, healthcare, and essential consumer sectors attract closer scrutiny irrespective of headline turnover.
• Vertical or conglomerate effects. Even modest turnover figures can mask foreclosure risks that concern the regulator.

Retail sector thresholds, special rules

The retail regime operates at lower thresholds than the general regime, reflecting the sensitivity of local competition in consumer-facing markets. The retail figures remain deliberately lower than the general figures for both the worldwide and the French limbs; the precise amounts should be confirmed against the current text of Article L.430-2.

What is “retail” for threshold purposes?

The retail regime applies where at least two of the parties operate one or more retail outlets. It is designed to capture concentrations in the distribution of goods to end consumers, where market power at the local level can materially affect prices and choice. The classification turns on the nature of the activity, the sale of goods to consumers through retail establishments, rather than on a party’s overall corporate character. A diversified group with a retail division will be assessed under the retail thresholds in respect of that activity.

Testing retail deals correctly

A common misstep is to test a retail transaction only against the general thresholds and conclude it is exempt. Because the retail figures are lower, a deal that would clear the general regime may still be caught under the retail regime. Advisers should always run both tests where any retail activity is involved, and should pay close attention to overlaps between the parties’ networks within the same local catchment areas, which can be decisive both for the notification analysis and for any subsequent competitive assessment.

Timing, which thresholds and rules apply

An important timing question is which set of rules and figures governs a transaction. As a general matter, the applicable thresholds are those in force at the time of notification. Where any change to the thresholds is under consideration or has been adopted, deal teams should confirm the effective date and any transitional provisions before assuming that a particular set of figures applies. Where a reform alters the thresholds, a concentration signed under one regime may, when tested at the point of notification, fall to be assessed against a different set of figures.

Practical tips for pending deals

• Confirm the notification date driver. Establish when notification would realistically be lodged and test against the rules and thresholds in force on that date.
• Re-run the numbers. Apply the current thresholds before committing to a filing plan, and refresh the analysis if figures or guidance change.
• Adjust the conditions precedent. Where French clearance is or is not required, the relevant condition should be drafted so it does not create an artificial obstacle to closing.
• Review long-stop dates. A shorter or longer clearance path may change the appropriate long-stop and any break-fee mechanics.

Residual review risk for below-threshold transactions

Sitting below the thresholds does not create an absolute safe harbour. The Autorité de la concurrence takes an interest in below-threshold transactions in defined circumstances, and businesses should build this residual risk into their transaction planning rather than treating the numeric exemption as the end of the analysis.

Risk concentrates where a transaction, despite modest turnover, produces a meaningful competitive effect. The most common triggers are strong positions in narrow local markets, the accumulation of market power through repeated small deals, and concerns raised by third parties who stand to be affected. Sector-specific sensitivities can also elevate a deal’s profile even where the parties are not large in absolute terms.

A simple risk matrix helps deal teams calibrate their response. Where both the likelihood of regulatory interest and the potential impact of intervention are low, a below-threshold deal can proceed with a documented self-assessment. Where either dimension is high, for instance, a high local market share combined with an active competitor likely to complain, parties should consider proactive engagement, a voluntary approach, or additional contractual protection. The goal is to avoid a situation where a completed transaction is subjected to conditions or challenge after the event.

Cross-jurisdictional coordination: France and EU merger control

French thresholds operate alongside, not instead of, the EU merger control regime under Council Regulation (EC) No 139/2004. A concentration with a “Community dimension”, defined by reference to the combined aggregate worldwide and EU-wide turnover of the undertakings concerned, falls to be notified to the European Commission rather than to national authorities, under the one-stop-shop principle. The interaction between the two regimes is central to any cross-border filing strategy.

When French or EU filing is required

In practice, a deal will usually be caught by one regime or the other rather than both, because the EU one-stop-shop displaces national filings for concentrations with a Community dimension. But careful analysis is essential. A transaction that does not reach the EU turnover thresholds may still be notifiable in France if the French thresholds are met. Conversely, a large cross-border deal with a Community dimension will go to the European Commission, and no separate French filing will generally be needed. The EU regime also contains referral mechanisms allowing cases to move between the Commission and national authorities in certain circumstances.

Timing and remedies coordination

• Map the filing landscape early. Test the deal against the EU Community dimension thresholds and the French thresholds at the outset, then extend the analysis to any other jurisdictions with a nexus.
• Sequence the filings. Where multiple jurisdictions are engaged, align notification timing so that clearance conditions and closing can be coordinated without avoidable delay.
• Coordinate remedies. Where competition concerns arise in more than one forum, remedy packages should be consistent to avoid conflicting commitments.
• Consider referral mechanisms. The EU regime contains mechanisms for cases to move between the Commission and national authorities; these should be assessed where the fit between the two regimes is uncertain.

Practical checklist for deal teams, testing, CPs and long-stop dates

Merger control analysis demands concrete action on live and prospective transactions. The following workflow captures the essential steps.

Testing workflow

1. Compute turnover. Establish the combined worldwide and French turnover figures for each party’s group, eliminating intra-group sales and attributing French turnover by customer location.
2. Apply both regimes. Test the deal against the general thresholds and, where any retail activity exists, against the retail thresholds, using the figures currently in force under Article L.430-2.
3. Fix the notification date. Confirm the likely notification date and apply the rules and figures in force on that date.
4. Assess residual risk. If the deal is below the thresholds, run a competitive self-assessment focusing on local market share, serial acquisition patterns and sector sensitivity.
5. Decide on strategy. Choose between no filing, a documented self-assessment, or proactive engagement where residual risk is material.

Model CP wording (threshold-based)

Where French clearance may or may not be required depending on the final turnover position, a conditional CP avoids locking parties into an unnecessary filing. A non-binding drafting suggestion, to be tailored by counsel, might provide that completion is conditional on French merger clearance only to the extent that the transaction is subject to mandatory notification under Article L.430-2 of the Code de commerce as in force at the date of notification, with a corresponding mechanism to disapply the condition if the parties reasonably determine that no mandatory filing is required. Long-stop dates should be set with the realistic clearance timetable in mind, and break-fee and cost-allocation provisions should be revisited in light of any change to the filing obligation.

Conclusion, key takeaways and recommended next steps

French merger control under Article L. 430-2 of the Code de commerce turns on a two-limb, turnover-based test, a combined worldwide limb and a French limb met by at least two parties, with a lower, sector-specific regime for retail. Because the precise threshold figures are set by statute and may be revised, every deal team with French exposure should confirm the current thresholds before relying on them, test live transactions against both the general and retail regimes, and adjust conditions precedent and long-stop dates where the filing obligation is in question.

Above all, remember that falling below the thresholds is not a guarantee of regulatory peace, the Autorité de la concurrence takes an interest in below-threshold deals in defined circumstances, and cross-border coordination with EU merger control remains essential. The prudent response is a disciplined, documented reassessment of each transaction rather than reliance on headline numbers alone. This article is provided for general information only and does not constitute legal advice; specific transactions should be reviewed by a French-qualified M&A lawyer.

Sources

1. Legifrance, Code de commerce, Article L.430-2 (consolidated text)
2. Autorité de la concurrence, official website and merger control guidance
3. EUR-Lex, Council Regulation (EC) No 139/2004 (EC Merger Regulation)
4. Journal Officiel de la République française (JORF)
5. Conseil d’État, decisions database
6. Conseil National des Barreaux (CNB)