Altice and SFR to pay €80m ‘gun jumping’ fine

Alan Burkitt-Gray
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SFR and Altice collaborated illegally after their merger was approved but before it was complete, says French competition authority

The French competition authority has imposed an €80 million fine on SFR and Altice because they jumped the gun on their 2014 merger deal before receiving regulatory approval.

Altice, whose Numericable subsidiary bought a 77% controlling stake in SFR from Vivendi in mid-2014, says that it “aimed to make the new entity operational as soon as possible after obtaining clearance of the transaction” and adds that the purchases “were performed in good faith, in the midst of legal uncertainty”.

The Autorité de la Concurrence says its decision is its first ever. The group says it “chose not to refute these practices and to accept the French Competition Authority’s settlement offer”.

It adds: “This settlement demonstrates the group’s eagerness to restore a constructive dialogue with the regulator. The group is focusing on its key avenues for growth, which include investing in and deploying very high-speed fibre optic and 4G/4G+ networks, and investing in content such as news, cinema and sports broadcasting rights.”

It notes that the authority “has clarified the rules that the parties to a merger must observe between the signature of the agreement and the Competition Authority’s decision.”

The Authority said it wanted to pass on “a strong message to businesses: they must be vigilant not to implement consolidation prematurely, under pain of severe penalties.”

The Authority says that once a deal has been approved, until it is complete “the parties to the transaction must continue to behave as competitors and not act as a single entity”. Yet the Authority finds evident of “gun jumping”, in its term, in the way SFR and Altice worked together on certain projects before completion.

It says the fine was so high because of its “observation of similar behaviour from Altice for the two transactions notified in 2014 and the deliberate nature of the conduct”.