French Courts Have Power to Block Sales on Foreign Websites – According to Advocate General Wathelet

Advocate General Wathelet issued a remarkable non-binding opinion on 9 November 2016 in response to a question referred for a preliminary ruling by the French Supreme Court to the Court of Justice of the European Union (the “ECJ”) in Concurrence SARL v. Samsung Electronics France SAS and Amazon Services Europe SARL (Case C-618/15).  Concurrence, one of Samsung’s French dealers, had complained that other Samsung dealers were selling products on Amazon websites with French, German, Italian, UK and Spanish domain names. These sales allegedly happened in breach of a contractual clause prohibiting online sales.

Samsung operates a selective distribution system for its high-end products and prohibits its dealers from selling outside the network, including over the Internet. Under French law, a party assisting directly or indirectly in breaching the ban on sales outside the network may be held liable. Concurrence therefore requested a French court to require Amazon to withdraw these products from its various websites. After that court and an appeal court had both dismissed the action on the grounds that they lacked jurisdiction over foreign websites not directed at the French public, the French Supreme Court finally referred the question for a preliminary ruling to the ECJ. 

Contrary to the judgments of the French courts, Advocate General Wathelet asserted that these courts do have jurisdiction and have the power to order Amazon to withdraw offending products from its websites.

The opinion considered the jurisdiction of the French courts on the basis of Article 5(3) of Regulation 44 /2011 of 22 December 2000 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters (the “Brussels I Regulation”), building on previous case law regarding the infringement of intellectual property rights. According to Advocate General Wathelet, if the applicant can demonstrate that adverse effects in the form of reduced sales and loss of profit are suffered in France and that activities of foreign Amazon websites contributed to such damage, French courts have jurisdiction over the case and the applicant should be able to obtain an injunction relating to these websites. 

As this opinion is not binding on the ECJ, it is still uncertain whether the ECJ will follow its Advocate General. If it does, this could constitute a ground-breaking development and a further step towards a generalised cross-border jurisdiction of Member State courts in the EU.