Maximum imposed prices

If European and French competition law prohibit the fixing of minimum imposed prices, the practice of maximum imposed prices, like that of recommended prices, is authorized by these same legislations.

Thus, Article 4 of EU Regulation 330/2010 of 20 April 2010 provides that the supplier may “impose a maximum selling price or recommend a selling price, provided that these do not amount to a fixed or minimum selling price as a result of pressure exerted or incentives by one of the parties”

The fixing of maximum imposed prices is also implicitly authorised by Article L.442-5 of the Commercial Code, sinceit only prohibits the practice of minimum imposed prices.

The fixing of resale prices allows the franchisor to ensure price homogeneity within the franchise network, and thus preserve the consistency of the network and the image of the brand.
The setting of maximum recommended prices must therefore be justified in the franchise agreement by a desire to guarantee a homogeneous pricing policy within the network, in order to preserve the image of the brand.

It should also be recalled that the franchisee retains full freedom to set its resale prices, within the limit of the maximum prices communicated

Finally, the franchisor must ensure that it does not adopt any contractual practices likely to call into question the franchisee’s freedom to set its resale prices, which must be effective.