Companies committed to an affiliation contract and the application of legislation related to sales

Par un arrêt du 22 février 2022 n°21-83.226, la Cour de cassation a eu l’occasion de préciser comment devait être interprétée la législation relative aux soldes au sein d’un réseau de commission-affiliation.  

In this case, the defendant, who was acting as a sales agent, believed that she could sell the products she had just acquired for sale, arguing that the said products had been kept by her manager for more than a month. The Court of Cassation refused to pursue it in this analysis.

Reminder of the rules applicable to payment

Article L310-3 of the Code of Commerce states:

Products advertised as sale must beFor sale and paid for at least a month on the start date of the relevant sales period.

Article L310-5, 3° adds:

“Punishable by a fine of 15,000 euros (…) the fact of making balances in relation to goods For less than a month on the start date of the relevant sales period.

Therefore, the Departments of Population Protection (DDPP), during their checks, ensure that the products offered for sale have been in the seller’s stock for at least a month before the start of the sale.

The question that arose in this case was whether the holding period of products should be evaluated at the manager or agent level.

Back to the concept of affiliate commission

Article L.132-1 of the Code of Commerce defines the agent in these terms:

“A broker is a person who acts in his name or in the name of a company on behalf of the principal.”
Thus, the agent is the agent of the principal: it offers for sale products belonging to the principal in return for a commission payment. From a purely legal point of view, the agent never becomes the owner of the products he offers for sale, only the owner owns these products.

It was this very situation that led the defendant to consider, in the case we are concerned, that it was already in compliance with the sales legislation in terms of “paying” for the products it had been selling for sale over a month ago by its principal.

Reading Articles L. 310-3 and L. 310-5 of the Commercial Code, the Court of Cassation held that this was insufficient to consider that the legislation on credits was well respected.

The position of the Court of Cassation

To dismiss the defendant’s arguments, the Court of Cassation points out that whatever contractual ties unite them, the agent and its principal are in fact two separate legal entities whose stock cannot be confused.

To the extent that Article L. 310-3 of the Commercial Code specifies that products sold for sale must be “on sale” for at least one month, possession of said products—a broader concept than the concept of ownership (1)—can therefore only be evaluated on The agent level, not the principal’s level.
Under these conditions, the Court of Cassation can only confirm the defendant’s guilt by paying a fine of 10,000 euros, including 5,000 suspended.

This ruling confirms Particularly strict application of provisions relating to balances And more generally, price cut ads.

In this regard, it should be noted that the new Article L. 112-1-1 of the Consumer Code, which reintroduces the definition of the reference price into French legislation, It will go into effect on May 28..

In addition to checks for the retention period of discounted products, companies should expect checks on the legality of their price cut ads, that is, from upcoming summer sales (or even earlier in the case of special sales or other pre-sales promotions).

This article only shares its author.

(1) Custody may in fact refer to property as well as to mere possession.

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