Refusal of a manufacturer to supply goods for resale to a seller further down the distribution chain often poses difficult questions as to whether such acts should be actionable as an anti-competitive act. The issue typically arises where a manufacturer refuses to deal with a discounter. On the one hand, refusal to deal seems on its face to be anti-competitive and aimed at maintaining a high price at the retail level. On the other hand, the manufacturer may have reasons, for example as a result of the image of its products or the need for particular service at the point of sale, as to why sale of the product in question in some particular way might not be appropriate. The issue came before the French Supreme Court in Gephav S. A. v. Biotherm et Compagnie. The defendant sold luxury perfumes through a selective distribution network. The plaintiff sought to be admitted to that network and sent an order for purchase of such items from the defendant but the order was not filled.

The Supreme Court held that selective distribution networks as such did not violate the French Freedom of Prices and Competition Ordinance as long as the criteria used for selecting participants in the network are of an objective nature and do not have the purpose or effect of excluding certain specific forms of distribution and are not applied in a discriminatory way. In the present case, however, the lower court had simply stated as a fact that sale of luxury goods through large scale distribution channels has the effect of harming the reputation and status of luxury goods. This has had the effect of excluding a specific form of distribution and so was not a valid ground for rejecting the plaintiff's request to be included in the defendant's selective distribution network. Furthermore the lower court had failed to carry out a proper evaluation of the facts relating to the actual service provided by the plaintiff at the point of sale so that its holding that refusal to admit the defendant to the network was based on objective criteria was also faulty.