France: France Takes Next Step in Anticorruption Enforcement: First "French DPAs" And What Companies Should Know

In Short

The Situation: Anticorruption legislation passed by French lawmakers in 2016 authorizes the resolution of a corruption matter by means of a "convention judiciaire d'intérêt public" ("CJIP"), the French version of a deferred prosecution agreement ("DPA"). Three "French DPAs" have been entered into thus far.

The Result: These first-of-their-kind resolutions offer a good opportunity to highlight the main features of the French version of the DPA and to draw comparisons with resolutions in other countries.

Looking Ahead: The increased flexibility that French prosecutors have to settle cases by means of a CJIP has significant implications with respect to the efforts of French authorities to investigate and prosecute allegations of international corruption.

In response to growing criticism directed at the country's anticorruption legal framework, French lawmakers passed Law No. 2016-1691 on transparency, anticorruption, and modernization of the economy in December 2016. This law, commonly referred to as the "Sapin II Law," introduced a new feature authorizing the resolution of a corporate corruption case through a CJIP.

In a CJIP resolution, the French public prosecutor and the company involved agree to the deferral of a criminal prosecution, subject to the company's satisfaction of certain conditions. In this way, the company can avoid a criminal conviction by paying a fine (which amount is capped at 30 percent of the company's average annual turnover over the past three years) and/or by being subject to a compliance/remediation program under the control of the French Anticorruption Agency. In addition, the company may be compelled to compensate victims for any damages they sustained as a result of the conduct at issue. CJIPs are applicable only to companies and only in cases involving corruption, influence peddling, laundering tax fraud proceeds, and related offenses.

Since the enactment of the Sapin II Law, the French public prosecutor has made use of this alternative to prosecution on three occasions. While the first CJIP was the subject of much commentary, the two more recent CJIPs were entered into with the utmost secrecy.

The first-ever CJIP was entered into between a Swiss private bank and the French financial prosecutor's department on October 30, 2017, and was validated by the president of the Paris High Court on November 14, 2017. This resolution arose out of allegations that the bank engaged in aggravated money laundering of the proceeds of tax fraud. In connection with the CJIP, the bank acknowledged the facts set forth in the CJIP and agreed to pay a sum of €300 million, including damages, disgorgement of profits, and a penalty tied to the legal violation. The bank was not subjected to a compliance/remediation program.

The most recent CJIPs were entered into by two French companies on February 14 and 15, 2018, and both cases involved corruption of a public official. In one of these cases, the CEO of the targeted company paid illegitimate commissions, amounting to more than €130,000, to an employee of a public business partner in exchange for obtaining and maintaining public contracts. This same public employee was also involved in the other case, in which this employee was paid hundreds of thousands of euros in cash by employees of the targeted company in exchange for obtaining and maintaining public contracts. In their CJIPs, the two companies acknowledged the facts and agreed to pay penalties of €800,000 and €2.7 million, respectively. In addition, the companies agreed to compensate the victims for their damages and undertake remediation measures.

These cases offer insight into considerations relevant to determining whether a CJIP may be an appropriate resolution in particular cases and, if so, what the CJIP may entail by way of conditions and requirements for the company involved. The CJIPs already entered into demonstrate that the public prosecutor takes into account several factors when setting the amount of the "public interest fine." The level of the company's cooperation and steps taken to prevent, detect, and remediate corruption are deemed to be mitigating factors (e.g., dismissal of the employees involved in violations, changes in top management, implementation of internal ethics, and compliance standards). On the other hand, certain aspects of an offense are deemed to be aggravating factors (e.g., duration of offense, involvement of public officials).

The special attention given to companies' level of cooperation is not specific to French CJIPs. Indeed, in the United States, it is well established that cooperation is a mitigating factor by which corporations and individuals can gain credit and leniency. Similarly, the initial DPAs in the United Kingdom, as well as policy pronouncements of the U.K. Serious Fraud Office, also emphasize the importance and mitigating effect of early self-reporting and cooperation on the part of the defendant.

As the early CJIPs indicate, the French enforcement authorities are effectively starting to use the enforcement tools introduced by the Sapin II Law. Whether or not, under the ne bis in idem doctrine, a CJIP would bar another country from prosecuting the company involved for the same conduct remains an important question, one that will no doubt be elucidated by additional legal developments, such as the recent decisions touching on ne bis in idem issued by the French Supreme Court and the European Court of Human Rights.

Two Key Takeaways

  1. The Sapin II Law introduced the French version of a U.S. DPA in corruption-related matters, referred to as a "convention judiciaire d'intérêt public."
  2. "French DPAs" allow companies to avoid a criminal conviction by paying a fine and/or implementing a compliance program.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Authors
Theodore T. Chung
Similar Articles
Relevancy Powered by MondaqAI
 
Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Related Topics
 
Similar Articles
Relevancy Powered by MondaqAI
Related Articles
 
Up-coming Events Search
Tools
Print
Font Size:
Translation
Channels
Mondaq on Twitter
 
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
 
Email Address
Company Name
Password
Confirm Password
Position
Mondaq Topics -- Select your Interests
 Accounting
 Anti-trust
 Commercial
 Compliance
 Consumer
 Criminal
 Employment
 Energy
 Environment
 Family
 Finance
 Government
 Healthcare
 Immigration
 Insolvency
 Insurance
 International
 IP
 Law Performance
 Law Practice
 Litigation
 Media & IT
 Privacy
 Real Estate
 Strategy
 Tax
 Technology
 Transport
 Wealth Mgt
Regions
Africa
Asia
Asia Pacific
Australasia
Canada
Caribbean
Europe
European Union
Latin America
Middle East
U.K.
United States
Worldwide Updates
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions

Mondaq.com (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of www.mondaq.com

To Use Mondaq.com you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.

Disclaimer

The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.

General

Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions