-
What are the key financial crime offences applicable to companies and their directors and officers? (E.g. Fraud, money laundering, false accounting, tax evasion, market abuse, corruption, sanctions.) Please explain the governing laws or regulations.
The main financial offences are defined in the Criminal Code, in particular:
- misappropriations: embezzlement, swindle, breach of trust, money laundering, forgery;
- breaches of probity: bribery, favouritism in public contracts, illegal conflict of interests, misuse of public funds. These offences often concern decisions taken by persons in positions of public authority, whether elected or not.
Certain financial offences are also provided for by texts outside the Criminal Code, in particular:
- Commercial Code: misuse of corporate assets, bankruptcy, cartels;
- Consumer Code: deceptive practices;
- General Tax Code: tax fraud;
- Monetary and Financial Code: insider trading, breaches of market transparency.
The main penalties for these offences are imprisonment (ranging from 3 to 10 years) and fines. When the offence is committed by a company, the maximum fine is five times that incurred by individuals. The fine may also be proportionate to the proceeds of the offence (e.g.: bribery, insider trading, money laundering). Complementary penalties may also be imposed (e.g. ban on management, exclusion from public procurement).
-
Can corporates be held criminally liable? If yes, how is this determined/attributed?
Companies may be held criminally liable for all offences, except press offences (libel). Under the Criminal Code, the offence must have been committed on behalf of the company, by its bodies or representatives.
Therefore, the company is not liable if, through abuse of position, the body or representative has acted on their own behalf or on behalf of a third party. However, case law is flexible in its interpretation: even a representative acting outside the scope of the company’s corporate purpose is viewed as acting “on behalf” of the company.
The corporate body or representative is an individual with the power, de jure or de facto, to manage the company. This may be a legal representative or a person with delegated powers.
-
What are the commonly prosecuted offences personally applicable to company directors and officers?
Among financial offences, some may only be prosecuted against corporate representatives and their accomplices, in particular:
- Misuse of corporate assets and fraudulent bankruptcy;
- Presentation of false accounts;
- Distribution of fictitious dividend.
However, certain other offences, which are not reserved to executives alone, are frequently attributed to them, in particular:
- Tax fraud;
- Fraudulent issuance of securities;
- Money laundering.
-
Who are the lead prosecuting authorities which investigate and prosecute financial crime and what are their responsibilities?
Prosecuting and investigating authorities:
Prosecutions are carried out by the Public Prosecutor’s Office, which reports to the Ministry of Justice. Investigation work is carried out by the police or gendarmerie under the supervision of the Prosecutor.
The Public Prosecutor’s Office has sections specialized in financial crime. The best-known is the National Financial Prosecutor’s Office, created in December 2013 (PNF). The PNF has nationwide jurisdiction over three types of offences: breaches of probity (bribery, influence peddling, etc.), damage to public funds (tax fraud, money laundering, etc.), market abuse (insider trading, price manipulation, etc.). There are also inter-regional courts specialized in financial matters, with jurisdiction over several districts. In addition, EU Regulation 2017/1939 created a European Public Prosecutor’s Office, operational since 2021. This regulation establishes a system of shared powers between the European Public Prosecutor’s Office and national authorities in the fight against criminal offenses affecting the financial interests of the EU. The European Public Prosecutor’s Office may investigate, prosecute and refer the perpetrators of such offences to national courts.
In the vast majority of cases, only an Investigation – led by the Prosecutor – is opened. An Investigation only partly follows the adversarial principle.
For more complex cases, the Prosecutor may open a Judicial Inquiry and fully entrust the probe to an Examining Magistrate. In this case, the police or gendarmerie act under the authority of the latter. This magistrate is independent. A Judicial Inquiry is more respectful of the defence, with the accused having a number of rights (access to the case file, requests for nullification and fact-finding).
However, this distinction is blurring. Since 2016, the Prosecutor is required to investigate both sides of the case, like the Examining Magistrate. The Prosecutor is also allowed to disclose all or part of the case file to the accused and the plaintiff for their observations.
Investigation services:
Certain investigative departments (police or gendarmerie), operating under the direction of the Prosecutor or Examining Magistrate, specialize in financial crime:
- The Central Office of Struggle against Corruption Financial et Tax Offences (OCLCIFF), part of the Judicial Police;
- The National Brigade for the Repression of Tax Delinquency (BNRDF).
A number of other government agents also have investigative powers in certain financial matters. These include Customs, the Directorate General of Public Finances (DGFIP) and the Financial Judicial Investigation Service (SEJF).
Outcome of Investigations or Judicial Inquiries:
At the end of a probe, the Prosecutor or the Examining Magistrate may decide to close the proceedings (no trial), refer the case to a criminal court (trial) or implement alternative measures.
-
Which courts hear cases of financial crime? Are trials held by jury?
Financial offences are tried before the Correctional Tribunal, composed of three professional judges, without a jury.
-
How do the authorities initiate an investigation? (E.g. Are raids common, are there compulsory document production or evidence taking powers?)
The Prosecutor may be informed of the commission of a financial offence by any means: anonymous letter, formal complaint, press article, report by an employee or by a company’s supervisory body (auditor, chartered accountant…), transmission of information by a public authority, etc.
The appointed authority (Prosecutor or Examining Magistrate) then has extensive powers to gather evidence in an inquisitorial fashion:
- Questionings and confrontations;
- Raids and seizures of documents or computer data;
- Requisitions for spontaneous communication of evidence;
- Wiretaps.
This arsenal is complemented by special seizures (bank accounts, real estate, movable property). Depending on the offence, these seizures do not necessarily bear on the direct or indirect proceeds of crime, and may involve any of the defendant’s assets, including those of legal origin.
-
What powers do the authorities have to conduct interviews?
Questionings can take place at various stages of a criminal procedure. The rules governing them vary according to the status of the person being questioned:
- Witness:
Witnesses may be heard during an Investigation or a Judicial Inquiry. A person who can be viewed as a suspect cannot be heard as a witness.
- Suspect:
A suspect is a person against whom there are reasonable grounds for suspecting that he or she has committed an offence.
The suspect may be taken into police custody or heard freely. When in police custody, the suspect is deprived of liberty for a duration of up to 48 hours (under ordinary law). Alternatively, the suspect may be questioned freely with the right to end the interview at any time.
In case of a Judicial Inquiry, indictments can be decided. A suspect may only be indicted when presented to the Examining Magistrate for a formal Initial Questioning (IPC). The IPC usually follows a police custody or a free questioning. At the end of the IPC, the suspect is either indicted or declared an assisted witness. The assisted witness is an intermediate applicable if the Examining Magistrate only has partial evidence of the suspect’s involvement. Unless he is eventually indicted, an assisted witness cannot be referred to a criminal court.
- Plaintiff:
Plaintiffs may be heard by the police or the Examining Magistrate. They are entitled to legal counsel present.
-
What rights do interviewees have regarding the interview process? (E.g. Is there a right to be represented by a lawyer at an interview? Is there an absolute or qualified right to silence? Is there a right to pre-interview disclosure? Are interviews recorded or transcribed?)
Rights depend on the status of the person being questioned.
- Witness:
Witnesses are required to appear in person and are not entitled to legal counsel. When heard by the police, the witness is entitled to remain silent. However, before an Examining Magistrate, the witness is sworn in and must answer questions. In all instances (Investigation and Judicial Inquiry), the witness may oppose professional secrecy to refuse to answer questions (notary, lawyer, doctor, journalist). Witnesses may also be heard anonymously if circumstances warrant.
- Suspect:
When summonsed, the suspect is required to appear in person.
During an Investigation, in order to be legally heard in police custody or at a free hearing, the suspect must be informed of (i) the nature of the alleged offences and their circumstances, (ii) the right to legal counsel, (iii) the right to a medical examination and, if necessary, to an interpreter, (iv) the right to inform a relative or employer, unless this is prevented by the specifics of the case and (v) the right to remain silent. The suspect and/or his lawyer do not have access to the case file.
During a Judicial Inquiry, when the suspect is questioned for the first time by the Examining Magistrate (IPC), they must be informed of the charges against them and their circumstances, the right to remain silent, to answer questions or make spontaneous statements. Legal counsel is present, with prior access to the entire case file. At the end of the IPC, the suspect is indicted or declared an assisted witness. From then on, only the Examining Magistrate has a right to question the suspect, in the presence of counsel with access to the up-to-date case file.
In all cases, the suspect has a right to remain silent and not to incriminate himself.
All hearings are recorded in written minutes signed by the interviewee, who has the right to reread them (with his or her lawyer if present).
-
Do some or all the laws or regulations governing financial crime have extraterritorial effect so as to catch conduct of nationals or companies operating overseas?
In principle, French law is only applicable to offences committed on French soil.
By way of exception, French law is applicable to offences committed (i) by a French national abroad if the acts are also punishable under the law of the country in question (ii) or when the victim is French. In both cases, prosecution must be preceded by a complaint from the victim or a denunciation by the authorities of the foreign country.
If the perpetrator has already been judged for the same offence abroad, he or she can no longer be prosecuted in France. Lastly, French law is applicable to offences punishable by at least 5 years’ imprisonment committed abroad by a foreigner whose extradition was denied by the French authorities.
In addition, certain international conventions extend the jurisdiction of French courts to acts that would otherwise escape domestic law. This is notably the case with the Geneva Conventions of 1949 and the OECD Convention on Combating Bribery of Foreign Public Officials of December 17, 1997.
-
Do the authorities commonly cooperate with foreign authorities? If so, under what arrangements?
The French authorities routinely cooperate with foreign authorities in the investigation of financial and other forms of transnational crime.
At the EU level, cooperation is steadily increasing. In addition to the creation of the European Public Prosecutor’s Office, active since 2021, several agencies (European Anti-Fraud Office – OLAF; European Agency for Judicial Cooperation in Criminal Matters – Eurojust; European Agency for the Cooperation of Law Enforcement Agencies – Europol) can collaborate with French authorities.
At the international level, France has ratified a number of bilateral and multilateral conventions implementing cooperation. France is also a member of Interpol. Finally, the French authorities participate in working groups such as the Financial Action Task Force (FATF), whose purpose is to draw up international standards to combat money laundering and the financing of terrorism.
Under domestic law, international mutual assistance in criminal matters is governed by the Code of Criminal Procedure, which sets out the procedures for information exchange and mutual assistance between France and any other country.
-
What are the rules regarding legal professional privilege? Does it protect communications from being produced/seized by financial crime authorities?
In principle, lawyers’ professional privilege is a matter of public order. It is general, absolute and unlimited in time, so that correspondence between a lawyer and his client cannot be seized and produced in court.
The scope of this secrecy applies to all matters, whether in the field of consulting or defence, and whatever the material medium (consultations, letters, emails, diaries, etc.).
However, the Cour de Cassation has substantially limited the inviolability of professional secrecy. In 2020, it ruled that in order to benefit from professional secrecy, it was necessary to “establish that the exchanges were linked to the exercise of the rights of the defence”, i.e. a legal proceeding or a proceeding aimed at imposing a penalty.
Within this limited framework, the Cour de Cassation recently ruled that documents seized from a company, although not addressed to the lawyer or by him, but which include a defence strategy he has put in place, are covered by professional privilege.
Formally, searches of a lawyer’s office are highly regulated, and always take place in the presence of a representative of the Bar. Whether seized at the lawyer’s home or at the home of a person being prosecuted, the seizure may be contested before the judge.
-
What rights do companies and individuals have in relation to privacy or data protection in the context of a financial crime investigation?
The Code of Criminal Procedure establishes the principle of secrecy of Investigations and Inquiries. However, it provides that the Prosecutor may disclose certain information for reasons of public order, provided that the communication does not include any assessment of the merits of the charges.
Except in this case, violation of this secrecy is punishable under the Criminal Code. Persons disclosing information subject to secrecy may be prosecuted if this hinders the course of justice.
However, it is now accepted case law that the protection of confidentiality of sources and the principle of freedom of the press prevent journalists from being prosecuted for violating the secrecy. This tolerance substantially limits the effectiveness of the protection.
-
Is there a doctrine of successor criminal liability? For instance in mergers and acquisitions?
Inflecting its historic case law and in light of EU Directive 2017/1132 of June 14, 2017, the Cour de Cassation ruled in 2020 that the criminal liability of an absorbed company can be passed on to the absorbing company. Under the terms of this decision, the judge also clarified that “the existence of fraud against the law allows the judge to impose a criminal penalty on the absorbing company when the merger-takeover transaction was intended to shield the absorbed company from its criminal liability”.
In a ruling of 2022, the Cour de cassation clarified the application of the new principle, ruling that trial judges must verify the absence of fraud, if necessary by ordering additional fact-finding measures.
-
What factors must prosecuting authorities consider when deciding whether to charge?
When only an Investigation is opened, the Prosecutor has the discretion to prosecute based on the collected evidence. He is free to dismiss the case, to propose an alternative measure or to refer the case to the trial judge.
When a Judicial Inquiry is opened, the Examining Magistrate orders the indictment of “persons against whom there is serious or corroborating evidence making it likely that they may have participated, as perpetrator or accomplice, in the commission of the offences referred to him. At the end of the Judicial Inquiry, the Examining Magistrate may decide to refer the accused to the trial judge if he or she considers that the probe has revealed sufficient evidence or, on the contrary, to terminate all or part of the proceedings.
-
What is the evidential standard required to secure conviction?
Under French law, the essential principles of the law of evidence are that “any person suspected or prosecuted is presumed innocent until proven guilty”, and that “offences may be established by any means of proof, and the judge decides on the basis of his innermost conviction”. These rules give the judge considerable freedom in admitting and weighing evidence.
For example, certain types of evidence that are excluded from criminal trials in some jurisdictions (e.g. hearsay) may be admitted in France.
The three limits to the admission of evidence are:
- the evidence has been legally collected by the authorities, i.e. in accordance with the rules of the Code of Criminal Procedure. Evidence obtained in violation of this rule is liable to be annulled;
- the evidence has been submitted to the contradictory examination of all parties;
- the evidence must have been obtained fairly, which has led to the exclusion, in very rare cases, of proof obtained unfairly, notably by entrapment. However, this rule – which stems from case law – is rarely used, so that French criminal courts are often entitled to retain evidence gathered by private individuals that would not be admissible in other jurisdictions (illicit wiretaps, anonymous letters, certain information covered by secrecy, etc.).
-
Is there a statute of limitations for criminal matters? If so, are there any exceptions?
Since a 2017 reform, the statute of limitations for financial offences is 6 years.
However, the statute of limitations does not necessarily run from the date of commission of the offence. When offences are considered “hidden” or “concealed”, the period “runs from the day when the offence became apparent and could be ascertained under conditions allowing prosecution”, up to a maximum limit of 12 years. This system is frequently applied in financial matters.
In addition, the limitation period is recurrent, meaning that it is interrupted each time the authorities carry out an act of investigation. This interruption renews the entire period. The statute of limitations thus renewed must itself be interrupted by a new act, and so on until final judgment is passed.
-
Are there any mechanisms commonly used to resolve financial crime issues falling short of a prosecution? (E.g. Deferred prosecution agreements, non-prosecution agreements, civil recovery orders, etc.) If yes, what factors are relevant and what approvals are required by the court?
There are various mechanisms for resolving financial crime cases outside of formal prosecution, for example:
Alternatives to prosecution: the Public Prosecutor’s Office can spontaneously propose alternatives to prosecution (mediation, payment of compensation, etc.). This mechanism is reserved to very minor offences;
Penal arrangement: the Public Prosecutor and the perpetrator can agree to an arrangement if the perpetrator acknowledges his or her responsibility. The arrangement is composed of alternative measures to prosecution. This mechanism can be used for offences of mild gravity (punishable by up to five years’ imprisonment). It is always subject to approval by the president of the tribunal at a public hearing, who can set it aside for reasons of expediency (nature of the offence, personality of the perpetrator, situation of the victim or defence of the interests of society);
Judicial public interest agreement (CJIP): since the Sapin II Act of 2016, the Public Prosecutor’s Office can offer a company implicated in bribery, influence peddling, tax fraud, money laundering or a related offence, to pay a fine and bring its internal system into compliance, in return for the prosecution being foregone. The company does not have to formally acknowledge its criminal liability.
The Prosecutor has sole authority to negotiate and sign the CJIP, which must be approved by the president of the tribunal at a public hearing. The president of the court makes a
decision on the basis of criteria that are distinct from the previous ones, of a more economic nature (including conformity of the amount of the fine and proportionality of the penalty to the proceeds of the offence).
The National Financial Prosecutor’s Office adopted guidelines in January 2023 on the implementation of this procedure, considering in particular “that cooperation in good faith by the legal entity is required” to be able to benefit from this procedure (spontaneous disclosure of the facts, disclosure of new information…).
All these mechanisms can only be implemented prior to the initiation of legal proceedings by the Prosecutor. Once prosecution has been launched, they are no longer applicable.
-
Is there a mechanism for plea bargaining?
The Appearance upon Admission of Guilt (CRPC) enables the Prosecutor and the perpetrator to agree on a sentence following prior recognition of guilt, after the prosecution has been initiated. This mechanism can be used for all financial offences. This agreement, which avoids a formal criminal trial, is always subject to approval by the president of the tribunal at a public hearing, who may invalidate the settlement on grounds of expediency (nature of the facts, personality of the perpetrator, situation of the victim or defence of the company’s interests).
An approved CRPC is equivalent to a criminal conviction.
This procedure generally does not involve direct negotiations between the parties, but rather a sentencing proposal issued by the Prosecutor to the accused.
In addition, this procedure is only partially confidential, which substantially limits its appeal to the public. This shortcoming is particularly damaging for the defendant when the agreement is not approved.
-
Is there any requirement or benefit to a corporate for voluntary disclosure to a prosecuting authority? Is there any guidance?
In principle, there is no formal obligation or advantage in revealing information that could give rise to criminal proceedings, whether against oneself or against others.
However, admission of guilt is a prerequisite for two of the alternative procedures to prosecution: the penal arrangement and appearance upon admission of guilt. In other cases, such as the judicial agreement in the public interest (CJIP), admission of guilt by the accused is not formally required.
In its 2023 guidelines, the French National Financial Prosecutor’s Office states that the “cooperation in good faith of the legal entity is required” in order to enter into a CJIP. This implies in particular the spontaneous disclosure of facts or new information. Once again, however, the limit lies in the absence of a complete guarantee of confidentiality specific to this procedure.
In addition, the notion of “active repentance” has been introduced into French law, for certain offences only. In the case of money laundering, bribery or influence peddling, any person who spontaneously informs the authorities of an illicit transaction before or during its execution is likely to benefit from a total or partial reduction in sentence.
Lastly, the defendant’s cooperation or confession can always influence the sentencing. But this determination is left to the discretion of the judge.
-
What rules or guidelines determine sentencing? Are there any leniency or discount policies? If so, how are these applied?
Under the Criminal Code, “any sentence handed down by the court must be individualized” according to “the circumstances of the offence and the personality of the offender, as well as his or her material, family and social situation”.
Depending on the defendant’s situation and criminal record, the seriousness of the offence and the harm caused, the sentence may be moderated.
There is no formal leniency procedure in criminal law (unlike in competition law).
In the field of public interest judicial agreements (CJIP), the 2023 guidelines issued by the National Financial Prosecutor’s Office propose fine modulation grids in the event of cooperation on the part of the parties involved, but in the absence of formal texts, their application is not compulsory.
-
In relation to corporate liability, how are compliance procedures evaluated by the financial crime authorities and how can businesses best protect themselves?
Criminal compliance procedures in the strict sense of the term are limited to audits conducted by the French Anti-Corruption Agency (AFA). As its name indicates, the AFA’s remit is limited to preventing corruption and influence peddling by corporations.
However, all French authorities with non-criminal jurisdiction (such as the Autorité des Marchés Financiers) are required to inform the Public Prosecutor’s Office when they become aware of a criminal offence (for example, during a regulatory compliance audit). When a denunciation is issued by such an authority, the Prosecutor often pays particular attention to it. The criminal courts themselves pay close attention to their findings.
The 2023 guidelines issued by the National Financial Prosecutor’s Office for the judicial public interest agreement (CJIP) include a proposal to reduce fines where “an effective internal whistleblowing system is in place”. However, this practice is not based on any automatically applicable text.
The most effective way for companies to guard against this risk is to organize regular preventive audits by external consultants.
-
What penalties do the courts typically impose on individuals and corporates in relation to the key offences listed at Q1?
Sentencing is based on the principle of individualization, according to various formal (personal situation of the offender) and informal criteria (seriousness of the offence, public impact, risk of repetition, etc.).
As part of his general instructions, the Minister of Justice may ask Public Prosecutors’ Offices to claim for heavier or lighter sentences, in line with the government’s criminal policy objectives. However, these instructions are not binding.
It should be noted that, as a matter of principle, the fines incurred by companies are five times those incurred by private individuals.
Historically, sentences handed down in financial matters were symbolic (suspended sentences, modest fines). Moreover, companies benefited from certain leniency, as judges were reluctant to apply penalties likely to have harmful effects on a group of people who had nothing to do with the grievances (employees, suppliers, customers, etc.).
Over the past few years, this leniency has been significantly curbed, in the direction of greater severity. Indeed:
- Criminal judges no longer hesitate to hand down firm prison sentences to company representatives;
- Fines imposed on companies have undergone a form of inflation, following various legislative reforms enabling them to be determined as per the proceeds of the offence (money laundering and bribery, in particular). The National Financial Prosecutor’s 2023 guidelines now provide for a method of calculating fines designed to increase them substantially in the case of judicial public interest agreement.
-
What rights of appeal are there?
The parties have 10 days from delivery of the first instance judgment to lodge an appeal.
The case is then retried in its entirety, or only on the counts appealed.
To contest the appeal decision, the parties have 5 days in which to lodge an appeal with the Cour de Cassation. At this stage, the case is judged in law and not in fact, on the basis of nine restrictive grounds.
At all stages of the domestic procedure, the person being prosecuted also has the option of asking the judge to refer the matter to the Constitutional Council if he or she deems that the applicable law a is contrary to the rights and freedom guaranteed by the Constitution (question prioritaire de constitutionnalité).
Having exhausted the remedies available under French law, litigants then have the option of taking their case to the European Court of Human Rights (ECHR), if they deem that their rights under the European Convention on Human Rights have been violated in the course of the judicial process to which they have been subjected. This ultimate procedure no longer pits the litigant against the Public Prosecutor’s Office, but against the State. The ECHR does not have the power to annul the decision of the French judge; its decision, of a declaratory nature, can only grant “just satisfaction” to the litigant, i.e. compensation.
-
How active are the authorities in tackling financial crime?
Various qualitative measures have been adopted to create an administrative and judicial body specializing in financial crime. Among others:
- Since 2004, there has been an increase in the number of specialized inter-regional jurisdictions (“JIRS”) in financial matters, whose territorial jurisdiction can now cover several districts (notably Bordeaux, Fort-de-France, Lille, Lyon, Marseille, Nancy, Paris and Rennes);
- The creation, in 2013, of a specialized police department (“OCLCIFF”), with national jurisdiction;
- The creation, in 2013, of the National Financial Prosecutor’s Office (“PNF”), with national jurisdiction;
- The creation, in 2016, of the French Anti-Corruption Agency (“AFA”);
- The abolition, in 2018, of the so-called “Bercy lock”, a procedure which made prosecution in tax matters subject to the double agreement of the tax authorities and the Commission of tax offences (both administrative bodies);
- The creation, in 2020, of the Office of the European Public Prosecutor (“OPGP”) responsible, on the basis of “enhanced cooperation”, for the prosecution by domestic courts of offences against the financial interests of the EU.
Despite these initiatives, financial offences continue to represent only a small proportion of criminal litigation in France. In 2022, out of 555,078 convictions handed down, only 10,603 concerned financial matters, i.e. 1.9%.
-
In the last 5 years, have you seen any trends or focus on particular types of offences, sectors and/or industries?
The crackdown on money laundering and tax fraud has increased significantly in recent years, due to a number of scandals with national (Cahuzac affair) or global (Panama Papers, WikiLeaks…) repercussions.
Also noteworthy is the substantial increase in prosecutions of executives for sexual harassment or assault in the workplace, again in the wake of high-profile scandals such as the Weinstein affair and the MeToo movement.
-
Have there been any landmark or notable cases, investigations or developments in the past year?
The following cases had a major impact in 2022 and 2023:
- On January 21, 2022, the Paris Correctional Tribunal convicted 8 people (including 4 companies) of favouritism, misappropriation of public funds and concealment of these offenses in connection with the awarding of polling contracts by the Presidency of the Republic. Penalties ranged from 6 months’ to 1 year’s imprisonment. Fines totalled €2,070,000;
- On January 20, 2023, the Cour de Cassation overturned the indictment of Agnès Buzyn, former Minister of Health, for reckless acts committed during the Covid-19 pandemic. However, this procedure is still underway;
- On March 21, 2023, the Paris Court of Appeal upheld Vincent Bolloré’s indictment for bribery of a foreign public official, a measure decided after the Correctional Tribunal refused to approve a plea bargain agreed with the Public Prosecutor’s Office;
- On May 17, 2023, the Paris Court of Appeal upheld former French President Nicolas Sarkozy’s sentence to three years’ imprisonment, including one year unsuspended, for bribery and influence peddling;
- On July 28, 2023, the French Supreme Court upheld the referral of Éric Dupond-Moretti, Minister of Justice, to the Cour de Justice de la République (criminal court empowered to judge cabinet members) on the grounds of illegal conflict of interests;
- On September 27, 2023, the Cour de Cassation will hear UBS’s appeal against its fine of 1,800,000,000 euros for money laundering and illegal marketing.
The years 2022-2023 also saw a relative increase in the number of judicial public interest agreements. Seven were concluded in 2022 (including a major agreement concerning the Airbus group), compared with four per year over the previous two years. Although the number of CJIPs remains low, the total amount collected since 2017 represents 3,700,000,000 euros, demonstrating that the mechanism is of economic nature.
-
Are there any planned developments to the legal, regulatory and/or enforcement framework?
The Ministry of Justice’s Orientation and Programming Act 2023-2027 is currently being discussed.
Its purpose is to improve the efficiency of justice and simplify or modify the rules of criminal procedure, in particular:
- Confidentiality of advice delivered by in-house lawyers: this amendment was approved on July 3, 2023. Subject to the law’s entry into force, it will enable in-house counsels to deliver confidential legal advice to company directors. However, this confidentiality will not apply to criminal or tax matters;
- A new mechanism enabling judges to authorize the remote activation of cell phones, which will remain prohibited in certain places (lawyers’ offices or homes, press company premises, etc.). This amendment is still under discussion as at August 1st, 2023;
- Recruitment of several court staff (clerks, magistrates) to reduce criminal case processing times by 50%.
-
Are there any gaps or areas for improvement in the financial crime legal framework?
Alternative prosecution procedures (CJIP, CRPC, etc. – see Question 17/18) do not come with a guarantee of complete confidentiality. This major shortcoming hampers their effectiveness, particularly in the event of an eventual refusal to approve the agreement. This defect has been implicitly pointed out by the French National Financial Prosecutor’s Office itself, as evidenced in its 2023 guidelines.
The protection of attorney-client privilege has been excessively undermined by various court rulings. It is now necessary to re-establish this guarantee, which currently has no constitutional protection and unsufficient legal protection.
Finally, the secrecy of Investigations and Judicial Inquiries no longer exists when a case receives media attention, since journalists are free to report information that is supposedly protected. This deserves to be reviewed.
France: White Collar Crime
This country-specific Q&A provides an overview of White Collar Crime laws and regulations applicable in France.
-
What are the key financial crime offences applicable to companies and their directors and officers? (E.g. Fraud, money laundering, false accounting, tax evasion, market abuse, corruption, sanctions.) Please explain the governing laws or regulations.
-
Can corporates be held criminally liable? If yes, how is this determined/attributed?
-
What are the commonly prosecuted offences personally applicable to company directors and officers?
-
Who are the lead prosecuting authorities which investigate and prosecute financial crime and what are their responsibilities?
-
Which courts hear cases of financial crime? Are trials held by jury?
-
How do the authorities initiate an investigation? (E.g. Are raids common, are there compulsory document production or evidence taking powers?)
-
What powers do the authorities have to conduct interviews?
-
What rights do interviewees have regarding the interview process? (E.g. Is there a right to be represented by a lawyer at an interview? Is there an absolute or qualified right to silence? Is there a right to pre-interview disclosure? Are interviews recorded or transcribed?)
-
Do some or all the laws or regulations governing financial crime have extraterritorial effect so as to catch conduct of nationals or companies operating overseas?
-
Do the authorities commonly cooperate with foreign authorities? If so, under what arrangements?
-
What are the rules regarding legal professional privilege? Does it protect communications from being produced/seized by financial crime authorities?
-
What rights do companies and individuals have in relation to privacy or data protection in the context of a financial crime investigation?
-
Is there a doctrine of successor criminal liability? For instance in mergers and acquisitions?
-
What factors must prosecuting authorities consider when deciding whether to charge?
-
What is the evidential standard required to secure conviction?
-
Is there a statute of limitations for criminal matters? If so, are there any exceptions?
-
Are there any mechanisms commonly used to resolve financial crime issues falling short of a prosecution? (E.g. Deferred prosecution agreements, non-prosecution agreements, civil recovery orders, etc.) If yes, what factors are relevant and what approvals are required by the court?
-
Is there a mechanism for plea bargaining?
-
Is there any requirement or benefit to a corporate for voluntary disclosure to a prosecuting authority? Is there any guidance?
-
What rules or guidelines determine sentencing? Are there any leniency or discount policies? If so, how are these applied?
-
In relation to corporate liability, how are compliance procedures evaluated by the financial crime authorities and how can businesses best protect themselves?
-
What penalties do the courts typically impose on individuals and corporates in relation to the key offences listed at Q1?
-
What rights of appeal are there?
-
How active are the authorities in tackling financial crime?
-
In the last 5 years, have you seen any trends or focus on particular types of offences, sectors and/or industries?
-
Have there been any landmark or notable cases, investigations or developments in the past year?
-
Are there any planned developments to the legal, regulatory and/or enforcement framework?
-
Are there any gaps or areas for improvement in the financial crime legal framework?