French corruption bill clears hurdle at National Assembly

31 January 2017 9:55am

10 June 2016. By Matthew Newman and Benjamin Lucas.

Legislation designed to prevent and prosecute corporate bribery and corruption offenses in France took an important step forward yesterday after French lawmakers in the National Assembly approved the bill. It will now be debated in the Senate.

French Finance Minister Michel Sapin called the draft law “a milestone for strengthening the foundation of our democratic values.”*

The legislation “aims to make France a great, transparent and modern democracy with effective tools to improve the fight against corruption, one of the main causes of citizens’ distrust of the public and the business world,” Sapin said in a statement.

The long-awaited transparency and anticorruption legislation — known as “Loi Sapin II” — after the minister, is intended to reverse France’s reputation for being soft on corporate crime. The legislation includes more protection for whistleblowers and a new corruption-fighting agency.

Companies with more than 500 workers and 100 million euros in sales that fail to comply with the rules could be fined up to 1 million euros ($1.1 million), and individuals could face penalties of up to 200,000 euros.

The French government has been heavily criticized by the Organization for Economic Cooperation and Development’s Anti-Bribery Working Group for its low rate of prosecutions of white-collar crime.

’Judicial Agreements’

Following an amendment by the legal committee, “judicial agreements” have been introduced. This is a significant change since the first draft was announced on March 30.

The provision allows companies to avoid a criminal trial by agreeing a financial settlement with prosecutors or an investigating judge. The measure, which was formerly known as “plea bargaining,” has been criticized by the Council of State.

The Council of State, which advises the government on the preparation of bills, said it should be scrapped because it “would not be in the interest of good administration.”

The revised measure — called a “judicial agreement of public interest” — allows a company to avoid a trial “as long as the prosecution has not been set in motion.” Under the procedure, a state prosecutor or an investigating judge would allow a company held liable for corruption to pay a fine no more than 30 percent of its average annual sales in the last three years.

The decision to include corporate deals is likely to be welcomed by the OECD working group on bribery, after its chairman Drago Kos, called on the French government to revisit their decision to drop the measure from the previous draft version of the bill.


The draft legislation also guarantees whistleblowers anonymity and creates common rights for all people who denounce corruption, regardless of their business sector. A government authority that defends citizens’ rights will provide funding and defray whistleblowers’ legal costs if their employers take action against them.

The draft bill removes certain procedural obstacles and will allow foreign officials to be prosecuted for corruption. Foreigners living in France can also be prosecuted for corrupt acts committed outside of France. In the past, only French people could be pursued for corruption outside of the country.

The law will create a new national anticorruption agency, replacing the previous body, the Service Central de Prévention de la Corruption, which had no powers to investigate or prosecute suspected corporate crime. The new agency will have a budget of between 10 million and 15 million euros.

Concerns about the independence of the agency have been addressed, as it will be placed under the joint authority of the ministry of justice and the ministry of finance.

The draft legislation will be debated in the French Senate’s legal committee on June 21 and 22.

Next week the French Justice Ministry will host an international meeting with about 60 anticorruption authorities in cooperation with the World Bank and the OECD.

*MLex translation from the original French

Damage Limitation: Trucks & Cartel Claims