Latest updates

New obligations for disclosure of beneficial owners in private M&A transactions
AyacheSalama
  • Corporate Finance/M&A
  • France
  • November 29 2017

Following the introduction of Ordinance 2016-1635 and Decree 2017-1094, non-listed companies which previously were not required to disclose the identity of their shareholders and maintained confidentiality through shareholders' agreements must now disclose their beneficial owners not only when a company is set up, but also on a continuous basis. However, the definition of a 'beneficial owner' remains unclear.

Supreme Court confirms its restrictive approach to estoppel principle
Kalliopé
  • Litigation
  • France
  • November 28 2017

A recent Supreme Court decision confirms that the estoppel principle is recognised under French law as a general principle and is now a procedural tool in the hands of litigators. However, the decision also revives the debate about the principle's true effectiveness before the French courts.

New law introduces ethical accountability for corporates
Hughes Hubbard & Reed
  • Company & Commercial
  • France
  • November 27 2017

The new law on the duty of vigilance for parent companies and principal contractors aims to improve the accountability of multinational companies, prevent serious incidents in France and abroad and allow parties to obtain compensation for losses which they suffer as a consequence of non-compliance. To achieve these aims, the law requires companies to draft an awareness plan and implement a monitoring and whistleblowing system. It also introduces penalties for non-compliance.

New compensation rules applicable in case of unfair dismissal
Coblence & Associés
  • Employment & Benefits
  • France
  • October 25 2017

The new government has upheld its promise to reform French labour law and enacted five ministerial orders, one of which is dedicated to the so-called 'visibility and securing of working relationships'. In particular, a damages scale, which will be mandatory for the judge and parties, will be introduced to provide security and clarity regarding the consequences of potential litigation. This scale, through the predictability that it provides, is meant to remove uncertainty and allow the creation of jobs.

Simplification of French foreign investment procedures
AyacheSalama
  • Corporate Finance/M&A
  • France
  • September 20 2017

The foreign investment rules provided under the Monetary and Financial Code were recently amended. M&A practitioners have welcomed the reform of the foreign investment rules, as it reduces the paperwork for foreign investments not falling within the scope of the prior authorisation regime. In addition, this reform has removed a cumbersome administrative procedure considered redundant.

'Fixed' matter or matter 'to be fixed': the subtleties of abatement of a suit
Kalliopé
  • Litigation
  • France
  • August 15 2017

Under French law, proceedings may be terminated on several procedural grounds. One of them is the abatement of a suit, which results in the termination of the proceedings without considering the merits of the case. In two decisions issued on December 16 2016, the Supreme Court specified the subtle conditions applicable to the enforcement of such a drastic procedural penalty.

Pilot outlets not a precondition to franchising
Aramis Law Firm
  • Franchising
  • France
  • August 08 2017

One of the key components of any franchise agreement is the transmission of know-how by the franchisor to the franchisee. Absent this, the agreement may be held null and void or requalified as a mere distribution agreement. In a recent decision, the Supreme Court held that the absence of any pilot outlet run by the franchisor does not amount to a lack of know-know transmission.

Impact of Sapin II Law on company law
Hughes Hubbard & Reed
  • Company & Commercial
  • France
  • July 03 2017

The Sapin II Law aims to support transparency, modernise business activity and combat corruption. It introduces measures to regulate executive pay in listed companies, simplify company law and modernise bond issues. Among other things, it has simplified the procedure for contributions of goodwill, abolished the prior authorisation requirement for certain transactions and simplified the procedure for issuing bonds.

Success for Saone-et-Loire
Hogan Lovells
  • Intellectual Property
  • France
  • June 26 2017

The Versailles Court of Appeal recently affirmed the Nanterre Court of First Instance's decision in relation to the transfer of three domain names infringing the trademark of a collectivité territoriale (the catch-all term for French communes, departments and regions). The court of appeal reviewed three decisions delivered under SYRELI, an alternative dispute resolution procedure, to resolve domain name disputes under the '.fr' country code extension for France.

Influencers' content: ARPP's first recommendations for collaborating with brands
  • Media, Marketing, Sports & Entertainment
  • France
  • June 15 2017

As influencers' content and communications are expanding internationally and in quite diverse ways, the Advertising Professional Regulatory Authority recently published new recommendations in relation to influencers' content, statements and publications. These first recommendations are an important starting point in the establishment of a legal regime applicable to these new actors and types of publication.

Extension of scope of intercompany loans
AyacheSalama
  • Corporate Finance/M&A
  • France
  • May 31 2017

The Macron Law and its implementation decree constituted breakthrough legislation for intercompany loans as they provide new exemptions to the French banking monopoly. The reform allows companies to overcome the difficulties faced when trying to secure a loan from banks and credit institutions. However, the newly authorised intercompany loans remain subject to several conditions that may significantly narrow the impact of this reform.

Paris Court of Appeal clarifies confusion
Hogan Lovells
  • Intellectual Property
  • France
  • May 15 2017

The Paris Court of Appeal recently found that, among other things, use of the domain name 'lecomptoirducoton.fr' had resulted in both trademark infringement and unfair competition in relation to the trademark COMPTOIR DES COTONNIERS. According to the court, when a domain name is not identical to a trademark, the likelihood of confusion between the two signs should be assessed. This assessment includes a likelihood of association, which should be evaluated internationally.

Franchisors' duty of loyalty and unfair termination
Aramis Law Firm
  • Franchising
  • France
  • May 09 2017

Under French civil law, a party to a contract has a duty of loyalty to its contracting party in the performance of the contract. The Supreme Court recently applied this duty of loyalty to a franchisor which had concluded a framework contract with a master franchisee. The court held that the franchisor did not cooperate with, assist or advise the master franchisee loyally. The court also held that it had terminated the framework contract in an unfair manner.

Individuals' image rights, hidden cameras and freedom of the press
  • Media, Marketing, Sports & Entertainment
  • France
  • May 04 2017

Following the broadcast of a television news report entitled "Internet: serial liar" on M6, one of the main national television channels, the doctor involved brought proceedings against M6 on the grounds that his image rights had been violated. As its defence, M6 claimed that the broadcast of the report was justified by two principles: the freedom of the press and the right to inform the public.

Protection of US legally privileged documents in French civil discovery procedure
Kalliopé
  • Litigation
  • France
  • May 02 2017

As with many other national laws, French law recognises parties' right to gather evidence at the pre-trial stage by way of a discovery procedure (ie, judges will require opponents to disclose files and documents under certain circumstances). However, the confidentiality of targeted files and documents can be a major obstacle to the success of such claims. The Supreme Court recently held that confidentiality provided by US legal privilege is unlikely to frustrate a discovery action undertaken in France.

Identity theft by domain name
Hogan Lovells
  • Intellectual Property
  • France
  • May 01 2017

The Paris Court of First Instance recently ordered the transfer of a domain name consisting of the name of a person whose identity had been misused, most likely fraudulently. The court noted that, under the Post and Electronic Communications Code, the registration or renewal of a domain name may be refused or the domain name may be cancelled if it likely infringes IP or personality rights, unless the domain name holder has a legitimate interest in the domain name and is acting in good faith.

Increased threshold to trigger directors' liability in insolvency scenario?
Bird & Bird AARPI
  • Insolvency & Restructuring
  • France
  • April 14 2017

The Sapin II Act amended the regime governing directors' liability in an insolvency scenario in order to encourage the recovery of honest directors of failed businesses. The Commercial Code now states that mere negligence is not a form of mismanagement that can serve as the basis of an action by the court-appointed liquidator against the director of a company in liquidation proceedings.

Multiple signing authorities in M&A agreements following recent contract law reform
AyacheSalama
  • Corporate Finance/M&A
  • France
  • March 22 2017

New rules on signing authorities were recently introduced in Article 1161 of the revised Civil Code in order to prevent direct and indirect conflicts of interest. However, the application of Article 1161 has become a source of concern for M&A practitioners and the impact of the new rules of representation of multiple parties in M&A agreements is a complex issue subject to ongoing legal debate.

Paris Court of Appeal rules on Iraq war's impact on due process in arbitral proceedings
Freshfields Bruckhaus Deringer LLP
  • Arbitration & ADR
  • France
  • March 16 2017

The Paris Court of Appeal recently set aside an award on the grounds of a violation of the principle of equality of arms. The court had to rule on the Iraq war's impact on due process in arbitral proceedings between the Republic of Iraq and two German companies. This decision comes as a reminder that arbitration is a jurisdictional process where parties and arbitrators, while enjoying considerable freedom and flexibility, should be mindful of due process and fair trial guarantees.

No requirement for domain names to be distinctive in unfair competition claims
Hogan Lovells
  • Intellectual Property
  • France
  • March 13 2017

The Court of Cassation recently provided a useful clarification in relation to unfair competition claims based on domain names. The court stressed that a domain name need not be either distinctive or original for an unfair competition claim to be admissible, but that these are relevant simply when assessing likelihood of confusion.