Airlines, lenders and lessors often send process servers to French aircraft manufacturers to ensure that assignments and transfers are enforceable against the manufacturer – an approach which is based on an old provision of the Civil Code. However, the position has been clear since the code was amended in 2016: assignments of rights no longer require notification to be delivered to a debtor by means of a process server.
Insolvency has been a topical issue in the French aviation market in 2020 with two significant mid-sized airlines declaring bankruptcy at the start of the year and the number of airlines in financial difficulty set to rise due to the ongoing effects of the COVID-19 pandemic. In this video, Matthieu de Varax and Thomas Boone discuss these issues as well as efforts to reduce the level of carbon emissions that the French aviation sector produces.
The Court of Cassation recently rendered a decision concerning an AirAsia Airbus A320 which crashed in the Java Sea in December 2014, killing all crew and passengers on board. Notably, this decision reaffirms that, under French law, a manufacturer's liability cannot be limited or excluded on the grounds that another party or some other cause contributed to the damage if the product was defective and caused the damage.
French drone legislation was recently updated to require telepilots who fly drones for leisure purposes to undergo specific training. In addition, Law 2016-1428 on enhancing drone operational safety recently entered into force. Among other things, the law requires telepilots who fly drones weighing more than 800g to undergo mandatory training and requires certain civil drones to be registered.
In 2016 French contract law was restructured to render it more predictable and commercially attractive. The reform extended to the currency limitation rule, which was considered both restrictive and unclear. A recently passed implementing law is expected to provide greater flexibility for aviation transactions, as the currency limitations no longer apply to transactions between professionals where payment in a foreign currency is common practice in the relevant industry.
While developing its French network, Ryanair received support from various regional airports, including the Mixed Syndicate of Charente Airports (SMAC). The European Commission ultimately found this financial support to be illegal and, as a result, Ryanair had to repay the illicit subsidy to the SMAC. When Ryanair failed to make the payment in full, the SMAC requested the Bordeaux court to order the arrest of a Ryanair aircraft on its arrival at Bordeaux-Merignac Airport.
Bird strikes are not uncommon in civil aviation: every year there are approximately 5,000 to 6,000 incidents costing $1.2 billion worldwide. But this begs the question of who should be held responsible for bird strikes where an airport subcontracts the prevention of bird risk to a third party. The Supreme Court for Administrative Law recently had to decide which party was responsible for this collision, as previous case law on the matter was unclear.
Bank account pledges are often part of the security package in secured lending. To avoid the risk of the account being emptied prior to enforcement, practitioners have developed a blocking notice that may be delivered to the account holder where a default occurs. This aims to prevent the debtor from sweeping the account ahead of enforcement actions. However, following two recent court decisions, bank account pledges may not be as bulletproof as previously thought.
A Court of Cassation decision relating to a finance lease agreement for a truck has brought longstanding jurisprudence in line with recent legislation. As such, finance lessors must ensure that indemnity provisions are ring-fenced and protected from the voiding of the finance lease agreement if the underlying sales contract disappears.