One of the most significant measures of the Action Plan for Business Growth and Transformation affecting patent law is about to come into force. Under the new measures, the National Industrial Property Institute will examine and grant French patent applications filed after 22 May 2020 if they meet not only the criterion of novelty, but also the criterion of inventive step.
The First Civil Chamber of the Court of Cassation recently overruled a Paris Court of Appeal decision and determined that there was no basis for the argument that Antrix Corporation Ltd had not made certain procedural objections during arbitration and therefore could not raise them in enforcement proceedings. The decision raises interesting questions about the nature of the 'waiver' contemplated in the Code of Civil Procedure.
As part of a range of emergency measures to help businesses meet the challenges posed by the COVID-19 pandemic, the government adopted Ordinance 2020-318 on 25 March 2020. The measures temporarily extend deadlines in the financial reporting and accounts approval process of listed and unlisted companies alike. In addition to commercial and civil companies, the new rules apply to partnerships, cooperatives, mutual companies, charities and foundations.
Until recently, in written procedures regarding civil matters, the parties had to be represented by a lawyer, whereas in oral procedures, representation was optional and the parties could represent themselves before a court. This practice has changed following the major reform of French civil procedure, which has amended, among many other procedural rules, those concerning mandatory representation in first-instance courts.
The government has taken a number of emergency measures on bankruptcy and insolvency proceedings as part of its response to the COVID-19 pandemic. These measures apply during the duration of the so-called 'health emergency', plus one or three months, depending on the case. This article considers the impact of the emergency measures on bankruptcy and insolvency proceedings in France.
Physicians, nursing trade unions and constituents recently petitioned the French Administrative Supreme Court with interim measure requests for the protection of fundamental rights during the COVID-19 crisis, resulting in eight rulings. Such interim measures (ie, injunctions or suspension of regulations) can be ordered for urgent matters when it is necessary to safeguard a fundamental freedom.
The COVID-19 pandemic has had a profound effect on business operations. Companies are having to adapt quickly to social distancing measures and travel restrictions and many are now dispensing with face-to-face board meetings in favour of virtual meetings or written procedures. Thus, an ordinance was recently adopted to relax the rules around virtual board and shareholder meetings.
The International Chamber of the Paris Court of Appeal recently rendered five decisions on setting-aside proceedings against five awards issued in the same arbitration. It was alleged that the tribunal had been improperly constituted as a party-appointed arbitrator had failed to disclose information that affected his independence and impartiality. Although this decision confirms the existing jurisprudence, the question of the exact scope of arbitrators' duty to disclose remains.
Some jurisdictions have recently held that certain independent workers (eg, Uber drivers) are actually classified as employees. This raises the question of whether franchisees should also be classified as employees. However, as opposed to a Court of Cassation decision which classified an Uber driver as an employee, a recent decision from the Limoges Court of Appeal seems to clarify that a franchisee cannot be classified as an employee due to the specific features of any franchise contract.
Following the introduction of EU Regulation 2019/452 and the Action Plan for Business Growth and Transformation law, a new decree and ministerial order were published and will enter into effect on 1 April 2020. This new set of regulations takes into account the complexity of the existing structures of investment in private M&A transactions and allows a better understanding of the context of a contemplated transaction by the French administration.
In France, provisional execution allows a judgment to be executed before it acquires the status of res judicata. Until recently, provisional execution could generally be invoked only if the requiring party submitted a request to this effect and the judge expressly granted such request. This practice has changed following the major reform of French civil procedure, which has amended the procedural rules concerning the provisional execution of judgments.
The French Civil Aviation Authority's Registration Office recently moved from Paris to Athis-Mons. As a result, aircraft mortgage beneficiaries must elect domicile in the jurisdiction of the Evry Tribunal Judiciaire. This will not prove too difficult for French banks, which may elect domicile at a branch in the Court of Evry's territorial jurisdiction; however, foreign lenders and non-banking mortgagees will have to find someone (eg, a notary) who will accept such election of domicile on their behalf.
The overriding principle which governs credit transactions in France has been relaxed over time in order to allow for, among other things, intragroup financing. Among the more recent derogations to the rules are those of 2015 and 2019, which made it possible for micro and small and medium-sized enterprises to obtain financing from companies with which they have economic links. The relevant implementing decrees make it clear that 'economic links' includes franchise agreements.
Law 2019-744 of 19 July 2019 seeks to simplify and update wide-ranging aspects of company law. The measures include changes to the approval process that public limited companies must follow in order to issue, in favour of a third party, a guarantee of the obligations of a subsidiary that they control. These changes aim to enable foreign subsidiaries of French companies to respond more quickly to international tender processes.
A recent Supreme Court decision validates the substitution mechanisms in the context of M&A transactions. The mechanism is particularly helpful in M&A transactions where a sponsor signs the initial agreements and, once a structure has been agreed, substitutes a special purpose vehicle to carry out the transaction. However, M&A practitioners should remain vigilant when drafting substitution clauses to ensure that they clearly state the parties' intentions as to the full release (or not) of the original party.
The Court of Cassation recently clarified its position on first-demand guarantees. Considering the significant consequences for the beneficiary of a guarantee (depending on whether it is characterised as a first-demand guarantee or suretyship), the court's reasoning should be looked at carefully by any drafter of a first-demand guarantee.
The French Administrative Supreme Court recently cancelled the Ministry of Health's decision to refuse to include Adcetris's extension of indication on the list enabling healthcare establishments to invoice drugs directly to the French health insurance system, which was based on a National Authority for Health opinion. The court notably ruled that assessments of public health interests concerning drug indications cannot be limited solely to the appreciation of prevalence.
The Action Plan for Business Growth and Transformation was recently adopted. This ambitious law introduces (among other things) a new arsenal for the French state to monitor foreign investment in sensitive industries. It has also brought with it several answers, clarifications and improvements to existing rules applicable to the preferred shares and free share allocation plans regimes, which will undoubtedly be useful to investors and companies undertaking private M&A transactions.
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.
The Supreme Court recently ended a conflict between the appeal courts and clarified that for any decision rendered exclusively on a jurisdictional issue, the party that wants to appeal such decision must file a motivated statement for appeal and, more importantly, appeal to the first president of the relevant appeal court through a formal request in order to obtain a fixed date on which the case will be heard. Otherwise, the statement of appeal will be declared void.