Analysis
14 July 2019

Compliance monitorship by the French Anti-Corruption Agency (AFA)

Bastille Day Newsletter 2019 - Legislative, Regulatory & Policy Updates

 

The French Anti-Corruption Agency (AFA) was empowered by the Sapin II Law1 to handle monitorships of companies as part of the implementation of the French Deferred Prosecution Agreements (Convention Judiciaire d’Intérêt Public “CJIP”). As of today, the monitorship process is still under experimentation and some consider it too narrowly focused on anti-corruption and recommend assessing other areas of compliance risk2.

Conditions and process of the AFA monitorship

Since 2017, France has introduced the CJIP into its legal system, a means by which companies, under determined conditions, can escape public proceedings by paying a fine or complying with certain obligations3. These obligations can be the implementation of an action plan4 aimed at improving the company’s compliance system under the AFA’s control for a maximum of 3 years5.

Given the complexity of the tasks resulting from monitoring a company, the AFA may delegate to or be assisted by law firms and experts6, as long as the monitorship complies with budget restrictions. Indeed, in an interview given to the Global Investigations Review (GIR), the AFA’s director of strategic analysis and international affairs, Renaud Jaune, considered that this externalisation “may prove too costly” 7 for the company, which must bear the costs.

The French monitoring procedure includes 5 stages. After an initial audit, a report establishing the action plan is drafted and then validated by the AFA. During the implementation’s phase, the AFA undertakes several tests to verify the company’s evolution and report annually to prosecutors. Finally, the AFA will draft a concluding report addressed to the prosecutors, evaluating whether the company has reached the required goals8.

Moreover, according to Julien Laumain, an AFA compliance expert, the Agency has a specific role in foreign monitorships on French companies, particularly by ensuring that national security-sensitive information will be protected from foreign monitors9.

Results and perspectives

In 2018, among the 5 companies that have entered into CJIP, 4 of them have had designated the AFA as a compliance monitor10. The most significant case concerns the French bank Société Générale, which agreed in May 2018 to a EUR 250 million fine and a 2-year monitorship11. This case is particularly significant, as it is the first US and French joint bribery resolution, signed with both the French National Financial Prosecutor’s Office (“PNF”) and the US Department of Justice (“DOJ”). As part of the settlement, the DOJ was asked by lawyers to allow the AFA monitorship to be set up instead of a DOJ monitorship12.

Although it is too early to determine whether this type of agreement is to become common practice, it is a turning for US/France cooperation13. The AFA Director Charles Duchaine, declared that these agreements would be used as prototypes, and that France must be competent to monitor French companies, even when the monitorship obligation of comes from a foreign authority14.

According to the 2018 AFA activity report, the first 4 monitorships clearly shown that at least 2 years are required in order to execute an effective control. Moreover, 2 of the CJIPs concluded in 2018 took place at a moment in which the company was operating a managerial change.

The AFA concludes that it can be in the interest for the company to accept a monitorship that will erase previous mistakes and improve its reputation regarding ethics issues15.

Related content

Publication
The Practitioner’s Guide to Global Investigations - 7th Edition
13 January 2023
Navacelle co-authors GIR of the Practitioner’s Guide to Global Investigations – 7th edition
NAVACELLE co-authors the French chapter of the seventh edition of Global Investigations Review’s Practitioner’s Guide to Global Investigations.
Analysis
Lobbying : Declaration obligations of interest representatives in France
14 July 2022
Lobbying: Declaration obligations of interest representatives in France
Highlight on the disclosure obligations imposed on interest representatives in France, as provided for by Law 2013-907 of October 11,...
Publication
The Guide to Sanctions -GIR (2022)
10 July 2022
The Guide to Sanctions (2022) – GIR
Navacelle co-author of the third edition of the Global Investigation Review's Guide to Sanctions.
News
Le monde du droit - Roxane Castro
2 February 2023
Le monde du droit announces the arrival of Roxane Castro as Counsel
Navacelle strengthens its regulatory litigation practice with the arrival of Roxane Castro
Event
2 February 2023
ICC Mexico – Sapin II and France’s efforts to tackle corruption
Stéphane de Navacelle is invited by the ICC of México to talk about the Sapin II law and France's efforts...
Event
CERAS - Violence, symptom or system
30 January 2023
“Violence, symptom or system? Naming, confronting, overcoming”.
Discover Stéphane de Navacelle's testimony during the annual session of the Ceras - Centre de Recherches et d'Actions Sociales.
Press review
Press review - Week of 23 january 2023
27 January 2023
Press review – Week of 23 January 2023
In this week’s press review, you will find two cases which were dismissed, one concerning the defective management of the...
News
Roxane Castro
26 January 2023
Navacelle strengthens its regulatory litigation practice with the arrival of Roxane Castro
With an international culture and a multidisciplinary team led by Stéphane de Navacelle and Julie Zorrilla, Navacelle continues to develop...
Publication
25 January 2023
Overview of the AFA’s survey regarding French companies’ anti-corruption systems
On 30 September 2022, the French Anti-Corruption Agency published the results of its second survey of French companies’ anti-corruption systems....
Analysis
24 January 2023
Sanctioning obstructions to AMF investigations: Update from the Constitutional Court in its decision of 28 January 2022
On 28 January 2022, the Constitutional Court ruled that Article L. 621-15, II, f of the Monetary and Financial Code...
Press review
Week of 16 January 2023
20 January 2023
Press review – Week of 16 January 2023
This week press review includes the latest news on criminal law, business criminal law and criminal procedure. Thus, this review...
Press review
Press review - Week of 9 january 2023
13 January 2023
Press review – Week of 9 January 2023
This week in the press review, a dismissal of the Chlordecone case in the French West Indies and a $17.2...
Event
The fundamental rights of the company - AIJA
12 January 2023
[Roundtable] The fundamental rights of the company
Stéphane de Navacelle participated in the French-speaking conference on fundamental rights in business organised by AIJA on Friday 13 January 2023.
Press review
Week of 2 January 2023
6 January 2023
Press review – Week of 2 January 2023
This week in the press review, two Members of the European Parliament have been subjected to immunity waiver proceedings in...