Droit des affaires

 

Coronavirus (Covid-19), French continuing plans and economy

 

On 13 March 2020, French Ministry of Justice issued a press release just after the announcements of the President of the French Republic. The aim, due to the emergency, is to protect citizens who are the most vulnerable and to curb the epidemic. Chancery has now prepared continuing plans to allow Justice to face core obligations of the Nation. 

 

According to a CNB (Conseil National des Barreaux) release dated 15 March 2020, the continuing plans will be triggered as from 16 March 2020 by the Ministry of Justice to avoid propagation of Covid-19. Tribunal and courts will be closed, except for cases relating to core litigations.

 

Core litigations are limited to (i) criminal tribunals and courts including (a) pre-trial custody (détention provisoire) and probation (contrôle judiciaire), (b) immediate criminal summary trials (comparution immédiate), (c) appearance before the liberty and custody judge (juge des libertés et de la détention), (d) appearance before the enforcement judge (juge de l’application des peines) including appeals, these latest in the events of emergency only, (e) permanence of public prosecutor’s office (permanence du parquet), (f) hearings relating to investigation chamber for custody (audience de la chambre d’instruction pour la détention) and (ii) civil tribunals and courts including (a) children’s courts and permanence in the events of emergency only (audiences du tribunal pour enfants et du juge pour enfants et permanence du tribunal pour enfants) - including educational assistance (assistance educative), (b) summary judgments (including relating to family matters), but based on emergency only, (c) civil liberties and custody judge hearings (juge des libertés et de la détention civil).

 

Due to the risks of contamination, instructions are, to the extent possible, to cancel criminal court sessions related to crimes (cour d’assises). It is also allowed to postpone hearings (taking into account reasonable time extension and pre-trial custody timeframe).

 

Legal public facilities (services d’accueil du public) will be closed as well as justice centers and legal access points. Even if justice civil servants will not be allowed to receive public, they will be reachable by phone to address emergency situations. 

 

As far as Paris is concerned, the first President of the court of appeal of Paris issued an ordinance dated 16 March 2020 (N°105/2020) named ordonnance de roulement modificative (amending rotation ordinance), on the basis of, inter alia, the decision of the Ministry of justice dated 15 March 2020 triggering continuing plans, article L1142-7 of the French Code de la Défense and emergency. Such article not only states that (i) the Ministry of Justice ensures in all circumstances the continuity of the legal criminal services as well as enforcement of criminal sanctions, but also (ii) he participates in fighting against elements adversely affecting fundamental interests of the Nation (this including preservation of the population in and outside France, according to article 410-1 of the French Code pénal). 

 

Aside to the public authorities, the legal profession, as a whole, may support the economy : it can be suggested that business lawyers may wish to consider advising their clients to enter into settlement agreements (within the meaning of article 2044 of the French Civil Code) to solve pending litigations and to unlock commercial situations created by the current sanitary crisis.  

This would give the economy a possibility to maintain a flow of activity

 

Up to date 16 March 2020. 

 

 

Business secrecy under French Law

 

Law dated N° 2018-670 dated 30 July 2018 related to protection of business secrecy implements European directive 2016/943 dated 8 June 2016 on the protection of undisclosed know-how and business information (trade secrets) against their unlawful acquisition, use and disclosure.

Protected information is defined by Article 1 of the law (L.151-1 of the French commercial Code) with the following criteria. In a nutshell, protected information (i) is not, in itself, or in the configuration of accurate addition of its elements, generally known or easily accessible by persons familiar of that kind of information due to their activity sectors; (ii) has a commercial value either effective or potential due to its secret feature; and (iii) is subject to reasonable protection measures by its legitime holder, given the circumstances, in order to keep its secret feature. Conditions of application of this new regulation are to be determined by a specific decree. In the meantime, given that the deadline to implement the European directive has expired, French law should be construed in the light of such a directive (and EU law). 

Up to date 30 July  2018

 

 

Company law - Exclusion of Partners (SEL – Société d’Exercice Libéral)

 

The current situation of partners of limited liability companies carrying on a civil professional purpose (SEL – Société d’Exercice Libéral) is protected by law and the constitutive documents (statutes and internal regulation). This is due to the fact that they have to be protected as they are running the business activity. This is particularly the case in the event of exclusion of partners, when a decision is made to exclude a partner from the company. 

 

In this respect, Article R.4381-16 of the French public health Code states that a partner practicing within the company can be excluded when (i) he is prohibited from practicing or providing care to covered parties for a period equal to three months or (ii) the said partner contravenes operating rules of the company.

 

Article R.4381-16 of the French public health Code gives guarantees as to the exclusion decision: no exclusion decision can be taken if the partner was not legally convened and if he has not been in the position to plead his case on specific facts for which he was charged. 

 

However, as to the voting process, Article R.4381-16 of the French public health Code states that the decision of the partners to exclude a partner is taken on the reinforced majority calculated excluding not only the vote of (i) the partners having been sanctioned for the same facts or related facts but also (i) the concerned partner (unanimity of other partners practicing within the company and entitled to vote having as well to be obtained). 

The fact that the concerned partner does not take part to the vote is not in line with the ratio decidendi of the Cour de cassation (i.e. com. 9 July 2013) and the challenged provision is deemed not to have been written. Such a provision may as well be considered in breach of the ECHR (European Convention on Human Rights), in this particular case of Article 6 (right of a fair trial) or of Article 13 (right of an effective remedy). 

The business activity is also protected in the event of temporary prohibition from practicing or providing care to covered parties (Article R.4381-16). In this perspective, provided that the partner is not excluded, the person concerned keeps his partners’ rights and duties, to the exclusion of the remuneration linked to his professional activity (Article R.4381-17). 

 

This protection is crucial to ensure management stability, legal safety and thus, to foster business activity. 

 

Up to date 21 June 2018

 

 

 

 

Contact et rendez-vous

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