The Fight Against Corruption in France

Over the past decade, France has significantly strengthened its legal framework governing the fight against corruption as well as other so-called “integrity” violations (manquements à la probité, in French) through several modernising laws. These laws have shaped the current legal framework for preventing and prosecuting such offences by imposing prevention measures on certain companies, strengthening sanctions, and providing prosecutors with a new legal tool to settle corruption cases. More than eight years after the well-known “Sapin II Law” came into force, its impacts are now visible, while the latest reforms suggest a legislative trend in favour of settlements of corruption cases rather than going to trial.

Historical Development of a New Integrity Paradigm in France

Several regulatory authorities were created in the first half of the 2010s to monitor, investigate and impose sanctions on integrity-related violations. The Laws of 11 October 2013 on transparency in public life created the High Authority on Transparency in Public Life (HATVP), which controls the declaration of assets and interests of public and elected officials and lobbyists’ activities. The National Financial Prosecutor, (Parquet National Financier) (PNF), was also created in 2013. Since then, the PNF has been investigating and prosecuting the most serious and complex economic crimes, covering four categories of offences:

• public finances-related offences (including tax fraud)
• “integrity”-related offences (including corruption and influence-peddling);
• market abuses (such as insider trading); and
• violations in relation to competition laws.

The Sapin II Law: A New era in the French Anti-Corruption Framework

A major addition to the French anti-corruption framework came with the enactment of Law No 2016-1691, relating to transparency, the fight against corruption and the modernisation of economic life, on 9 December 2016 (the “Sapin II Law”). The Sapin II Law integrates an important prevention aspect by requiring companies (with at least 500 employees and a turnover exceeding EUR100 million) to adopt robust compliance programmes. Article 17 of the Sapin II Law lists the measures set out in this programme, namely:

• a code of conduct defining and illustrating prohibited conducts;
• a whistleblowing system allowing for reporting violations of the code of conduct;
• a risk-map ranking corruption risks;
• due diligence policies on clients, principal suppliers and intermediaries;
• internal or external accounting control procedures aimed at detecting and preventing corruption risks;
• anti-corruption training for most exposed personnel;
• a disciplinary system to sanction violations of the code of conduct; and
• internal control mechanisms to audit the measures implemented.

The Sapin II Law also created the French Anti-Corruption Agency (AFA), which oversees and monitors the implementation of the compliance programmes. The AFA is responsible for monitoring the concrete implementation of efficient anti-corruption measures deployed by entities falling within the scope of the Sapin II Law. Entities subject to an AFA control receive a notification from the Agency, which provides the subject and scope of the inspection. At the end of its inspection phase, the AFA files a report containing its observations and recommendations. In the case of a breach, and after giving the concerned entity the opportunity to make its observations, the AFA may issue a warning (avertissement). In the case of a serious violation, the AFA may decide to refer the case to its sanctions committee, which can impose administrative sanctions up to EUR1 million for companies, and EUR200,000 for their directors. It is worth noting that the AFA has the authority to refer any crime or misdemeanour it learns about during its inspections to the prosecutor, in accordance with Article 40 of the Criminal Procedure Code.

The AFA also contributes to the development of the anti-corruption doctrine. It issues recommendations and practical guidelines aimed at assisting companies in their compliance efforts. So far, the AFA has published two sets of recommendations on compliance programmes, the first set in December 2017 and the second on 12 January 2021. Though non-binding, these recommendations are of a persuasive authority. In its latest recommendations, the AFA adopted a three-pillar approach centred on:

• the involvement of executives and top managers (the co-called instance dirigeante) in disseminating a corporate culture consistent with anti-corruption requirements;
• a risk-based approach that is based on the company’s risk-mapping; and
• risk-management processes to prevent risks, detect potential misconduct and impose sanctions to repress misconduct.

The AFA has also published a significant number of specific guidance documents on various topics to assist companies with the implementation of their compliance programme. Examples include guidelines on accounting controls or a recent practical guide relating to patronage and sponsorship operations. The Authority has also issued sector-oriented guidance, for instance for sport federations and, in 2024, for entities in the health sector. More recently, in December 2024, the AFA also published an analysis of integrity-related case-law and two extensive summaries of relevant decisions. The AFA also works in conjunction with the PNF. For example, in 2023, the authority and the PNF published joint-guidelines regarding internal investigations essentially providing guidance on what is expected from companies conducting internal verifications into suspected breaches. 

The publication of these documents allows companies to have more visibility on what is expected of them regarding the measures that they should implement and the factors that will be taken into account when the AFA assesses the efficiency of their compliance programmes. They also provide useful guidance for non-mandatory policies that companies may want to implement to limit their corruption risks.

Move to a More Settled Justice System

Individuals found guilty of corruption can be punished by up to 10 years’ imprisonment and a fine of up to EUR1 million or twice the amount gained through the commission of the offence. For companies, these amounts are multiplied by five. Ancillary sanctions that can be imposed on companies found guilty of corruption notably include debarment, closure of the business, or exclusion from public procurement.

The Sapin II Law created a French-style deferred prosecution agreement (DPA), the so-called Convention Judiciaire d’Intérêt Public (CJIP), which was set up to encourage companies to settle corruption charges rather than going to trial. This mechanism allows a prosecutor to propose an agreement whereby a company will be fined, without an admission of guilt. By signing this CJIP, the company can avoid ancillary sanctions that might be imposed at trial. The fine provided for in the CJIP is proportionate to the advantage derived from the misconduct, up to 30% of the company’s average turnover over the past three years. The company may also be required to implement an anti-corruption programme under the monitoring of the AFA and to indemnify the identified victims of the offence. Since the enactment of Law No 2024-582 of 24 June 2024, the company may also be required to forfeit assets seized during the procedure. The CJIP must be approved by a judge during a public hearing. To date, more than 20 CJIPs have been signed and approved to resolve corruption or influence peddling charges. The most significant fine imposed on a company having signed such agreement exceeded EUR2 billion.

On 16 January 2023, the PNF issued the second version of its guidelines on the CJIP (the “Guidelines”). These Guidelines set forth additional details on the expected level of cooperation and on various factors that lead to decreasing or increasing the fine. The Guidelines also elaborate on certain key areas, such as initiation of the negotiation, confidentiality of the exchanges in this context, expectations in terms of co-operation, and co-ordination with overseas authorities.

Prosecution of Individuals: A Complex Issue

Contrary to the US DPA, the CJIP is only available to legal entities. Individuals, including the company’s directors, cannot enter such settlement. For individuals facing charges of corruption or influence peddling, the prosecutor can propose a guilty plea, the so-called comparution sur reconnaissance préalable de culpabilité (CRPC) as an alternative to trial. This is a settlement whereby the individual admits guilt and agrees to the prosecutor’s proposed sanctions (prison and/or fine). This settlement must be approved by a judge during a hearing. Before a recent reform, in the event of a refusal to approve, the prosecutor had no choice but to refer the case to the criminal court for a trial or to request the opening of a judicial investigation. This automatic return to a “classic” judicial scheme in the event of a failed CRPC often worked to the detriment of the accused. Firstly, the accused was deprived of the opportunity to have their case quickly resolved, as the CRPC procedure typically lasted no more than six months, compared to at least a year for a classic trial. Furthermore, the accused may have made statements or provided documents to the prosecutor as part of the CRPC procedure. Although the parties were prohibited from mentioning these before the criminal court or the investigating judge, the judicial authority was aware of the failed CRPC attempt. Lastly, if the accused risked a more severe prison sentence, as in the case of a CRPC, the maximum penalty could not exceed three years or half of the imprisonment penalty that would have been incurred at trial.

The structuring of CJIPs and CRPCs remains a sensitive and complex topic. In February 2021, a court ratified the CJIP concluded with a company but refused to approve the CRPC negotiated with several of the company’s executives. These individuals where thus referred to trial despite having admitted guilt during the negotiation of their CRPC. In this specific configuration, namely the simultaneous implementation of a CJIP for the company and a “guilty plea” for an individual, the refusal to approve the CRPC placed the individual in an even more delicate situation, as the judicial authority had potentially gathered numerous pieces of evidence in the context of the company’s co-operation. Besides the challenge of preparing their defence in this context, the person summoned before the criminal court also suffered from the publicity surrounding the CJIPs, which are always accompanied by a press release. This situation thus posed significant issues particularly regarding the accused’s defence rights. 

Things have recently evolved, with the enactment of Law No 2023-1059 on 20 November 2023. The prosecutor can now amend the settlement offer and seek approval from the judge a second time rather than going to trial or requesting an investigation from the investigating judge. This change, effective from 30 September 2024, indicates a shift towards a more negotiated justice.

Corporate Internal Investigations: A Key Step

With the deployment of a new anti-corruption framework, the added value of internal investigations conducted by companies is increasing. The aim of corporate internal investigations is to uncover and analyse facts in relation to, inter alia, integrity violations. While French law does not specifically govern internal investigations, labour, criminal and data privacy laws, as well as ethical rules, are frequently relevant and might significantly influence the conduct of such investigations. These norms are notably aimed at preserving the rights of individuals.

The AFA and the PNF also issued joint guidelines aimed at presenting their expectations in terms of internal investigations. As a matter of fact, companies are increasingly encouraged to co-operate with prosecution authorities (domestic or not) and share the conclusions of the internal investigation report and sometimes co-operate more efficiently with the authorities. It is worth noting that internal investigations reports drafted by attorneys are covered by attorney client privilege and thus companies are not obliged to share them with the French authorities.

Conclusion

The French anti-corruption framework has considerably evolved over the past few years. The Sapin II Law makes it mandatory for certain companies to implement robust compliance programmes to ensure their risks are properly mitigated. It also provides the prosecutors with tools to facilitate prosecution. Recent reforms indicate a trend towards a more settled justice system, as advocated by the PNF since the Sapin II Law entered into force. The publication of two sets of guidelines covering the CJIP procedure, combined with the latest legislative reform allowing the prosecutor to seek a second approval from the judge after a rejection of the CRPC are both evidence of this trend. While negotiated justice may pose significant challenges to the rights of individuals, it has sometimes proven to be more efficient than year-long trials.