There are several public registers that may be useful for identifying the asset position of another party prior to enforcement.
For instance, judgment creditors wishing to identify their debtor’s real estate assets in France may turn to the real estate registry (registre de la publicité foncière), which holds ownership information for real estate in France.
The register of commerce (registre du commerce et des sociétés) is available at www.infogreffe.com and identifies the directors of registered companies. The register also identifies the shareholders who are liable for the company's debts to an unlimited extent (Société civile immobilière and Société en nom collectif), and can be used to check the debt report (privileges and pledges) of a company and whether a corporation faces bankruptcy proceedings.
All French trade marks, patents, registered design applications and registrations are publicly available on the online databases of the French National Institute of Industrial Property (INPI).
In addition, as a matter of principle, court proceedings in France are public, and many trial court decisions are reported on www.legifrance.gouv.fr. It may therefore be possible to find useful information about a debtor by scrutinising judicial decisions.
Judgment creditors may also hire a private investigator to gather information on the debtor’s asset position.
If the information collected by the means listed above is incomplete and/or insufficient, there are other means by which a party can lawfully identify another party's asset position within France, by entrusting the task to a French bailiff (huissier de justice).
French law allows bailiffs to make information requests to a wide range of public bodies and bodies authorised by French law to hold deposit accounts (this is done along with access to the FICOBA registry, which is an inventory of all deposit accounts in France).
The bailiff is not allowed to request information from the presumed debtor’s employer.
Public bodies may only disclose the address of the debtor, the identity and address of his or her employer, or all third-party debtors or custodians of liquid or payable amounts, and a list of real estate assets.
Organisations authorised by French law to hold deposit accounts may only disclose whether one or more accounts, joint accounts or merged accounts have been opened in the name of the debtor, and where the accounts are held.
Normally, the information collected will be sufficient to identify the debtor’s asset position and enforce a judicial decision. Details obtained by the bailiff may not be disclosed to third parties, or even to the bailiff's principal.
Costs associated with these enquiries are fixed by statute.
Different types of domestic judgments are available under French law.
French scholars usually draw a distinction between judicial decisions that have become final after all rights of appeal have been exhausted or after the expiry of relevant time limitations, and those that have not become final.
In addition, a judgment may be contentious or non-contentious (jugement gracieux) – a contentious judgment settles a dispute whereas a jugement gracieux is rendered in non-contentious matters.
French scholars also make a distinction between judgments rendered by adversarial hearing (jugements contradictoires – ie, in the presence of both/all parties concerned and after both/all parties have presented their cases) on the one hand, and judgments assumed to have been rendered by adversarial hearing (jugements réputés contradictoires) and judgments rendered by default (jugements par défaut) on the other. Default judgments arise in circumstances where a defendant fails to appear before the court in a case brought by a claimant. Though not present before the court, the defendant is bound by the court's ruling and is subject to any sanction imposed by the court. To qualify as such, a default judgment must fulfil two cumulative conditions: the judgment must have been rendered in last resort, and the defendant must not have been served with the document that instituted the proceedings. A judgment will be réputé contradictoire if only one of these two conditions is fulfilled.
Another useful distinction can be drawn between the following:
The key distinction is between enforceable and unenforceable judgments. In principle, judgments will be enforceable after all ordinary rights of appeal have been exhausted or after the expiry of the relevant time limitations.
By way of exception and before Decree No 2019-1333 of 11 December 2019, provisional enforcement could be ordered at the request of the parties or sua sponte each time the judge deemed it appropriate and compatible with the nature of the matter, and where it was not prohibited by law. In addition, summary orders (ordonnances de référé), decisions containing provisional orders (mesures provisoires) governing the course of a proceeding, orders providing for protective measures (mesures conservatoires) and directions of the pre-trial judge (juge de la mise en état) granting an interim payment (provision) to a creditor were all enforceable provisionally by law.
Decree No 2019-1333 of 11 December 2019 reforming French civil procedure established that "First instance judgments are enforceable provisionally by law unless the law or the judgment handed down provides otherwise" (new Article 514 of the French Code of Civil Procedure). In other words, provisional enforcement is now automatic, and is attached to first instance judgments without need for the judge to order it. The decree thus reverses the rules previously in force in judicial proceedings, which required the claimant to request provisional enforcement to be ordered.
The principle of the provisional enforcement by law of first instance judgments is only applicable to judicial proceedings initiated on or after 1 January 2020, and:
In the event of an appeal, and if the judge of first instance has rejected the provisional enforcement by law of his or her judgment, a request may be made before the First President of the Court of Appeal or, when the matter is referred to him or her, to the Pre-Trial Judge of the Court of Appeal (Conseiller de la Mise en Etat), to ask for the reinstatement of the provisional enforcement by law (Article 514-4 of the Code of Civil Procedure). Three conditions must then be met:
An “enforceable judgment” is referred to in French legislation as a “titre exécutoire”. The term is not limited to enforceable judgments resulting from judicial proceedings. The following are considered to be the main titres exécutoires:
For the sake of simplicity, the concept of “enforceable judgment” set out hereafter will refer to enforceable judgments resulting from judicial proceedings.
A lawyer is generally instructed to organise and co-ordinate the enforcement process, and to represent the client during the enforcement proceedings, if there are any.
Act No 2019-222 of 23 March 2019 (known as the 2018-2022 programming and justice reform act) and Decree No 2019-1333 of 11 December 2019, which reformed French civil procedure, came into force on 1 January 2020. These new provisions entail very important changes and it is therefore advisable not to take any procedural steps without carefully checking the possible impact of the reform on these steps.
French law provides various options for enforcing a domestic judgment. The rules set out below aim to give an overview of the manner in which judgments can be enforced in France. They do not deal with special regimes, such as rehabilitation (redressement judiciaire) and liquidation (liquidation judidiciaire) proceedings or household over-indebtedness (surendettement des particuliers) proceedings, which trigger an automatic stay of enforcement against the debtor, subject to few exceptions.
At the outset, it should be underlined that, in principle, the enforcement judge (juge de l’exécution) has specific jurisdiction to deal with disputes arising between judgment debtors and creditors (on 25 March 2021, the Cour de cassation judged that the enforcement judge has jurisdiction to deal with disputes arising between judgment debtors and creditors only if a measure that constitutes actual enforcement of a judgment has been engaged on the basis of an enforceable judgment). A bailiff is in charge of taking any physical steps required.
That being said, a distinction must be drawn between the protective measures (mesures conservatoires) that are available to a creditor who has not yet obtained an enforceable judgment, and those measures that constitute actual enforcement of a judgment (mesures d’exécution forcée).
The various types of protective measures differ according to the nature of the assets to be attached. However, the general circumstances in which any protective measure is granted are very similar. Application is made to the enforcement judge, who in practice will be the president of the Tribunal Judiciaire in which the debtor is located. Application may also be made to the President of the Tribunal de Commerce, if the application deals with commercial matters and if proceedings have not yet commenced on the substance of the case.
Application to the enforcement judge will normally be made ex parte. The creditor must simply demonstrate the existence of his or her claim and the threat of non-recovery of said claim. In a simple debt collection situation, it is usual to present copies of all relevant invoices, together with a copy of a formal demand letter before action (mise en demeure), by recorded delivery post.
If the application is successful, the creditor must ensure that the bailiff serves notice of the protective measure on the debtor within three months of the judge’s order, failing which it is no longer effective. The creditor will be obliged to start proceedings to obtain an enforceable judgment within a period of one month from the date of enforcement of the protective measure. Failure to do so results in the automatic lapse of the measure. The low standard of proof required to obtain a protective measure and the nature of ex parte proceedings put the creditor in a strong position. Therefore, if the creditor fails to obtain an enforceable judgment, he or she may be liable for any damage suffered by the debtor.
The appropriate protective measure requested from the enforcement judge will depend on the nature of the debtor’s asset to be frozen. If the debtor is a company, every asset is at risk, whether movable or immovable, tangible (corporels) or intangible (incorporels). The position is very similar for an individual debtor, except for movable property that is necessary for general living or employment, which is not subject to attachment.
Protective measures can be divided into two categories.
The debtor may challenge these protective measures obtained by the creditor at any time, before the judge who granted the measure, particularly when the conditions for granting it were not satisfied from the beginning. The judge may order its discharge (mainlevée) or, upon the request of the debtor, may substitute any measure to the initial protective measure.
A creditor may also choose to obtain an enforceable judgment without having previously sought a protective measure and simply proceed to enforcement of his or her judgment against the debtor’s assets.
A creditor holding an enforceable judgment can instruct the bailiff to enforce payment to the creditor of sums owed by third parties to the debtor (saisie attribution). This attachment is executed by the bailiff notifying the third party that sums owed to the judgment debtor are to be paid directly to the judgment creditor up to the amount due, pursuant to the enforceable judgment. The third party is thereby forbidden from paying the debtor.
The procedure of saisie vente (not applicable to real estate property) involves several stages. First, a bailiff is instructed to serve the debtor with an order to pay the debt (commandement de payer). The bailiff then draws up an inventory of the property of the debtor, which has the effect of rendering the assets non-transferable. This process triggers a one-month period in which the debtor may, with the agreement of the creditor, organise the sale of the assets. In the absence of an agreement between the creditor and the debtor, a forced sale takes place following a public announcement, and control of the assets passes to a ministerial officer appointed for the sale. The proceeds of the sale, whether forced or not, will be paid directly to the creditor.
A judgment can be enforced against financial instruments to be attached by the bailiff on the issuing entity or its authorised agent, depending on the nature of the financial instruments and their form of management (saisie des droits d’associés et des valeurs mobilières). Once the attachment has been effected, all pecuniary rights attached to the financial instruments become non-transferable. The debtor can obtain the release of the attachment (mainlevée) by paying the relevant corresponding sum of money to discharge the debt secured by this charge.
The attachment of salaries (saisie des rémunérations) must also be mentioned as a way to enforce judgments but, in practice, this type of attachment is difficult to obtain in France due to the natural reluctance of the French courts to withhold his or her only source of income from a debtor.
In circumstances where the creditor has to enforce his or her judgment against the real estate of the debtor, he or she must seek a foreclosure of real estate (saisie immobilière). Traditionally, the forced sale of real estate is not perceived as a matter of priority, in view of its time-consuming process.
The length of the proceedings to enforce domestic judgments will depend on a wide range of factors, including the nature of the enforcement measure, how easy it is to determine the debtor’s assets, and the nature and location of the debtor’s assets.
It should be noted that, in the exceptional context of the COVID-19 health crisis, several laws have been passed in France, particularly with regard to the time limits for legal proceedings, including enforcement proceedings (Order No 2020-306 of 25 March 2020 on the extension of time limits during the health emergency period and the adaptation of legal proceedings procedures during this period, amended by Order No 2020-427 dated 15 April 2020 and supplemented by Order No 2020-560 dated 13 May 2020).
It was ruled that the time limits that expired between 12 March 2020 and 23 June 2020 were extended, from the end of this health emergency period, for the period that was legally required to act (but within the maximum limit of two months). Added to the limited access to judges during the health emergency period, this suspension of the time limits led to a significant slowdown in court proceedings.
Enforcement costs are subject to a scale of charges that establishes the remuneration owed to bailiffs for each enforcement measure. Under Decree No 96-1080 of 12 December 1996, the remuneration scale for bailiffs comprises fixed and proportional charges. As a matter of principle, the debtor must ultimately pay the major part of the costs of enforcing the judgment against his or her own assets.
When the information publicly available is incomplete and/or insufficient for determining the debtor’s assets, there are other means by which a creditor holding an enforceable judgment can lawfully identify another party's asset position within the French jurisdiction, mainly by entrusting the task to the bailiff charged with obtaining forced execution against the debtor’s property.
As a matter of principle, the debtor may challenge enforcement measures within one month of the date of service. The case must be filed with the enforcement judge, who generally rules within three to six months, after the parties have had the chance to file written briefs and appear in court.
The enforcement judge may exercise discretionary powers in favour of a debtor, including granting the debtor a period of up to two years to repay the debt.
Enforcement covers all proceedings permitting the carrying out of "enforceable" obligations against the debtor’s assets – eg, under French law, the obligations to pay, to do something or to refrain from doing something, and lastly to give or return. The basic principle in French law is that any creditor holding an enforceable judgment relating to one of these three categories of obligations may obtain forced execution against the property of the debtor.
Therefore, and broadly speaking, a judgment will not be enforceable if it remains subject to ordinary recourses, or if it is not provisionally enforceable by law.
It should also be emphasised that, since 2008, an enforcement action is time-barred ten years after the date of the judgment, as a matter of principle.
The documentation and analysis service of the French Supreme Court (Cour de cassation) has a database mainly containing the decisions and opinions of the Supreme Court and decisions of particular interest issued by other judicial courts. The database is publicly available under the conditions applicable to public service legal publications on the internet. Most of the published court decisions can be accessed via the Legifrance legal portal (www.legifrance.gouv.fr).
Judgments are part of the public record and there is no way under French law for a judgment debtor who has paid what is owed to remove the judgment from the above-mentioned database. Steps may be taken during the judicial proceedings to remove the names of the parties, but only in circumstances that rarely apply.
The three key conflicts private international law aims to resolve are those relating to jurisdiction, choice of law and the recognition/enforcement of foreign judgments.
There are three main types of law relevant to the enforcement of a foreign judgment:
France is a party to a large number of multilateral treaties (all of which are available on www.legifrance.gouv.fr), including the Hague Choice of Court Agreement 2005, and also to bilateral treaties.
Throughout the European Union, the primary tool used to enforce foreign judgments is the Brussels 1a Regulation (Regulation (EU) No 1215/2012 of 6 December 2012). This recast regulation has applied since 10 January 2015 and replaced Council Regulation (EC) No 44/2001 (the new Brussels I Regulation), which continues to apply to the recognition and enforcement of all judgments rendered in proceedings initiated before 10 January 2015. These regulations are supplemented by a number of other pieces of European legislation, as follows:
The relationship between the EU and Norway, Switzerland and Iceland is governed by a similar piece of legislation to the Brussels 1a Regulation: the Lugano Convention (the Convention on Jurisdiction and the Recognition and Enforcement of Judgments in Civil and Commercial Matters of the European Community with Iceland, Norway and Switzerland of 30 October 2007).
Variations in approach to the enforcement of foreign judgments may exist, depending on their jurisdiction of origin – eg, inside or outside the EU.
If the judgment falls within the scope of the Brussels 1a Regulation, there will be no need for the grant of “exequatur”. The Brussels 1a Regulation shall apply in civil and commercial matters but shall not extend, in particular, to revenue, customs or administrative matters, nor to the liability of the state for acts and omissions in the exercise of state authority. In addition, the Brussels 1a Regulation shall not apply to:
Because of this simplified approach settled by the Brussels 1a Regulation, judgments rendered in EU member states will be easier to enforce than non-EU judgments.
On 2 July 2019, the Hague Conference on Private International Law finalised a new treaty on enforcement of judgments: the Convention on the Recognition and Enforcement of Foreign Judgments in Civil or Commercial Matters (the 2019 Hague Judgments Convention).
The 2019 Hague Judgments Convention creates rules for the circulation of judgments, except in cases where there was a judgment produced on the basis of a choice of court agreement between parties to an international dispute, which are governed by the 2005 Hague Choice of Court Convention.
The definition of “judgment” in the 2019 Hague Judgments Convention covers any decision on the merits given by a court in the civil and commercial context, with some legal exceptions set out in the Convention (for example, there are certain subject matter exclusions, such as insolvency, intellectual property, privacy or certain antitrust matters). It should be noted that arbitration and related proceedings are excluded from the scope of the 2019 Hague Judgments Convention, as are judgments providing for interim measures of protection.
To be enforceable under the 2019 Hague Judgments Convention, the judgment must meet one of the jurisdictional requirements set out in the Convention (for example, relating to residency, consent to jurisdiction, place of performance of a contractual obligation or jurisdiction agreements). The 2019 Hague Judgments Convention also gives a list of limited grounds on which recognition or enforcement can be refused (including where, broadly, there was improper notice of the proceedings, where the judgment was obtained by fraud, or where recognition or enforcement would be manifestly incompatible with public policy), with it being specified that under no circumstances may a judgment given in a contracting state be reviewed as to its substance under the 2019 Hague Judgments Convention.
The Hague Conference press release describes the 2019 Hague Judgments Convention as a “gamechanger in international dispute resolution”, which will provide “better, more effective, and cheaper justice for individuals and businesses alike”, even if the effect of the 2019 Hague Judgments Convention is more limited than the Brussels 1a Regulation regime (recognition and enforcement can be refused on broader grounds under the 2019 Hague Judgments Convention, for example).
Nonetheless, it should be underlined that it will be some considerable time before the 2019 Hague Judgments Convention can apply. First of all, it will only apply between those countries that ratify it and bring it into force (approximately 12 months after ratification) and, even then, it will not apply unless the proceedings that led to a judgment were initiated at a time when the 2019 Hague Judgments Convention was in force for both the state of origin and the state where the judgment is to be enforced.
It is also worth noting that the 2019 Hague Judgments Convention provides for a number of circumstances in which a contracting state may make declarations that limit its application (for example, a state with a strong interest in not applying the 2019 Hague Judgments Convention to a specific matter can declare that it will not be applied to that matter). A contracting state can also refuse to have a reciprocal relationship with another contracting state. There are also provisions stating that the Convention will not affect the application of other treaties where certain criteria are met.
There are currently three signatory states: Israel, Uruguay and Ukraine.
As uncertainty continues regarding post-Brexit processes for enforcing court judgments across borders (on 4 May 2021, the European Commission published its assessment of the UK's application to accede to the Lugano Convention in a Communication to the European Parliament and Council, concluding that UK membership should be refused), if the UK and the EU27 sign up, it could also be a helpful fix regarding the enforcement of UK judgments in the EU27.
In the absence of an international convention between France and the country that issued the judgment, non-EU judgments shall be enforceable if the following conditions as set by current French case law are satisfied:
Under the Brussels 1a Regulation, a judgment issued in a member state that is enforceable in that member state shall be enforceable in other member states.
Subject to special regimes set out by bilateral or multilateral conventions, the legal framework under which a foreign judgment rendered outside the EU may be enforced in France is the French Code of Civil Procedure and the French Code of Civil Enforcement Procedures, supplemented by the relevant case law.
In practice, creditors seeking to recover a claim in France will seek an enforcement order (exequatur). To obtain an “exequatur”, the judgment creditor must summon the opposing party before the Judiciaire. The application may be made to the court of the opposing party’s domicile or the court of the place where the enforcement is sought. If the exequatur is granted, it will be done so by a single judge following the exchange of written pleadings and a hearing. Parties must be represented by a lawyer. The requesting party must provide a copy of the foreign judgment, together with a translation if needed. The French judge must make sure that the following conditions as set by current French case law are satisfied:
French courts may not review the merits of the foreign judgment. The exequatur may be appealed within one month of being served by one party on the other (or within three months for parties domiciled abroad).
Decisions rendered by the jurisdictions of EU member states are enforced in other member states following a simplified regime initially adopted by the Brussels Convention of 1968 (1972 O.J. (L 299) 32), later superseded by Council Regulation (EC) No 44/2001 (the New Brussels 1 Regulation), which was itself superseded by the Brussels 1a Regulation, which has been in force since 10 January 2015.
According to the Brussels 1a Regulation, once a judgment is obtained in any member state’s court, it must be readily recognised and enforced throughout the European Union. Therefore, the judgment creditor needs only to serve on the judgment debtor a copy of the judgment that satisfies the conditions necessary to establish its authenticity, accompanied by a certificate from the court of origin certifying that the judgment is enforceable, and containing details of the judgment (ie, a range of details on matters such as the issuing court, the names of the judgment creditor and judgment debtor, the date of the judgment, and what the judgment requires to be done), as well as a translation of the judgment if requested, before enforcing the judgment. The judgment creditor is then entitled to enforce the foreign judgment as if it were a French judgment. However, the French enforcement authority shall adapt any unknown measure or order contained in the foreign judgment to a domestic legal equivalent, with equivalent legal effects that pursue similar aims and interests.
For the purposes of enforcement in a member state of a judgment rendered in another member state ordering a provisional measure (including a protective measure), the applicant shall serve on the judgment debtor a copy of the judgment and the certificate containing details of the judgment, as well as a description of the measure, and certifying that the court had jurisdiction over the substance of the matter, and that the judgment is enforceable in the member state of origin. Where the measure was ordered without the defendant being summoned to appear, the judgment creditor must also provide proof of service of the judgment.
The cost and time to enforce foreign judgments will depend on whether the foreign judgment was given in an EU or non-EU jurisdiction. As previously stated, in the first case, a judgment creditor does not need to obtain an enforcement order, so enforcement proceedings will be quicker and less expensive than when a judgment creditor seeks to enforce a non-EU judgment. Indeed, the exequatur proceedings require the judgment creditor to be represented by a lawyer, and the procedure may take a few months at least before the exequatur is obtained.
The cost and time to enforce both EU and non-EU judgments will depend on a wide range of factors, including in particular the nature of the enforcement measure, how easy it is to determine the debtor’s assets, and the nature and location of those assets.
Instructing a competent local bailiff and a competent local lawyer experienced in foreign judgment enforcement is a key consideration in seeking the enforcement of foreign judgments in France, and increases the probability of effective collection, in terms of both cost and time.
The Brussels 1a Regulation does not deprive the judgment debtor of the right to seek suspension of or to challenge the EU judgment via an ordinary appeal in the member state of origin, nor to challenge the enforcement of the judgment in the member state where it is sought.
If the judgment is successfully challenged in the member state of origin, this could neutralise the original judgment. However, this possibility does not affect the presumption of the Brussels 1a Regulation that the original judgment – when presented in the member state where enforcement is sought – is entitled to receive both recognition and enforcement, even if the enforcement court has the discretion to wholly or partially suspend the enforcement of a foreign judgment if it is challenged in the member state of origin.
The Brussels 1a Regulation exhaustively sets out the exceptional grounds that, when present, prevent the recognition and hence the enforcement of a foreign judgment in the member state where the request is made, as follows:
Non-EU judgments may be challenged if the court that initially rendered the judgment did not have jurisdiction over the case, or if the judgment is incompatible with French international public policy or was procured by fraud. The exequatur may be appealed within one month of the date of the service by one party on the other (or within three months for parties domiciled abroad).
In 1981, France enacted a decree on arbitration, which successfully consolidated its position as the leading country in international commercial arbitration. A new decree on French arbitration law came into effect on 1 May 2011 and is seen as strongly establishing France's will to maintain its leading role in international commercial arbitration and its aim to have arbitrating parties continue to select Paris as their seat of arbitration.
France is also a party to the New York Convention, which entered into force in France on 24 September 1959 and deals with the recognition and enforcement of arbitral awards, but specifically provides that it shall not apply when the legislation of the state where the recognition or enforcement of the award is sought is more favourable to recognition and enforcement than the New York Convention, which is the case under French law.
As will be seen hereinafter, the recognition and enforcement of arbitral awards may be refused on only a few grounds, making it typically far easier to enforce an arbitral award than a non-EU court judgment.
The enforcement of arbitral awards involves the very important preliminary question of whether an arbitral award should be characterised as an international or a domestic award. Articles 1487 et seq of the Code of Civil Procedure apply to the enforcement of domestic (ie, French) arbitral awards, whereas Articles 1514 et seq apply to the enforcement of international arbitral awards, covering foreign awards and awards rendered in international matters in France and abroad.
Despite the slight differences of regime between international and domestic awards, French law and French courts are generally considered as pro-arbitration, and decisions denying the enforcement of awards are quite rare.
As previously stated, French arbitration law takes a pro-enforcement position regarding the recognition and enforcement of arbitral awards. Therefore, it is possible, for instance, to obtain recognition and enforcement in France of interim or partial awards. It may also be possible to obtain the recognition and enforcement in France of foreign awards granting non-monetary relief (eg, an order requiring a party to produce documents). An international award rendered outside France (whether international or domestic) that is set aside in the place of arbitration may also be recognised and enforced in France.
Finally, the main limit to the recognition or enforcement of arbitral awards is that the award must not be manifestly contrary to public policy considerations.
Under the Code of Civil Procedure, an arbitral award must be followed by an enforcement decision (exequatur) obtained through ex parte proceedings in order to be enforceable or recognised in France.
French arbitration law does not expressly provide for a limitation period applicable to the commencement of legal proceedings for the enforcement of awards. However, the French Civil Code provides a five-year limitation period that generally applies to personal actions, and should be considered to apply to the filing of legal proceedings for the enforcement of domestic awards in France. There is a debate concerning whether the limitation period may apply to the enforcement of international awards in France, but there is no specific case law on this issue.
The provisions pertaining to the recognition and enforcement of a domestic arbitral award are set out in Article 1487 et seq of the Code of Civil Procedure. First, the party seeking to rely upon the arbitral award must be able to prove the existence thereof. This is a basic requirement and will be easily satisfied upon production of the arbitral award itself, together with the arbitration agreement. The second condition to the recognition or enforcement of the arbitral award is that it must not be manifestly contrary to public policy. Therefore, a domestic arbitral award may be enforced by virtue of an exequatur from the Tribunal Judiciaire in whose jurisdiction the arbitral award was given, and the party wishing to enforce a domestic arbitral award shall produce the original award, together with the arbitration agreement, or duly authenticated copies of such documents.
A judgment granting an order of exequatur is not subject to any review. A judgment refusing an order of exequatur is subject to appeal within one month of service (or within three months for parties domiciled abroad). A successful appeal against the award will result in its revocation by the Court of Appeal so that the award becomes unenforceable in France.
An international arbitral award shall be enforced in France on the same conditions provided for domestic awards – ie, if the party relying on it can prove its existence and if such recognition or enforcement is not manifestly contrary to international public policy. As with domestic arbitrations, an international arbitral award may be enforced by virtue of an exequatur from the Tribunal Judiciaire in whose jurisdiction the international arbitral award was given, if it was given in France. If the arbitral award was given in a foreign country, it may be enforced by virtue of an exequatur from the Paris Tribunal Judiciaire. A party wishing to enforce an international arbitral award shall produce the original award, together with the arbitration agreement, or duly authenticated copies of such documents. All these documents must be translated into French, by a certified translator, if requested.
An appeal against an exequatur must be brought before the Court of Appeal within one month (or three months for parties domiciled abroad) from the date of proper service of the exequatur.
When it comes to enforcing an arbitral award against the assets of a debtor in France, the governing legislation is the law on civil enforcement procedures described above.
As stated above, because of the minimal checks necessary to obtain an exequatur of an arbitral award, whether domestic or international, the costs incurred in the related proceedings may not be great, even if the award creditor is represented by a lawyer. As a matter of principle, the party wishing to enforce an international arbitral award must produce the award together with the arbitration agreement translated into French, so the fees of a certified translator should be taken into account. It may take only a few weeks to obtain an exequatur of an arbitral award.
The cost and time to enforce arbitral awards will depend on a wide range of factors, including in particular the nature of the enforcement measure, how easy it is to determine the debtor’s assets, and the nature and location of those assets, especially with foreign awards.
Service of the arbitral award is significant under French law, as this will determine the time period for exercising any rights of recourse against the arbitral award.
Only ordinary recourses are dealt with below: applications for the revision of an arbitral award (recours en revision) and applications by which third parties may challenge an arbitral award (tierce opposition) will not be addressed hereinafter.
Regarding domestic awards, an appeal (if the possibility of such a recourse has been agreed between the parties) or an action for setting aside must be brought before the court of appeal in whose jurisdiction the arbitral award was issued. These recourse actions are admissible as soon as the award has been given, until the end of a one-month period starting from the service of the award (or three months for parties domiciled abroad). Appeals and actions for setting aside are brought, managed and determined according to common French rules governing procedure in contentious matters before the Court of Appeal. There are six grounds on which the Court of Appeal may deny the enforcement of a domestic arbitral award, as follows:
It should be underlined that, in principle, parties are deemed to have waived their right to subsequently rely on any irregularities which they knowingly, and without legitimate reason, refrained from raising before the tribunal. This is not limited to procedural irregularities, but also applies with respect to all of the available grounds to set aside an award, with the exception of public policy grounds.
Appeals and actions to set aside a domestic award lead to a suspension of enforcement, unless the award has been rendered with the provisional enforcement.
Regarding international arbitral awards, whether obtained in France or abroad, the time period for applying for the arbitral award to be set aside is one month following service of the exequatur (or three months for parties domiciled abroad). There is no possibility to challenge an international award without an exequatur. Therefore, there is no preventative recourse, contrary to domestic arbitration. The procedure for setting aside an arbitral award relies on commonly applicable civil procedures under French law. There are five grounds on which the Court of Appeal may deny the enforcement of an international arbitral award, as follows:
The notion of international public policy has been interpreted by French case law in terms of French public policy requirements, and not as truly international public policy. In particular, the Paris Court of Appeal has stated that "international public policy means our conception of international public policy, that is to say, the entirety of the rules and matters of fundamental importance which the French legal system requires to be respected even in situations of an international character."
French courts allow only a minimal review of objections on the grounds of international public policy, and will not enquire whether the decision in the award infringes a rule of public policy of some other state. Judicial review may be exercised only in the case of manifest infringement. The review may be limited to the “effective and concrete” character of the alleged violation.
However, the current position of the Paris Court of Appeal, which recently introduced the concept that “serious, accurate and consistent” clues giving effect to an international arbitral award would lead to a violation of international public policy, reveals a tendency to a deeper assessment of international public policy. For instance, French courts have considered that the failure of the arbitrator to comply with a European rule of law if this rule is imperative and effectively applicable to the case infringes the French concept of international public policy. Equality of arms (in the context of the right to a fair trial) also belongs to the French international public order. French courts have also considered that the recognition and enforcement of an award that would give effect to a contract induced by fraud would infringe the French concept of international public policy. More generally, arbitral awards that would give effect to illegal activities, such as money laundering, infringe the French concept of international public policy, according to French courts. Recently, the Paris Court of Appeal recalled that the French concept of international public policy covers both substantive and procedural public policy.
Ultimately, it should be emphasised that the new French arbitration law that came into effect on 1 May 2011 provides the possibility for a party to enforce an international award notwithstanding a pending action to set aside or a challenge to enforcement. Accordingly, an exequatur of an international arbitral award granted by the Tribunal Judiciaire is provisionally enforceable as of right, whereas previously actions to set aside or appeals against an exequatur of an award led to a suspension of enforcement. However, the person against whom enforcement is sought and who challenges the enforcement may request a temporary stay of enforcement, if such enforcement could severely prejudice his rights.
It should also be noted that the grounds for denying enforcement of an international arbitral award under French law are almost the same as those provided in the New York Convention. The only difference under French law is that French courts do not refuse or stay enforcement of a foreign award simply because a challenge against the award has been sought in a foreign court, or because a judgment of a foreign court has set aside or annulled the award.
The French enforcement system has its own dynamic and is constantly improving; it might also depend on external factors, including politically, with the COVID-19 crisis and Brexit being perfect examples thereof.
Within Europe, Brexit highlights the importance of each country’s system of enforcement of judgments. Following Brexit, UK judgments no longer benefit from automatic recognition within the European legal system. The fallout was anticipated only to a certain extent before Brexit – for example, with respect to International Swaps and Derivatives Association (ISDA) master agreements.
Until recently, the most widely used standard contract for derivatives and swaps by ISDA was subject to English law and the jurisdiction of the English courts. In July 2018, two new ISDA master agreement standards were set forth, subject to French and Irish law. The French legal standard, chosen as a practical solution for civil law countries, is subject to the jurisdiction of the newly established French international courts, both at first instance and at appeal levels to deal with international contracts, including contracts between non-French parties. This new development is directly related to Brexit and the French system of recognition and enforcement of judgments.
Given the stakes attached to enforcement, French law has created a stable system where creditors have the right to enforce a judgment recognised by law that is subject to constitutional protection. This right to enforceability echoes European jurisprudence and regulations which, in general, have a solid influence on the French legal system for the recognition and enforceability of judgments.
The system of enforcement of judgments has recently been heavily affected by the consequences of COVID-19. This does not affect the main trends relating to the impact on foreign judgments.
French Law: Trend to Extend Recognition and Enforceability of Foreign Judgments
Under Regulation 1215/2012 dated 12 December 2012, also known as the Brussels I bis Regulation, judgments in civil and commercial matters rendered within an EU member state enjoy automatic recognition and enforceability in France. Furthermore, these judgments are directly enforceable on French territory without any specific formality. The same applies to the enforceability of French judgments within the EU. Rules similar to the EU regulation have been applied, in part, to most EFTA member states by the Lugano Treaty dated 30 October 2007. However, under this convention, enforceability is still subject to a declaration.
In theory, there are a few available defences that can impede the enforcement of foreign judgments within the EU, but these are limited to issues such as public policy, failure of service and situations where the judgment in question is irreconcilable with an earlier judgment. However, these defences are very limited and difficult to bring in the absence of exequatur orders prior to enforcement.
In contrast, and subject to a bilateral treaty with France, the enforcement of foreign judgments issued outside the scope of Brussels I bis or the Lugano Convention are subject to exequatur orders from the relevant French court.
The UK submitted a formal application in April 2021 to join the Lugano Convention after Brexit. The European Commission expressed a negative opinion on this application in May 2021. Until this situation changes, and subject to the potential application of the Hague Convention of 30 June 2005, this means that UK judgments will be required to go through the normal French exequatur procedure before they can be enforced in France.
To obtain exequatur, a party must fulfil conditions set by the French courts to evaluate foreign judgments, which have become more liberal and less restrictive over the years.
The exequatur must now meet three conditions:
Under French international public policy, the French courts exercise more limited control than under domestic policy. Examples of international public policy requirements include the following:
Although limited, the additional steps related to exequatur involve additional time and risks, which may be prejudicial to the creditor. Furthermore, a party objecting to recognition and/or enforceability has the right to bring a claim before the relevant French court if the foreign judgment does not meet the requirements for recognition or enforceability.
Recent Variations to the Scope of Immunity
Foreign judgments rendered in tax, administrative and criminal matters cannot be subject to exequatur, and certain international or public bodies benefit from immunity. Foreign heads of states, as well as foreign diplomats/agents and international organisations, enjoy a certain measure of protection against enforcement measures.
A new law was enacted on 9 December 2016 to increase this level of protection. Conservatory or enforcement measures against a foreign state are now subject to specific authorisation from an enforcement judge in the Paris civil court and are limited to certain occurrences, one of which is the explicit consent of the foreign state.
Specific provisions were adapted for hedge funds, where measures relating to assets belonging to a foreign state may not be enforced by a French judge if one of the following conditions is fulfilled:
Public bodies (the French state, public and local authorities as well as public establishments) also enjoy immunity, but can be ordered to pay a pecuniary penalty if they do not execute a judgment.
If a local authority fails to execute a judicial decision ordered by the French state, subject to the control of the competent judge and various other conditions, necessary measures may be taken, including the sale of the local authority’s assets if said assets are not deemed necessary to the operation of the local authority.
A judgment dated 5 September 2019 handed down by the Paris court of appeal on the basis of these new provisions has provided valuable information on the new regime of immunity from enforcement.
In simplified terms, the Paris court of appeal implemented a new balance between the state and the creditors that is:
This ruling is part of a movement to find the right balance between the respective interest of the states and those of the creditors.
Enforcement Measures: the Efficiency Objective of the Latest Reforms
There are three main categories of enforcement measures:
These enforcement measures may only be taken against the debtor’s assets and not against the person themselves, except on strictly limited occasions. The creditor has the right to choose the type of enforcement measure, depending on the nature of the assets to be attached.
The reforms of recent years have:
The most recent reform simplifies the rules of court organisation by providing for an additional transfer of competence in favour of the enforcement judge, who is now responsible for the specific procedure related to the attachment of remunerations (decree dated 11 December 2019). The efficiency of the property seizure was improved by the increase of the validity period of certain steps taken by the claimant for payment (decree dated 27 November 2020).
Nevertheless, this trend towards increasing the powers of the enforcement judge raises the question of the relationship with the substantive judgment. The power of the enforcement judge to examine enforceable titles cannot allow him or her to question titles that have the force of res judicata. However, the enforcement judge has powers of interpretation, which may be extensive in certain cases.
The most recent reforms (resulting from a law for the 2018–2022 planning and reform of the justice system dated 23 March 2019) illustrate the approach of French legislators, which is to improve the efficiency of the system on an incremental basis based on the evolution of economic and technological trends and the experience of the practitioners.
As an example, the law has transferred, in part, the management of seizures of real assets and salaries from the courts in charge of salary seizures to the French state bank (caisse des depôts et consignations) when seizure is sought by several creditors. This reflects a trend in French procedure: the transfer of certain duties of the court to third parties, thus allowing the court to focus on its essential duties. In the same vein, the secretary of the enforcement judge will have the role of allocating the amount of remuneration seized, in lieu of the judge.
Impact of Digital Transformation
The French system continuously introduces laws that recognise the use of digital tools to implement enforcement measures. For example, the notification of a judgment by a bailiff – a prerequisite step before every enforcement action – may be executed electronically, but only with the debtor’s express agreement. This specific requirement explains why electronic notification is rarely used.
A law of 23 March 2019 imposed the use of electronic acts in matters relating to the seizure of bank accounts. Electronic acts are also used to seize vehicles through notification to the public authority in charge of vehicle registry, thus preventing the sale of vehicles that are subject to judgments.
Extension to the EU Territory
The efficiency objective of the French system extends to European territory. For example, the French courts have ruled that the seizure of an account held by a French bank also extends to accounts managed by its European branches.
Complementary Ways to Enforce Judgments Available under French Law
The rights of creditors to obtain the enforcement of a judgment have been strengthened through various additional measures, as follows:
Balance between Enforcement and Protection of Debtors
French law concurrently acts to protect the debtor against measures that do not respect the debtor’s fundamental rights (such as the right to dignity and privacy) and the special status of bailiffs – professional officers appointed by the Minister of Justice, who enjoy public authority prerogatives to enforce judgments and are governed by mandatory rules and a code of ethics. These debtor rights have been applied in several ways, as listed below.
Enforcement of Judgments Suspended by Insolvency Proceedings
Under French law, judgment enforceability and enforcement measures are suspended and/or prevented by the automatic stay attached to the opening of an insolvency proceeding. This principle applies to all creditors – secured and unsecured. Except in a few limited cases, the suspension will continue to apply until the closure of the insolvency proceedings and thereafter.
This (particularly strong) protection of the debtor is aimed at preserving the continuity of the debtor’s business and preserving equality between the creditors. However, in practice there is a limit to the level of enforceability applicable to corporations and self-employed professionals. To some extent, individuals also have their own protections, which are comparable to insolvency proceedings through the French legislation on over-indebtedness.
Enforcement of Judgments Suspended by Criminal Seizures
A law of 9 July 2010 provided a new powerful tool to prosecutors and investigating judges: the possibility to order seizures during criminal proceedings. Those seizures may apply to any asset that could be subject to confiscation by the criminal court in the case of a trial (bank accounts, movable assets, property, shares, etc).
Assets may be seized not only if they have a link to the alleged offence – being the object or the product of this offence, or a means used to commit the offence – but also if they are equivalent in value to the alleged offence. Those seizures may be ordered at any stage of the criminal proceedings and are possible upon judicial order when sufficient evidence has been collected to establish an offence, before any judgment from the criminal court on the substance.
Such criminal seizures have been increasingly used over recent years, and suspend or prevent any civil enforcement measure on the concerned asset until its withdrawal or confiscation. According to recent case law, this even applies to assets that are included within the scope of an insolvency proceeding.
The creditor who initiated an enforcement procedure before the criminal seizure is deemed to have a security on the seized asset.
Subsequently, if retaining the seized asset is no longer necessary under criminal legislation, a creditor with an enforceable title related to a due claim may be judicially authorised to initiate or resume a civil enforcement procedure on this asset.
Frozen Assets in an International Context
Funds or other types of assets located in France may be frozen by a foreign judicial order or by the effect of an international or foreign regulation, especially for international sanction purposes. The question arose under French law as to whether such sanctions prohibit third party creditors from taking any conservatory measures on the frozen assets, which includes carrying out conservatory seizures or taking security interests.
In July 2020, in a matter relating to Iranian banks whose assets were frozen in accordance with a European regulation, the French highest civil court referred the question to the EU Court of Justice, as to whether conservatory measures may be taken by third-party creditors without the prior approval of the relevant national authority as required by the European regulation for any measures that have the effect of transferring the ownership of assets. The French highest court noted that while conservatory measures do not have any such effect, they still modify the “destination” of the assets.
In another matter, where a court in Cyprus issued an injunction against French companies to not dispose of any of their assets subject to criminal and civil sanctions, the French highest civil court decided in October 2018 that conservatory measures could be authorised by a French court, notwithstanding the injunction. Among other reasons, the court noted that this injunction – which may be considered as a provisory and conservatory measure under Cypriot law aimed at preventing the debtor from organising its insolvency – did not render the assets “unavailable” and is thus compatible with conservatory measures taken by another creditor under French law.
Impact of the COVID-19 Crisis on French Procedures
The current global health crisis has made it difficult to strike a balance between the public health imperative, the protection of the rights of litigants and the predictability of the rules of procedure.
In an attempt to reconcile continuity of public service and the physical closure of the courts, the French government was empowered to issue numerous legal reforms of a temporary and exceptional nature, particularly those of 27 March 2020 and 20 May 2020. Faced with a triple imperative of pragmatism, legal security and simplification, the rules have been adapted for the courts in non-criminal matters, particularly with regard to procedures. In this context, temporary measures have been taken (eg, the enforcement freeze, the limitation of forced executions carried out by bailiffs, the adaptation of the courts and the reinforcement of the dematerialisation).
These measures were withdrawn with the improvement of the public health situation. However, certain measures are still in place and will likely be maintained on a permanent basis, such as the possibility for a debtor to obtain the suspension of enforceability measures through the opening of pre-insolvency proceedings called “conciliation”, which allows the debtor to preserve its activities and assets without entering into a true insolvency proceeding. Subject to various conditions and limits, the suspension may give the debtor the same protection against enforcement measures as a true insolvency.
Practical Lessons from the Recent Developments
The enforcement of judgments in France offers various rights to creditors, which are regularly enhanced by French legislators, albeit limited by the situation (financial and otherwise) and the protection of the debtor. This was the case before the COVID-19 crisis, and continues to be the case during and thereafter.
Creditors are encouraged to proactively define a strategy adapted to the French jurisdiction; this may be implemented in advance, even before an enforceable judgment is rendered (eg, choice of appropriate jurisdiction when possible, use of conservatory measures, use of securities, etc).