The main provisions concerning environmental protection are included in the French Environmental Charter and the French Environmental Code.

Please note that there are additional implementation provisions that have not been codified in the French Environmental Code and that the mining regulation is provided by the French Mining Code (not covered in this chapter).

Key Policies

A main aspect of French environmental law relates to classified facilities regulation. An industrial or agricultural facility that could have an impact on the environment is usually subject to this regulation.

French law lists the activities that are subject to regulation (nomenclature) and establishes thresholds for declaration, registration or authorisation regimes – for further discussion, see 4.2 Environmental Permits/Approvals. The regulatory authorities may impose requirements on regulated facilities or activities. A similar regulation provides that an activity affecting waters (surface waters and groundwater) can be subject to declaration or authorisation from the relevant authorities. Those authorities may impose some requirements on regulated activities.

Another main aspect of environmental regulation concerns waste management. The governing principle is that waste producers or owners are legally responsible for collection, elimination and recycling.

Key Principles

The French Environmental Charter enshrines the fundamental principles of environmental protection at a constitutional level. Indeed, this charter contains important principles such as the precautionary principle, the right to live in a healthy environment, the right to environmental information, the duty not to harm the environment, the duty to preserve the environment and repair the damage ‒ but also the “polluter pays” principle. The prevention principle is also included in this charter. In addition, the charter sets out the principle of sustainable development as a central objective of public policies.

Additional principles are defined in the French Environmental Code and embody legal concepts such as the principle of participation, which allows affected people to express their opinion on a project with potential environmental impacts. Another key principle is “non-regression”, which implies that measures protecting the environment can only be improved with regard to constant scientific progress and shall not be reduced.

In France, the key regulatory authorities are the Ministry for Ecological Transition and Territorial Cohesion (Ministère de la transition écologique et de la cohésion des territoires) and the prefects of departments (local subdivisions of the French regions), who directly represent the Ministry at a local level. The missions of the Ministry for Ecological Transition and Territorial Cohesion mostly involve the drafting of environmental regulatory provisions.

Prefects of departments, meanwhile, are responsible for issuing orders or authorisations relating to the activity of regulated facilities and for ensuring compliance with regulatory requirements. In carrying out these functions, prefects rely on local administrative services such as the Regional Directorates for the Environment, Planning and Housing (Directions Régionales de l'Environnement, de l'Aménagement et du Logement, or DREAL) in the region, as well as the Departmental Directorate of the Territories (Direction Départementale des Territoires, or DDT) ‒ all of which participate in the local implementation of the national policy. At a local level (communes), mayors also exercise environmental-related enforcement (eg, waste law).

The Energy and Climate Law (Loi Energie-Climat) of September 2019 specifies the role of the Environmental Authority (Autorité Environnementale), which is the advisory body concerning projects that are likely to affect the environment. Its role is to give an opinion on the quality of the environmental impact assessment (see 4.2 Environmental Permits/Approvals). The Environmental Authority shall remain totally independent and be different from the authority in charge of delivering the permit. In this context, a decree was adopted in July 2020, making the prefect of a region the official authority in charge of case-by-case decisions (ie, when the environmental impact assessment is not automatically applicable).

Finally, other specific agencies play a role in some defined sectors – for example, the Nuclear Safety Authority (ASN) or the Regional Health Agency (ARS).

In 2019, one large agency was created regarding all biodiversity matters: the Office Français de la Biodiversité (OFB). This law of July 2019 aims to better protect biodiversity by merging under a single agency all the services responsible for the preservation of French ecosystems.

Globally, local-level authorities may work together to deal with an environmental issue that has, for example, sanitary implications ‒ as they may be complementary. Specifically, the Inter-Services Mission for Water and Nature (Mission Inter-Services de l'Eau et de la Nature, or MISEN) is an authority whose goal is to facilitate coherence in enforcing and financing actions for the implementation of water and biodiversity policies. The MISEN includes various regional authorities such as the DREAL, the Regional Directorate of Food, Agriculture and Forestry (Direction Régionale de l'Alimentation, de l'Agriculture et de la Forêt, or DRAAF), the DDT and the OFB, among others. The MISEN operates under the authority of the prefect in each department.

Additionally, the Operational Committee to Combat Environmental Crime (Comité Opérationnel de Lutte contre la Délinquance Environnementale, or COLDEN), created in September 2023, is an authority that develops and implements strategies that mobilise the full range of administrative and legal levers to combat environmental crime. The COLDEN may impose both administrative and criminal sanctions. The COLDEN gathers a wide range of stakeholders ‒ for example, magistrates, public prosecutors, the DDT, the DREAL, the OFB, and the national police ‒ and operates under the authority of a prosecutor.

The protection of environmental assets in France is mainly governed and organised by the French Environmental Code, which groups together the laws and regulations governing environmental protection. The French Environmental Code protects the natural heritage ‒ ie, all fauna, flora, geological, soils, mineralogical, paleontological and ecological resources.

The French Environmental Code is divided into several “books” and chapters, each dedicated to a particular asset ‒ for example, Book II is dedicated to the physical environment and covers the protection of water and aquatic and marine environments (Title 1) and the protection of air and atmosphere (Title 2). Book III is dedicated to natural areas, Book IV is dedicated to natural heritage, and Book V is dedicated to the prevention of pollution, risks and harmful behaviours or substances.

These provisions apply to all French territories, including land, fluvial and marine territories.

On top of the rules gathered within the French Environmental Code, certain rules laid down by EU regulations ‒ and, more occasionally, by international treaties ‒ also apply to the protection of environmental assets. Recent examples include the Treaty of the High seas signed in the United Nations General Assembly at the end of September 2023.

Violating environmental protection rules can lead to three different types of sanction: administrative, criminal and civil. The administration plays the role of regulator in environmental protection and can impose numerous obligations, with penalties for non-compliance. For the same offence in which the administration intervenes, criminal sanctions may also be imposed, and the offender may be held civilly liable. By way of example, in the emblematic case of the Erika, the companies involved were sanctioned on all three levels.

Under French law, the environmental authorities have investigative and access powers with regard to environmental incidents and breaches of law/permits. They have both administrative and criminal enforcement rights.

Administrative Inspections

The French Environmental Code provides conditions under which administrative inspections can be performed. During such inspections, the administrative authority has several powers regarding access to the facility and documents. The 2019 OFB Law gives additional powers to environmental inspectors, who are authorised to take samples and place them under seal. The new European Public Prosecutor, Environmental Justice and Specialised Criminal Justice Law of December 2020 has extended their competence even more.

If irregularities are found during the inspection, the administrative authority can impose sanctions. After the inspector’s visit, the operator receives a copy of the report and thus becomes aware of the case against them and can respond to the prefect. Operators must receive a formal notice requesting them to comply with the law. Before actual sanctions are taken, the operator is given the chance to comply.

The 2019 OFB Law has introduced a new criminal offence. If an operator, who has conducted their activity without authorisation or certification, is ordered to take remediation measures in the context of the cessation of their activity and does not respect this order, the sanction might result in a two-year prison sentence and a maximum fine of up to EUR100,000.

Negotiated settlements are not allowed under French law. Authorities cannot agree to either reduce sanctions or decline to bring an enforcement action in their role as administrative police.

Criminal Investigations

Criminal investigations are accomplished by regulatory authorities in the case of a breach of environmental law. In the event of a criminal investigation, the inspection performed is similar to the administrative procedure but the prerogatives of the inspector are extended – for example, they may conduct identity checks.

Similarly, the inspector issues a report to the prosecutor and remains (along with the prefect) at the prosecutor’s disposal for further investigations. By way of example, the inspector may question the operator on behalf of the prosecutor. Since the OFB Law, environmental inspectors are also able to collaborate with other police services on a given case, while remaining entirely autonomous in their investigations. Since December 2020, these environmental inspectors have the same powers as judicial police officers for the judicial investigations they lead.

Environmental permits may be required, depending on the project. The classified facilities nomenclature and the water activities nomenclature provide categories and thresholds that determine the legal framework applying to the project (declaration, registration and authorisation for classified facilities; declaration and authorisation for water activities). Facilities with the highest environmental risks fall under a special category, determined by the Seveso Directive (high or low rank) and require specific controls and prescriptions.

An environmental authorisation (ie, a permit) is required for activities that materially affect protected interests listed in the French Environmental Code – namely, nature and the environment, water, health, safety, agriculture, historical monuments and archaeological heritage.

Since March 2017, all the procedures necessary for projects subject to authorisation under the classified facilities regulation or the water regulation have been merged into a single environmental authorisation. This environmental authorisation thus covers other specific authorisations when they are required for the project (eg, land-clearing activities, derogation for destruction of protected species, and greenhouse gas emissions allowances). However, the building permits are not included in this broad authorisation and instead are issued separately.

The French Environmental Code provides the criteria and procedures to obtain the permit.

• First, the declaration regime simply requires reporting the facility to the regulatory authorities before the implementation of the activity. As of 1 January 2021, the procedure must be completed entirely online.
• Second, some facilities must submit an application in order to be registered by the regulatory authorities. As of 1 May 2022, the registration can be submitted online. Under those two regimes, the administrative authority can order additional prescriptions on the projects if deemed necessary.
• Third, some facilities must file an authorisation application, which is reviewed by the regulatory authorities. Construction projects or any intervention in the natural environment that are likely to have significant effects on the environment or human health must undergo an environmental impact assessment.

The Environmental Impact Assessment Directive sets criteria and thresholds integrated in French law and determines whether the projects are likely to have notable consequences. Projects with a potential impact on the environment must undergo either a systematic environmental assessment or an assessment after a case-by-case review, depending on certain thresholds.

After a public inquiry, regulatory authorities issue the authorisation with prescriptions or refuse it with justifications. In order to appeal permitting decisions, it is mandatory to lodge a claim before the administrative court within two months following the permitting decision for the operator and within four months for interested third parties.

Finally, a law of 2019 has introduced the concept of “industrial platform” (Plateforme industrielle) in the French Environmental Code. This legal innovation does not create a new category of permits, but rather provides a new legal framework for a concentration of facilities within the same restricted geographical area that exercise similar activities and thus can pool the administration of some goods and services required for their activity. From an environmental point of view, the pooling of their devices enables the facilities to reduce their waste production and energy consumption and to optimise safety checks.

The French Parliament recently adopted a “Green Industry” law, which aims to shorten the deadlines necessary to obtain the environmental permit. It may also bring changes to the current regimes (further detailed in 4.3 Regulators’ Approach to Policy and Enforcement).

Since 2017, the French political approach regarding environmental policy and enforcement has been in favour of simplifying procedures for facility’s operators. Indeed, the French government created the “environmental authorisation” in 2017 (see 4.2 Environmental Permits/Approval). Its most important goal is to improve the efficiency of project authorisation procedures for operators, reduce the time required for obtaining an authorisation and, at the same time, limit the number of disputes that may arise in connection with a single project. This procedure has not only improved the process for industrial petitioners but also case examination and public access to environmental information.

In the same spirit and as part of the development of low-carbon energy production sectors, a law was passed in March 2023 concerning the acceleration of renewable energy production. Additionally, a second law was adopted in June 2023 relating to the acceleration of new nuclear facilities construction.

Finally, an October 2023 law relating to the Green Industry encourages procedural simplification. The main provision of this law is the simplification of the environmental authorisation procedure. Public consultation will be led alongside the examination of the application file by the environmental authority, so as to reduce the period of issuance of the environmental authorisation by half. Additionally, exceptional procedures are introduced for industrial projects of major national interest (projets industriels d’intérêt national majeur, or PIINM), identified by decree. There will be a faster compatibility of local planning documents, building permits will be issued by the State rather than by local authorities, and exemptions from restrictions posed by protected species will be facilitated.

The regulators’ approach is also in favour of strengthening waste management, following a law that was passed in 2020 in order to reinforce extended producer responsibility and circular economy mechanisms. Regulators are also focusing on improving knowledge of polluted sites and soils, the effectiveness of remediation measures, and the attractiveness of the areas where these sites are located. 

Under French law, an environmental permit can generally be transferred. The change in the permittee is contingent upon the declaration by the new permittee to the regulatory authority within three months following the transfer.

While most permits can be transferred through a simple declaration, the transfer of the environmental authorisation for facilities requiring financial guarantees (landfilling, quarries or some other polluting activities) must be authorised by the prefect. The new operator must file an application for the transfer in order for the regulatory authorities to review the financial guarantees. If the authority authorises the transfer, it may impose additional prescriptions or requirements.

Finally, a procedure for the partial transfer of environmental authorisations was introduced in 2021, thereby enabling a permittee to transfer part of its site to one or more other beneficiaries, who will then hold new and separate environmental authorisations. This possibility is subject to strict conditions – namely, the transfer must not adversely affect interests protected by environmental law and the responsibilities of the beneficiaries must be clearly divisible.

Both criminal and administrative sanctions punish the breach of permitting requirements.

Firstly, if one runs a facility without an environmental authorisation, the criminal sanctions include a one-year prison sentence and a maximum fine of EUR75,000. If the offender is a corporate entity, this maximum fine is multiplied by five.

Secondly, the regulatory authority may:

• require, by issuing a formal notice, compliance with the regulation within a time limit; and
• then impose administrative sanctions on the offender.

In addition to the suspension of the facility’s activity, the regulatory authority may hold a deposit until the required work is completed. The authority can also have the prescribed measures carried out automatically, in place of the person summoned, and at their own expense.

To ensure that the measures will be fully implemented, the regulatory authority can impose a maximum fine of up to EUR15,000 or a daily penalty payment of up to EUR1,500 until compliance is achieved. According to the 2021 Climate and Resilience Law, the sanction can be more severe when a risk of harmful and lasting harm to the environment results from this offence.

Under French law, three types of liability can be imposed on operators and polluters.

Administrative liability (also called environmental liability) is imposed by regulatory authorities on operators of facilities or activities subject to environmental laws and regulations. The regulatory authorities evaluate the damage and the measures taken to prevent or mitigate it in order to determine liability.

Civil liability in environmental matters occurs for torts or negligence resulting in pollution. The causal link between the harmful event and the damage has to be proven and may result in the award of compensatory damages. Besides, the French Civil Code embodies the ecological prejudice reparation concept, codifying the Erika case resolution (see 11. Civil Liability).

Additionally, it is possible to be held liable for environmental damage under contractual liability. Such liability would likely arise in land purchases where a seller retains important information regarding the facility and the industrial history of the land (see 16. Transactions).

Criminal liability applies to both individuals and corporate entities. The head of a company may be criminally liable for the actions of the company. Sanctions can include imprisonment or a criminal fine. The 2021 Climate and Resilience Law introduced new environmental offences, notably:

• a general offence of environmental damage, sanctioned by a five-year prison sentence and a EUR1 million fine;
• an uncontrolled waste-dumping offence, sanctioned by a three-year prison sentence and a EUR150,000 fine; and
• an “ecocide” offence, introduced in cases of voluntary environmental endangerment and sanctioned by a ten-year prison sentence and a EUR4.5 million fine.

Two more offences now sanction the endangerment of the environment when caused by the breach of a formal notice. The sanction is a three-year prison sentence and a EUR250,000 fine.

If there is a threat of a persistent damage to the environment, the operator of a classified facility must report to the regulatory authorities the nature of the threat, the preventive measures that the operator implements, and their effects. In case of damage, the operator must inform the authorities without delay, in addition to taking any measures to end the causes of the damage and limit its aggravation as well as its impacts on human health and ecological services.

The regulatory authorities must address a formal notice to the operator in the event of non-disclosure or incomplete disclosure of these pieces of information. Upon expiry of the period determined by the regulatory authority in its formal notice and without any reply from the operator, the regulatory authority will proceed with sanctions such as the payment of a fine of up to EUR15,000.

Administrative obligations and liability for historical incidents or damage may be transferred from one operator to another if the new operator is conducting the same activities. Therefore, the new operator will be liable for the pollution relating to the continued activity even if they were not the operator at the time the pollution originated.

Liability for pollution from the former operator that is unrelated to the continued activity is not transferred. The landowner cannot be liable for historical environmental incidents or damage, except under specific circumstances. In that regard, if none of the aforementioned former stakeholders can be identified, the owner of the contaminated land may be liable if their negligence or participation in the pollution can be proven.

The French Environmental Code provides for at least three reporting requirements in the event of environmental incident or damage.

First, the operator of a classified facility must declare, as soon as possible, to the Classified Facilities Inspectors any accidents or incidents arising from the operation of its facility that are likely to affect the environment.

Second, in application of the “polluter pays” principle, in the event of a damage to the environment, the operator (ie, for this purpose, any natural or legal person – public or private – who exercises or controls a profit-making or non-profit-making economic activity on a professional basis) must immediately inform the administration authority and take measures to put an end to the causes of the damage as well as to prevent or limit its worsening and its impact on human health and ecological services.

Third, regarding activities that specifically affect water, any person aware of any incident or accident that endangers the safety of the public and the quality, circulation or conservation of water must inform the mayor and the prefect as soon as possible.

Administrative Liabilities

When the classified facilities regulation applies, the prefect may order any administrative measure necessary to address a threat to the environment. Similar provisions are applicable under the water regulation or to any type of environmental damage supervised by a regulatory authority.

State’s liability

Interested third parties (eg, neighbours of a classified facility) may seek the state’s legal responsibility for the lack of action taken to protect the environment. Public authorities can elude liability if they demonstrate that they have conducted the necessary checks to ensure the facility’s safety.

More generally, there is an overall tendency to seek state liability for its inaction or insufficient action regarding environmental protection. By way of example, the Administrative Supreme Court found the State liable in several landmark cases concerning the insufficiency of the measures enshrined in the Protective Atmospheric Plan, whereby the State was ordered to pay a penalty of EUR10 million for every six months of inaction.

Civil liability

The key concepts of civil liability include “disturbances of the neighbourhood” and “control over the things under one’s guard” (see 11.1 Civil Claims). The French Civil Code also sets out the ecological prejudice reparation concept and provides that any person who causes an ecological prejudice must repair it.

A corporate entity may be liable for environmental damage or breaches of environmental law when acts of negligence or faults are demonstrated. Under French criminal law, the liability of the individual does not exclude the liability of the corporate entity. The maximum fine for a corporate entity is five times the sanction for an individual.

The European Public Prosecutor, Environmental Justice and Specialised Criminal Justice Law of December 2020 provides the option for corporate entities whose actions have harmed the environment to pay a public fine, within the framework of an environmental judicial agreement (Convention Judiciaire d'Intérêt Public, orCJIP). Moreover, the same law has created a specialised court (juridiction spécialisée) in charge of environmental disputes.

As regards the interaction between corporate law and environmental law, a 2019 law entitled Plan d'Action pour la Croissance et la Transformation des Entreprises (“Loi PACTE”) prescribes that any decision related to the company management must take into account corporate social responsibility (CSR) and environmental considerations.

Voluntary firms may explain their “reason for being” to justify what they can bring to customers in a competitive market. Besides, companies should be mindful of their advertising duties, as the 2021 Climate and Resilience Law imposes rules on greenwashing.

Nearly 40 environmental taxes generate more than EUR50 billion revenues in France. The main taxes are as follows.

TGAP

A company that has a polluting activity or uses polluting products is subject to the General Tax on Polluting Activities (Taxe Générale sur les Activités Polluantes, or TGAP).

Companies are subject to this tax if their activity involves the storage, treatment, or transfer to another country of hazardous waste or non-hazardous waste.

The TGAP tackles polluting emissions, washing products and extracted materials. As such, if the company’s activity involves the delivery or the use of extracted materials or washing preparations, they are subject to this tax. Companies that emit one of 18 polluting substances are also subject to this tax .

Taxes on Air Pollution

The bonus-malus system for automobiles aims at changing the fleet to the lowest emitters of CO₂ vehicles by increasing the price of diesels (and, to a certain extent, oil motors) and by encouraging the production and number of electric cars. An ordinance of July 2023 transposes the new EU framework governing road pricing for heavy goods vehicles planned for the European Collectivity of Alsace. It also enables regions and departments voluntarily to introduce an eco-contribution system for heavy goods vehicles.

In addition, certain emissions of industrial origin (eg, polluting air emissions from classified facilities that exceed certain thresholds) are also subject to the TGAP.

Taxes on Water Pollution

The tax policy on water pollution is implemented through water agencies. It aims to limit water pollution and covers, for example, the emission of pesticides by taxing companies that discharge polluting products in a watercourse (categories and thresholds listed in the French Environmental Code).

Taxes on Waste

Finally, the “incentive pricing” (TI, TEOMI, REOMI) consists of linking the amount of the household waste collection tax to the quantity (volume or weight) of waste produced. The aim is to raise awareness among waste producers of the need to reduce waste overall, as well as reducing the quantities of unsorted waste sent to landfill or incineration.

French law does not directly provide for incentives or penalties for “good” or “bad” environmental behaviour. However, the French Ministry announced in September 2023 that a bonus-penalty system would be used as a tool to improve collection and recycling rates for plastic bottles. The bonus-penalty system would be imposed on local authorities, as they are in charge of the selective collection of household packaging (including plastic bottles).

As of 2010, the French Environmental Code provides that a parent company may be held financially liable for the remediation measures of contaminated land if it wrongfully contributes to its subsidiary’s bankruptcy.

Under the French Commercial Code, certain companies have to include a non-financial performance statement in their annual management report. The obligation to publish such a statement falls on companies with more than 500 employees, as well as on listed companies with total assets of EUR20 million or a turnover of EUR40 million and non-listed companies with EUR100 million in total assets or a EUR100 million turnover.

The statement must tackle environmental and societal issues such as climate change, social commitments to sustainable development, and the circular economy. Listed companies must also add to their statement pieces of information concerning their activity’s effects on human rights and the fight against corruption and tax avoidance.

In January 2024, ESG requirements will be modified and extended according to the EU Corporate Sustainability Reporting Directive of 2023. A March 2023 law authorised the government to transpose this directive into French law by ordinance.

In France, environmental audits are used in a wide variety of operations. Although the situations an environmental audit covers are varied, European Regulation No 1221/2009 provides that it is a “systematic, documented, periodic and objective evaluation of the environmental performance of an organisation, management system and processes designed to protect the environment”.

Environmental audits are often used by companies following the detection of an anomaly or following the occurrence of an incident or accident on an operating site.

In France, there is no general obligation for companies to carry out an environmental audit but certain circumstances imply performing one. By way of example, an environmental audit is often required:

• prior to the purchase of land, an industrial building or a factory; or
• in the event of the acquisition of a brownfield or the transfer of remediation obligations.

Directors and other officers can be held personally liable for environmental damage or breaches of environmental law committed by the company if the offence was the result of their personal conduct (neglect or fault in causing the offence) or if it can be shown that they had personal knowledge of the offence and did not act accordingly. This standard is not specific to the environmental area.

The individual’s level of authority is not taken into account when finding them liable, but rather the fact that they were acting in the capacity of a company’s representative or acting on the company representative’s instruction or delegation. In the latter situation, the judge will carefully examine the scope and regularity of the delegation or representative’s instruction.

The penalties for environmental offences range from a fine of up to EUR100,000 to a prison sentence of up to two years. Additional penalties, such as prohibition from doing business in a similar area for a time period of up to five years, may also be imposed.

Global liability insurance for company directors can cover defence expenses and damages arising from civil procedures (thus including environmental matters) and can sometimes benefit the spouse and/or inheritors or legal representatives. Criminal fines are not covered by liability insurance. The company will be the signatory of the insurance contract for the benefit of all natural persons likely to be held personally responsible and therefore who had, have or will have an executive or representative position in the company or in its subsidiaries.

In France, environmental insurance may be purchased specifically to cover any type of contamination or nuisance (detailed further in 12.2 Environmental Insurance). However, French law does not impose any obligation on operators to purchase an environmental insurance.

Almost all environmental risks can be covered by environmental insurance, except for:

• environmental damage resulting from identified contamination prior to signing the contract;
• chronic contamination due to the operator’s activity; or
• damages resulting from a lack of maintenance of the facility.

Financial institutions and/or lenders can be held liable for damages arising from projects they fund, depending on their level of involvement and their awareness of the risks. The same liability regime applies to financial institutions as to any corporate entity.

Furthermore, the French government has demonstrated its will to promote green finance by launching Greenfin, a label that aspires to be the first state certification for green finance. This certification aims at ensuring transparency and the environmental involvement of financial products.

Since financial institutions and/or lenders’ liability is not specific to environmental project funding, these entities should be aware of the risks taken in becoming involved in their borrower’s projects and of the level of involvement. The more involved a lender or financial institution is, the more likely it is to be held liable for a damage or breach, including environmental damage or breach.

This is why thorough due diligence is necessary (see 18.1 Environmental Due Diligence). In this respect, the 2019 Energy Climate Law requires investment companies to include in their policies information about the risks associated with climate change and biodiversity.

As mentioned in 6.3 Types of Liability and Key Defences, some of the key concepts of civil liability applied to the environment are “disturbances of the neighbourhood” and the “control over the things under one’s guard”.

The former provides that no one should cause excessive damage to their neighbourhood, even if an environmental permit authorises the industrial activity. However, the theory of “prior occupation” applies under certain conditions ‒ ie, one could not bring claims over a nuisance that already existed prior to their occupation of the neighbouring site.

The second concept provides that a person may be held liable for the harms caused by the things under their effective control. Moreover, the French Civil Code provides for tortious liability, which may impose an obligation to repair the damage resulting from wrongful acts or negligence.

Finally, since 2016 the French Civil Code states that anyone who causes environmental damage can be held liable and be obliged to repair it in kind. If impossible, the reparation ought to be pecuniary. This provision incorporates what is referred to as a “pure” environmental damage, meaning that it is no longer necessary to prove the violation of a “human interest” ‒ for example, financial loss, physical injury, or property damage.

Under French law, exemplary or punitive damages cannot be awarded. This category of damages would be a violation of the principle of full compensation of prejudices. Indeed, the French judge must contribute to the repair of the full extent of prejudice caused.

A 2016 law created the possibility of group actions. The French Environmental Code states that a group action is possible when several people in a similar situation suffer from an environmental damage, caused by the same person and with a breach in legal or contract-based duties as its common origin. Such legal action may seek the cessation of the violation and/or the reparation of the damage.

Environmental “approved associations” (which is a specific status) can lead a group action. Approved associations working for the defence of those who suffered physical injury damage or defending an economic interest may also do so.

The landmark case establishing civil liability for environmental damage was the 2012 Erika case concerning the oil spill caused by the sinking of a tanker. In this case, in addition to criminal liability, the court recognised the legal concept of an ecological prejudice for the first time.

Climate litigation is currently increasing considerably and this trend is certainly going to assume greater importance in years to come. Gradually, liability regarding climate change and global warming is being sought more and more – for example, the French State has been found liable for its lack of climate action.

In addition, the fire at the Lubrizol chemical products plant and warehouse in September 2019 will surely become a major civil and criminal case. It is already giving rise to a governmental action plan for the prevention and the management of industrial risks, as well as generating regulatory changes in terms of the prevention and management of accidents on hazardous sites (see 17.1 Self-Reporting Requirements).

Finally, an important decision has been issued concerning transnational water pollution. The judge found an operator liable for causing environmental damage and fined him more than EUR9 million vis-à-vis a foreign state.

It is possible to transfer or apportion liability for incidental damage or breaches of law through a contract between two private parties. Such private contract does not affect private parties’ potential liability to regulatory authorities.

The last operator of a classified facility may transfer its administrative liability through an “interested third party” (tiers demandeur) that conducts remediation under the provisions issued by the regulatory authority. This results in the transfer of the last operator’s liability to the purchaser. The operator has a residual liability if the third party cannot fulfil its new obligations.

Environmental insurance contracts are available for events that can occur in the course of operating activities, including events causing ecological prejudice. There is also a special insurance for historic pollution, but it only covers currently unidentified pollution and is yet to be further developed in France.

First, one of the key laws governing contaminated land in France is the classified facilities regulation. This regulation addresses the contaminated land obligations in the context of the cessation of activity.

There is no definition of contaminated land under French law. However, a 2017 French methodology provides criteria in order to determine the environmental condition according to which a site shall be managed.

The general approach taken by regulatory authorities is a risk-versus-use approach (the sanitary conditions of the site must be compatible with the use of the site through a Human Health Risk Assessment) and respect for the interests protected by the French Environmental Code.

Remediation is mandatory at the end of the facility operations. Remediation goals are made in a manner consistent with the expected future use of the site. If the future use is most frequently an industrial use, a different use can be suggested by the operator, regarding the planning regulation. Usually, the mayor (le maire) and the landowner (if different from the operator) are consulted on the use suggested by the operator to the prefect. Several operators can be held responsible for parts of the remediation where different activities have generated pollution on the same site.

Secondly, on sites where pollution occurs or might occur as a threat to the public health or safety, the regulatory authority may implement the necessary remediation works at the expense of the person responsible for the remediation. The regulatory authority may also charge a deposit until the remediation works are finalised.

Therefore, when remediation has been carried out properly, the person who changes the use must provide measures to manage the pollution so as to ensure that the land is compatible with public safety or health. Additionally, consultancy firms are increasingly involved in cessation of activities procedures. An August 2021 Decree developed their involvement as consultancy firms now have to deliver several certifications for the operator of an industrial site in order to prove to the regularity authorities that they complied with their requirements.

A December 2022 Decree defines eight types of use for the management of polluted soils and also defines the concept of change in use. The uses range, among others, from industrial to residential, outdoor recreational, agricultural or renaturation use.

Traditionally, the last operator of an industrial site would only be responsible for the remediation that was necessary to allow the safe operation of continued industrial uses, while a person seeking to change the use of the site would be responsible for the additional remediation needed to permit the change of use. As detailed in 6.3 Types of Liability and Key Defences, when neither the last operator or stakeholders can be identified, the owner of the land may be held responsible if their negligence or participation in the pollution can be proven.

Each operator is liable for the impacts of the activities of the facilities that they have operated, as well as for the impacts caused by the operators whom they succeed in the same activity. If impacts on a same site come from different activities, the administration must identify each operator as far as it is concerned (see 6.1 Liability for Historical Environmental Incidents or Damage).

The rules governing locus standi require that a legal action must be useful to the plaintiff. More precisely, people affected by a contaminated land must prove that they have a direct and personal interest to bringing proceedings against polluters/landowners/occupiers and that this interest is also legitimate, born and present. Associations, for their part, must prove that the contamination directly affects the interests they have set out to defend, in accordance with their statutes.

The application of these requirements may vary depending on the courts (civil, administrative or criminal). However, the requirements are generally considered to be broadly construed and easily met.

Waste regulation does not apply to contaminated land anymore, except for the provisions addressing the waste present on the site or the excavated soils. The key laws governing waste management in France come from an EU Directive that was incorporated in the French Environmental Code (see 16.1 Key Laws and Regulatory Controls).

In France, following an environmental accident, a classified facility’s operator must report to the Classified Facilities Inspector and the prefect. The report must analyse the causes of the accident and the effects and consequences of the latter on the environment and on the population. The operator must also report the measures undertaken to prevent any similar future accident or incident and also report measures carried out to overcome the accident’s impacts in the medium to long term.

Public prosecutors play a special role in investigating environmental accidents. If the public prosecutor decides to pursue the case, the victim or complainant are informed and an investigation may take place. Besides, the OFB may investigate a site and fine offences. Criminal investigations are carried out by the OFB under the authority of the public prosecutor.

On top of that, the French Environmental Code provides that a technical investigation may be led by the Office for Investigation and Analysis of Industrial Risks on its own initiative or as required by the Ministry for Ecological Transition and Territorial Cohesion. The investigation aims to improve the security of the site and to prevent future accidents, without determining potential liabilities. On the basis of the investigation, the Office for Investigation and Analysis of Industrial Risks drafts security recommendations. The operator has two months in which to respond with concrete measures that will improve the security of the industrial site. The investigation is published, albeit with anonymised data and testimonies.

France is involved in international climate negotiations within the framework of the United Nations Framework Convention on Climate Change (UNFCCC).

In 2015, France hosted the 21st Conference of the Parties (COP21), which resulted in the Paris Agreement. Key policies, principles, laws and case law relating to climate change in France largely derive from this legal framework. At the national level, the Climate and Resilience Law of August 2021 states that France aims to respect the reduction goals set in the Paris Agreement.

Key Policies

Reduction of atmospheric concentrations of greenhouse gases in order to prevent dangerous anthropogenic interference with Earth’s climate system is considered as a national priority. This goal is implemented through sectoral policies and global targets for the reduction of greenhouse gas emissions. France aims to cut its greenhouse gas emissions by 50% by 2030, compared with 1990 levels.

Key Principles

To meet the objectives of the Paris Agreement and the commitments to greenhouse gases reduction made by France through its Intended Nationally Determined Contribution (INDC), the French Climate Plan unveiled in 2018 sets the goal of carbon neutrality by 2050. The Climate Plan is divided into several focus areas: thermal renovation, clean mobility development, and the encouragement and promotion of a circular economy. It also aims at achieving carbon neutrality by 2050 through banning new hydrocarbon exploration projects and reinforcing green taxes. The national low-carbon strategy 2 (SNBC 2) in force today includes the same objectives defined by the 2018 climate plan.

Key Laws

Key laws relating to climate change are the 2009 Grenelle II Law and the 2015 Energy Transition for Green Growth. In 2019, the Energie Climat law (discussed in 2.1 Regulatory Authorities) introduced the concept of “ecological and climate emergency” in the French Energy Code.

The 2021 Climate and Resilience Law has introduced new sets of climate policies on food, work and production, transport, housing, and criminal law matters. This law also established the objective of zero net artificialisation of the soil, which aims at slowing the pace of urbanisation, in favour of natural areas. Many decrees were taken in 2022 to implement this law.

The EU Emissions Trading Scheme (EU ETS) was implemented in 2005 is the EU’s main instrument for reducing greenhouse gas emissions. The recent reform of the scheme is part of the “Fit for 55” package, a set of proposals to revise and update EU climate, energy and transport legislation, which will contribute to achieving the EU’s climate objectives of reducing net greenhouse gas emissions. In France, this European system is transposed via the National Quota Allocation Plan (Plan National d'Affectation des Quotas, or PNAQ). It defines the greenhouse gases emission quotas allocated to more than 1,300 plants by the State. The current PNAQ is in its fourth phase, from 2021 to 2030.

Legal goals are determined by the French Energy Code, which contains a legal target for greenhouse gas emissions reduction of 40% between 1990 and 2030. For 2021–30, the Government has issued a series of objectives aiming at reducing greenhouse gas emissions by 43% (by comparison to 2005 levels), with a particular focus on aviation and industry. In order to involve every sector, thematic working groups, composed of actors from different sectors such as sport, transport or industry, were created in September 2022 to discuss the reduction of their energy consumption. The goal is also to reach carbon neutrality by 2050.

The Environmental Code provides for a series of reduction objectives contributing to the overall objective of reducing greenhouse gas emissions (especially regarding energy consumption).The 2019 Energie-Climat law sets a reduction by 40% of the consumption of fossil energy by 2030, and anticipates the shutdown of the four remaining coal-fired power plants.

However, the context of the war in Ukraine threatens the security of energy supply, forcing France to reopen coal-fired power plants. Nevertheless, in September 2023, the President renewed his campaign promise to convert the two remaining coal-fired power plants into biomass plants by 2027.

Exposure to asbestos is widespread and is the most common cause of workplace death in France.

Use of asbestos and all products containing asbestos is strictly forbidden in France subsequent to a decree issued in 1996.

Protection measures for the general public against asbestos range from organising research and monitoring of the state of conservation of buildings containing asbestos, to setting out the rules in connection with responsibility of building/apartment owners, and organising the communication of technical documentation between participants (landlords, construction companies, lessors, etc).

The Labour Code also provides a set of rules to protect workers from inhaling asbestos in the course of their normal work activities in direct connection with asbestos products (dismantling or handling).

Physical harm or injury does not have to be established for a claim in damages. Since 2010, French courts recognise the existence of a specific anxiety prejudice for workers who have been exposed to asbestos during the time of their past work activities and who are expecting a possible diagnosis of an asbestos-related illness.

The key laws governing waste come from an EU Directive on waste management, which was incorporated in the French Environmental Code. Their main principles and objectives are to limit the production and the toxicity of future waste at their source, to organise waste management so as to be respectful of the self-sufficiency and proximity principles, to add value to waste through recycling and to proceed to the disposal of waste as a last recourse solution. Therefore, there is a hierarchy in waste management.

Traditionally, the person responsible for waste management is either the waste producer or the waste holder.

The mayor is the regulatory authority for the application of the waste regulation, except if the waste is subject to the classified facilities regulation (where the prefect is competent).

A February 2020 law made circular economy a priority, through improving waste recovery and recycling, and undermining planned obsolescence. This law also provides further duties for producers: there will be a global prohibition of the destruction of unsold products in order to preserve resources.

This law also introduces a deposit return scheme in order to increase recycling and significantly reduce the amount of waste. An ordinance of July 2020 (transposing EU directives) complements this law, aiming to broaden the exit from waste status and to strengthen the management of biowaste. A law of November 2021 plans the recycling of digital sector products.

Any waste producer or waste holder is responsible for the waste management until its final disposal or recycling, even if the waste is transferred for treatment to a third party. Indeed, the person responsible for the waste has a legal obligation to ensure that the person to whom they deliver it is authorised to take charge of it and will comply with the applicable regulations. The waste producer or waste holder may not contractually exhaust their regulatory liability, but they can obtain an indemnity from the waste hauler or treatment facility.

In a 2023 decision, the Administrative Supreme Court ruled that the person collecting and transporting wastes on behalf of third parties cannot be qualified as a producer or holder of wastes under environmental law unless they acted with negligence. This means that the environmental liability for the disposal of waste, assigned to the transporter or collector, remains with the producer or consignor.

The French Environmental Code has provided for the principle of extended producer responsibility (responsabilité élargie du producteur, or REP) since 1975. The responsibility reverts to the producer of the product, the manufacture of which ultimately results in the creation of the waste.

Approximately 30 sectors are now regulated. Producers usually have to pay an eco-contribution in order to fulfil their REP obligation. The Anti-Waste and Circular Economy Law (la loi anti-gaspillage pour une économie circulaire, or AGEC) of 2020 has created nine new REP sectors, including building materials, cigarettes, toys, sport and handiwork equipment. In addition, a penalty is established for producers that do not meet the prevention and management objectives.

The 2020 legislation has also launched a system of economic bonuses and maluses to encourage more environmentally friendly methods of production ‒ for example, the use of recycled materials and renewable resources, the durability, reparability and reuse of products, as well as the reduction of hazardous substances in the process. This system will apply to every product that belongs to a REP sector.

The law also extends the existing obligation of the manufacturer to take back an old device, free of charge, when the consumer buys a new one. This obligation also applies to online commerce. Also, from January 2023, companies that put waste-generating products on the national market will have to inform consumers about the environmental qualities and characteristics of these products.

The operator of a classified facility must report to the regulatory authorities incidents or accidents that were caused by the facility’s operation and that may harm the protected interests listed in the French Environmental Code. The report must address the circumstances and causes of the incident or accident, its consequences on people, and the measures taken to avoid a similar incident or accident and to neutralise its long and medium-term effects.

Since the Lubrizol incident (see 11.4 Landmark Cases), much has been carried out to improve crisis management and information within facilities in which dangerous substances could be the cause of major accidents. A September 2020 decree aimed at improving the prevention and the management of industrial risks is one such example.

For activities that affect water, the mayor and the prefect must be informed as soon as possible by any person aware of any incident or accident that endangers public safety or the quality, circulation or conservation of water (see 6.2 Reporting Requirements).

Under French law, the public has the right to obtain environmental information from public authorities and bodies. This principle applies to every interested person and to all public and private bodies in the name of environmental public service, to the extent that it is not sensitive information (classified, public security, etc) and that it is related to environmental matters.

Specific activities (waste, high industrial risks, contaminated lands, etc) are regulated by particular provisions.

The Géorisques website enables the public to be informed about both natural and technological risks. Indeed, the site combines several databases, such as the Information Zone on Soils (Base des Sols Pollués, or BASOL) for classified facilities. Thus, this website aims to provide the general public with information on the historic pollution of a given land and to guarantee the absence of sanitary and environmental risks for future land uses.

Under the French Commercial Code, some corporate entities are obliged to annually disclose information concerning the entity’s corporate and social responsibility (CSR) engagement to their shareholders. This includes management of the social and environmental consequences of its activity.

Furthermore, the Duty of Vigilance Law of 2017 creates an obligation for the parent company to implement a “vigilance plan”. It applies to two kinds of companies:

• companies headquartered in France that employ, for two consecutive years, at least 5,000 employees in the parent company and in its direct and indirect subsidiaries headquartered in France; and
• companies headquartered in France that employ, for two consecutive years, at least 10,000 employees in the parent company and in its direct and indirect subsidiaries headquartered in France and abroad.

The plan aims at controlling the corporate entity’s activities and preventing significant breaches in environmental or human rights regulations. Since January 2020, several major French companies have been subject to claims brought by NGOs challenging the climate-related aspects of their compliance plans. Moreover, one NGO is publishing a comparative legal study of the plans of 25 multinationals with ranks and marks since 2020.

The EU Sustainable Finance Disclosure Regulation (SFDR) and the EU Taxonomy Regulations both apply in France. France is also required to transpose the EU Corporate Sustainability Reporting Directive (see 7.5 ESG Requirements).

As of 2021, the SFDR imposes mandatory ESG disclosure obligations for asset managers and financial market participants. The SFDR aims to help investors by providing transparent information about the extent to which financial products take social and environmental features into account.

The 2020 EU Taxonomy Regulation is also applicable in France. Taxonomy reporting must take place annually, in the non-financial statement or in a separate report until 2024 and in the management report from 2025 onwards. Among other things, this taxonomy enables companies to demonstrate their commitment to the low-carbon transition and enables investors to have a better understanding of the risks and opportunities of their investment portfolios.

To go further, French legislator has also adopted specific obligations in the frame of Energy Climate Law. Article 29 of the 2019 Energy Climate Law entered into force in 2021, at the same time as SFDR EU Regulation. It modified a provision of the monetary and financial code in order to state that portfolio management companies must include information on the risks associated with climate change and biodiversity. Portfolio management companies must also make available to their clients and to the public a document setting out their policy on the inclusion in their investment strategy of environmental quality criteria and the means implemented to contribute to the energy and ecological transition, as well as a strategy for implementing this policy.

Environmental due dilignce is typically conducted on M&A, but is less frequent for financial and real estate transactions.

In general, environmental due diligence is highly recommended. It is particularly important when a classified facility is included in the deal, as the environmental due diligence is the only way to identify the compliance issues regarding every environmental regulation and the liabilities issues in connection with contaminated lands.

An environmental due diligence performed by a purchaser typically ensures that the seller complies with applicable environmental regulations. In the case of a classified facility, the environmental due diligence will also check the possession and validity of the permits and licences required for the activity, as well as the fulfilment of the prescribed conditions. The buyer will also check the legal implications of the different identified risks and contingencies.

Environmental due diligence would typically include at least a Phase 1 report that relates to compliance and historical activities on the facility. The Phase 2 report (site investigations) is generally recommended. It would attempt to verify the environmental condition of the site based on actual testing of soil and/or groundwater.

When it comes to land acquisition, the French Environmental Code provides that the seller must inform the purchaser via a written statement that a classified activity used to operate on the site. The landowner must also inform the potential buyer of any danger or harm resulting from the previous facility operation.

When the seller is also the facility’s operator, the contract must demonstrate that the seller provided information concerning whether or not the facility’s operation led to the use or storage of hazardous substances.

As regards M&A transactions, there is a general duty to provide information.

A seller who fails to provide the appropriate information by voluntary omission or negligence might retain environmental liability for historical environmental damage or breaches of environmental law in the following situations.

Hidden Defects Warranty

In principle, the law provides for the responsibility of the seller in case of hidden defects. A hidden defect reduces or renders impossible the use of the property to the extent that the buyer would not have acquired it ‒ or only acquired it at a lower price – had they known about it.

The buyer may then cancel the sale partially or totally. However, many contracts contain a provision excluding the seller’s responsibility for hidden defects. Such clauses are not applicable if it is proven that the seller had the knowledge of the defect at the time of the sale.

Fraud (Dol)

When the seller intentionally retains information in order to mislead the buyer, the buyer may then cancel the contract. A fraud can be applied to share or asset deals.

Taxes on Energy

In France, there are five energy tax fractions: electricity, natural gas, energy products other than natural gas and coal in mainland France, energy products other than natural gas and coal in overseas territories, and coal.

In 2014, the government introduced a carbon tax. The price of final products increases in proportion with the carbon dioxide emissions generated by the production, thus favouring products with the lowest emissions. Initially the tax amounted to EUR7 per ton of CO₂. It has been reassessed each year and, as of today and since 2019, amounts to EUR44.60.

As regards the use of electricity, any electricity consumer – regardless of whether the electricity was generated by clean energy ‒ must pay a tax. This tax is called a “contribution to the electricity utility” (Contribution au Service Public de l’Electricité, or CSPE). The tariff shield, which limits the rise in electricity prices, was extended until the beginning of 2024 by the 2023 Finance Law.

The 2024 Finance Law also states the possibility of an increase in the domestic consumption tax on natural gas.

Other taxes

Other specific taxes exist such as taxes for the nuclear sector, the petroleum products or oil sector, and also for the production of electricity sector.

Owing to its transversal characteristics, Environmental Law and therefore environmental disputes may be resolved in either jurisdictions’ orders, depending on the case. However, it is notable that disputes that involve relations between the administration and the operator of an industrial site are resolved in an administrative jurisdiction, whereas disputes that involve civil claims or criminal claims are resolved in a judicial jurisdiction.

In addition to traditional litigation, disputes brought before civil courts can be resolved through mediation. Mediation procedures can be proposed by the parties themselves, as well as by the judge, who is increasingly encouraging parties to resort to mediation when the opportunity arises.

As regards criminal claims, following a December 2020 law, it is possible for a public prosecutor to propose that a legal entity charged with one or more offences covered by the French Environmental Code and related offences (excluding crimes and offences against persons) conclude a CJIP imposing one or more of the following obligations:

• pay a fine to the Public Treasury;
• regularise its situation under the supervision of the relevant departments of the Ministry of the Environment ;
• ensure, within a maximum of three years and under the supervision of the same departments, that the ecological damage resulting from the offences committed is repaired.

In order to achieve a modernised Environmental Law, the main reforms that need to be implemented are firstly to pursue the simplifying of procedures so as to ensure the carrying out of the economy’s decarbornation and to enable a fast and effective development of green industry. The second necessary reform is to improve the implementation of the “zero artificialisation net” measures. The final reform the authors deem to be fundamental is to better balance the implementation of measures applicable to protected species in terms of biodiversity.