Under French criminal law, there are three categories of offences:

• minor offences (punishable by financial penalties only);
• misdemeanours (punishable by imprisonment for between two months and ten years); and
• crimes (punishable by more than ten years' imprisonment).

The last two categories are characterised by the following constituent elements being met:

• a physical element, which concerns the prohibited act itself;
• a mental element, which consists of a general intent (dol général), requiring that the perpetrator of the offence be aware that they are acting in violation of the law and possess the will to commit that act, and a special intent (dol spécial), which requires an intent to pursue a specific goal; and
• in certain cases, a prior condition, which consists of a prerequisite for the committing of the offence.

The perpetrator is the person who commits, or attempts to commit, the offence (Article 121–4 of the Penal Code – PC). The liability and sanctions incurred are identical in both cases. An attempt is committed where the execution of an act is commenced but then suspended – or if it failed to achieve the desired effect – solely through circumstances independent of the perpetrator’s will (Article 121–5 of the PC).

In 2017, the statute of limitation for misdemeanours and crimes was doubled, rising to six and 20 years respectively. These ordinary rules have exceptions in several areas, such as drug trafficking and terrorism.

The starting point of the limitation period depends on the nature of the offence – ie, whether it is instantaneous (the limitation period shall begin on the day on which the offence is committed) or continuous (the statute of limitations shall run from the day on which the criminal activity ceased) (Articles 7, 8 and 9 of the Code of Criminal Procedure – CCP).

However, the starting point of the time limit may be delayed in certain specific cases – eg, when the offence is secret (occulte) or concealed (dissimulée).

In the latter case, French courts have decided that the limitation period only runs from the day on which the offence could be discovered under circumstances enabling prosecution. This principle was enshrined in 2017 in the CCP (Article 9–1). It is particularly relevant in white-collar crime cases as it regularly applies to, for instance, breach of trust, misuse of corporate assets, bribery or influence peddling. To avoid any risk of offences being imprescriptible, the prosecution of a misdemeanour is, in any event, time-barred 12 full years after the day on which the offence was committed.

As a general rule, the perpetrator of an offence can be subject to criminal prosecution in France when the offence or any of its constituent facts are committed in French territory. However, French courts also have jurisdiction to rule on offences committed outside the territory in several other cases.

French law may also apply on the grounds of the nationality of the author or victim.

• When the perpetrator is French, French law applies to all crimes but also to misdemeanours committed in any foreign country, subject to the dual criminality requirement (Article 113–6 of the PC).
• When the victim is French, French law applies to all crimes and misdemeanours punishable by imprisonment, regardless of whether or not the perpetrator is French (Article 113–7 of the PC).

According to Article 113–8 of the PC, in the cases provided for by Articles 113–6 and 113–7 of the same code, the Public Prosecutor can only begin a prosecution following a complaint lodged by the victim (or any rightful claimant) or an official denunciation from the country concerned.

It should be noted that, with regard to bribery and influence peddling specifically, the dual criminality requirement, as well as the requirements of Article 113–8 of the PC, were abolished by Law No 2016–1691, dated 9 December 2016 (the "Sapin II Law"). This means that any French person who commits these offences outside French territory can now be prosecuted in France in all circumstances.

Moreover, based on principles relating to the connection between offences or their indivisibility (Articles 203 and 382 of the CCP), foreign individuals or legal entities, having committed unlawful acts outside France, can still fall within the jurisdiction of French courts when they are co-perpetrators, accomplices or launderers of an offence that French courts may hear, or when they engaged in its concealment.

Legal entities may be criminally liable for all criminal offences, if the offences are committed on their behalf by their corporate bodies or representatives (Article 121–2 of the PC).

However, the liability of legal entities does not preclude individuals from also being liable if they are perpetrators of, or accomplices to, an offence.

The principle of discretionary prosecution enables proceedings against either the legal entity only, the individual(s) only, or both – it being specified that the condemnation of the individual(s) is not a prerequisite to sanction the legal entity and vice versa.

In addition, legal entities as well as individuals may be ordered by the judge to pay compensation for loss or damages arising from the offence they have committed.

Initially, pursuant to the principle of individual criminal liability, in the context of a transaction involving a loss of legal existence (eg, a merger, a total demerger or a dissolution), the successor entity could not be held liable for the offences committed by the other entity before the transaction if a final sentence had not been ordered before the date of the transaction.

In a decision handed down on 25 November 2020, the Criminal Chamber of the French Cour de cassation reversed its case law by allowing the criminal conviction of an absorbing company for offences committed by the absorbed company prior to the merger (Court of Cassation, 25 November 2020, No 18–86.955). It has since confirmed this decision (see, for example, Court of Cassation, 22 April 2022, No 21–80.653). The application of this ruling, although subject to certain conditions, now prevents merger-absorption from being an obstacle to the criminal liability of companies.

Furthermore, in a decision dated 16 June 2021 concerning a French-American global telecommunications equipment company, the Court of Cassation held the holding company criminally liable for the corruption of foreign public officials by three employees of its subsidiaries, although not having participated directly in the corrupted acts, on behalf of the group policy established by the holding company (Court of Cassation, 16 June 2021, No 20–83.098).

Civil action may be brought before civil courts or, together with the public action (see 2.1 Enforcement Authorities), before criminal courts.

However, the following conditions must be met in order to claim damages for the loss suffered because of the offence:

• the plaintiff must have legal capacity and interest to act; and
• the alleged harm must be personal, certain and actual, and must have been caused by the offence.

The victim of an offence has the right to choose between civil and criminal proceedings. This choice is irrevocable (Article 5 of the CCP), but irrevocability applies only when the victim brought the civil action before the civil courts in the first place (Article 426 of the CCP).

If the civil judge decides before the public action is initiated, the results will be independent. If the public action is initiated before or during the civil proceedings, the criminal res judicata has authority over the civil (Article 4 of the CCP).

Class actions are only possible for a very few consumer law cases (Article L. 623–1 of the Consumer Code).

Finally, accredited NGOs are authorised, in certain circumstances, to exercise the rights of a civil claimant for a certain number of offences, in particular for various corruption offences (Article 2–23 of the CCP).

The judgments issued in recent cases involving breaches of the duty of probity suggest that French courts are becoming more severe and tending towards aligning French sentences with US ones, with increasing recourse to non-suspended prison sentences and huge financial penalties for economic and financial offences.

On 20 February 2019, the Paris Criminal Court sentenced a Swiss bank to a record fine of EUR3.7 billion (three of its former representatives had been sentenced to fines ranging from EUR200,000 to EUR300,000 and suspended imprisonment sentences ranging from 12 to 18 months), on the grounds of unlawful financial and banking solicitation of French prospects and aggravated money laundering of the proceeds of tax fraud. This decision, which is unprecedented, seemed to announce a new penalty ceiling, it being specified that the bank and the three former representatives were condemned to pay EUR800 million for damages to the French State.

However, in light of a decision of the Court of Cassation of 11 September 2019 according to which, with regard to money laundering of the proceeds of tax fraud, the amount of the penalty is determined on the basis of the amount of the evaded tax and not on the basis of the concealed taxable amounts (see 3.13 Money Laundering), the Paris Court of Appeal reduced the fine imposed on the bank to EUR3.7 million, on the ground that the Court was not in a position to assess the amount of the assets laundered.

On 13 September 2019, a pre-eminent politician was sentenced to four years' imprisonment as well as ten years of ineligibility for tax fraud. On 18 October 2019, the same politician was sentenced to five years' imprisonment as well as ten years of ineligibility for aggravated laundering of the proceeds of tax fraud. Both sentences were confirmed by the Paris Court of Appeal, on 4 March 2020 and 27 May 2020 respectively. The Court of Cassation confirmed his guilt on 30 June 2021 (Court of Cassation, 30 June 2021, No 20–83.355).

On 2 March 2021, a former French President was convicted of corruption and influence peddling, and sentenced to three years in prison, two of them suspended. He is the first former French President to be sentenced to a custodial sentence. He appealed, which leaves him still presumed innocent.

Use of the Convention Judiciaire d’Intérêt Public (CJIP)

Since the introduction of the CJIP as the French equivalent of the US deferred prosecution agreement, 24 have been concluded with French and foreign companies. The two most recent cases, dated June 2022, involve the corruption of foreign public officials by French companies.

On 26 February 2021, a CJIP was concluded with a major French multinational transport and logistics company in order to resolve investigations into allegations of the corruption of foreign public officials in Togo, resulting in the payment of EUR12 million to settle the case. The directors of the company had agreed to enter into an appearance on prior recognition of guilt (comparution sur reconnaissance préalable de culpabilité – CRPC). Surprisingly, the court refused to approve said CRPC on the grounds that the seriousness of the facts justified a referral to the Criminal Court.

On 15 December 2021, a French luxury conglomerate agreed to pay EUR10 million to French authorities in order to settle claims that it hired the former chief of the domestic intelligence agency (Direction Générale de la Sécurité Intérieure – DGSI) to spy on a filmmaker and his advocacy group, who made a widely popular documentary targeting the company’s CEO. The investigations had focused on allegations that the former DGSI head had committed acts of influence peddling by using his network of police, legal and intelligence contacts in the service of the conglomerate.

A CJIP was also concluded on 31 May 2022 with a major US multinational fast food chain over claims the company diverted income abroad – through abusive practice of royalties – to cut its tax bills. The settlement includes a fine of about EUR508 million and tax payback, as well as penalties of EUR737 million. The total amount is one of the highest obtained through the CJIP mechanism. This settlement came as France and other OECD members were seeking to enforce a global minimum corporate rate to reduce tax avoidance by multinational companies.

On another note, Law No 2020–1672 dated 24 December 2020 extended CJIPs to offences provided for by the Environmental Code. The first environmental CJIP was concluded on 16 December 2021, and two other settlements have since taken place. Whilst these cases demonstrate the growing willingness of the French authorities to sanction corporate environmental violations, the impact of this mechanism thus far is questionable given the low fines imposed (EUR1,000, EUR3,000 and EUR5,000, respectively) compared to the potential amount that could be imposed, which can reach up to 30% of the defendant’s average annual turnover or budget over the past three years. Nevertheless, it is important to highlight the fact that these first environmental CJIPs concerned the commission of relatively simple offences by small companies, not exceeding the local level. This may not be the case if such settlements are considered for more serious acts causing lasting damage to the environment or public health.

Late 2021 Criminal Proceeding Reform

Under Law No 2021–1729 dated 22 December 2021 relating to the reform of the French judiciary system, the duration of the preliminary investigation (enquête préliminaire) is limited to two years, with a possible extension of one year by decision of the Public Prosecutor. Investigations into organised crime and terrorism may last three years, with a possible extension of two years. However, these deadlines may be suspended in the event of a request for international mutual assistance.

Furthermore, access to the file at the investigation stage may now be granted when at least one of the following conditions is met:

• the person was questioned in an unrestrained hearing or in police custody more than one year ago;
• the person's home was searched more than one year ago; or
• the presumption of innocence of the person has been violated by a means of communication to the public.

The Public Prosecutor rules within one month of receiving the request to access the file.

The powers to prosecute and convict perpetrators of criminal offences belong to the judicial authorities and are not granted to administrative bodies.

The Public Prosecutor’s office is the key to prosecution as it is empowered to decide whether it is appropriate to institute proceedings, although civil claimants may also initiate prosecution by way of a civil party complaint (plainte avec constitution de partie civile) – see 2.2 Initiating an Investigation – or direct summons to appear before a criminal court. The local Public Prosecutors at every ordinary High Court (Tribunal judiciaire), as well as the Investigating Magistrate and the Criminal Chamber of the High Court, have jurisdiction to handle criminal cases when the Public Prosecutor brings cases before them.

However, this general jurisdiction is shared with specific administrative authorities, prosecutorial agencies and specialised courts.

Prosecutors at eight inter-regional specialised courts – as well as the Investigating Magistrate and the Criminal Chambers of these inter-regional courts – are granted expanded territorial jurisdiction over a certain number of economic and financial offences, in highly complex matters.

Moreover, on 1 February 2014, a National Financial Prosecutor specialising in economic and financial matters, and more specifically in corruption and tax fraud matters, was added to the judicial system to deal with those matters that are most complex or “likely to generate significant national or international impact” (Circular of 31 January 2014, JUSD1402887C).

With regard to economic and financial offences, the above-mentioned prosecutorial bodies are assisted by a specialised investigative service: the Central Office for the Fight Against Corruption and Financial and Tax Offences (Office Central de Lutte contre la Corruption et les Infractions Financières et Fiscales – OCLCIFF).

In addition, the Agency for the Management and Recovery of Seized and Confiscated Assets (Agence de Gestion et de Recouvrement des Avoirs Saisis et Confisqués en matière pénale – AGRASC) is in charge of recovering assets seized in criminal proceedings and conducting pre-judgment sales of confiscated assets.

Finally, under French law, the main administrative authorities empowered to prosecute specific administrative – but not criminal – offences are as follows:

• the Financial Markets Authority (Autorité des Marchés Financiers – AMF), which is an independent public authority with a remit to maintain orderly financial markets;
• the Competition Authority (Autorité de la concurrence – AdlC), which specialises in the control of anti-competitive practices and the control of mergers;
• the Prudential Control and Resolution Authority (Autorité de contrôle prudentiel et de résolution – ACPR) which is in charge of regulating the banking sector; and
• the Anti-Corruption Agency (Agence Française Anticorruption – AFA), whose main duty is to verify that certain legal entities (see 3.3 Anti-bribery Regulation) implement programmes to prevent and detect offences of corruption and influence peddling and, when appropriate, to prosecute and punish them.

A criminal investigation may begin in different ways. In this regard, one must distinguish between the three different forms a criminal investigation can take.

An investigation of a recently committed offence (enquête de flagrance) may be opened when a crime punishable by imprisonment is in the process of being committed or has just been committed, or when the suspect is found to be in possession of something that would implicate their participation in the offence (Article 53 of the CCP). Therefore, such investigations may be opened only by enforcement policy officers informed of a relevant offence or having directly witnessed it, under the supervision of the Public Prosecutor (Article 54 of the CCP).

A preliminary investigation (enquête préliminaire) may be initiated for any suspected offence either by the Public Prosecutor – following the complaint of a victim, a denunciation, a press article, etc – or by law enforcement officers on their own initiative (Article 75 of the CCP), generally following a criminal complaint.

A judicial investigation (information judiciaire) is led by an Investigating Magistrate following an opening submission (réquisitoire introductif) made by the Public Prosecutor, or following a civil party complaint (plainte avec constitution de partie civile), which can only be lodged after an ordinary complaint which the Public Prosecutor lets the victim know they will not prosecute, or if a three-month period has run from the filing of that ordinary complaint (Article 85 of the CCP).

In general, law enforcement officers acting under the supervision of the Public Prosecutor or an Investigating Magistrate have broad powers to carry out all actions necessary to determine the truth. However, such powers vary depending on the type of investigation carried out and the type of offence.

Questioning

Police officers may hear any witness who may provide information in one or more interviews, without any duress. If necessary, for the purposes of the investigation, the witness may be retained under duress, for a maximum of four hours (Articles 62 and 77 of the CCP).

Provided there are one or more plausible reasons to suspect that a person has committed or attempted to commit a crime or offence punishable by imprisonment, that person cannot be heard as a simple witness and shall be placed under police custody – with all the guarantees provided by the law for such a coercive measure (Articles 63–1 et seq and 77 of the CCP) – if such a measure is the only way to achieve at least one of the objectives enumerated by law (eg, preventing the person from altering the evidence or material clues, or preventing the person from tampering with witnesses or victims and their families or loved ones).

In principle, the person placed under custody may not be held more than 24 hours. However, the detention may be extended for a further period of up to 24 hours on the authorisation of the Public Prosecutor (Articles 63 and 77 of the CCP). For certain specific offences, police custody may exceptionally be subject to two supplementary extensions, each of 24 hours (Articles 706–88 et seq of the CCP).

Data Production

A law enforcement officer may also order any person, establishment or organisation, whether public or private, or any public services that are likely to possess any documents relevant to the inquiry in progress, including those produced from a registered computer or data processing system, to provide those documents (Article 60–1 of the CCP).

Dawn Raids

Under specific conditions and, as appropriate, supervision of the Public Prosecutor or the Investigating Magistrate, police officers may carry out investigations at the suspected person’s home or office (Articles 56, 76 and 95 of the CCP) or in any other relevant place, such as vehicles (Article 78–2–3 of the CCP), hotel rooms and bank vaults (Article 96 of the CCP), to search and seize objects and documents that could be useful for establishing the truth.

Whereas police officers may carry out dawn raids on their own initiative without any prior authorisation of the searched party, nor the authorisation of a judge, in investigations of flagrance (Article 56 of the CCP), such operations may not be conducted without the express consent of the suspected person or a reasoned order of the “liberty and custody judge” in the course of preliminary investigations.

Surveillance

Finally, for certain white-collar offences (including corruption and influence-peddling offences, tax fraud offences when they are committed by an organised gang, and market abuse offences when they are committed by an organised gang), criminal authorities may take advantage of measures such as surveillance, infiltration, wiretapping, recording conversations and filming certain premises or vehicles (Article 706–1–1 of the CCP).

The practice of internal investigation is still in development in France. It is not governed by any laws, except the ethical rules adopted by the Paris Bar Association to regulate internal investigations led by lawyers and case law.

Moreover, to comply with the Sapin II Law, a company may be encouraged to initiate an internal investigation in order to benefit from the possibility of concluding a CJIP (see 2.7 Deferred Prosecution). Indeed, according to the guidelines published by the National Financial Prosecutor’s Office (Parquet national financier – PNF) and the AFA on 27 June 2019, the conditions taken into account when assessing the possibility of concluding a CJIP include the opening, by the legal entity, of an internal investigation related to the facts and dysfunctions of the compliance system in question, which should also contribute to the determination of individual responsibilities and the identification of the main witnesses.

More recently, these authorities have published a draft practical guide on internal anti-corruption investigations, which they have submitted for consultation. In line with the guidelines for the implementation of the CJIP, the AFA and the PNF expect companies to "transmit the investigation report to the judicial authorities". Much more surprisingly, the AFA and PNF consider that "if internal control or audit activities reveal facts of a criminal nature, even before an internal investigation is initiated, the management body is advised to bring them to the attention of the judicial authorities without delay”, and that "the company should give priority to informing the judicial authority beforehand".

Finally, and in order to compel the company outside of any legal obligation, the benefit of a CJIP is subordinated to "the early and sincere denunciation by the company to the judicial authority of the criminal acts of which it has knowledge and the communication of the internal investigation". Conversely, "any delay in the transmission of information resulting from the internal investigation or any partial communication of the elements gathered by the company may be considered as an aggravating factor when calculating a possible CJIP fine". Acting otherwise could lead the company to "be held liable for the dissipation of evidence or fraudulent consultation" or "for the dissipation of criminal assets that may be apprehended".

France is party to many multilateral and bilateral instruments ensuring co-operation in criminal matters.

As a member of the European Union, France is part of several mechanisms that aim to facilitate the exchange of information between European countries. Pursuant to Articles 694–14 to 695–10 of the CCP, a European Investigation Order – requesting the gathering and transfer of evidence – can be executed without additional formalities in any other EU member state.

There are also specific provisions governing the European Arrest Warrant. Under Articles 695–11 et seq of the CCP, such a warrant can be delivered to a foreign counterpart in order to require its assistance in the arrest and presentation to competent authorities of a person accused of a serious offence in France.

On the international stage, France is party to a number of bilateral agreements (MLATs) regulating co-operation between countries. For example, France is a signatory of more than 60 bilateral agreements concerning extradition proceedings.

France is also a signatory of memoranda of understanding (MOUs).

Several recent high-profile cases demonstrate that European and international co-operation works efficiently.

Blocking Statute

That being said, it has to be underlined that these mechanisms of co-operation are express derogations from the French “blocking statute” (Law No 68–678, dated 26 July 1968).

Indeed, concerning the transmission of evidence in France to foreign authorities, the blocking statute prohibits any person from disclosing documents or information of an economic, commercial, industrial, financial or technical nature intended to constitute evidence for foreign judicial proceedings, except where the disclosure occurs through the mechanisms provided by international treaties or agreements such as the Hague Convention. Such a prohibition is sanctioned as a criminal offence. Indeed, non-compliance with these provisions is punishable by imprisonment of up to six months and a fine of up to EUR18,000 for individuals and EUR90,000 for legal entities.

However, both the effectiveness and the efficiency of this law have been criticised. As a matter of fact, the blocking statute defence to discovery has always failed in front of US judges; foreign judges believe that the law lacks “hardship” since it has only led to one conviction, in 2007.

Several propositions have been made to improve the French blocking statute, notably in 2012 and 2019. A new regulation has recently clarified the referral procedure for companies and designated a single point of contact for stakeholders applying the blocking statute: the Strategic Information and Economic Security Service (Service de l’information stratégique et de la sécurité économiques – SISSE; see Decree No 2022–207 of 18 February 2022).

In the context of the CJIP concluded on 31 January 2020 by a leading manufacturer in the aerospace sector, the PNF took particular care to fully comply with the blocking statute when sharing documents and information with the Department of Justice and the Serious Fraud Office.

The principle is that public action is initiated and exercised by the Public Prosecutor (Article 1 of the CCP).

However, prosecution may also be initiated by the victim of the offence or by accredited NGOs.

The prosecutor then has the most important role insofar as he or she "receives complaints and denunciations and assesses the appropriate action to be taken" (Article 40 of the CCP). When informed of the commission of an offence, the prosecutor has the following options:

• not prosecuting (dismissal without further action);
• prosecuting; or
• using an alternative to prosecution.

In the same way as for investigations, administrative authorities (AMF, AdlC, ACPR, etc) or the government authorities themselves (tax authorities, customs authorities, etc) have the power to initiate proceedings in order to impose administrative sanctions on natural or legal persons who fail to comply with their obligations in a particular field.

The new CJIP mechanism introduced by the Sapin II Law – see 1.6 Recent Case Law and Latest Developments – Use of the Convention Judiciaire d’Intérêt Public (CJIP) – is only available for legal entities suspected of acts of bribery, influence peddling, the laundering of tax fraud proceeds, related offences and (since the Anti-Fraud Law of 23 October 2018) tax fraud offences.

Act No 2020–1672 of 24 December 2020 extended the scope of the CJIP to offences provided for by the Environmental Code, excluding crimes and offences against persons (Article 41–1–3 of the CCP).

This settlement procedure is an option made available for the Public Prosecutor before the opening of criminal proceedings, and for the Investigating Magistrate before the closing of their investigation, at the request of, or in agreement with, the Public Prosecutor. Should this procedure be initiated, the accused legal entity may be required to:

• pay a public interest fine in proportion to the advantages gained from the offences within the limit of 30% of the annual average turnover calculated on the basis of the last three turnovers available, with the possibility to spread the fine over a maximum of one year; and/or
• set up, under the AFA’s supervision, a compliance programme for three years in line with the measures described above; and
• if necessary, compensate the victims for their loss.

The victim would retain the ability to claim compensation for their loss before the civil courts and the legal entity’s executives, as well as any individual involved, would remain criminally liable before the criminal jurisdictions.

Therefore, negotiating and concluding a CJIP does not close the whole criminal case by itself. In practice, attorneys tend to negotiate in parallel that the charges against the individuals be dismissed when a CJIP is concluded. Public Prosecutors and Investigating Magistrates are very cautious about this, and are often eager to prosecute or refer the individuals to the Criminal Court.

Since the entry into force of the Sapin II Law, 24 CJIPs have been concluded, with more than EUR4 billion in fines paid to the French Treasury.

"Pleading guilty" is recognised under French law through the mechanism of a preliminary admission of guilt (comparution sur reconnaissance préalable de culpabilité – CRPC). This procedure allows the Public Prosecutor’s office or the Investigating Magistrate to offer directly and without a trial, on its own initiative or at the request of the accused or their lawyer, one or more penalties to a person, either legal or natural, who acknowledges the acts of which they are accused (Articles 495–7 to 495–16 of the CCP). If the accused accepts the penalty(ies) proposed, the presiding judge of the High Court must then approve such penalty(ies). Use of this procedure results in a criminal conviction because the aforementioned court judgment approving the penalty(ies) is deemed a conviction.

In addition to concealment (see 3.11 Concealment), the main general offences applicable to business are misuse of corporate assets, breach of trust, fraudulent obtaining and forgery. For all these offences, a criminal intent is required.

Misuse of Corporate Assets

French criminal law proscribes the misuse of corporate power or assets, which is defined, with respect to joint-stock companies, as the use of company property or credit, or the misuse of powers or voting rights by a company chairman, director, member of the executive or supervisory board, or de jure or de facto manager, in bad faith and in a manner that they know is contrary to the interests of the company, for personal purposes or to benefit another company or business in which they are directly or indirectly involved (Articles L. 242–6 and L. 242–30 of the Commercial Code – Ccom). Specific regulations apply to de jure and de facto managers of commercial enterprises with different structures (partnerships limited by shares, simplified joint-stock companies and limited liability companies).

Individuals may incur a penalty of up to five years' imprisonment, a fine of up to EUR375,000 and various additional penalties, while legal persons may incur a fine of up to EUR1.875 million and various additional penalties.

With respect to joint-stock companies and limited liability companies, the use of company property or credit as described above may be punished by imprisonment of up to seven years and by a fine of up to EUR500,000 in cases where the offence was accomplished or facilitated by an agreement concluded with, or an account opened in, a foreign entity, or thanks to the interposition of a natural or legal person, or of any entity or trust or similar institution registered abroad.

Breach of Trust

Under Article 314–1 of the PC, breach of trust is the act of “embezzling funds, securities or any assets that have been delivered in order to be returned, represented or for a specific use.” Individuals may incur a prison term of up to five years, a fine of up to EUR375,000 and various additional penalties, while legal persons may incur a fine of up to EUR1.875 million and various additional penalties. These sanctions may be increased to up to seven years and EUR750,000, notably when the offence is committed by a person making a public appeal with a view to obtaining the transfer of funds or securities, either for their own account or as the manager or legally employed or de facto employee of an industrial or commercial company (Article 314–2 of the PC).

The delivery is the prior condition of the offence; the asset must then be embezzled.

This offence is applicable to all intangible assets capable of appropriation. It may therefore be used in the case of a violation of business secrecy.

Fraudulent Obtaining

Under Article 313–1 of the PC, fraudulent obtaining is the act of “misleading a person either by the use of a false name or quality, or by the abuse of a true quality or by the use of deceptive practices, and thereby leading such a person to deliver funds, securities or services or to consent to a deed, operating obligation or discharge.” Individuals may incur a prison term of up to five years, a fine of up to EUR375,000 and various additional penalties, while legal persons may incur a fine of up to EUR1.875 million and various additional penalties.

Forgery

French criminal law punishes forgery (ie, any fraudulent alteration of the truth that is liable to cause harm), whether created by any means in a written document or through any other medium of expression, the object of which is, or the effect of which may be, to provide evidence of a right or of a situation carrying legal consequences (Article 441–1 of the PC).

Individuals may incur a penalty of up to three years' imprisonment, a fine of up to EUR45,000 and various additional penalties, while legal persons may incur a fine of up to EUR225,000 and various additional penalties.

Bribery

Under French criminal law, the prosecution of bribery revolves around the status of the person bribed so that a specific offence exists for each type of person bribed. The French legislator has thus criminalised bribery of:

• domestic public officials (Articles 433–1 and 432–11 of the PC);
• domestic judicial staff (Article 434–9 of the PC);
• private individuals (Articles 445–1 and 445–2 of the PC);
• foreign or international public officials (Articles 435–1 and 435–3 of the PC); and
• foreign or international judicial staff (Article 435–9 of the PC).

Regardless of the offence concerned, the bribe can be defined as any offer, promise, donation, gift or reward unlawfully offered or requested that will induce or reward the performance or non-performance by a person of an act pertaining to their position.

Active and passive bribery

In each situation, a distinction is made under French law between active bribery and passive bribery, which allows for the separate prosecution of the bribe-giver and the bribe-taker.

Active bribery is the act of unlawfully offering, at any time, directly or indirectly, advantages (as listed above) to a person (public official, judicial official or private individual) for the benefit of that person or of a third party, to induce that person to perform or refrain from performing, or because such person has performed or refrained from performing, any act pertaining to their position, duties, mandate or activities, or facilitated thereby; or accepting the proposal of a person who unlawfully requests, at any time, directly or indirectly, such advantages in exchange for such acts.

In contrast, passive bribery is the act whereby a person (public official, judicial official or private individual) unlawfully requests or accepts advantages (as listed above), at any time, directly or indirectly, on their own behalf or on behalf of a third party, in return for performing or refraining from performing, or because such person has performed or refrained from performing, any act pertaining to their position, duties, mandate or activities, or facilitated thereby. The mere receipt of a bribe thus constitutes an offence in itself.

Domestic public officials

Individuals who commit the offences of active bribery and passive bribery of domestic public officials and judicial staff may be imprisoned for up to ten years, and be ordered to pay a fine of up to EUR1 million. The fine may be increased to double the proceeds generated by the offence (Articles 433–1–1, 432–11–1 and 434–9 of the PC). Additional penalties may also be imposed on such persons.

Legal entities are liable to a fine of EUR5 million, which may be increased to double the proceeds generated by the offence, and additional penalties (Articles 433–25 and 434–47 of the PC).

Domestic judicial staff

Bribery of domestic judicial staff for the benefit or to the detriment of a person who is the subject of a criminal prosecution is punishable by imprisonment of up to 15 years (Article 434–9 of the PC).

Foreign public officials and judicial staff

Active or passive bribery of foreign public officials and of foreign or international judicial staff is punishable by imprisonment of up to ten years and a fine of up to EUR1 million, which may be increased to double the proceeds generated by the offence (Articles 435–3 , 435–1, 435–9, 435–7 and 435–15 of the PC). Active bribery of foreign public officials committed by a legal entity is subject to a fine of EUR5 million, which may be increased to double the proceeds generated by the offence (Article 435–15 of the PC). Additional penalties are also provided (Articles 435–14 and 435–15 of the PC).

Private individuals

Active and passive bribery of private individuals by individuals is punishable by imprisonment of up to five years and a fine of EUR500,000, which may be increased to double the proceeds generated by the offence (Articles 445–1 and 445–2 of the PC), as well as additional penalties (Article 445–3 of the PC), whereas legal entities are liable to a fine of EUR2.5 million, which may be increased to double the proceeds generated by the offence, as well as additional penalties (Article 445–4 of the PC).

Influence Peddling

Influence peddling (trafic d’influence) is an offence that occurs when any person (whether a private person or official) who has real or apparent influence on the decision-making of an authority abuses this influence for an undue advantage (offer, promise, donation, gift or reward). The French legislator has criminalised active and passive influence peddling where the decision-maker is:

• a domestic authority or public administration (Article 433–2 of the PC);
• a domestic judicial official (Article 434–9–1 of the PC);
• a public official from a public international organisation (Articles 435–4 and 435–2 of the PC);
• a judicial official from an international court (Articles 435–8 and 435–10 of the PC); or
• following the Sapin II Law, a public official from a foreign state (Articles 435–4 and 435–2 of the PC).

The penalties imposed for influence peddling are similar to those imposed for bribery.

Other behaviours involving public officials that may constitute criminal offences under French law include:

• embezzlement of public funds (Articles 432–15 of the PC);
• misappropriation of public funds (Article 432–10 of the PC) or unlawful taking of interest (Article 432–12 of the PC); and
• favouritism (Article 432–14 of the PC).

Article 17 of the Sapin II Law requires the implementation of a corruption prevention plan for chairpersons, general managers and company managers, as well as members of the management boards of public limited companies employing at least 500 employees, or belonging to a group whose headquarters has its registered office in France and whose turnover, or consolidated turnover, exceeds EUR100 million. This represents around 1,800 companies in France. The chairpersons and general managers of public industrial and commercial establishments employing at least 500 employees, or belonging to a public group employing at least 500 people, and whose consolidated turnover, or turnover, exceeds EUR100 million, are also subject to this obligation.

Persons subject to this obligation must therefore take measures, under the AFA’s supervision, to prevent and detect the commission, in France or abroad, of acts of corruption or influence peddling by establishing a compliance programme consisting of the following measures:

• adopting a code of conduct, integrated into the internal regulations, and describing the behaviour to be prohibited;
• implementing an internal alert system;
• establishing a risk map detailing possible external solicitations according to the sector and geographical areas;
• implementing a procedure for evaluating customers, first-tier suppliers and intermediaries;
• carrying out internal or external accounting controls;
• providing training to the most exposed managers and staff;
• introducing disciplinary sanctions; and
• establishing a system for internal monitoring and evaluation of the measures taken.

AFA Enforcement

The legislator has empowered the AFA to assess the quality and effectiveness of the preventative measures – through the conduct of inspections during which the Agency may have access to any documents and hear any individuals – and to impose, in the event of non-compliance, graduated sanctions (ranging from warnings to fines and injunction procedures to bring internal procedures into line) through its Enforcement Committee, regardless of the communication of any finding of a criminal offence for acts of corruption or influence peddling to the Public Prosecutor.

The Enforcement Committee of the AFA may impose a financial penalty in proportion to the seriousness of the breaches found and the financial situation of the individual or the legal entity sanctioned; its maximum amount is set at EUR200,000 for individuals and EUR1 million for legal entities.

The Enforcement Committee of the AFA rendered its first decision on 4 July 2019, in which it dismissed an AFA referral of a company and its CEO on the grounds of breaches of the above-mentioned measures. On 7 February 2020, it rendered its second decision, further to which a company was enjoined to comply with the Sapin II Law requirements with respect to its code of conduct and to finalise the implementation of its accounting procedures. On 7 July 2021, the Enforcement Committee reviewed the injunctions issued on 7 February 2020 and thus clarified its expectations regarding the formalisation of the code of conduct.

French law provides for a series of offences regulating market abuse and banking operations.

Market abuse can receive both a criminal and an administrative qualification. Thus, it can be investigated, prosecuted and sentenced by the PNF and the criminal division of the Paris High Court or by the AMF. Article L. 465–3–6 of the Monetary and Financial Code (MFC) introduced a case referral system in order to decide whether the criminal channel or the administrative channel is the most appropriate choice for the punishment of the alleged facts, while prohibiting each of the authorities in question (the AMF’s Board and the PNF) from prosecuting market abuse without obtaining the other’s approval to do so.

That being said, the market abuse administrative offences are those described in Regulation No 596/2014/EU of the European Parliament and Council of 16 April 2014 on market abuse (MAR), whereas market abuse criminal offences are defined and prohibited by Articles L. 465–1 et seq of the MFC.

Although there are some minor differences between these two regulations, both prohibit insider dealing (Articles 8 of MAR and L. 465–1 and L. 465–2 of the MFC), unlawful disclosure of inside information (Articles 10 of MAR and L. 465–2 III and L. 465–3 of the MFC) and market manipulation (Articles 12 of MAR and L. 465–3–1 et seq of the MFC).

Enforcement of Market Abuse Regulation

Pursuant to Articles L. 465–1 to L. 465–3–4 of the MFC, any individual committing a market abuse or attempting to commit such a criminal offence may face a fine of up to EUR100 million and imprisonment of five to ten years. Legal entities are liable to a fine of up to EUR500 million (Article 131–38 of the French PC) and supplemental penalties provided by Article 131–39 of the French PC.

Before the AMF’s Enforcement Committee, individuals and legal persons convicted for market abuse can be sentenced to pay a financial penalty of up to EUR100 million or ten times the amount of gains generated. For individuals acting under the authority or on behalf of a financial intermediary, the maximum financial sanction incurred is up to EUR15 million or ten times the amount of the profit earned. Even if not provided by law, the sanctions pronounced by the AMF’s Enforcement Committee in market abuse cases generally represent two or three times the profits earned.

Banking Activity Regulation

Many offences also apply to banking activity (Articles L. 351–1 et seq of the MFC).

For instance, unlawful financial and banking solicitation (ie, financial or banking solicitation by any person who has not obtained a professional licence to do so) is prohibited and sanctioned by imprisonment of up to six months and a fine of up to EUR7,500 (Article L. 353–1 of the MFC).

Breaching banking secrecy is also prohibited. It constitutes an offence punishable by imprisonment of up to one year and a fine of up to EUR15,000.

The specifics of criminal tax law can be explained by the dual purpose of this discipline:

• to punish the tax evader; and
• above all, to collect the tax due to the state.

This leads to certain justified derogations from the principles of general criminal law and criminal procedure.

The General Tax Code provides for a dual system of tax sanctions and criminal sanctions, which can be combined depending on the circumstances.

There are many offences relating to tax fraud, often specific to the different types of existing taxes. The main offence remains. Above all, the general offence of tax fraud (Article 1741 of the General Tax Code) can result from several types of behaviour, such as:

• failure to submit a tax return within the prescribed time limits;
• the concealment of taxable sums;
• the organisation of insolvency in order to obstruct tax collection; and
• other fraudulent methods.

In addition to recovering the evaded tax, tax fraud is punishable by imprisonment of up to five years, a fine of up to EUR500,000, or EUR2.5 million for legal entities, which may be increased to twice the value of the proceeds of the offence, and various additional penalties.

These sanctions may be increased to up to seven years and EUR3 million (which may be increased to twice the value of the proceeds of the offence) if the offence is committed by an organised gang or if there are aggravating circumstances.

Most companies must provide the court registry with annual accounts, an annual report and an auditor's report on their annual accounts. Furthermore, listed companies are required to publish several financial information reports, punctually, on a quarterly basis.

It is therefore an offence for the chair, directors, members of the executive or supervisory board, or de jure or de facto managers to publish or provide the shareholders with annual accounts that do not accurately reflect the company’s results. Individuals may incur a prison term of up to five years and a fine of up to EUR375,000 and additional penalties (Articles L. 241–3, L. 242–6 and L. 249–1 of the Ccom). Legal entities may incur a fine of up to EUR1.875 million.

Listed companies may also be prosecuted before the AMF if they disclose financial information that is false, inaccurate or deceptive (Articles 223–1 of the AMF’s General Regulation and 435-3-2 of the Ccom). Legal entities and their executives that are held liable for the dissemination of false information may face a financial penalty of up to EUR100 million or an amount equal to up to ten times the gains generated (Article 621–15 of the MFC).

Unlike countries such as the USA, Japan or Canada, which mainly have formal criminal competition law, French law on anti-competitive practices has largely shifted to administrative law, even if some behaviours may still be criminally prosecuted.

Prohibited Agreements

Under Articles 101(1) of the Treaty on the Functioning of the European Union (TFEU) and L. 420–1 of the Ccom, prohibited agreements are defined by:

• the willingness of companies to reach agreement through a formal agreement;
• concerted practices or coalitions; and
• an infringement of competition because of this agreement.

According to European and national case law, the agreement may only constitute an infringement of competition law if it affects the market in a significant way (ECJ, 9 July 1969, Case 5/69 – Court of Cassation, 4 May 1993). In addition, agreements are assessed in concreto. Therefore, while an agreement may contain clauses that, in abstracto, are restrictive of competition, it may, once placed in its technical, economic and legal context, no longer have an anti-competitive character.

Abuse of a Dominant Position

Under Articles 102 of the TFEU and L. 420–2 of the Ccom, the exploitation of a dominant position is abusive if it has as its object or may have the effect of preventing, restricting or distorting competition.

The existence of a dominant position is a prerequisite for the constitution of the infringement. In addition, the exploitation of this position can be abusive in different ways:

• by using certain practices;
• by foreclosing competitors; or
• by monopolising relationships with customers or suppliers.

Abuse of Economic Dependence

Finally, pursuant to Article L. 420–2 of the Ccom, the abusive exploitation of a state of economic dependence affecting the functioning or structure of competition is an offence. Economic dependence is a relationship in which one of the partners has no alternative solution if they wish to refuse to enter into a contract under the conditions imposed by their customer or supplier (Court of Cassation, 7 January 2004, No 01.12–477).

Enforcement and Defences

In the event of a breach of competition law, the Competition Authority may issue injunctions to companies, accept commitments from them (Article L. 464–2 of the Ccom) and/or impose financial penalties, which may amount to 10% of the worldwide consolidated turnover of the companies (Article L. 464–2 of the Ccom).

The company can justify the anti-competitive practice by referring to a legal text that would impose such a practice or by demonstrating the efficiency gains achieved through the practice (Article L. 420–4 of the Ccom).

Lastly, Article L. 420–6 of the Ccom criminalises the act of participating in anti-competitive practice, and punishes it with a prison term of up to four years and a fine of up to EUR75,000.

The main offences under consumer criminal law are prohibited trade practices, deception and falsification.

Prohibited Trade Practices

This category includes unfair trade practices, which are subdivided into misleading practices and abusive practices. Practices of both subcategories are punishable by imprisonment of up to two years and a fine of up to EUR300,000 (Articles L. 132–2 and L. 132–11 of the Consumer Code). Prohibited trade practices also include the abuse of an individual’s state of ignorance or weakness, which is punishable by imprisonment of up to three years and a fine of up to EUR375,000 (Article L. 132–14 of the Consumer Code).

Deception

Article L. 441–1 of the Consumer Code prohibits deception. As a prerequisite, a trade contract needs to exist: the perpetrator must commit acts that are likely to mislead the contractor while intending to deceive them. Deception may take place through a third party and may concern:

• the nature, origin, substantial qualities or composition of the product;
• the quantity/identity of the products delivered; or
• the products’ fitness for use, risks of use and controls.

This offence is punishable by imprisonment of up to three years and a fine of up to EUR300,000 (Article L. 454–1 of the Consumer Code). Sanctions may reach seven years of imprisonment and a fine of up to EUR750,000 where the product concerned involves a danger to human and animal health or where the acts were committed by an organised group.

Falsification

Lastly, Article L. 413–1 of the Consumer Code prohibits falsifications – ie, using unlawful manipulation or processing that does not comply with the regulations in force and is likely to alter the substance of the product. Falsification covers three types of products:

• products used for human or animal consumption;
• beverages; and
• agricultural or natural products.

This offence is punishable by imprisonment of up to two years and a fine of up to EUR300,00 (Article L. 451–1–1 of the Consumer Code).

Enforcement

The fines provided for all offences mentioned above can be increased to 10% of the annual average turnover, in proportion to the benefits derived from the offence (Articles L. 132–2, L. 132–11, L. 132–14, L. 451–5 and L. 454–4 of the Consumer Code). Fines sanctioning misleading practices can also reach 50% of the expenses incurred in carrying out the advertising or practice constituting the offence (Article L. 132–2 of the Consumer Code).

Legal persons are also liable for the offences mentioned above. Fines imposed on legal persons can reach five times the maximum fine amount provided for individuals.

Article 226–18 of the PC sanctions the collection of personal data by fraudulent, unfair or unlawful means, which is punishable by imprisonment of up to five years and a fine of up to EUR300,000.

Article 226–22 of the PC sanctions the act of disclosing personal data in a manner that would violate the consideration of the person concerned or the privacy of their private life, to a third party who does not have the right to receive said data. This offence is punishable by imprisonment of up to five years and a fine of up to EUR300,000.

Article 323–1 of the PC punishes the act of accessing or remaining, fraudulently, in all or part of an automated data processing system, by imprisonment of up to two years and a fine of up to EUR60,000.

Article 323–3 of the PC sanctions the fraudulent introduction of data into an automated processing system or the fraudulent deletion or modification of the data it contains. This offence is punishable by imprisonment of up to five years and a fine of up to EUR150,000.

In France, the violation of trade secrets is not protected by a specific offence. When such a violation occurs, companies use related offences such as breach of trust, theft, concealment and laundering.

Lastly, treason and espionage (Articles 411–1 et seq of the PC), as well as violations of national defence secrecy (Articles 413–9 et seq of the PC), are punishable.

French customs law gathers together a set of offences that relate to the transport of goods and evasion of the vigilance of the administration. A second category of offences involves more malicious misconduct, which aims to distort the customs treatment of goods as provided for by the regulations. As a result, there are a very large number of offences regarding the conduct of international trade operators.

One of the most important offences concerns smuggling, which refers to the illegal transport of goods or persons, in particular across borders, in order to avoid paying taxes or to bring prohibited products into a country or, conversely, to remove them despite a ban. The Customs Code provides for a penalty consisting of the confiscation of the disputed goods, a prison sentence of up to ten years and a fine from EUR150 up to ten times the value of the disputed goods, depending on the nature of said goods.

The Customs Code contains disparate provisions that are designed to prosecute acts of all kinds that have the common feature of seeking to override the multiple obligations imposed on international trade actors. These acts include:

• failure to comply with customs declaration obligations – for example, any omission or inaccuracy relating to the information to be provided in the declarations (Article 410), or any false declaration in the case of imported goods, their value or origin (Article 412); and
• violation of the restrictive measures on economic relations set out by EU Regulations, or by international treaties and agreements approved and ratified by France – eg, by trading embargoed goods or commodities (Article 459).

Concealment was criminalised as complicity for a long time, but is now an autonomous offence. Under Article 321–1 of the PC, concealment is to conceal, retain or transfer a thing or to act as an intermediary in its transfer, knowing that it was obtained through a crime or misdemeanour, or to knowingly benefit in any manner from the proceeds of a crime or misdemeanour.

Concealment therefore implies the commission of a prior offence. It is not limited to the hiding, possession or transmission of something resulting from this offence: it also includes the act of profiting from it. In order to characterise concealment, the agent must know that the thing came from a crime or misdemeanour.

Enforcement

As a general rule, individuals can incur a term of imprisonment of up to five years and a fine of up to EUR375,000. However, when the original offence is punishable by a prison sentence that is longer than that incurred for concealment, the receiver incurs the penalties pertaining to the offence that they knew about. If there are aggravating circumstances attached to the original offence, the receiver of the proceeds will only incur the penalties that relate exclusively to the circumstances of which they were aware.

Moreover, fines may be raised beyond EUR375,000 to up to half the value of the proceeds. Individuals may also incur a number of additional penalties.

Legal persons may incur a fine of up to EUR1.875 million (which may be increased to half the value of the proceeds of the offence), as well as various additional penalties.

The penalties incurred by individuals and legal persons may also be doubled when the concealment is committed:

• on a regular basis or using the facilities offered by the exercise of a profession; or
• by an organised gang.

In France, the perpetrator of the predicate offence cannot be prosecuted for both the predicate offence and concealment. However, their accomplice can be prosecuted for concealment.

Under Article 121–7 of the PC, an accomplice is an individual or legal person who has knowingly, by aiding and abetting, facilitated the preparation or commission of a crime or misdemeanour, or any person who – by means of gift, promise, threat, order or abuse of authority or powers – has provoked the commission of an offence or given instructions towards its commission.

Complicity implies a main punishable act and an act of complicity. Moreover, the accomplice must have been willing to commit their acts with full knowledge of the main offence.

The accomplice is punished as a perpetrator and incurs the same main and complementary penalties as the main perpetrator.

Articles 324 et seq of the PC prohibit money laundering.

Two forms of behaviours are criminalised:

• facilitating, by any means, the false justification of the origin of the property or income of the perpetrator of a crime or misdemeanour that has provided them with a direct or indirect profit (Article 324–1, paragraph 1 of the PC); and
• assisting in the placement, concealment or conversion of the direct or indirect product of a crime or misdemeanour (Article 324–1, paragraph 2, of the PC).

Money laundering is committed regardless of whether the perpetrator derives any benefit from it. The offence requires the committing of an original offence punishable by law. The offence is also intentional, which implies that the perpetrator must have been aware of the fraudulent origin of the funds.

Enforcement

Individuals can incur a term of imprisonment of up to five years, a fine of up to EUR375,000 and additional penalties. These sanctions may be doubled in the case of aggravated money laundering – ie, when the offence is committed:

• on a regular basis or using the facilities offered by the exercise of a profession; or
• by an organised gang.

The fine may be increased to half the value of the assets or funds involved in the money laundering (Article 324–3 of the PC). With regard to money laundering of the proceeds of tax fraud, the Criminal Chamber of the Court of Cassation established the principle that the amount of the penalty is determined on the basis of the amount of the evaded tax and not on the basis of the concealed taxable amounts (Court of Cassation, 11 September 2019, No 1177). This considerably reduces the amount of the penalties imposed (see 1.6 Recent Case Law and Latest Developments).

Moreover, when the underlying offence is punished by a prison sentence longer than that incurred for money laundering, the money launderer incurs the penalties pertaining to the offence that they knew about.

Legal persons may incur a fine of up to EUR1.875 million (which may be doubled in the event of aggravated money laundering) and additional penalties. The fine may also be increased to half the value of the assets or funds involved in the money laundering.

The 6 December 2013 Law enabled the reversal of the burden of proof concerning money laundering (see 5.1 Burden of Proof).

Obligation to Prevent Money Laundering

The prevention of money laundering imposes a number of obligations on economic and financial actors, including:

• an obligation of vigilance – actors must pay particular attention to any activity which, by its nature, appears particularly likely to be related to money laundering or terrorist financing, and in particular complex or unusually large transactions, as well as to all unusual types of transactions that do not have an apparent economic purpose or a visible legal purpose; and
• a reporting obligation – actors must report any suspicious transaction to the co-ordination unit in charge of intelligence processing and action against illegal financial circuits (Traitement du renseignement et action contre les circuits financiers clandestins – TRACFIN).

Failure to comply with these obligations may lead to various sanctions.

French criminal law provides for a number of grounds for the exclusion or mitigation of criminal liability, such as:

• mental disorder (Article 122–1 of the PC);
• physical or moral constraint (Article 122–2 of the PC);
• legal or factual error (Article 122–3 of the PC);
• the order of the law or the command of a legitimate authority (Article 122–4 of the PC);
• state of necessity (Article 122–7 of the PC); and
• minority (Article 122–8 of the PC).

It should be noted that most of these grounds are rather exceptionally applied, especially in white-collar matters.

The Sapin II Law created a new defence for whistle-blowers, discouraging their prosecution for breach of secrecy (Article 122–9 of the PC). Moreover, on 21 March 2022 France enacted the implementation of the EU Whistleblower Directive of 2019. The new law entered into force on 1 September 2022 and revamps the reporting process by enabling whistle-blowers to report directly to French authorities without being compelled to report within the organisation first. Whistle-blowers and the “facilitators” assisting them in their reporting process will all be better protected against retaliation measures.

Apart from that, French law does not provide for any specific defence. For example, setting up a very comprehensive internal compliance programme that goes beyond legal requirements does not protect a company from any prosecution or conviction for bribery.

Nevertheless, even when the perpetrator cannot escape prosecution and conviction, they may be exempted from penalties if their social rehabilitation has been established, the damage caused by the offence has been remedied and the disturbance arising from the offence has ceased (Article 132–59 of the PC). The judge has full discretion in granting such an exemption. In practical terms, it is mostly granted when the offences are minor or when the perpetrator is a first-time offender.

As explained in 4.1 Defences, French law does not provide for any specific defence and/or exception.

Mitigation

Under French law, there is no special treatment for offenders who co-operate with investigators and prosecutors. However, it should be noted that the co-operation of the accused during the investigation stage and throughout the proceedings, as well as, for instance, the adoption by legal entities of measures intended to reinforce the internal fight against white-collar crime, may be considered as mitigating factors by a court when it determines the quantum of the penalty imposed.

Self-Disclosure

Specific provisions regarding anti-corruption law recently entered into force. The Sapin II Law introduced the possibility for the perpetrators of, or the accomplices to, an offence of bribery of public officials or judicial staff only (private bribery being excluded) to have their prison sentence reduced by half if their informing the administrative or judicial authorities enabled said authorities to put a stop to the offence or to identify other perpetrators or accomplices (Articles 432–11–1, 433–2–1, 434–9–2, 435–6–1 and 435–11–1 of the PC). The same possibility exists for the perpetrators of, or the accomplices to, the offence of tax fraud (Article 1741 of the General Tax Code).

Competition

French competition law provides for a leniency procedure carried out by the Competition Authority, which may grant total or partial immunity from financial penalties incurred by a company participating in a cartel if that company contributes to the proving of that cartel's existence (Article L. 464–2 of the Ccom).

French criminal law does not provide for any other rule regulating self-disclosure, nor any other leniency measure.

However, it should be noted that co-operation and self-disclosure are part of the criteria taken into account by the Public Prosecutor while assessing the opportunity to enter into a CJIP and/or the amount of the fine to be pronounced.

In the public sector, Article 40 of the CCP requires all public officials and civil servants who, in the performance of their duties, become aware of a crime or misdemeanour to inform the Public Prosecutor’s office and provide it with all the relevant information.

In the private sector, statutory auditors are required, under criminal penalties if they do not (Article L. 820–7 of the Ccom), to report to the Public Prosecutor criminal acts of which they become aware, and incur no criminal liability for doing so, including on the grounds of making malicious accusations (Article L. 823–12 of the Ccom). They are also required to report to TRACFIN transactions involving sums that they know, suspect or have good reason to suspect originate from an offence that is punishable by a prison sentence of more than one year, or that contribute to financing terrorism (Article L. 561–2 12 of the MFC).

The Sapin II Law granted protection to whistle-blowers, who benefit, under certain conditions, from immunity against retaliatory measures by their employer (Article L. 1132–3–3, Section 2 of the Employment Code) and against criminal prosecution for breach of secrecy (Article 122–9 of the PC).

Moreover, obstruction of a whistle-blower's action constitutes an offence punishable by imprisonment of up to one year and a fine of up to EUR15,000. Defamation complaints against whistle-blowers are also discouraged: the maximum fine that may be imposed on plaintiffs for abusive or dilatory complaints has been increased from EUR30,000 to EUR60,000 (Article 13 of the Sapin II Law).

Compliance measures are also imposed on large companies of more than 50 employees, state administrations and municipalities of over 10,000 inhabitants, which are obliged to set up appropriate alert management procedures to escalate reports from members of staff (Article 8 of the Sapin II Law).

Finally, a specific provision seeks to guarantee the strict anonymity of the whistle-blower and the information provided throughout the reporting process. The unlawful disclosure of such information is punishable by up to two years' imprisonment and a fine of up to EUR30,000 (Article 9 of the Sapin II Law).

Other types of incentives, such as financial rewards, do not exist under French law, except in the field of tax fraud (Article 10-0 AC of Tax Procedure Code).

A new whistle-blowing law entered into force on 1 September 2022, broadening the definition of the whistle-blower and making the admissibility of whistle-blowing more flexible.

In the work environment, the whistle-blower is no longer required to have personal knowledge of the facts they report; as such, they may disclose schemes that have been reported to them. The facts reported may concern “information” on a crime, misdemeanour or violations of the law, but also on “attempts to conceal” these violations. The violation of the rule is no longer required to be "serious and manifest".

The new law also revamps the reporting process. Whistle-blowers are no longer compelled to report within their organisation first: they can choose to report directly to French authorities (Article 8, II of the Sapin II Law).

It is also possible to make a public disclosure in the three following situations (Article 8, III of the Sapin II Law):

• when authorities do not react within a certain period of time (to be determined by the French government);
• when there is a “serious and imminent danger”; and
• when reporting to authorities would create a risk of retaliation, where it would not effectively address the breach at stake or where there are serious reasons to believe that the authorities may be in collusion with the perpetrator of the breach or involved in the breach.

The new law improves whistle-blowers’ protection against a number of retaliation measures, such as layoffs or damage to reputation on social media.

The non-liability of whistle-blowers due to their reporting is also extended. They cannot be held liable for the damage caused by their good faith reporting, nor criminally liable for having intercepted and taken away confidential documents related to their whistle-blowing, containing information to which they had lawful access (Article 10-1 of the Sapin II Law). These provisions apply to natural persons and non-profit legal entities assisting whistle-blowers in their reporting process, and to natural persons connected with whistle-blowers who may face retaliation measures in a work-related context (Article 6-1 of the Sapin II Law).

The presumption of innocence is one of the fundamental principles of French criminal procedure, so the burden of proof lies with the Public Prosecutor. This principle requires the judge to give the accused the benefit of any doubt as to the substance of the charge (Constitutional Council, 19 and 20 January 1981).

The prosecuting party must, in theory, provide full and complete proof of the existence of the elements constituting the offence.

However, the difficulties regarding the burden of proof have led the legislature and judges to create some kinds of presumption of guilt. In white-collar matters, this covers both money laundering and misuse of corporate assets. With regard to money laundering, Law No 2013–1117 of 6 December 2013 created a presumption of the illegality of assets and income; in other words, the assets or the income are presumed to be the direct or indirect proceeds of a crime or misdemeanour when the material, legal or financial conditions of the investment or concealment or exchange can only be justified by the intent to hide the source of the funds or the actual receipt of such assets or incomes (Article 324–1–1 of the PC).

With regard to the misuse of corporate assets, consistent case law considers that, where it is not possible to prove that company funds, taken in secret by a manager, have been used solely in the interests of the company, they have necessarily been used in the latter’s personal interest (Court of Cassation, 30 January 2019, No 17–85304).

The discretion of the judge to determine penalties is one of the fundamental principles of French criminal law. The judge thus has full discretion to choose which of the applicable penalties they deem appropriate and to determine the quantum of the penalty, with the only restriction being the maximum prescribed by law. The law does not provide minimum sentences.

However, in all cases the judge must explain the grounds for their decision if they impose a prison sentence that is not suspended and provide for no adjustments to the penalty (such as the placement under electronic surveillance).

Furthermore, a basic principle of French law is that sentences are not consecutive: if several penalties of the same type are possible because more than one offence has been committed, only one penalty of such type may be imposed, up to the highest statutory maximum penalty.