Exceptional measures taken in France to face the Covid-19 crisis (En)

A new law was just voted on April 23, 2020 to broaden and strengthen the measures taken by the French Government since March 23, 2020 which instated a new national legal state of health emergency to shield the French population and economy from the current global COVID-19 pandemic virus.

Here after you will find a recap and update of the most important measures regarding public administrative services, companies' economic activity and various aspects of our social and economic activities.

President Macron speaking on French Television, March 16, 2020 © Élysée
President Macron speaking on French Television, March 16, 2020 © Elysium

Exceptional measures to support companies
(Orders n ° 2020-316, -317, -318, -319, -321, LFR-bis)

On the top of the partial unemployment measures available to all companies which activity is affected by the pandemic, and the ability to carry-forward employer's social charges: all companies (except real estate civil companies and financing companies) will also have the opportunity to apply to their bank for a loan guaranteed by the Public Investment Bank (300 billion euros in total).

These loans are one-year cash flow loans that can cover up to 3 months of the firm's yearly revenue, for which the French State will be guarantor up to 90% at a very low interest rate.

All companies will benefit from an extension of the deadline to publish their accounts but also from flexibility measures to organize general assemblies via videoconference or mail.

Regarding companies that currently are under contract with the State or those that are about to apply for a public tender during the state of emergency, deadlines and rules related to transitions and execution of public contracts will be more flexible.

Some exceptional measures were tailored for companies which employ less than 10 people, have a turnover below 1 million euros and have had to close their business to the public or suffered from a loss of at least 50% of their revenue.

They can suspend payment of their rents, electricity, gas and water supplies invoices without incurring penalties and late interests.

They will not expose themselves to cut-offs.

The French government has also created an emergency fund: the abovementioned enterprises will be able to request the payment of a non-taxable 1500 euros assistance.

This financial assistance can be increased to 3,500 euros in some situations.

These allowances will be exempted from corporate taxes, income taxes and all social contributions levies.

For small and medium-sized companies that are being refused loans guaranteed by the State, the government also decided to create a “refundable allowance”.

For very small enterprises that are being refused a State-guaranteed loan, the government created a complementary mechanism with equity loans.

The specific criteria to determine which companies are eligible will later be determined by way of a decree.

Regarding enterprises that were already in difficulty before the outburst of the pandemic, the most recent measures have made a step towards more inclusion towards some of them.

Typically excluded from the assistance measures, companies which were not in difficulty before December 31, 2019 but that have since been placed under safeguard procedure will be able to benefit from the State guarantee on loans.

Finally, the State has taken special measures in order to support strategic companies.

The government will allow State capital increases and even temporary nationalizations up to 20 billion euros for around 20 companies (especially in the aeronautics and automotive sectors).

Investment Public Bank (BPI) program to support the firms © DR
Investment Public Bank (BPI) program to support the firms © DR

Exceptional measures to maintain essential judicial activities and suspend non-essential activities
(Orders n ° 2020-303, -304, -305)

Most French jurisdictions have adopted extraordinary continuity measures in order to maintain the essential judicial activities in courts while suspending all non-essential ones.

Each jurisdiction has published its own plan of activity for the next weeks.

All non-essential proceedings are suspended until further notice and courts' public administration services are physically closed.

The following activities are considered essential and to be maintained:
* For civil cases:
- Emergency proceedings and protection for weak individuals are maintained.
- All other civil cases are postponed.

* For criminal proceedings:
- Emergency urgent criminal proceedings,
- proceedings related to temporary imprisonment and restrictions of liberty,
- urgent educational measures for minors,
- and also urgent hearings in front of the family judge such as domestic violence are maintained.

The Court of Justice (Paris) © Ph.Guignard/air-images.net
The Court of Justice (Paris) © Ph.Guignard / air-images.net

The suspension of all administrative & judicial deadlines
(Order n ° 2020-306)

Most deadlines that were to expire between March 12, 2020 and the end of one month following the end of the state of emergency, temporarily set for May 24, 2020 (ie June 24, 2020), are extended for a period of at most two months.

Therefore, under the current situation, deadlines above mentioned will be extended until August 24, 2020 when the initial term was two months or more.

When the administrative or judicial term is under two months, said term will start running again at the end of the protected period (ie June 24, 2020 for now) and expire within its initial period.

For example, if a judicial action had to be filed within one month by May 10, 2020 at the latest, then the one month term will start again on June 24, 2020 and expire on July 24, 2020.

These provisions only concern most deadlines imposed by law or by regulations (not by contracts).

They do not apply to:
* withdrawal periods, such as the 10 days withdrawal period which benefits to the buyer of real estate.
* tax declarations

Regarding tax declarations:
* Companies can file their tax declaration by June 30, 2020
* Non-residents individuals can file their declarations by June 4th, 2020.

The French Ministry of Justice © L. Bonaventure
The French Ministry of Justice © L. Bonaventure

More flexibility for labor law
(Orders n ° 2020-322; -323; -324; -385)

During the period of the state of emergency, employers will be able to impose or modify dates of paid leave through a branch or enterprise agreement with staff representatives.

The orders have extended the domain of additional allowance due by the employer in case of sick leave of employees.

The government also leaves open the possibility to deviate from mandatory rules regarding the maximum duration of weekly work and of weekly rest, subject to the adoption of a decree and only regarding essential sectors for the continuity of social and economic life of the nation.

The eligibility to most social rights (unemployment allowance, disability allowances, welfare minimal income, State medical aid, etc.) will be extended without the mandatory standard re-evaluation.

Prime Minister Edouard Philippe and Labour Minister Muriel Pénicaud © AFP
FPrime Minister Edouard Philippe and Labor Minister Muriel Pénicaud © Jacques Witt / POOL / AFP

Extension of all resident permits in France
(Order n ° 2020-328)

Resident permits that were to be expired between March 16, 2020 and May 15, 2020 are to be extended for a period of 90 days.

This extension concerns:
* temporary resident cards (1 year),
* pluriannual resident cards,
* long-term resident cards and long-term visas (of 1-year max.). It is also applicable to the temporary documents such as temporary authorizations of stay in France.

It is also applicable to the temporary documents such as temporary authorizations of stay in France.

It is also important to note that since March 17, 2020 border controls have been reactivated in France and that all non-French nationals or resident who do not show an imperative reason to enter French territory will be refused to cross French borders.

Imperative reasons should include in our opinion:
* medical surgery
* children custody
* french court orders.

A visit to France by non-citizens and non-residents should therefore be very carefully planned and documented.

©DR
© DR

Conclusion

It is important to note that many other measures have been taken for specific sectors or activities in order to ensure their continuity during the crisis (ie. healthcare facilities) but also in order to support their absence of revenue due to the crisis (ie. tourism facilities).

The government also created the possibility for employers to giver a non-taxable premium to employees who are still working during the crisis.

Don't hesitate to contact us for more information: paris@weissbergavocats.com

©DR
© DR

By Kenneth Weissberg & Audrey Weissberg




Presentation of the new international chambers of the Paris commercial court and the Paris court of appeal: a good alternative to arbitration? (In)

As the fifth wheel in the negotiations, the choice of jurisdiction clause in the event of future dispute is often negotiated at the last minute.

By compromise or by default, an arbitration clause is then frequently inserted.

But arbitration procedures are not always the most appropriate, nor the easiest to implement.

The time spent agreeing on available arbitrators is significant, and the costs incurred in submitting to arbitration proceedings can be considerable and disproportionate to the stakes of the dispute, thereby limiting access to justice. Moreover, the rules of international arbitration only allow in a few limited situations to bring an action for annulment, thus leaving the litigant powerless in the event of an arbitral award which is erroneous as a matter of law.

A new alternative is however open to international contract negotiators since 2018: inserting a choice of jurisdiction clause in favor of the international chambers of the Paris Commercial Court and the Paris Court of Appeal.

The judges on these panels are not only bilingual but also have a dual legal culture: they have usually studied in France, in the United States, or in England and have often lived and worked abroad. As for the International Chamber of the Court of Appeal, even the lawyers and clerks have a dual French and Anglo-Saxon legal culture.

The procedure gives an important room for the use of English language: English-language exhibits do not have to be translated, parties, experts, witnesses and even in some cases lawyers can speak in English, without translation.

Above all, regardless of the language, the procedure used makes it possible to focus on the study of the facts as in an arbitration procedure and much more than in a classic French procedure, since several days may be allocated to hear each of the parties, but also their witnesses or experts, which will allow the judge to question them, test their credibility and ask questions during the hearings on the pleadings.

The procedural schedule is set in advance and ensures the predictability of the course of the proceedings: four physical procedural hearings are planned in order to provide a framework for the proceedings and schedule the dates for hearings of the parties and witnesses, pleadings and the date of the judgment.

Decisions are rendered in French with an English translation prepared by the Court Registry. These decisions, in bilingual versions, will be easily enforceable throughout Europe without the need for an additional exequatur procedure.

Another advantage is that the debates can - if both parties wish so - take place in closed hearing, as is the case in arbitration. The only difference is that the decision is ultimately made public.

The two-tier jurisdiction also allows to encourage the first judge to be rigorous in his legal reasoning in order to avoid leaving it wide open to an appeal.

Finally, while in France very little compensation is traditionally awarded for legal and lawyers' costs, the new international chambers of the Court of Appeal show the willingness to allocate costs based on article 700 of the Code of Civil Procedure that corresponds to the costs and fees actually incurred by the parties.

To this date, the first decisions rendered by the International Chamber of the Paris Court of Appeal concerning in particular the companies Thales, Fedex, Unilever, Eloi, Consar.

In the spring of 2020, a practical guide will be published from a joint effort of the Paris Bar and the Paris Commercial Court and the Paris Court of Appeal, which will draw on the experience of a two-year-practice and provide more details on the functioning of these chambers.

By Audrey Weissberg, Lawyer at the Paris and Quebec Bars




New jurisdiction clause in your international contracts: how to improve the quality and reduce the costs of your procedures? (Fr)

Last wheel of
coach in negotiations, the clause conferring jurisdiction in
Future litigation is often negotiated at the last minute. Through
compromised or by default, then a clause is frequently inserted
Arbitration.

However, arbitration procedures are not always the most adequate, nor the easiest to implement. The time spent agreeing on available arbitrators is significant and the costs incurred in submitting to arbitration proceedings can be considerable and disproportionate to the issues at stake, thereby limiting access to justice. In addition, the rules of international arbitration allow only in a few limited situations to make an action for annulment, thus leaving the litigant powerless in the event of an arbitral decision erroneous in law.

A new alternative is however open to the contract negotiator
international since 2018: insert an attribution clause of
jurisdiction for the benefit of the international chambers of the Tribunal
Commerce of Paris and the Paris Court of Appeal.

The judges of these courts are not only bilingual
but also endowed with a double legal culture: they most often
studied in France, the United States, or England and have often lived
and worked abroad. Regarding the International Chamber
of the Court of Appeal, even lawyers and clerks have a double
French and Anglo-Saxon legal culture. 

The procedure gives an important place to the use of English:
parts in English do not have to be translated, parts,
experts, witnesses and even in some cases lawyers can
speak in English, without translation.

Above all, regardless of the language, the procedure used allows
give a fair share to the study of the facts as in a procedure
and much more than in a traditional French procedure
since several days may be allocated to hear each of the
parties, but also their witnesses or experts, which will allow the
magistrate to question them, test their credibility and ask questions
questions during oral hearings.

The procedural schedule is
set upstream and ensures predictability of the course of the
procedure: four physical procedural hearings are scheduled to
oversee the procedure and schedule the dates for the parties' hearings and
witnesses, oral arguments and the date of the judgment.

Decisions are rendered in French with an English translation
prepared by the Registry. These decisions, in bilingual version, may
be easily executed anywhere in Europe without resorting to
additional exequatur procedure.

Another asset, the debates, can - if both parties wish -
take place behind closed doors like what happens in matters
Arbitration. The only difference being the advertising in fine of the
decision.

The double level of jurisdiction also makes it possible to induce the first judge
strictly speaking in its legal reasoning to avoid lending the
flank to a remedy. 

Finally, while in France, it is traditionally granted very
low compensation for legal costs and lawyers, the
new international chambers of the Court of Appeal display the
will to allocate articles 700 of the code of civil procedure
respectful of the costs and fees actually incurred by the parties.

To date, the first decisions rendered by the Chamber
of the Paris Court of Appeal concern in particular the
companies Thales, Fedex, Unilever, Eloi, Consar. 

In spring 2020, the
publication of a practical guide published by a joint effort of the bar
of Paris and the Commercial Court and the appellate court of
Paris, which with the experience of two years of practice, will give more
details on the operation of said chambers.

By Maître Audrey Weissberg, Lawyer at the Paris and Quebec Bars




How to better succeed in your negotiations with your foreign partners? (Fr)

Conférence sur les chambres internationales du Tribunal de commerce et de la Cour d'appel de Paris
Conference




The execution of foreign court decisions in France and in Canada: feedback and shared views (Fr)

Congrès Annuel du Jeune Barreau du Québec sur l'exequatur France Canada
Annual Congress of the Young Bar of Quebec on the exequatur France Canada