French Constitutional Council Permits Civil, But Not Criminal Enforcement of Corporate Duty of Vigilance Law

A post by guest blogger Penelope Bergkamp

On 23 March 2017, the Constitutional council of the French Republic ruled on the constitutionality of the recently adopted Corporate Duty of Vigilance Law (hereafter “Law”). The Constitutional council held that the obligation imposed by the Law to establish a vigilance plan and the enforcement mechanisms of formal notice and injunction are not in conflict with the Constitution. Likewise, the mechanism for holding a company responsible in case of non-compliance with the obligation to establish the vigilance plan is in conformity with the Constitution. With respect to the criminal enforcement of the Law, however, the Constitutional council did identify a constitutional problem

As discussed in a previous blog post, the Law specifies what the vigilance plan should include. While the maximum fines (up to € 30 million) are clearly identified, the Constitutional Council found the conditions under which sanctions can be imposed, insufficiently clear. Specifically, the Constitutional Council found that:

  • The terms used by the legislature, such as “reasonable measures of vigilance” and “appropriate action to mitigate risks,” are very general;
  • The reference to violations of “human rights” and “fundamental freedoms” is broad and indeterminate; and
  • The scope of the companies and activities falling within the scope of the infringement is very broad.

Thus, in light of the vagueness of the language used by the legislature in defining the obligations the Law imposes, the Constitutional council declared the provisions of the law providing for fines contrary to the legality principle laid down in the French Constitution. This principle, which is expressed in the slogan nullum crimen sine lege,  requires that penal provisions clearly identify the conduct that is punishable.

As a result of this ruling, the Law remains in place, except that no criminal sanctions can be imposed for breaches. Since the Law imposes binding obligations, however, a company can be exposed to civil liability if it is in breach of its obligations. For instance, a non-governmental organization or injured individual could assert claims under tort law against a non-compliant company. In such a lawsuit, a plaintiff could seek compensation for damages suffered as a result of the breach or a court order to the effect that the company must implement a vigilance plan.

Penelope Bergkamp
Bachelor of Laws (expected 2017), KU Leuven

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