May 20, 2023

Newsletter MAFR - Law, Compliance, Regulation

📧Le PNF devrait avoir ouvertement compétence en matière de CJIP environnementale : la CJIP "Guy Dauphin Environnement" du 17 mai 2023

by Marie-Anne Frison-Roche

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â–ş Full Reference: M.-A. Frison-Roche, "Le PNF devrait avoir ouvertement compĂ©tence en matière de CJIP environnementale : la CJIP "Guy Dauphin Environnement" du 17 mai 2023" ("The French National Financial Prosecutor’s Office should have open jurisdiction over environmental Judicial Public Interest Agreement: the "Guy Dauphin Environnement" Judicial Public Interest Agreement of 17 May 2023"), Newsletter MAFR Law, Compliance, Regulation, 20 May 2023.

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đź”´ The Judicial Public Interest Agreement GDE of 15 May 2023 or how the French National Prosecutor's Office is rightly meddling in Environmental Compliance

The Parquet National Financier (French National Financial Prosecutor’s Office) does not have jurisdiction over environmental matters, and this is regrettable. For it is very well placed to obtain, in particular for the benefit of associations, adequate measures for the future, which refers to the definition of Compliance Law. This is what he is actually achieving through the Convention judiciaire d'intĂ©rĂŞt public - CJIP (Judicial Public Interest Agreement) GDE.

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📧read the article ⤵️

Among the many mechanisms that characterise Compliance Law, the most famous is undoubtedly the Convention judiciaire d'intĂ©rĂŞt public - CJIP (Judicial Public Interest Agreement) inserted into French Law by the so-called Sapin 2 law of 2016.

Among its many advantages, there is its efficacy, because it enables the examination of the past to be closed in order to allow the parties concerned to devote their strengths to the future, in particular the company signing the agreement, which does not include any admission of guilt with regard to the facts admitted in the agreement, but even more so to improve the future through the "compliance programme", since the company undertakes to act in a certain way in the future, under an administrative supervision. In this respect, the Judicial Public Interest Agreement corresponds to the general definition of Compliance Law as the branch of Law that deals with the future.

 

This is probably why the scope of application of the Judicial Public Interest Agreement continues to expand. First introduced in 2016 in "probity" matters (corruption and influence peddling), the Judicial Public Interest Agreement can now be concluded in relation to tax fraud offences and environmental offences.

 

THE FRENCH NATIONAL FINANCIAL PROSECUTOR'S OFFICE HAS NO JURISDICTION TO PROPOSE A JUDICIAL PUBLIC INTEREST AGREEMENT IN ENVIRONMENTAL MATTERS

However, while the French National Financial Prosecutor's Office has jurisdiction to conclude such agreements in relation to acts that may be qualified as corruption, influence peddling and tax fraud, as well as their laundering, it does not have jurisdiction to conclude a Judicial Public Interest Agreement in environmental matters. No doubt the authors of the 2020 French law that extended this mechanism to this matter considered that the nature was too far removed from finance and money to be within the jurisdiction of the French National Financial Prosecutor's Office.

 

THE LOGIC OF THIS LACK OF JURISDICTION: THE DIFFERENCE BETWEEN NATURE AND FINANCE

This seems logical, but the result is that the French National Financial Prosecutor's Office has jurisdiction over financial offences, whereas environmental offences fall within the jurisdiction of the ordinary public prosecutor's office. Indeed, one can regularly read about Judicial Public Interest Agreements concluded by public prosecutors in relation to pollution offences, including compliance programmes providing for remediation and commitments.

 

THE DISADVANTAGES OF THIS LACK OF JURISDICTION

In practice, however, it is the French National Financial Prosecutor's Office that develops the technique of the Judicial Public Interest Agreement, which is complex and requires a relationship of trust between the magistrates and the attorneys who assist the company, in what is sometimes called a "negotiated criminal justice".

 

In addition, the French National Financial Prosecutor's Office is developing a doctrine, most recently in guidelines published in January 2023, an act of soft law by which it sets out, among other things, the way in which it calculates the amount of the public interest fine and its assessment of the type of unilateral commitments that the company can make via the "compliance programme". But this cannot apply to environmental matters. Unless other public prosecutors start following the French National Financial Prosecutor's Office guidelines.

 

The Judicial Public Interest Agreement, which is currently used in practice mainly in connection with tax fraud, is a new instrument that is particularly appropriate for environmental issues. Indeed, in environmental and climate matters, it is above all the future that counts and the commitments, whether spontaneous or forced, of economic operators that count. It is therefore the compliance programmes, which must be carried out under the supervision of an entity and/or monitors.

 

In this perspective, the Judicial Public Interest Agreement that has just been concluded on 17 May 2023 between the French National Financial Prosecutor's Office and the company Guy Dauphin Environnement (GDE) shows how the French National Financial Prosecutor's Office can use its power and expertise in this perspective.

 

THE GUY DAUPHIN ENVIRONNEMENT JUDICIAL PUBLIC INTEREST AGREEMENT PROPOSED BY THE FRENCH NATIONAL FINANCIAL PROSECUTOR'S OFFICE

In this Judicial Public Interest Agreement, the French National Financial Prosecutor's Office is undoubtedly within its jurisdiction since the facts recounted in the agreement are legally qualified as influence peddling, since a company whose business is to sort metal waste in order to recover it had committed acts that could be qualified as such with regard to public entities with a view to obtaining administrative authorisations to carry out this activity.

However, the case described at length shows that it was the action of the stakeholders, both the residents of a river, undoubtedly affected by the pollution caused by the activity, and an environmental protection association, which led to a lengthy dispute before the administrative courts, that eventually produced the Judicial Public Interest Agreement conclusion.

Moreover, although the site had only been open for 3 days, the sums imposed as fines are high, the compliance programme is demanding (the group having since taken over the company having fully cooperated with the French National Financial Prosecutor's Office).

But what is most remarkable is the "compensation of victims". While the lack of consideration for victims in the Judicial Public Interest Agreement mechanism is often deplored, the French National Financial Prosecutor's Office considers that due to a transactional protocol signed between the company and the environmental associations in 2019: "Le procureur de la RĂ©publique financier considère donc que les associations Ă  l'origine de la prĂ©sente procĂ©dure ont Ă©tĂ© dĂ©sintĂ©ressĂ©es de leur Ă©ventuel prĂ©judice" (which we can translate by: "The French National Financial Prosecutor therefore considers that the associations at the origin of the present proceedings have been compensated for their possible prejudice").

 

VIA FINANCE, IT'S THE PROTECTION OF NATURE THAT IS TARGETED

This remarkable motivation implies that any environmental breach that may take the form, upstream or downstream, of an offence that gives the French National Financial Prosecutor's Office jurisdiction (the category of tax fraud being even more appropriate than that of breaches of probity) will in fact be examined by the French National Financial Prosecutor's Office in the first instance and, above all, will perhaps be the subject of appropriate measures in direct relation to the environmental issue, by means of compensation for the damage suffered by the associations and by means of compliance programmes.

 

FOR AN EXTENSION OF THE NATIONAL JURISDICTION OF THE FRENCH NATIONAL NATIONAL FINANCIAL PROSECUTOR'S OFFICE IN ENVIRONMENTAL MATTERS

Since Financial Law does not hesitate to link up with environmental issues, in particular with so-called "green" finance or the forthcoming sustainability report, it would be logical and simpler to give the French National Financial Prosecutor's Office jurisdiction to deal with environmental offences and to use the instrument that is the Judicial Public Interest Agreement to provide a solution, looking more to the future than to the past, in the shadow of its own doctrine as it issues it with regard to the large companies that are its interlocutors

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