Transparency, responsbility, accountability…such are the guiding words of the new « Sapin II Law », fully named the « Law on Transparency, the Fight Against Corruption, and for the Modernisation of Economic Life » which was recently approved by France’s Constitutional Council and which will now enter into effect over the coming months.
What do you need to know?
Sapin II expands extra-territorial reach for French prosecutors. The law applies fully to corruption by French companies overseas and foreign companies who have a presence in France
Creates new obligations for companies to take an active role in preventing corruption. Companies with over 500 employees and/or an annual turnover in excess of EUR 100m must put in place a framework to allow for accountability.
The law puts in place eight mandatory measures for a corruption prevention program with more to come. So far, these include a code of conduct to be integrated into the internal regulations of the company; a whistleblowing line; ongoing risk assessments; due diligence regarding clients, suppliers and intermediaries; internal and external controls; training; a roster of disciplinary sanctions; and an internal audit of the program. Companies will need to consult with their employee representative organizations prior to integrating the code of conduct into internal regulations. Foreign companies with similar systems already in place will have to update and adapt them.
The law creates a new national anti-corruption agency called Agence Française Anticorruption (AFA).
The law requires all companies with more than 50 employees to establish a whistleblower mechanism and provide protection against retaliation guaranteeing confidentiality.
The system is different from its UK and US counterparts. It only applies to disinterested parties. The whistleblower must have firsthand knowledge of the facts they are reporting. With very few exceptions, whistleblowers receive immunity from criminal prosecution.
Whistleblowers must first use the internal whistleblowing channels before blowing the whistle to the public authorities and the press.