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Corporate duty of vigilance: another step forward towards the French law’s adoption

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On 29 November, French Members of the National Assembly (lower house of French Parliament) adopted in new reading the draft law on duty of vigilance for parent and subcontracting companies.

Even if French civil society hoped for a more ambitious text, the bill still represents an important step forward in the fight against corporate impunity for human rights and environmental abuses.

ECCJ joins French civil society organisations in welcoming the draft law’s new version and in calling on the French Government to place it on the Senate's agenda as soon as possible, to ensure its final adoption before the end of its mandate.

French MPs, together with the French Government, have now reaffirmed the central objective of the bill – obliging large companies to carry out a vigilance plan to identify and prevent risks associated with their activities, throughout their supply chains. This means liability would apply when companies default on their obligations, including the presence of faults in the plan and its implementation, or the absence of a plan.

While re-establishing the spirit of the text voted in first and second readings in the National Assembly, the current version brings new elements.

  • The content of the due diligence plan to be established by the parent or subcontracting companies is specified [1]. An additional optional decree could complement these measures in the future, and specify ways of drafting and publishing the vigilance plan. Until then, we welcome the law-makers’ decision to make the bill immediately enforceable upon its adoption.
  • Another new element is that a company's stakeholders, like trade union representatives or civil society groups, could be involved in the development of the vigilance plan.
  • The MPs have increased the maximum fine in the event of damage due failure to publish or implement a plan. The fine is now capped at 30 million euros. Although high, the amount is not a significant sum compared to the turnover of large companies covered by the law [2].

However ground-breaking, the bill still has its limitations. It only affects around 100 major business groups, it does not include a strong provision aimed at facilitating access to justice for victims - the burden of proof still weighs on the victim, and the corporate liability regime is limited.

In spite of its shortcomings, the draft law nevertheless remains an undeniable first step forward. Our organisations are now calling on the French Government to have the text reviewed by the Senate in 2016, and to adopt the bill before the end of term.

 [1] The plan should contain elements such as a risk mapping, including risk identification, analysis and ranking; or procedures for a regular evaluation of their subsidiaries, subcontractors and suppliers. A mechanism for monitoring the preventive measures in place, and assessing their effectiveness, is also integrated.

[2] The maximum fine does not add up to more than 0.1% of the yearly turnover of the companies concerned.

 

More info: Draft bill (French)

More info: Draft bill (English)

 

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