La Revue Squire

France and the law? On the one hand there is the old love story, with prestigious legislators, famous lawyers, the Declaration of the Rights of Man, much admired codes, a passion for public law, constitutions neatly succeeding one another.

On the other, let's not delude ourselves, Chamfort (an 18th century French philosopher) turns the clock back with a single deadly phrase: he reminds us that, in contrast to the English, the French do admire authority but they despise the law.

Paradoxically, a sign that the French are subject to what could be coined as a certain "decline in the law" is the relentless pursuit of normative inflation, recently denounced in the annual report of the "Conseil d'Etat" (the highest French administrative law court).

We all learnt at university that "too many laws kills the law" (this multiplication becomes a source of uncertainty and legal complexity). Yet nothing can stop certain legislators from what is in effect, "permanent legislative strobe lighting".

By way of example, the "Conseil d'Etat" noted in its last report that work time has been amended by 8 laws or orders in less than 12 months; the tax reduction regime for grants to charities has been modified on average twice a year between 2000 and 2005; and that 6 laws have been passed in 3 years on the subject of apprenticeships.

To fully loop the loop, one needs to bear in mind the existence of the law of 9 December 2004 "to simplify the law".... Kafka, Borgès? It's up to you!

A recent illustration related to the new French insolvency law (dated 26 July 2005) demonstrates this legal loss of direction. The economic daily "La Tribune" issued on 27 April, announced the opening of 125 protection procedures, during the first trimester of 2006. The French Minister of Justice stated in relation to this (in what was, I imagine, a rather smug tone): "Such figures are very revealing as to the immediate nature of the awareness of interest in reform throughout the whole country, by courts of all sizes".

Sad jargon, sad reports; bureaucrats and the media agenda dictating their own laws…


Rédigé par Shannon Yavorsky le Mercredi 31 Mai 2006 à 16:46

France has been asked by the European Commission to amend legislation preventing football and other club sports from being listed on stock markets. The Commission took the view that this is an unjustified barrier to the free movement of capital and therefore in breach of Article 56 of the EC Treaty. The request took the form of a “reasoned opinion”, the second stage of the infringement procedure under Article 226 of the EC Treaty. If a Member State that has received a reasoned opinion fails to give a satisfactory reply within the deadline, typically two months, the Commission may refer the matter to the European Court of Justice.

The infringing French legislation is found in Act No 84-610 of 16 July 1984 on the organisation and promotion of physical and sports activities. Article 13 of that Act states that limited companies in the sports sector shall not raise capital from the public. Professional sports clubs and notably football clubs are thereby prevented from being listed on the stock market. The initial complaint about the Act was lodged with the European Commission in 2002 by eight professional French football clubs.

Admission to stock exchanges and the issue of securities on capital markets are considered movements of capital for the purposes of Article 56 of the EC Treaty. To appreciate the scope of Article 56 one can consult Directive 88/361/EEC (OJ No L178, 8.7.1988, p.5.), which, adopted before the introduction of Article 56, is a useful source for interpretation. Annex I of the Directive contains a list of transactions that are to be considered as capital movements. Rulings of the ECJ have consistently held that restrictions on the movement of capital must:

- be applied in a non-discriminatory manner;
- be required for overriding reasons of general interest;
- be such as to guarantee the achievement of the objective pursued; and
- not go beyond what is necessary to achieve that objective.

According to Le Monde, the French minister for sport, Jean-Francois Lamour (a former Olympic fencing champion and the same minister who said that London didn’t have the sporting “know-how” to host the 2012 Olympics) reacted by saying that discussions would be taking place to find a solution in line with both EU law and the “specificity of French sport”. Mr Lamour is of the view that allowing French clubs to raise capital from the public is not a miracle solution that will secure the economic development of the clubs.

Lamour proposes instead that clubs focus on building and exploiting their stadiums such that their balance sheets do not solely reflect income from media rights. This is of particular relevance in view of the fact that two major channels, Canal + and TPS, are due to merge and thus reduce possible income streams from television rights. It may be that Lamour’s stadium proposition will be amenable to the “specificity of French sport” and the Commission. However, in view of the ECJ’s decisions on provisions that restrict the movement of capital, it may be that the French Act doesn’t have a sporting chance.

Droit du SPORT

Rédigé par Fleur Allain le Mercredi 31 Mai 2006 à 16:43

Court of Appeal of Paris 28 January 2006, Bellure v L'Oréal et al. - 15 February 2006, Bellure v Beauté Prestige International

The Court of Appeal of Paris recently handed down two judgments confirming that scent is protected under French Copyright Law. The claimants in this case, L'Oréal and Beauté Prestige International, both perfume distributors, brought an action for copyright infringement against the Bellure Company. Allegedly, Bellure initially imitated the packaging, bottles and brand names of famous scents but then branched out into copying the scents themselves.

The claimants said that their scents were being infringed by the defendant’s scent.

The defendant argued that a scent could not be protected under Copyright Law since Article L.112-2 of the French Intellectual Property Code only protects works that can be heard or viewed. The defendant claimed that a scent or taste cannot be described objectively and cannot therefore qualify for protection under French law. Moreover, the defendant argued that because a scent is a technical invention it cannot be protected by copyright even if it did have an aesthetic result.

The Court of Appeal of Paris, like the first instance judges, rejected all of the defendant’s arguments. It considered that Article L. 112-2 of the French Intellectual Property Code does not provide an exhaustive list of works that can be protected by copyright. It also considered that the ability of a work to be fixed is not a condition for protection under the law. The condition required is that the work is merely perceptible.

After examining the contents of the scents at issue, the Court thought that two points were particularly persuasive. First, it considered that there was a real “effort of creation” by the creator of the scent. Secondly, survey evidence indicated that a majority of women asked thought that the scents were similar. The Court therefore decided that Bellure had infringed the claimants’ copyrights.

Bellure Company was ordered to pay 1,380,000 euros in damages.

Though not entirely new, this is an important decision because it confirms that French copyright law may protect scents, flavours, and perhaps even the recipes of famous chefs. This copyright protection will be added to the body of Trademarks, Design and Unfair Competition Law which protects the overall design of the container of a product but not the contents of such a container.


Rédigé par Gautier de La Rochebrochard & Stéphane Flichy le Mercredi 31 Mai 2006 à 16:37

The European Enforcement Order, which has been in force since 21 October 2005, allows recovery of uncontested claims within the European Union at a minimum cost.

Suppose that you hold a claim you would like to execute against someone who lives in another EU country, the European Enforcement Order offers you a procedure through which you can execute a judgment, for example, in France, the country of origin of the claim, in order to obtain payment in the country of residence of the debtor.

The apparent simplicity of this procedure seems tempting, yet it still requires fulfilment of numerous conditions.

Contentieux - Procedure

Rédigé par Aurélie Musset le Mercredi 31 Mai 2006 à 16:23

The décret nº 2005-1739 of 30 December (corrections published in the Official Journal on 4 January 2006)

Highly anticipated for several months, an “anti-takeover” décret (a French executive decision taken by either the President or the Prime Minister) was published on 30 December 2005.

Following rumour of a takeover of Danone by an American company, the French Economy Minister announced the publication of a décret allowing French authorities to control foreign investments that are carried out in France.

From now on, the Economy Minister can ask for certain guarantees from foreign investors wanting to takeover French companies in “sensitive” sectors.

The décret aims to apply the provisions of the Finance and Monetary Code, requiring authorisation of the Economy Minister for foreign investments in France that, even occasionally, involve public activities or varied areas such as:

- Activities which threaten the public order, public security or national defence;
- Activities involving research, production, or sales of arms, munitions, explosive powders or substances.

The décret defines the nature of the protected activities and the conditions in which authorisation would be granted by the Economy Minister.


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