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► Full Reference: M.-A. Frison-Roche, Laws, Compliance, Contracts, and Judges: places and alliances, Working Paper, March 2023.
📝this working paper is the basis for an article published in French (click HERE) in the 📚chronique of Compliance Law held in the Recueil Dalloz.
📚Read the other articles published by this Compliance Law Chronicle. open since 2018.
►Summary of this Working Paper: To understand the functioning of compliance systems in the articulation of the legal actors and the legal instruments used, whatever the technical sector considered, it is necessary to put the "law", the "contract" and the "judge" back into the perspective of legitimacy and efficiency regarding what Compliance is.
At the very least, it is a 'conformity' mechanism. In this process of simple obedience, legislators, economic operators, and judges find themselves in the position of having to obey the law in a hierarchical conception.
In a more dynamic and ambitious conception, when Compliance Law is not reduced to a more astute method of obedience but draws substantial normativity from the Monumental Goals pursued, legislators and operators enter an alliance. The contract becomes a major instrument, and the Judge becomes a major actor, no longer to punish the non-obedient but to facilitate the links to help a sustainable system.
Faced with issues such as digital, climatic, and technological challenges, where we are each so weak and isolated, we must not limit our conception and practices to the instrument of conformity but choose the substantial Compliance Law, i.e. the alliance of forces, which puts forward the contract and renews the office of the judge, with the Public Authorities remaining legitimate in setting the Monumental Goals since they commit the future of the social group.
🔓read bellow the developments⤵️
1. Substantial Definition of Compliance Law by its negative and positive Monumental Goals🖇Compliance Law is an « Adventure»📎
2. Compliance, a systemic branch of Law, conceived and deployed teleologically🖇More narrow in the rules targeted, Compliance Law is much more ambitious since its object is to safeguard systems (banking, financial, informational, energy, climate, etc.), or even to improve them so that the human beings who live in them can remain there, or even flourish📎
3. Implication of immediate and continuous actions, of which Vigilance is the advanced manifestation 🖇In this Law whose the object is the future, immediate actions are required, notably structural actions, for example the adoption of plans, to generate long-term effects and cultural changes, reflecting the political nature of a branch that extends Regulatory Law. The Vigilance mechanism is therefore neither particular nor isolated. It can only be understood as the "leading edge" of Compliance Law as a whole📎
4. Need to articulate the available forces, through legal instruments and their authors: laws, contracts and judgments🖇These negative ambitions (to avoid disasters, especially climatic ones📎
5. Traditional hierarchical conception of the regulations giving orders, the actors only showing their obedience🖇In this conception of regulatory efficiency, the order is issued by texts, most often takes the form of prohibitions produced by Criminal Law📎
6. Obedience of the company that applies the compliance regulation within itself by punishing itself 🖇This declination of obedience reaches the company more directly when it prosecutes itself through internal investigations, denounces itself📎
7. In obedience to the Law through sanction, the "contract" may be no more than a metaphor🖇For the regulations to be effectively obeyed, arrangements, commitments and acceptances of all kinds are in fact favoured under Compliance. This can be accepted, but in a legal system every must always know the exact correspondance between words and facts to understand where one stands. Thus what is referred to as the "contractualisation of criminal trials"📎
8. The use of contracts to fulfil its legal compliance obligation🖇. On the other hand, companies have developed a properly contractual practice, which has nothing to do with these previously described techniques. Without the need for a specific law, companies, subjects of Compliance Law, can choose any effective means to give concrete form to their legal compliance obligation, they can use all the means at their disposal: unilateral commitments, soft law, pedagogy, ethics, sanctions, but also contracts. Through their practice, they will show that they respect their legal compliance obligation. The contract is then the means by which the company concretises its legal compliance obligation, a contract by which the regulation is propagated. The contractual tool is greatly appreciated, as it is more easily indifferent to borders, espouses the space and duration of value chains📎
9. The use of the contract as a compliance service with regard to the law: the "compliance contract"🖇 Let us imagine, as a textbook hypothesis, that a company does not like the legal constraints of compliance that weigh on it. It does not want to mobilise its internal resources but nevertheless wants to comply with the law (for many reasons). It will then outsource this task, most often regulatory block by regulatory block, entrusting a service provider with the task of ensuring its compliance with the RGPD, another with the task of setting up its warning system, another with the task of monitoring the vigilance plan. Etc. From these contracts📎!footnote-2896 which correspond to a demand, born of these requirements of the law, was born the "compliance market" which is growing at an exponential rate. It remains to write the regime of this "special contract", of which compliance is the very object.
9. The use of the contract as a compliance service regarding the regulations: the "compliance contract"🖇 Let us imagine, as a textbook hypothesis, that a company does not like the legal constraints of compliance that weigh on it. It does not want to mobilise its internal resources but nevertheless wants to comply with the regulations (for many reasons). It will then outsource this task, most often regulatory block by regulatory block, entrusting a service provider with the task of ensuring its compliance with the Europe GDPR, another with the task of setting up its whistleblowing system, another with the task of monitoring the sustainability due diligences plan, etc. From these contracts📎
10. Contracts with a different purpose but involving or justifying the insertion of "compliance clauses"🖇 In addition, in contracts reflecting the economic activity of the company, for example in supply contracts, a clause will be inserted whereby the company that supplies the material undertakes to ensure that the manufacturing conditions comply with the Code of Compliance and Ethics of the buyer who will use it to make the finished product and sell it to the final consumer. Similarly, a clause in the framework distribution contract will stipulate that the distributor must submit a compliance audit to its partner each year, particularly in terms of an effective fighting against corruption, and the latter may come at any time to check the accuracy of this commitment.
11. The development of compliance clauses and contracts regarding monumental goals through the autonomous will of the company: obliging itself beyond the regulatory constraint🖇 In the first type of clauses and contracts, the company, being in a relationship of obedience to the regulations, imagines modalities of its own to fulfil its own "compliance obligation" that the Law has drawn up. But the company is a legal person that not only carries out the order given to it by the Law but can also express its own goals📎
12. The natural presence of the judge as an agent of effectiveness of the parties' will🖇 Since there is a contract - and not just a "contractualisation" - the judge naturally intervenes, whether he is a specialised judge or a judge of general law, the claim that algorithms and smart contracts able eliminate judges being an illusion📎
13. The natural action of the judge to help companies to move from the contractual tool of conformity to the contractual tool of Compliance. The judge, who is virtually present in every contract, ensures that the purpose of the contract and its compliance stipulations are put into practice. Firstly, the judge must consider his office at the level of the 'conformity' tool alone. Indeed, if we consider that the company must "comply with the regulations", the judge's office, in transparency of the contract, will be to verify the adequacy of the parties' contractual behaviour to what is prescribed by the regulations, which is interpreted teleologically in relation to these goals📎
14. The issuance by the judge of standards of proof of the effectiveness of the contract to serve the monumental goals of the compliance system. The judge is then at the centre of what must be the alliance of forces if the compliance system is to be powerful enough to protect and even build the future. For this to happen, laws, contracts, commitments, and behaviours must be "effective, efficient and effective" in relation to the monumental goals pursued📎
15. The reciprocal porosity between compliance clauses, compliance contracts, and the judge's methods. Just as the judge must interpret compliance contracts and compliance clauses in a teleological manner to respect the teleological nature of Compliance Law of which they are the instruments, so the benefits of the judge's methods deserve to be borrowed by clauses. For example, "due process" clauses to develop common compliance tools, mediation clauses or dispute board clauses.
16. Conclusion. Thus Regulations, Compliance, Contract and Judge cease to be four terms that are far from each other or that must necessarily be placed in a hierarchy: there are sufficient points of contact between them to produce the alliance of forces required to respond through Law to the systemic challenges of the future, such as digital technology and climate, in the face of which we are all isolated, ignorant, weak and powerless.
On the conception of Compliance as a common adventure, 🕴️M.-A. Frison-Roche, 🚧The adventure of Compliance Law, 2020.
S. in general, 🕴️M.-A. Frison-Roche, 🚧Compliance Law, 2016 ; 🕴️M.-A. Frison-Roche (ed.), 📘Compliance Monumental Goals, 2023.
That's why people's rights have a central place, not only to become effective - this effectiveness being a "systemic Monumental Goals" - but also as Compliance Tools. S.🕴️M.-A. Frison-Roche, 📝Rights, primary and natural Compliance Tools, in 🕴️M.-A. Frison-Roche (ed.), 📘Compliance Tools, 2021.
🕴️M.-A. Frison-Roche, 📝Building by Law the Unicity of Compliance Tools from the Definition of Compliance Law by its "Monumental Goals", in 🕴️M.-A. Frison-Roche (ed.), 📘Compliance Tools, 2021.
🕴️M.-A. Frison-Roche, 🚧Thinking and using Vigilance through its Compliance Monumental Goals, 2023.
🕴️M.-A. Frison-Roche, 🚧Compliance Law and Climate. To prevent Climate Risk and build Climate Balance, 2022.
🕴️R.-O. Maistre, 📝What are the Monumental Goals for the Regulator in a Rapidly Changing Audiovisual and Digital Landscape?, in 🕴️M.-A. Frison-Roche (ed.), 📘Compliance Monumental Goals, 2023.
🕴️C. Peicuti et 🕴️J. Beyssade, 📝Feminisation of Positions of Responsibility in the Workplace as a Goal of Compliance. Example of the Banking Sector, in 🕴️M.-A. Frison-Roche (ed.), 📘Compliance Monumental Goals, 2023.
On the complex articulation between Compliance Law and Criminal Law, s. 🕴️J.-Cl. Marin, 📝Quels outils pour la construction du Droit de la Compliance en Europe ?, in 🕴️M.-A. Frison-Roche (ed.), 📕Pour une Europe de la Compliance, 2019 ; 🕴️G. Beaussonie, 📝Do Criminal Law and Compliance form a system? and 🕴️Ch. André, 📝State Sovereingty, Sovereingty of the People: What Social Contract for Compliance?, in 🕴️M.-A. Frison-Roche (ed.), 📘Compliance Monumental Goals, 2023.
The Judicial Public Interest Agreement is a Compliance Tool that is both well studied and very much in its infancy.
See for instance 🕴️A. Gallois, 📝La convention judiciaire d'intérêt public, in 🕴️J.-M. Brigant (ed.), 📗Le risque de corruption, 2018; 🕴️M. Galli, 📝Une justice pénale propre aux personnes morales : Réflexions sur la convention judiciaire d'intérêt public, 2018; 🕴️Th. Amico, 📝La convention judiciaire d'intérêt public ou la compliance comme moyen de lutte contre la récidive, in 🕴️N. Borga, 🕴️J.-Cl. Marin and 🕴️J.-Ch. Roda (ed.), 📕Compliance : l'entreprise, le régulateur et le juge, 2018;🕴️A. Bavitot, 📝Shaping the company through negotiated Criminal Justice Agreements. French Perspective, in 🕴️M.-A. Frison-Roche (ed.), 📘Compliance jurisdictionalisation, 2023.
S. for instance 🕴️S. Schiller, 📝A single judge in the event of an international breach of compliance obligations?, in 🕴️M.-A. Frison-Roche (ed.), 📘Compliance jurisdictionalisation, 2023 ; 🕴️N. Ida, 🎤Les régulateurs bancaire et financier face aux contrats de compliance dans leur office juridictionnel, in 🧮Le juge face aux clauses et aux contrats de compliance (The Judge facing clauses and contracts of Compliance), 2023.
🕴️M.-A. Frison-Roche (ed.), 📘Compliance jurisdictionalisation, 2023.
🕴️M.-A. Frison-Roche, 📝The Judge-Judged. Articulating words and things in the face of the challenging conflict of interest and 🕴️J. Heymann, 📝The legal nature of the "Supreme Court" of Facebook, in 🕴️M.-A. Frison-Roche (ed.), 📘Compliance jurisdictionalisation, 2023.
On the internal investigations, 🕴️J.-M. Darrois, 📝La loi Sapin 2 : un défi pour les avocats, in 🕴️M.-A. Frison-Roche (ed.), 📕Régulation, Supervision, Compliance, 2017 ; 🕴️M.-A. Frison-Roche, 📝The Judge-Judged. Articulating words and things in the face of the challenging conflict of interest, in 🕴️M.-A. Frison-Roche (ed.), 📘Compliance jurisdictionalisation, 2023 ; 🕴️M.-A. Frison-Roche et M. Boissavy (ed.), 📕Compliance et droits de la défense (Compliance and rights of the defense), 2024.
Cour de cassation (French Court of Cassation), 🎥La contractualisation du procès pénal, symposium of 13 March 2023.
That's why compliance stipulations are particularly used to ensure the effectiveness of of the legal obligation of vigilance and will be used more and more. S. the developments in 🕴️M.-A. Frison-Roche, 🚧Thinking and using Vigilance through its Compliance Monumental Goals, 2023.
The company is encouraged in this by the legislator, by the insertion of the "raison d'être" by the French so-called "Pacte law".
The evolution of Corporate Law is intertwined with Compliance Law (s. for instance 🕴️A.- V. Le Fur, 📝Interest and “raison d’être” of the company: how do they fit with the Compliance Monumental Goals?, in 🕴️M.-A. Frison-Roche (ed.), 📘Compliance Monumental Goals, 2022.
This is evident in the legislative development of the vigilance obligation, which in European Union Law is based on Corporate Law, whether it is a question of Corporate Sustainability Due Diligence or of the new non-financial information obligations and the "sustainability report" which should be presented. S. Haut Conseil du Commissariat aux Comptes (H3C), 🎤Réalités et défis de la CSRD - Perspectives du devoir de vigilance, 2023.
This link between Compliance and "raison d'être" is established in relation to all crucial structures. It therefore concerns not only companies in the generic sense of the term, but also the "professions" that are in a position to act to achieve the Monumental Goals of compliance. See for example 🕴️M.-A. Frison-Roche, 🎥Régulation et Compliance, expression des missions d'un Ordre (Regulatory Law and Compliance, expression of the Professional Order missions) ; 🎥La compliance, perspective dynamique pour exprimer la raison d'être des commissaires de justice (Compliance, dynamic perspective to express the "raison d'être" of the Commissaires de justice), 2022.
🕴️M.-A. Frison-Roche, 📝Reinforce the Judge and the Attorney to impose Compliance Law as a characteristic of the Rule of Law, in 🕴️M.-A. Frison-Roche (ed.), 📘Compliance jurisdictionalisation, 2023.
The judge thus gives more effectiveness to the 'soft law' in this area, and correspondingly more prerogatives to the persons concerned to defend themselves against the increased scope of this soft law. The case-law of the Conseil d'État (French Council of State) in particular is the source of this desire. S. 🕴️F. Raynaud, 📝The administrative judge and Compliance, in 🕴️M.-A. Frison-Roche (ed.), 📘Compliance jurisdictionalisation, 2023.
🕴️M.-A. Frison-Roche, 📝Compliance et médiation (Compliance and mediation), 2023.
On the trilogy of effectiveness, efficiency and efficacy, which applies particularly well to teleological Compliance Law, 🕴️ M.-A. Frison-Roche 📝Monumental Goals, beating heart of Compliance Law, in 🕴️M.-A. Frison-Roche (ed.), 📘Compliance Monumental Goals, 2022.
On the probationary system and the role of each,🕴️ M.-A. Frison-Roche, 📝The judge, the compliance obligation, and the company. The Compliance probationary system, in 🕴️M.-A. Frison-Roche (ed.), 📘Compliance jurisdictionalisation, 2023.
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