Jan. 17, 2020

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The attorney, vector of conviction in the new Compliance system

by Marie-Anne Frison-Roche

Pour lire le document de travail en français, cliquer sur le drapeau français

This Working Paper written in English is the basis for an article published in French in the French journal Dalloz Avocat , in March 2020.

 

 

 

Summary of the working Paper.

If we perceive Compliance Law as an aggression of the private company and a binding set of mechanisms that have no meaning and added value for it, then the attorney has a utility: defending the business. It can do so not only during the sanctions phase, but also to prevent it.

But this function is not central.

It becomes so if we understand Compliance Law as a body of substantial rules, pursuing a "monumental goal": the protection of the person, goal injected by political bodies and taken up by the operator. From this, the company must convince everyone to take it back, inside the company and outside. In a general and contradictory debate, the attorney carries this conviction, because he and she is always convincing those who at the end judge (market, public opinion, etc.) that is their raison d'être.

 

(In this short document, the pop-ups refer to the different works that develop each of the points)

Compliance is sometimes denied as even constituting legal mechanisms . It would only be a brutal weapon, often launched from abroad!footnote-1751, covered with ethical sugar. It would therefore be naive to believe in Compliance Law!footnote-1752 ... Under its big words, Continental Law would not be there!footnote-1764. More so, its destruction would be the goal! Well-informed, even called to the rescuefootnote-1753, the attorney then appears in defense of businesses and of our entire legal system, bruised by Compliance. In this new war between systems, the lawyer should choose its side. Either Civil Law or Common Law…; either Companies or Regulators ...

Defined as company's protector forced to attack itself, the attorney is placed in defense. Is it the most suitable position for him?

If we look at Compliance tools - risk mapping!footnote-1754, investor communication, staff training, concretization of the company's raison d'être - where is this fighter?

In this structural Law of Information!footnote-1765, the handling of litigation would then only be a sort of after-sales service for Compliance deployed in Ex Ante, when unfortunately a failure is noted; the attorney is well placed upstream since he is the one who, downstream!footnote-1763, will limit consequences of a default. War figure, he will therefore be able to implement peace strategies with the prosecutor, his interlocutor.

Is it only that? Isn't this even very derogatory for Compliance techniques, since it means that Compliance Law postulates litigation? Taking this pathology for granted and resigning yourself to it. Legalizing the business' operation. Standing against each other!footnote-1760.

 

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Let’s take another perspective. If we consider that the company is not only a space of decision and control but also of debates before these new judges who are the investors, the consumers, the public opinion - henceforth global -, then we need attorneys. Permanently, in peacetime and in a structural way. No longer in a defense reduced to the aggressor's aggression, but in a contradictory debate. Principle of contradictory and Attorney!footnote-1755, a couple which has always been natural.

In an operation by debate, the attorney retains his primary quality there: he knows that he does not decide, that he never imposes, that he must always convince. And this weakness here constitutes its strength.

Certainly many would like to insert Compliance into machines so-called "learning" and "intelligent", which store information and correlate it. The technique of “regulation by data” supposes that machines could “automatically decide”!footnote-1756. Algorithms would make the compliance programs while other series of figures would deduce the new rules to follow.

In this mechanical future of Compliance, there is no need to understand the rules. Only obedience would be required!footnote-1761. Chinese Compliance Law accommodates this. No need for an attorney. Nobody needed!footnote-1762 in a blind compliance system ...

If we think on the contrary that the purpose of Compliance Law is to entrust the company with the task of ensuring the protection of human beings in their environment!footnote-1758, then in this, more political, humanist conception, people have to convince others of companies' actions' merits with regard to the concrete goals they have the function of achieving in the long term. Convincing in the company and convincing third parties!footnote-1759.

These "vectors of conviction", who know how to have no power and who take effective care of others, are traditionally and ultimately the attorneys. Today the concern for others is the "monumental goal"!footnote-1757 of Compliance Law.

The attorney must therefore be at the first place.

 

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1

This is particularly stated with regard to American Law,  in particular its Compliance Law applied in banking and financial sector or in matters of embargo.

For more developments on this point and the related technical references, see. Frison-Roche, M.-A., Compliance and extraterritoriality: a natural and efficient couple for the future of Europe, 2020.

2

On the idea that those who defend Compliance Law are victims of their own naivety, s. for example, the report named "Gauvain written for "Restorer the Sovereignthy of France and Europe and protect the French and European Companies from extraterritorrial regulations (rapport pour Rétablir la souveraineté de la France et de l'Europe et protéger nos entreprise  des lois et mesures à portée extraterritoriale , 2019.

3

Because initially conceived in the banking and financial sector, and in the United States, it is very often allegued that Compliance mechanisms could not be exported (even in good faith) outside neither these sectors nor this country - with its legal system which is his. For a more nuanced  point ofview, see. Frison-Roche, M.-A. Compliance: before, now, after, 2017, and the references cited.

4

The attorney thus being, in particular with the auditor, among the many experts with whom the company self-organized for understanding and mastering the Compliance system which has melted on it .... See on this question of "required expertise" in the Ex Ante of Compliance ", conference of January 29, 2020 organized by the Journal of Regulation & Compliance.

6

Information that we can "trust", the Compliance mechanisms being linked to the phenomenon of Trust (public good).

On this more general theme, see. Frison-Roche, M.-A., Compliance and Trust, 2017.

7

Since in strategy we always navigate in anticipation from upstream to downstream and by the memory of downstream to upstream, since the judge is by nature a central figure in Compliance Law, the attorney, inseparable of the judge, occupies de jure the same place there. V. Frison-Roche, M.-A., Company, Regulator, Judge: thinking about Compliance by these three characters, 2018, and the references cited.

8

As it is de facto postulated for the the character of the "whistleblower" who is placed on the chessboard of Compliance mechanisms, either by recognition of its virtue, or by recognition of its effectiveness. This way of emergence of information is not at all the same for the attorney, who by tradition is both the person of the debate but also of the secret. V. Frison-Roche, M.-A., The Impossible Legal Unity of the Whistleblower Category, 2020.

10

See in this sense the numerous works of "gray literature" issued by regulators. For example the document published jointly by the Financial Conduct Authority and the Bank of England in January 2020 

11

When it'is only question to obeying, that is to say bending, there is no longer any need for ethics, since Ethics consists in standing straight.

Compliance mechanisms, in their close link with Ethics and Responsibility, assume that people who have power "(tone from the top") stand upright. In this, they stem more from a logic of conviction, personal and towards others, than blind obedience.

See in this sense, Frison-Roche, M.-A., Have a good behavior in the digital space, 2019, and the references cited.

12

While the notion of "person" is unbreakable from Compliance mechanisms. See in this sense Frison-Roche, M.-A., Compliance and Personality, 2020, et the references cited.

13

On the conception of Compliance Law putting human beings at the heart of Compliance mechanisms, c. Frison-Roche, M.-A., A Substantial Compliance Law, based on the European humanist tradition, 2019, and the references cited. 

14

"Conviction" becomes decisive, even outside of the courtroom, when Compliance mechanisms, beyond constraint, are articulated with incentive techniques. V. Frison-Roche, M.-A., Compliance and incentives: a couple to propel, 2020, and the references cited. 

15

On the conception of Compliance Law putting human beings at the heart of Compliance mechanisms, this "monumental goal" being an integral part of the very definition of Compliance Law, defined in a no procedural way but in a substantial conception, s. Frison-Roche, Compliance Law, 2016 ; A Substantial Compliance Law, based on the European humanist tradition, 2019.

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