Strengthening of the French Blocking Statute : The French Government’s one-stop shop
Frédéric Saffroy and Alice Bastien
As of April 1, 2022 (1), the French Strategic Intelligence and Economic Security Service (“SISSE”) will assist French companies receiving discovery demands or requests from foreign authorities to disclose sensitive and strategic information, strengthening the 1968 French Blocking Statute (the “Blocking Statute”) (2).
The SISSE – as a centralized department – will assist French companies to identify sensitive economic, commercial, industrial, financial, or technical information and will specify whether the information may be transmitted.
The targeted companies must inform the SISSE about any request from foreign public authorities or from any person acting on their behalf.
French companies will have to submit a file to the SISSE (using secure means), including an organizational chart identifying the natural or legal persons controlling the company, a description of its activities, a list of its main French and foreign competitors and the reasons for the applicant’s demand (3).
The SISSE will issue an opinion, together with relevant French authorities (department of Justice, department of Foreign Affairs, Anti-corruption Agency, Financial Markets Authority, etc.), within one month, on the applicability of the Blocking Statute’s provisions.
The French Blocking Statute: a shield against extraterritorial foreign laws
The Blocking Statute prohibits the disclosure of sensitive economic, commercial, industrial, financial, or technical information by French natural and legal persons to foreign authorities or its use in foreign judicial or administrative proceedings (5), issued outside the framework of international mutual legal assistance schemes (6). A breach of those prohibitions is punishable by up to six months’ imprisonment and a EUR 18,000 fine (7).
French courts have only enforced this prohibition once, resulting in a EUR 10,000 fine (8). As a result, foreign authorities – mainly American courts – consider that the statute is not a valid reason to not comply with discovery or pre-discovery requirements (9).
The SISSE, created in 2016 and attached to the Directorate General for Enterprise (department of Economy), oversees France’s economic security policy. It coordinates the protection from foreign threats of technologies and companies. The SISSE works closely with other ministries, services (including intelligence agencies) and independent authorities to unify the national response.
Faced with increasing demands, mainly from the US (such as Alstom (2014), Société Générale (2018) or Airbus (2020) cases), French companies were asking for a real “weaponization” of the legislation – beyond the role attributed to the Anti-corruption Agency by the Sapin II Statute – to protect themselves from extraterritorial procedures such as e-discovery, Cloud Act and other subpoenas. It remains to be seen how this regulation will be considered by foreign authorities.
For any additional information, please contact the Compliance and Regulatory team.
(1) Decree n° 2022-207 of February 18, 2022.
(2) Statute n° 68-678 of July 26, 1968, modified by the Statute n°80-538 of July 16, 1980.
(3) Order of March 7, 2022, published in the French Official Gazette.
(4) Article 1 of the Blocking Statute.
(5) Article 1 bis of the Blocking Statute.
(6) For example, the Hague Convention of March 18, 1970, on the Taking of Evidence Abroad in Civil or Commercial Matters.
(7) Article 3 of the Blocking Statute.
(8) Criminal chamber, Cour de cassation, n° 07-83.227, December 12, 2007, in the “Executive Life” case.
(9) Société Nationale Industrielle Aérospatiale v. U.S. District Court for the Southern District of Iowa, 482 U.S. 522 (1987).