LEGISLATION AND REGULATION
DIRECTIVES BANK RECOVERY AND RESOLUTION AND DEPOSIT GUARANTEE SCHEMES IMPLEMENTED INTO FRENCH LAW
Ordinance no. 2015-1024 dated August 20, 2015 implemented into French law both the Bank Recovery Resolution Directive and the Deposit Guarantee Scheme Directive.
LEGISLATION LIFTS SOME OF THE RESTRICTIONS TO LOANS BETWEEN CORPORATES
Under current rules, banking monopoly prohibits any entity other than a licensed or passported credit institution from extending loans on a regular basis, subject to a number of exceptions. Additional exceptions had been recently added to allow crowdlending. Recent legislation promoted by Minister of the Economy Emmanuel Macron creates further exceptions to this rule.
French companies incorporated as sociétés par actions (joint stock company) or sociétés à responsabilité limitée (private limited liability) with audited accounts may grant loans for a maximum period of two years to micro-firms, small and medium-sized enterprises and intermediate-sized enterprises, on an ancillary basis to their main business. Loans will be permitted only where the economic ties between the borrower and the lender justify the extension of a loan. Granting a loan should not result in the borrower requiring the lender to grant payment terms that exceed legally prescribed payment terms (broadly, 30 days following the date of receipt of the goods or performance of the service, unless the contract provides otherwise). Further restrictions on the limits of the loans are to be determined by secondary legislation.
Receivables arising from such loans may not be securitized or be subject to financial forward contracts.
DRAFT LAW PROPOSES TO PUT AN END TO DUAL ENFORCEMENT OF MARKET ABUSES AND MORE GENERALLY OVERHAUL ENFORCEMENT OF MARKET ABUSES
As previously reported, case law from both the European Court of Human Rights and the French Constitutional council requires amending current rules that provide for the dual enforcement of market abuses (i.e., insider trading, market manipulation, misinformation), both by the enforcement body of the securities regulator and by criminal courts. The Constitutional Council had given the government until September 1, 2016 to do away with the double-enforcement system for market abuses. In the interim, where two proceedings (either before the AMF or criminal courts) have been initiated and are still pending, the enforcement that has been initiated first will be the only one allowed to be pursued.
In order to conform legislation...