This post was prepared by Corentin Chevallier, an attorney in Foley Hoag's Paris office. A French language copy is available here.
On February 21, 2017, the French National Assembly (Assemblée nationale) adopted proposed legislation defining a duty of vigilance for parent companies and their subcontractors.
The law provides that multinational firms carrying out all or part of their activity on French territory shall establish mechanisms to prevent human rights violations and environmental damages throughout their supply chain.
The law applies to large French companies. Specifically, companies covered by the law include companies operating in full or in part on French territory and counting (within their own company and on their direct and indirect subsidiaries) with at least 5,000 employees when their head office is located in France; or 10,000 employees when their head office is located abroad. It is estimated that between 150 and 200 companies will be directly covered.
Companies subject to the legislation must establish and effectively implement a vigilance plan, which shall include reasonable vigilance measures seeking to identify and prevent human rights violations, breaches of fundamental freedoms, violations of health and safety rights of people, as well as environmental damages. The plan should cover the parent...