All eyes are on France as the enforcement mechanism set out in the French Law on the Corporate Duty of Vigilance (the “Vigilance Law”) is now set in motion. The mechanism, which was triggered for the first time in 2019, has now been used in five instances, with two cases so far having reached a court.

This blog post, mostly factual, includes a description of the enforcement mechanism, a summary of the first enforcement cases and an identification of the preliminary trends arising from such cases. Main challenges regarding the enforcement mechanism are analysed in a second blog post.

1.            Operation of the Enforcement mechanism

The Vigilance Law provides for a twofold judicialisation. First, a remediation mechanism, through civil liability, not yet triggered and not covered in this post. Second, an enforcement mechanism [injonction] to ensure that a company falling within the scope of the Vigilance Law complies with the obligations set forth in this law (the “Vigilance Obligations”).[i] This mechanism can be used, irrespective of whether any actual damage has been sustained.

The enforcement mechanism, actionable since spring 2019,^[ii] is based on a two-stage escalation process:

• Stage one: if a party demonstrating standing considers that a company has failed to comply with its Vigilance Obligations, this party can serve on the company a three-month official notice to comply [mise en demeure].
• Stage two: once the three-month notice period has elapsed, if this party considers that the company is still not complying with its Vigilance Obligations, it can then ask the competent court to order an injunction with a potential periodic penalty payment.^[iii] The case may also be referred to the president of the court in the context of interim/emergency proceedings [procedure de référé].

2.            Summary of the first cases (as of 28 January 2020)

Below is a brief overview of current cases based on the information provided in the formal notices where such notices are available and in the requesting parties’ press releases and press kits (more details are available in these documents referred to in the endnotes):

Most of the cases also suffer from an absence or insufficiency of stakeholder consultations. In particular, trade unions explain they were not consulted, including for the design of the alert mechanism (an instance in which such consultation is mandated by the Vigilance Law).

To date, two cases have escalated to stage two. First, the Nanterre Tribunal de Grande Instance was seized on 23 October 2019 (Total in relation to activities in Uganda). The interim/emergency proceedings [procedure de référé] was used in this instance. The hearing took place on 12 December 2019 and the court’s decision should be handed down on 30 January 2020. Second, the Nanterre Tribunal judiciaire was seized on 28 January 2020 (Total in relation to climate change).[xiii]

The court will have to determine whether Total complied with the Vigilance Obligations. If it has not, the court will then have to decide whether and how it will order the company to comply with the Vigilance Law, including under a possible periodic penalty payment.

As of the time of writing, the three-month period has expired for the three other cases, but there is no public information on possible escalation to stage two.

3.            General observations and trends regarding the first cases

3.1          Parties

The enforcement mechanism has been seized by a variety of parties so far. Looking at the five existing cases, the official notices to comply have been brought by at least two entities (Teleperfomance) and at most 18 (Total, climate change). In all instances, but for one (Total, climate change), at least one of the entities is based outside of France. In one instance, none of the requesting parties are French (EDF). In two instances, the requesting parties include representatives of local authorities (Total, climate change; EDF).

All of the companies targeted had published a vigilance plan in 2019, but these plans were dissimilar in their length and comprehensiveness. In every case, these plans were deemed unsatisfactory by the requesting parties. Their allegations are focused on the impacts generated by the activities of the companies (Total, climate change; XPO), and/or that of their subsidiaries abroad (Teleperfomance; EDF; and Total, Uganda) and that of subcontractors with an alleged established commercial relationship (for part of the activities under scrutiny for Total, Uganda).

3.2          Choice of companies

The enforcement mechanism of the Vigilance Law has not yet been activated in relation to companies which do not yet have a vigilance plan but that likely fall within the scope of the Vigilance Law (including some French subsidiaries of foreign groups). As for those having a plan, earlier studies from different stakeholders reveal that most companies still need to improve their plans.[xiv]

In this context, one could query why Total, EDF, Teleperfomance and XPO were the companies to be singled out and handed a formal notice to comply. The requesting parties provide information regarding the choice of target companies in their public materials:

• For Total (in relation to climate change), the requesting parties bring forward numerical evidence on the share of Total’s alleged contribution to French Co2 emissions combined with its alleged expansion strategy for hydrocarbon production.[xv]
• For Total (in relation to activities in Uganda), the requesting parties refer to Total’s former track record on economic, social and environmental consequences of its activities and to the fact the company “has never really been brought before the courts, circumventing if not instrumentalising the law to serve its most contestable practices”.[xvi] They consider that the Vigilance Law offers a way to improve this situation, as it allows for direct intervention against the parent company.[xvii]
• For Teleperfomance, the requesting parties noted that “Teleperformance’s 300,000-person global workforce are in countries with systematic labor violations.” They further explain that the company is still largely unknown to the public but yet “nearly every consumer has had multiple interactions with the company, who provides front-line customer service over the phone, through social media, live chat, email, SMS or WhatsApp for some of the world’s biggest brands […].”[xviii]
• For XPO Logistics Europe, the requesting parties highlight the importance of outsourcing inflow to XPO and the fact that the company “as the economic employer [has] the power and leverage to influence their suppliers and subcontractors and set the standards along their global supply chains.”[xiv] The requesting parties further explain that “companies cannot subcontract their responsibilities or outsource their duty of care.”[xx]
• For EDF, the requesting parties consider that “[e]ven though wind farms aim to produce “green” and “clean” energy, violations of indigenous people’s rights in the Isthmus of Tehuantepec [in Mexico] –where Unión Hidalgo is located– has been systematic since the start of the installation of such projects.”[xxi]

Overall, these actions show the pro-activity of some entities in using the Vigilance Law as a tool to ensure that businesses have processes in place to respect human rights and the environment and that they “walk their talk” (thus monitoring any possible green or blue washing).

3.3          Communication and interactions prior to and after the formal notice

In most instances, the requesting parties had approached or questioned the companies prior to issuing a formal notice to comply and prior to the publication of the vigilance plans for 2019. These approaches included letters, communication campaigns or even a specific instance before the French National Contact Point where complainants eventually decided to withdraw from the procedure (in the case of EDF).^[xxii]

It is unclear, however, the extent to which a space for dialogue was created between the requesting parties and the targeted companies prior to the triggering of the enforcement mechanism. Would such dialogue be perceived by the parties as a genuine opportunity to engage in a constructive dialogue, or rather as a mere formality preceding the inevitable service of a formal notice to comply?

Interestingly, and although no causal link is evidenced, we note that Total included climate change in its vigilance plan prior to being served with a formal notice to comply but after the requesting parties threatened to serve such notice.[xxiii] But the edits were not considered as satisfactory for the requesting parties. As for Teleperformance, the company updated its vigilance plan for 2019 after the formal notice to comply was served and further updated it in December 2019.

The formal notices to comply have been complemented by media campaigns led by the requesting parties, especially in the two cases targeting Total. This coverage contrasts with the communications of targeted companies, which are limited in length and give concise explanations, thereby leaving the narrative mainly in the hands of the requesting parties. In particular, very brief responses were provided by EDF (through Twitter) and by Teleperfomance (through the BHRRC). Total issued a press release for the climate change case on the same day that the press kit including the formal notice to comply was released, and for the Uganda case a few days before the injunction was filled. We are not aware of any response from XPO Logistics Europe.

As this post shows, the enforcement mechanism is still in its infant phase, and the current cases generate a series of challenges further addressed in a second blog post.

Stéphane Brabant is a lawyer, partner and co-head of the Global Business and Human Rights Practice at Herbert Smith Freehills; Elsa Savourey is a lawyer, member of the Paris Bar, specialised in business and human rights. She also acts as firm-wide coordinator of the Global Business and Human Rights Practice at Herbert Smith Freehills. They are grateful to Adèle Bourgin and Marie Badr for their research and comments on the preliminary versions of this post.

[i] Commercial Code, article L. 225-102-4.-II. As a reminder, the Vigilance Law sets out three obligations for certain companies. They go beyond simple reporting, and require companies to: 1) establish a vigilance plan; 2) effectively implement it; and 3) make the vigilance plan and the report on its effective implementation public as well as include both of them in the company’s annual management report. For a detailed analysis of the scope of the Vigilance Law and the obligations, see Stéphane Brabant & Elsa Savourey (eds), French vigilance law – A Practical and Multidimensional Analysis, Int’l Review of Compliance and Business Ethics, Dec. 2017.

[ii] This is, de facto, due to the time required to establish the first vigilance plans, implement them effectively and report, in the second year, on the implementation of the vigilance plan established in the first year.

[iii] Note that a periodic penalty payment consists of injunctive fines payable on a daily or per-event basis until the defendant satisfies a given obligation.

[iv] Letter of formal notice to comply to Total (in English), 19 June 2019, p. 2; see also Notre affaire à tous, ZEA, Sherpa, Les Eco Maires, Press kit on the formal notice to comply (in French), including the letter of formal notice to comply to Total, 18 June 2019.

[v] Id.

[vi] Les Amis de la Terre & Survie, Press kit on the formal notice to comply (in French), including the letter of formal notice to comply to Total, 25 June 2019, p. 12 (our translation).

[vii] Id., p. 2.

[viii] Id., p.6-9.

[ix] Id., p.10.

[x] Sherpa, Press release reporting on the formal notice to comply to Teleperformance (in English), 18 July 2019 (last accessed 17 Jan. 2020).

[xi] ProDESC, Press release reporting on the formal notice to comply to EDF (in English), 1 Oct. 2019 (last accessed 18 Jan. 2020).

[xii] Letter of formal notice to comply to XPO Logistics Europe, 1 Oct. 2019.

[xiii] Sherpa, Press release reporting on the decision to seize the Nanterre Tribunal judiciaire, 28 Jan. 2020.

[xiv] Entreprises pour les droits de l’Homme (EDH), Application of the Law on the Duty of Vigilance, Vigilance plans 2018-2019 (in English), 14 June 2019 ; Shift, Human Rights Reporting in France (in English), Nov. 2019 ; ActionAid, Amis de la Terre France, Amnesty International, CCFD-Terre Solidaire, Collectif Ethique sur l’étiquette, Sherpa, Duty of vigilance – Year 1 : Companies must do better (in English), Feb. 2019.

[xv] Notre affaire à tous, ZEA, Sherpa, Les Eco Maires, Press kit on the interpellation (in French) 23 Oct. 2018, p. 7 (this document was issued the Paris before the formal notice to comply was served).

[xvi] Les Amis de la Terre & Survie, Press kit on the formal notice to comply, including the letter of formal notice to comply to Total (in French), 25 June 2019, p. 2 (our translation).

[xvii] Id.

[xviii] UNI Global Union, Press release : Report raises red flags about Teleperformance’s compliance with the Duty of Vigilance Law, 17 April 2019 (last accessed on 18 Jan. 2020).

[xix] ITF, ETF, XPO Global Union Family, The XPO Global Union Family: Formal Notice to XPO Logistics Europe under the French Corporate Duty of Vigilance Law, not dated, p. 1.

[xx] Id.

[xxi] ProDESC, Press release reporting on the formal notice to comply to EDF, 1 Oct. 2019 (last accessed 18 Jan. 2020).

[xxii] OECD, database of specific instances, EDF / EDF Energies Nouvelles and Prodesc / Union Hidalgo Agrarian and Indigenous Sub-Community (last accessed 18 Jan. 2020).

[xxiii] Total, Vigilance plan 2019, p. 94; an unofficial translation of the letter from Total to the requesting parties’ lawyers on 14 Jan 2019 is available on the BHRRC: https://www.business-humanrights.org/sites/default/files/documents/TOTAL%20ANSWER%20STATEMENT.pdf