Here is an overview of legal measures taken in France as of April 24, 2020 in response to the coronavirus pandemic.
Please note that due to the extraordinary situation, the legislation is in continuous evolution and may change very fast.
On 16 March 2020, the French President declared that France was “at war” against the Covid-19. A few days later, the whole territory was put in a state of health emergency, which entails a certain number of legal consequences.
The emergency law N° 2020-290 of 23 March 2020 to cope with the covid-19 outbreak has indeed declared the state of health emergency for a two-month period from its publication (on 24 March 2020) and enables the Government to take, by way of orders, within three months from the publication of the law, emergency measures.
1. RESTRICTIONS OF MOVEMENT AND GATHERINGS
Until 11 May 2020, we must not leave our place of residence except for the following reasons, and with a certificate :
to go to work, if remote working is not possible;
to buy essential supplies at authorized local shops;
to go to a medical appointment that cannot be postponed or carried out remotely ; or for treatment of a long-term health condition.
to take children to daycare or to take care of an elderly person;
to take exercise individually or to walk with members of our household, within a kilometer around home and for no more than an hour.
To respond to a court or administrative summons
To join missions of public interest at the request of the administrative authorities.
Local authorities may take further measures regarding the confinement, particularly as regards the conditions under which we may take exercise. We should therefore check the website of the relevant prefecture or town hall to ensure that we are in compliance.
We will need to complete a new certificate every time we leave our home. If one does not have a printer, he/she can write it out by hand. Certificates must be filled in with an indelible pen, dated, timed and signed. An electronic version of the certificate is also available here: https://media.interieur.gouv.fr/deplacement-covid-19/ and may be presented to authorities on smartphone.
If one has to travel to work, the employer will also need to fill out and stamp a (permanent) certificate.
Access restrictions to Mainland France and to French Overseas territories are also in effect. Every traveller is requested, from 8 April 2020, 12 AM, to fill out and carry one of the following travel certificates according to his/her situation :
for a trip from mainland France to French overseas territories
for an international travel from abroad to mainland France
for an international travel from abroad to French overseas territories
The document is to be presented to transportation companies before boarding, as well as to border control authorities.
All certificates are available here : https://www.interieur.gouv.fr/Actualites/L-actu-du-Ministere/Attestation-de-deplacement-et-de-voyage
If one does not respect these rules, he/she may be liable for a €135 fine, rising to €200 in case of reoffence within two weeks; for three or more offences in a period of 30 days one may face criminal charges leading to €3750 fine and up to 6 months in prison.
2. PROTECTION OF EMPLOYMENT
In this time of health emergency, questions are being asked as to the health situation and the remedies to resort to and as to the measures employers are to implement. Independently of the opinions and/or recommendations a lawyer could give them based on a given situation, the existence of a Q&A for companies and employees published by the Ministry of employment and regularly updated is worth mentioning (Q&A for companies and employees).
In this respect, please note that “the main recommendation for companies is to have their employees telework as far as possible and to avoid business travels. They must also implement the recommended measures to fit out work stations so as to ensure a one-meter distance between employees”.
This notably entails updating the single document on risk assessment at work and consulting (remotely) the staff representative bodies.
To date, several orders and three decrees have already been published on the following subjects:
Paid leave, days of rest and working time
Additional sickness allowance / Employee savings
Purchasing power exceptional bonus (known as "PEPA")
Health services at work
2.1 Partial activity
A decree of 25 March 2020 and an order of 27 March 2020 have modified the rules applicable to partial activity.
Here are the main provisions of the decree:
· The CSE’s opinion may be sought after an application for partial activity and be submitted to the administration within a maximum two-month period.
· The application for partial activity may be sent within a 30-day period starting on the employees being placed in partial activity.
· Until 31 December 2020, the period for expressly or tacitly accepting authorization requests is brought down from 15 to 2 days.
· The hourly rate of the partial activity allowance is equal to 70% of the gross hourly wage, limited to 4.5 times the SMIC (i.e., minimum wage) hourly rate, the latter may not be less than 9.03 euros.
· The partial activity authorization may be granted for a period of up to 12 months.
· The partial activity measures are available to employees with a flat-rate pay agreement covering days worked (forfait jours).
These provisions apply to the compensation claims sent or renewed since 1 March 2020 (Decree No. 2020-325 of 25 March 2020 ).
The (Order No. 2020-346 of 27 March 2020), on the other hand, clarifies the following:
· The compensation calculation for certain categories of employees (part-time employees, employees with a professional training contract, employees on training, employees with a “forfait jours”).
· The enlargement of the measures to public companies, to employees with employers who are individuals, to foreign companies with no establishment in France but which employ at least one employee in France and to state-owned companies managing a public service of an industrial and commercial nature relating to ski lifts or ski slopes.
· The “fate” of protected employees: the order provides that partial activity shall apply to a protected employee, if it affects all the employees in the company, the establishment, the service or the workshop to which the concerned person is assigned.
· CSG (i.e., generalized social contribution) liability on the partial activity allowance and on the additional allowance paid by an employer pursuant to a collective agreement or a unilateral decision.
A Decree n°2020-435 of 16 April 2020 sets the rules to calculate the indemnity and allowance of short-time work for the employees whose working time is computed in days or hours over the year. The Decree also sets the rules applicable to specific employees such as the navigating employees of the civil aviation, freelance journalists, salespersons working under the VRP status, home-based employees, employees paid per task, artists, model, employees of live stage and recorded entertainment activities.
An Order n°2020-460 dated 22 April 2020 clarifies certain payroll issues and provides for the possibility to individualize a bit more the access to short-time work through an in-house collective agreement.
The Ministry of employment has also established and updated a Q&A on the exceptional partial activity measures : Q&A, Exceptional partial activity measures
Finally, the quota of hours able to be compensated with respect to the partial activity allowance has been brought to 1,607 hours per employee until 31 December 2020 (Administrative order of 31 March 2020).
2.2 Paid leave, days of rest and working time
An order of 25 March 2020 provides for the following measures:
· Possibility for the employer, after the conclusion of a company- or a branch-level agreement, to impose on employees, or to modify, paid leave dates within the limit of 6 working days and subject to complying with a one-clear day minimum prior notice.
· Possibility for an employer to impose on employees, or to unilaterally modify, the dates of RTT days off, of days of rest provided for by a flat-rate pay agreement or days of rest resulting from rights assigned to a time saving account, subject to complying with a one-clear day minimum prior notice, which can go up to 10 days.
· Possibility for the companies pertaining to business areas which are particularly necessary for the security of the Nation and for the continuity of economic and social life
(the list of the concerned companies shall be fixed by decree) not to comply with the maximum working periods, with the daily rest and with the Sunday rest. The use of these exemptions requires informing the CSE and the Direccte (Order No. 2020-323 of 25 March 2020).
2.3 Additional sickness allowance / Employee savings
An order of 25 March 2020 removes the one-year seniority condition to be entitled to the allowance supplementary to daily allowances, until 31 August 2020.
The order also postpones to 31 December 2020 the date of payment to the beneficiaries of the sums allocated in 2020 in relation with incentive or profit sharing, or the date of their allocation to an employee savings plan or a frozen current account (Order No. 2020-322 of 25 March 2020).
An order of 25 March 2020 provides for the extension, for jobseekers having exhausted their rights as from 12 March 2020 and until a date which shall be fixed by administrative order, of the period of payment of their allowance for a period which shall also be fixed by administrative order (Order No. 2020-324 of 25 March 2020).
2.5 Purchasing power exceptional bonus (known as "PEPA")
An order of 1 April 2020 relaxed the payment conditions of the purchasing power exceptional bonus.
First, it postpones the deadline for payment of the bonus from 30 June to 31 August 2020. Then, it enables all companies (without an incentive agreement being required) to pay this exceptional bonus with an exemption, of up to 1,000 euros, from social contributions and taxes and from the income tax. For companies with an incentive agreement, this cap is raised to 2,000 euros. Lastly, in order to allow rewarding more specifically the employees working during the covid-19 outbreak, a new criterion for adjusting the amount of the bonus may also be adopted by the collective agreement or the employer’s unilateral decision implementing this bonus. It shall now be possible to take into account the working conditions related to the outbreak (Order No. 2020-385 of 1 Avril 2020).
2.6 Health services at work
An order of 1 April 2020 provides notably that any medical examinations which are to take place as from 12 March 2020 as part of an employee’s individual health follow-up may be postponed (Order No. 2020-386 of 1 April 2020 adapting the conditions for carrying out the duties of the health services at work to the health emergency and modifying the rules applicable to preliminary partial activity authorization requests).
The provisions of this ordinance have been clarified with the decree n°2020-410 of 8 April 2020 temporarily adjusting to the state of health emergency the time frames for medical visits and exams by the occupational health services.
2.7 Professional training
Among the measures provided for to secure training during the covid-19 crisis, an order of 1 April 2020 notably provides for the possibility for an employer to postpone the work-related interview which gives a summary of the employee’s career path until 31 December 2020 along with the possibility to extend, by amendment, the apprenticeship contracts and professional training contracts whose termination date occurs between 12 March and 31 July 2020 (Order No. 2020-387 of 1 April 2020 ).
2.8 Staff representatives
The rules relating to staff representative bodies’ meetings and to professional elections during the state of health emergency have been adjusted by an order of 1 April 2020.
The main measures are the following:
· Suspension, as from 12 March 2020, of the electoral processes which started before 3 April 2020, for a period of three months from the end of the state of health emergency.
· Suspension of the electoral processes which are to start during the state of health emergency, in which case the procedure shall start within three months of the end of the state of health emergency (i.e., before 24 August 2020).
· Extension of corporate offices held by elected representatives and protection against dismissals during the extension period.
· Possibility to hold staff representative bodies’ meetings by video conferences, conference calls (under conditions to be set by decree) or instant messaging (under conditions to be set by decree and if there is an impossibility to arrange a video conference or a call conference or if a company-level agreement provides therefor).
· In any event, an employer must inform the members of the staff representative body of the conditions in which the meeting can be held.
· The decision to impose on employees dates for their days of rest or to implement the exemptions to working time or to Sunday rest, pursuant to the order No. 2020-323, must give rise to immediate information of the CSE. The latter’s opinion shall be given within a month from this information. An employer may however implement these measures before the CSE gives its opinion (Order No. 2020-389 of 1 April 2020 ).
A Decree n°2020-419 dated 10 April 2020 authorizes and organizes meetings of the CSE through videoconference, conference call or any other digital tool.
An Order n°2020-460 dated 22 April 2020 announces a decree to come in order to adapt CSE consultation timelines relating to Covid-19.
3. SUPPORT TO BUSINESS
3.1 Solidarity fund
An Ordinance n°2020-317 dated 25 March 2020 completed by decree n°2020-371 dated 30 March 2020 and decree n°2020-394 dated 2 April 2020 has created a solidarity fund intended to provide financial aid to natural and private law legal persons having economic activity severely affected by the Covid19 crisis.
The Solidarity Fund is created for a three-month period (renewable once for the same duration by decree) and will be funded by the State, and on voluntary basis, by regions and certain other territorial authorities.
In order to be eligible, the enterprises shall fulfil the following criteria:
· having started their activity before 1 February 2020;
· not having suspended its payment as at 1 March 2020;
· employ less than 10 employees;
· turnover inferior to 1 million euros;
· taxable profit inferior to 60,000 euros;
· not be controlled by a commercial company;
· not be, as at 31 December 2020, in difficulty within the meaning of EU Regulation n°651/2014.
In addition, these enterprises must be subject to a ban on receiving public or experience a loss of turnover of at least 50% for the month of March 2020 compared to the month of March 2019 (for the aid paid in March); a loss of turnover of at least 50% for the month of April 2020 compared to the month of April 2019 or to the average monthly turnover of 2019 (for the aid paid in April).
The amount of such aid will amount a maximum of 1,500 euros, which may be increased by 2,000 euros if the enterprise (i) employs, as at 1 March 2020, at least one employee (with a fixed-term or open-ended contract), (ii) is not be able to pay its debts for the next thirty days and (iii) has been refused a loan of a reasonable amount from a bank of which it was already client (if the demand was made after 1 March 2020).
An additional aid of EUR 2.000 to 5.000 may be granted to enterprises experiencing the most difficulties, under certain conditions.
To get the solidarity fund, companies have to send a declaration through the tax authority’s website (impot.gouv.fr).
An Order n°2020-460 dated 22 April 2020 provides that any evidence supporting the request of solidarity fund must be kept during 5 years in case of control by tax authorities.
Smallest companies, which are eligible for the solidarity fund, may also benefit from the postponement of the payment of their rent as well as bills relating to water, electricity and gas (Ordinance n°2020-316 dated 25 March 2020).
For gas, electricity and water bills, companies can send an amicable deferral request by email or telephone to their supplier.
Then, the collection of rents and charges for small companies whose activity has been interrupted by decree is suspended from 1st April 2020, and for subsequent periods of cessation of activity.
Concerning small companies whose activity, without being interrupted, is seriously degraded by the crisis, their situation will be studied on a case-by-case basis.
3.2 Postponement of payment of social security contributions and fiscal taxes
All companies can, without justification or penalty, ask the business tax service to postpone the payment of their direct taxes. Social security contributions payable to the URSSAF may also be deferred, in whole or in part, without penalty.
Date of payment of these social contributions and taxes may be postponed up to 3 months.
3.3 Bank loan
The government has implemented a system of guarantees to support the bank financing of companies, up to 300 billion euros.
Until 31 December 2020, businesses of all sizes, regardless of their legal form, with an exception of real estate companies, credit institutions and finance companies, may apply to their usual bank for a loan guaranteed by the State to support their cash flow.
This loan may represent up to 3 months of 2019 turnover, or two years of total payroll for innovative companies or companies created since 1st January 2019. No reimbursement will be required the first year. The company may choose to reimburse the loan over a maximum of five years.
3.4 Credit mediation
Credit mediation is a public system that helps any company that encounters difficulties with one or more financial institutions. 105 mediators are present in the whole French territory.
To get in contact with a credit mediator: https://mediateur-credit.banque-france.fr/
4. CONSEQUENCES ON CORPORATE LAW
4.1 Legal basis
Under the terms of Emergency Law No. 2020-290 of 23 March 2020 dealing with to the spread of the Covid-19 epidemic, the Government was authorized, inter alia, to take any measure by ordinance:
“(f) simplifying and adapting the conditions under which general meetings and collegial management bodies of legal persons governed by private law and other entities meet and deliberate, as well as the rules relating to general meetings;
g) simplifying, specifying and adapting the rules relating to the drawing up, closing, audit, review, approval and publication of accounts and other documents that legal persons governed by private law and other entities are required to file or publish, in particular those relating to timetable,, as well as adapting the rules relating to the allocation of profits and the payment of dividends”.
It is in this context that two ordinances have been taken :
· Ordinance n°2020-318 dated 25 March 2020 adapting the rules relating to the drawing up, closing, audit, review, approval and publication of accounts and other documents and information that private law legal persons and entities without legal personality are required to file or publish in the context of the covid-19 epidemic;
· Ordinance n°2020-321 dated 25 March 2020 adapting the rules governing meetings and deliberations of general meetings and governing bodies of private law legal persons and entities without legal personality in the context of the covid-19 epidemic.
4.2 Ordinance N°2020-318: Adaptation of the rules relating to the drawing up, closing , audit, review, approval and publication of financial statements
1. Extension of submission time limit of financial statements by the management board to the supervisory board
The three-month period following the end of each financial year granted to the management board to present the financial statements (and, where applicable, consolidated accounts), together with the management report and any other documents required by law, to the supervisory board for verification and auditing purposes, is extended by three months.
Only companies closing their accounts between 31 December 2019 and the expiry of a period of one month after the date of cessation of the state of health emergency declared by article 4 of the emergency aw dated 23 March 2020 may benefit from this extension.
This extension does not apply to companies that have appointed a statutory auditor when such auditor has issued his report on the accounts before 12 March 2020.
2. Extension of the time limit for drawing up financial statements by the liquidator
The three-month period following the end of each financial year granted to the liquidator of all commercial companies whose dissolution has been decided to draw up the annual financial statements and the report referred to in article L.237-25 of the French Commercial Code is extended by two months.
Once again, only companies closing their accounts between 31 December 2019 and the expiry of one month after the date of cessation of the state of health emergency in force may benefit from this extension.
3. Extension of the deadline for approving the financial statements
Time limits required by law and regulations or by the by-laws of private law legal entities (including in particular sociétés par actions simplifiée) or entities without legal personality to approve the financial statements and, where applicable, the documents attached thereto, or to convene the general meeting responsible for such approval, are extended by three months.
This extension has a very broad scope of application: civil and commercial companies, economic interest groupings, cooperatives, mutual associations, unions and federations of mutual associations, mutual insurance companies, provident institutions and social protection insurance group companies, municipal credit unions and mutual agricultural credit unions, funds, associations, foundations, unincorporated partnerships (sociétés en participation).
However, this extension shall not apply to entities that have appointed a statutory auditor when such auditor has issued his report on the accounts before 12 March 2020.
Only entities closing their accounts between 30 September 2019 and the expiry of one month after the date of cessation of the state of public health emergency in force may benefit from this extension. Thus, companies closing their accounts on 31 December 2019 have until 30 September 2020 to have them approved.
4. Extension of the deadline for drawing up management forecast documents
Companies of a certain size – those with at least 300 employees or a turnover of at least EUR 18 million – must draw up a statement of realisable and available assets, a forecast profit and loss account, a cash flow statement and a forecast financing plan.
Deadlines imposed on the board of directors, management board or managing directors pursuant to article R. 232-2 of the French Commercial Code for the preparation of the aforementioned documents are extended by two months.
This extension applies to documents relating to accounts or half-years closed between 30 November 2019 and the expiry of one month after the date of cessation of the current state of emergency.
4.3 Ordinance N°2020-321: Adaption of the rules for meetings and deliberations of general meetings and management of supervisory bodies
The ordinance encompasses all private law legal persons and entities that do not have legal personality. The following entities are thus covered without limitation: civil and commercial companies (including unincorporated partnerships (sociétés en participation), pools of holders of securities or financial securities, French and European economic interest groupings, cooperatives, mutual insurance companies, mutual associations and federations of mutual insurance companies, mutual insurance companies, provident institutions, municipal credit unions and mutual agricultural credit unions, endowment funds (fonds de dotation), sustainability funds (fonds de pérennité), associations and foundations.
The measures provided for apply to all types of general meetings (ordinary, extraordinary and special meetings) and collegial supervisory or management bodies (such as boards of directors, supervisory boards and management boards), each being faced with difficulties to hold meetings because of the measures enacted to contain the spread of covid-19.
The ordinance makes a distinction between general meetings on the one hand and collegial administrative, supervisory or management bodies on the other hand, but provides a unified response to these issues.
2. Meetings of collegial supervisory or management bodies
Extending the use of videoconference and telecommunication facilities
The use of videoconference and telecommunication facilities is authorised for all meetings of collegial bodies, including those relating to the approval or review of the annual financial statements, without condition that the use of such facilities be included in the by-laws and internal regulations and without a clause to the contrary in the by-laws being able to oppose it.
In order to guarantee the integrity of the discussions, the technical means used must enable to identify the members of these bodies and guarantee their effective participation, the transmission of at least the participants’ voice and implementation of processes that allow the continuous and simultaneous retransmission of the deliberations being sufficient to meet this condition.
Extension of the use of written consultations
The use of written consultations of members of the boards is extended. The use of this mode of deliberation is authorised for all meetings of the collegial bodies, including those relating to the approval or review of the annual financial statements, without condition that the use of such facilities be included in the by-laws and internal regulations and without a clause to the contrary in the by-laws being able to oppose it.
The written consultation must be carried out under conditions, in particular in terms of timetable, which ensure the collegiality of the deliberations.
3. Convening and holding of general meetings
Convening and information rules
Firstly, as regard listed companies, the ordinance precludes any nullity of meetings when a convening notice to attend by post could not be sent out due to circumstances outside the company’s control (e.g. impossibility of access to the premises or of preparing the necessary notices, in the context of the covid-19 epidemic)
Pursuant to article 3 of the ordinance, the dematerialised exercise of the right of communication to which members of the meetings are entitled prior to the meeting is extended and made more flexible, thus authorising the use of electronic messages. However, and subject to this arrangement, the right of communication remains governed by the provisions specific to each meeting.
Furthermore, the formalities for convening meetings for which the place and mode of participation will be modified by applying the alternative methods of participation provided for by the ordinance (see point 1.3.2 below) are adjusted on an exceptional basis (article 7 of the ordinance 2020-321).
This particularly applies to entities that initiated these formalities before the date of entry into force of the ordinance with a view to a meeting to be held after that date.
In this case, the competent body of the entity that decides to apply the possibility of holding a “closed” meeting, by videoconference or written consultation, must inform the shareholders or members, either by means of a press release in the case of listed companies, or by any means ensuring that members in other entities are effectively informed, without having to repeat the formalities already completed on the date of this decision – any irregularity in convening the meeting being disregarded – (but without prejudice to the formalities that remain to be completed).
Rules of participation and deliberations
· Possibility of holding closed sessions
The holding of “closed” sessions (i.e. without the physical participation or participation by means of videoconference or telecommunication of their members and other authorised participants, such as the statutory auditors and representatives of employee representative bodies) is exceptionally authorised, so as not to prevent the adoption of decisions whose adjournment could have significantly adverse consequences (e.g. on the granting of financing).
However, recourse to this derogation is subject to the condition that the meeting has been convened in a place affected, on the date of the convening notice or on the date of the meeting, by an administrative measure limiting or prohibiting collective gatherings on health grounds.
If this measure derogates on an exceptional and temporary basis from the right of members of general meetings to attend sessions (as well as from the rights whose exercise requires attendance at the meeting, such as, for example, the right to ask oral questions or to amend draft resolutions during the meeting), it must not affect the other rights (such as the exercise of the right to vote or the right to ask written questions) which are exercised in accordance with the provisions laid down in the texts applicable to them.
When a decision is made to hold a closed session, the members of the meeting (and other authorized participants) must be notified by any means capable of ensuring that they are effectively informed (such as notice of convening documents) of the date and time of the meeting and the conditions under which they will be able to exercise the rights attached to their membership.
Members shall participate and vote at the meeting in accordance with the other terms and conditions provided for by the texts governing the meeting and the ordinance (such as sending a proxy, remote voting or, if the body competent to convene the meeting so decides, videoconference or means of telecommunication).
· Facilitation of alternative modes of participation in meetings
In order to facilitate the participation of members in meetings held in closed session, method of participation by videoconference or written consultation is extended on an exceptional basis. These alternative methods of participation may be used for all decisions falling within the jurisdiction of general meetings, including those relating to the accounts. The decision to use them is made by the body competent to convene the meeting, which may delegate its competence to the legal representative of the entity.
It thus becomes exceptionally authorised for entities for which this form of participation is not already provided for by law.
For entities for which this form of participation is authorised by law subject to certain conditions, the ordinance exceptionally neutralises these conditions (e.g. that subjecting it to the existence of a clause in the by-laws) and precludes the enforceability of a clause to the contrary in the by-laws,
In all cases, the means of videoconference or telecommunication used must ensure the identification of shareholders or partners and guarantee the integrity of the debates, the transmission of at least the voice of the participants and the implementation of processes allowing the continuous and simultaneous retransmission of the deliberations being sufficient to meet this condition.
With the same objective, recourse to written consultation of general meetings for which this method of participation is already provided for by law is facilitated by making it possible without a statutory clause to this effect being necessary or being able to oppose it.
5. CONSEQUENCES ON LEGAL PROCEEDINGS
5.1 Legal basis
Ordinance N° 2020-306 dated 25 March 2020 deals with the extension of time limits during the period of the health emergency and the adaptation of procedures (hereinafter, the Ordinance).
In substance, the Ordinance provides for new time limits applicable to civil proceedings in the context of the health emergency, taken into consideration that a specific Ordinance (n°2020-303 dated 25 March 2020) exists on time limits applicable to criminal proceedings.
The Ordinance implements a period of legal protection (i) and provides both for the extension of the limitation and foreclosure periods for certain acts (ii) and a moratorium applicable to certain contractual clauses (iii). Its interpretation is facilitated by a circular of 26th March 2020 of the Ministry of Justice (hereinafter, the Circular).
5.2 Implementation of a period of legal protection
Only the limitation periods that should have expired "between 12th March 2020 and the expiry of a time limit of one month from the date of termination of the health emergency period" benefit from the prorogation.
As a reminder, the health emergency period is declared "for a period of two months from the entry into force of this law" (Article 4 of law 2020-290). As this law is of immediate application, the date of termination of the health emergency period is set on 24th May 2020, subject to possible legal extensions or premature termination by decree.
The period of legal protection would be between 12th March and 24th June 2020 (date of termination of the health emergency period extended by one month) (hereinafter, the Protection Period).
Excluded are the limitation period whose, term expires outside of the Protection Period, i.e. either before 12th March 2020, or after the month following the date of termination of the health emergency period.
5.3 Extension of procedural deadlines
The material scope of application is very broad. The extension of limitation periods concerns all acts, appeals, legal actions, formalities, declarations, notifications or publications "prescribed by law or regulation" (Article 2 of the Ordinance), thus excluding acts affected by contractually fixed time limits.
However, it should be noted that, at the end of this period, these acts or payments must be carried out "within the time limit legally set for action" but "within a limit of two months".
Does the Ordinance have a suspensive or an interruptive effect? As a reminder, the suspension stops the course of the limitation or foreclosure period temporarily, without, however, erasing the period already elapsed prior to the suspension. On the contrary, the interruption of the limitation period resets the starting point of a new period.
The Circular seems to provide elements of response in favour of an interruption of the limitation periods, without, however, explicitly referring to this notion:
"The Ordinance does not provide for a general suspension nor a general interruption of the time limits, which have expired during the legally protected period defined in Article 1, nor does it provide for the abolition of the obligation to carry out all acts or formalities, the term of which expires within the period referred to. (…)”
The same circular states that: "the legal time limit for taking action shall run again from the end of this period, in the limit of two months".
Thus, one understands that there is an interruption of the current limitation periods, thus creating a new period starting to run at the end of the Protection Period, which seems to be confirmed by the Circular.
Consequently, any period extended under the provisions of the Ordinance and starting to run from 24 June 2020, should end at the latest on 24 August 2020.
The following administrative or jurisdictional measures are thus automatically extended:
"1° Precautionary measures, legal inquiries, investigation, conciliation or mediation measures;
2° Prohibition or suspension measures that have not been pronounced as a sanction;
3° Authorizations, permits and approvals;
4° Measures of assistance, accompaniment or support for persons in social difficulty;
5° Measures to assist in the management of the family budget.”
5.4 Moratorium applicable to penalty payments and to certain contractual clauses
The Ordinance also aims to take into account the difficulties of enforcement resulting from the health emergency by paralysing the penalty payments ordered by the courts or the administrative authorities as well as the contractual clauses aimed at sanctioning the non-fulfilment of an obligation within a given period (penalty clauses (clauses pénales), termination provisions (clauses résolutoires) and forfeiture clauses (clauses de déchéance) (hereinafter, the Contractual Clauses) (Article 4 of the Ordinance).
Thus, penalty payments and Contractual Clauses are deemed not to have taken place or not to have taken effect, if the payment period or a deadline for fulfilment of a contractual obligation has expired during the Protection Period. They will take effect one month after the Protection Period, if the debtor has not fulfilled his obligation by that time.
Penalty payments and penalty clauses, which had taken effect before the beginning of the Protection Period, are suspended during the Protection Period; they will become effective again the day after the end of the Protection Period.
The Circular also provides that when the penalty payments or the penalty clauses had taken effect before the beginning of the Protection Period, the judge or the administrative authority may terminate them if the matter is referred to them (but this is not specified in the Ordinance).
The Ordinance also contains provisions on the termination or denunciation of agreements.
A party that, could not terminate a tacitly renewable contract or object to its renewal within the contractual time limit because of the covid-19 epidemic may be given additional time to do so. In this respect, the Ordinance sets two-month period following the end of the Protection Period (i.e. until 24th August 2020) to terminate or denounce an agreement if, its termination or the objection to its renewal was supposed to take place within a period or a time limit, that normally expires during the Protection Period.
By granting these additional time limits, the government wishes to ensure enhanced protection of the interests of the parties to certain contractual clauses in the exceptional circumstances imposed by covid-19. However, it must be anticipated that questions will arise as to the application of the Ordinance.