Government must prepare all sectorial bills in accordance with new simplification requirements by the second quarter of 2018.

By Paul Davies and Michael Green*

The French Prime Minister has further emphasised the importance of France’s new regulation simplification policy in an Administrative Circular Letter of January 12, 2018.

Citing the fact that the administrative burden weighing on businesses represents an annual €60 billion, or 3% of the country’s gross domestic product (GDP) alone, the Prime Minister directed that each central administration director (directeur d’administration centrale) draft simplification plans at the level of each ministerial department before the end of Q1 2018. From Q2 2018 onwards, the French government will have to prepare all sectorial bills in accordance with these simplification requirements. The newly created Inter-ministerial Directorate for the Transformation of the Public Sector will review all sectorial bills in close coordination with the General Secretariat of the Government (SGG).

The French government has been taking steps to curb the development of regulation, in accordance with commitments made during Emmanuel Macron’s successful presidential campaign. According to the last census of regulations in 2010, French regulation includes 58 codes, 2,000 laws, and 26,000 decrees — numbers that have undoubtedly increased in the intervening period. France has entered the first stage of an overall effort to simplify norms, which will not only affect regulations but should also apply to laws further to an upcoming constitutional reform.

The Prime Minister set four objectives relating to regulations in the Administrative Circular Letter of 26 July 2017:

1. Any new regulation shall be offset by the removal of at least two existing regulations, and if that is not possible, such regulations must be simplified.

For such removals or simplifications to be considered valid, they must be: (a) implemented in the same area of the new regulation; and (b) qualitatively equivalent and satisfy more than a mere quantitative objective.

The SGG will be responsible for ensuring compliance with this rule and will, as necessary, order that the enactment of a new regulation be abandoned if the “double-offset rule” (règle de double compensation) is not met.

Two categories of regulations are not subject to the application of this new rule: (a) regulations implementing new laws; and (b) regulations with no administrative impact on civil society at large (e.g. organization of the administration, criminal procedure, status of civil servants, and budgetary measures).

2. The assessment of the impact of regulations will improve. The Prime Minister requires that regulators work to assess regulations that impact businesses, local administrations, and individuals, and which are not considered necessary for the enforcement of the primary law.

3. Greater vigilance on the transposition of EU directives will occur. This means that the government will prohibit any measure that extends beyond the minimum requirements of an EU directive. The cabinet will determine any derogations to this principle and will only permit them if duly justified. Any gold-plating (surtranspositions) that is identified will be redrafted to align with EU requirements.

4. Laws and regulations should be limited to language necessary to give legal effect to policies. In particular, laws and regulations should not include affirmation of political principles or other unnecessary language.

France’s process of simplification follows attempts to minimise and limit “red tape” that has been seen in the EU, the UK, and other jurisdictions. Latham will continue to track whether the French government successfully implements the aforementioned objectives, and whether such actions result in the removal or simplification of existing regulations.

*This post was prepared with the assistance of David Desforges, Avocat à la Cour (Paris)