The English Court (Chancery Division) has again considered the problem created for French companies that are parties to litigation outside France by French Law No 68-678 of 26 July 1968 ("the Law"). The Law prohibits the communication or disclosure (and possibly even the search for) documents or information of an economic, commercial, industrial, financial, or technical nature for use as evidence in foreign judicial or administrative proceedings without an order of the French Court. Breach of the Law is a criminal offence exposing the company and individuals to up to six months imprisonment and/or a fine. (National Grid Electricity V ABB and Others,  EWHC 822 (Ch), 11 April 2013).
The issue arose in the context of a large-scale follow-on damages action by National Grid against various companies for breach of European competition rules. The breach arose out of the supply of Gas Insulated Switchgear over a period of 16 years where the European Commission decided that 20 companies had engaged in a sophisticated cartel and imposed fines of more than €750 million. The task of estimating the cartel overcharge and therefore the damages to be awarded was a matter for expert evidence and heavily dependent on documentary evidence. Disclosure was therefore of great significance. Clearly, the French defendants did not wish to expose themselves to criminal sanctions in France.
The English court was required to exercise its discretion in deciding whether to order disclosure, taking into account, among other things, the importance of the evidence and the degree of risk of prosecution in France if the order for disclosure was made and complied with. The court decided to order disclosure. The judge considered it virtually inconceivable that, where another European court had assumed jurisdiction over a French company in accordance with the Brussels Regulation in order to determine a claim for damages alleged to result from an established and serious violation of a fundamental provision of EU law, the public authorities of France would in the exercise of their discretion institute criminal proceedings against that company for complying with the procedural rules of the Member State where the proceedings had been brought. This was particularly so where the proceedings served an objective of EU policy.
In reaching this decision, the judge took into consideration that there was only one known case of such a criminal prosecution having been brought in France (the Christopher X/MAAF case in 2007). However, this case arose on very exceptional facts. Christopher X was a French lawyer who had attempted to obtain information in France covered by the Law without an order of a foreign court and by deception.
The judge also took into consideration the context in which the Law had been passed, namely because of concern in France at what were seen as abusive discovery requests being made of French companies facing litigation, particularly in the United States. However, the disclosure requests in these English proceedings were made for an entirely legitimate and necessary purpose. Moreover, where French companies had in the past complied with U.S. disclosure orders, no criminal prosecutions had been brought (for example, the extensive disclosure given by Air France in the antitrust litigation arising from an air cargo cartel pursuant to an order of the U.S. District Court for the Eastern District of New York in 2010).
The French defendants in this case were not opposed to giving disclosure. They simply found themselves in the invidious position of potentially having to comply with an order of the English court and thereby place themselves at risk of criminal prosecution in France. The French defendants did obtain orders from the French court that requests be issued for the taking of evidence in France under the EU Evidence Regulation, but these were rejected by the French Ministry of Justice (the implications of the grounds of rejection—whether they would make criminal prosecution in France more or less likely—were disputed). On the basis that the English court does not generally regard its orders as abusive, there are not likely to be many, if any, cases where it declines to order disclosure simply on account of the risk posed by the Law.