Never the most celebrated actor on the stage of English litigation, the French Blocking Statute nonetheless has its fans, particularly among competition lawyers. The recent decision of the Court of Appeal in Secretary of State for Health v Servier Laboratories  EWCA Civ 1234, however, may prove the Statute’s final curtain call in this jurisdiction.
Law No. 68-678 of the French Republic, to give the Statute its proper name, was originally enacted in response to a United States antitrust investigation into French shipping companies. By 1980, the heat of US antitrust scrutiny was on French aviation: two Air France executives had been interrogated in the US; a passenger had started private antitrust proceedings against Air France in the US Courts claiming that he had been overcharged for a flight from Paris to Rome; the US Civil Aviation Board was threatening to withdraw the antitrust immunity of IATA, of which Air France was a member. France’s response was to enact Law No. 80-538, amending and substantially broadening the scope of the 1968 Law to create a barrier against the long arm of US extraterritorial antitrust proceedings and, in particular, their discovery rules. (For a detailed account of the perceived abuses of US antitrust law which led to the enactment of Law No. 80-538, see Toms, “The French Response to the Extraterritorial Application of United States Antitrust Laws”, 15 Int’l. Law. 585).
The terms of the Blocking Statute as amended are extremely broad, confined neither to antitrust proceedings, nor to aviation, nor to the US. Indeed it was in The Heidberg  2 Lloyd’s Rep 324, a shipping dispute, that the Statute is first recorded to have walked the boards (or, as it turned out, the plank) of an English Court. The defendant shippers and insurers, both French companies, sought to discharge orders for discovery and inspection of documents on the grounds that compliance with those orders would put them in breach of Article 1 bis of the Statute, which provides as follows:
Subject to international treaties or agreements and applicable laws and regulations, any individual is prohibited from requesting, seeking or disclosing, in writing, orally or in any other form, documents or information of an economic, commercial, industrial, financial or technical nature, with a view to establishing evidence in foreign judicial or administrative proceedings or in relation thereto.
However, Cresswell J accepted the evidence of the plaintiff’s expert that, despite the broad terms of the Statute, it was intended to apply to ‘abusive foreign discovery proceeedures as, for example, the “long-arm statutes” practised in the United states’. He was unpersuaded that the defendants would commit a criminal offence if they complied with the disclosure order, and considered there to be no risk that they would be charged with any such offence.
Despite its failure in The Heidberg, the French Blocking Statute has from time to time played parts in the procedural stages of English litigation, but never with any success, at least so far as reported cases are concerned. Most recently, the Statute was deployed in the cases of Servier  EWHC 2761 (Ch),  EWHC 3663 (Ch) and Alstom  EWHC 822 (Ch). Again, the Blocking Statute was a failure at first instance: attempts to resist an order for Part 18 further information in Servier and for specific disclosure in Alstom were rejected, by Henderson J and Roth J respectively. The defendants appealed.
Their central argument was that in light of the decision of the CJEU in Case C-332/11 ProRail BV v Xpedys NV (21 February 2013), it was mandatory for the English Court to have resort to the Taking of Evidence Regulation (Council Regulation (EC) 1206/2001), rather than itself to order disclosure or further information. The ProRail case concerned a Belgian Court making an order for the taking of evidence in the Netherlands by a Belgian expert. The CJEU held at ¶47 that although it is not normally mandatory to use the Regulation, it will be mandatory where what is ordered in another Member State affects “the powers of the Member State”. That was so in the Servier and Alstom cases, argued the appellants, since what had been ordered involved a violation of French law.
The Court of Appeal did not hesitate in dismissing the appeals. Rimer LJ and Beatson LJ (with both of whom Laws LJ agreed) each held that matters such as disclosure were governed by the lex fori, English law; the risk of illegality of prosecution under French law was a matter which went only to the Court’s discretion, and had been properly taken into account by Henderson J and Roth J (¶¶99, 102-107, 117). As for ProRail, Rimer LJ distinguished it on the basis that the case only decides that a domestic court must use the Taking of Evidence Regulation where it wishes to obtain evidence in another Member State in a way which requires the assistance of that State’s authorities (¶101); Beatson LJ did so on the basis that disclosure and Part 18 Requests do not constitute the “taking of evidence” within the scope of the Regulation (¶¶112-116).
More fundamentally, as Beatson LJ observed, France is bound by the TEU and the TFEU, and in particular by the duty of co-operation under Article 4.3 TFEU, the principle of non-discrimination in Article 18, and the competition rules in Articles 101 and 102. How can the French Blocking Statute be lawful insofar as it purports to prohibit compliance with the orders of a court of a Member State properly seised of an Article 101 or 102 claim? As Beatson LJ put it rather more carefully: ‘at its lowest, France’s obligations under the Treaty mean that a prosecution in respect of any information provided… is highly unlikely’ (¶118).
The Court of Appeal’s judgment may mark the end of the French Blocking Statute’s career in England and Wales. Even in a non-EU case, extremely compelling evidence of a real risk of prosecution (which has hitherto eluded litigants) is likely to be necessary to persuade the Court in its discretion not to order disclosure. But surely, in a claim based upon Article 101 or 102 TFEU or other provisions of EU law, the Blocking Statute can never act again?
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