02 mai 2016

Value creation : How the lawyer can create value by reducing a fine


Les Echos, one of France’s best Economic newspapers, has a weekly page devoted to law and business.

On its Monday 25 April 2016 issue, the newspaper published an article written by its journalist Vincent BOUQUET titled “Réduire une amende en usant du droit”.

In December 2013, Société Générale and several other banks accepted an agreement to put an end to an inquiry on the LIBOR/EURIBOR scandal in which several banks had secretly agreed on the interest rate of interbank loans, thereby violating European competition law. The whole case was settled for a price of 1,7 Billion euros, with 445,8 Million for Société Générale.

The French bank decided to challenge this agreement on the basis that it was discriminatory as it did not follow the market share of each bank.

The European Commission finally accepted to reduce the fine by 218 Million euros.

According to the journalist, there is a double efficient legal risk management by Société Générale.


First, they enter an agreement with the European commission and as a consequence solve their case quickly and with a limited liability, compared to companies like JP Morgan and Crédit Agricole that undergo a court procedure that may lead to an uncertain and potentially higher sanction.

Secondly, they challenge the agreement when they notice that their share is more important than what they think is fair.


No doubt anyway that Société Générale lawyers created value for their company in this LIBOR proceeding !



EDHEC Business School

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20 avril 2016

How to use a legal duty as a marteking tool

Sometimes, complying with a legal duty can be used as an asset for a company.

This is what happened in April for mobile phone operators.

On 20 April 2016, SFR sent a message so its clients "Good news ! As soon as 30 April 2016, phone use prices from Europe and overseas departments not included in your phone contract go down due to European legislation. Get more information about our new prices on our website..."

Than French mobile communication commany could as a consequence take advantage of their duty to comply with European legislation as a marketing advantage to communicate some good news towards its clients.

A good example of how legislation is not necessarily a flaw but can also be used as a positive element by companies.



EDHEC Business School

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06 avril 2015

The impact of law on entrepreneurship in the wind energy business

As a number of articles of this blog show, law has an impact on entrepreneurship. The example of wind energy proves that this influence can be both positive and negative. 

Law can have a positive influence in two ways.  First, law can make it possible or easier to develop a business.  It can allow new types of wind energy machines or facilitate the settling of such wind energy machines on land. Parliament may also create incentives for consumers like tax credits or the duty of energy distributors to buy the electricity produced. That will foster demand and as a consequence boost sales... 

As a book published recently shows, law may also have a negative effect on entrepreneurship.  In their book "les énergies renouvelables" published in their collection "le monde expliqué aux vieux" by the editor 10/18 in November 2014 in parnership with Claude Nahon from EDF, Nicolas Barre and Merlin Roubaud show that several legal reasons limited entrepreneurs' attraction for wind energy.


The first one is the imprevisibility if the legal framework. France decided to subsidize the buying of wind electricity by distributors so that wind energy producers get induced to do so. The European court of justice however cancelled that subsidized price on 19 December 2013 and government still needs to set a new price. In the meantime, wind energy machines producers don't dare invest before the legal framework is set. 

The other reason why law limits entrepreneuship in the wind energy sector is a judiciary one. In order to settle a wind energy plant, one needs to get administrative approval. As the authors showed, more than one project out of two is then challenged in court by citizen or organisations opposed to the subsequent visual or sound pollution. Building a wind energy appliance in France may therefore take an average of 6 to 8 years whereas it would take 2 to 4 years in Germany.

As a report "panorama des énergies renouvelables 2013" summarises, "the legal insecurity over the regulatory framework and the administrative complexity linked to the development of these business participate in limiting their growth".

A very good example of the inducing and limiting effects of law on entrepreneurship. 

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Associate professor in Legal Entrepreneurship

Professeur associé en entrepreneuriat juridique  

BBA Entrepreneurship programs director

Responsable des programmes d'entrepreneuriat BBA

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06 mars 2015

The Kase and the use of law for entrepreneurship

The Kase is a company selling cell phone cases.

thekase_logoLast year, The Kase could hight expand its turnover by opening new shops that were formerly operated by The Phone house. Kase indeed could use commercial rent legislation to develop its business in an efficient way.

According to the French commercial code, when a commercial lease is signed, the tenant can transmit its right to be a tenant to a third party. Thid cannot be refused by the landlord either if the tenant's business us sold too, or if the tenant company gets bankrupt. The new tenant must however perform an activity that is allowed by the lease contract. If not,  the landlord can refuse or use his position in the negotiation to impose a higher price or more costly lease conditions.

When the cell phone distributor "The phone house" got bankrupt, the Kase offered to buy a number of leases. The shops were situated in very good commercial places. At this time however, following the entering of Free Mobile on the mobile market in France, all cell phone distributors were in a bad shape and none was therefore interested in buying The phone house. 

Because the Kase sold phone cases, its activity was allowed by The phone house's leases. The Kase could therefore buy the right to operate in these shops for a low price without having to pay anything to landlords. This is one, even if it is not the only, reason why The Kase could quickly and successfull develop in France during the last two years.

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Associate professor in Legal Entrepreneurship

Professeur associé en entrepreneuriat juridique  
BBA Entrepreneurship programs director

Responsable des programmes d'entrepreneuriat BBA


Accounting, Law and Finance Department
Bureau S3-193
24 avenue Gustave Delory
CS 50411  
Entrée du campus : 372, Rue Verte - 59170 CROIX



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08 janvier 2015

Two famous lawyers at EDHEC Business School on 13 January 2015

L'Agora-EDHEC is a student union at EDHEC Business School. They organise conferences and debates with famous speakers in the EDHEC auditoriums, gathering 200 to 700 participants.

Next Tuesday, l'Agora-EDHEC invited two renowned French lawyers, Hervé Témime and Jean Veil, to speak about law and espacially debate on the topic "Well knowing law or well knowing the judge ?".


Here is the official invitation :


L’Agora, tribune étudiante d’EDHEC Business School, vous invite à rencontrer Hervé Temime et Jean Veil,  le  mardi 13 Janvier sur le campus de Lille. Les deux avocats viendront débattre autour du thème « Bien connaître la loi ou bien connaître le juge ? » en nous livrant leur point de vue quant à leur profession et quant au système juridique français.


Jean Veil et Hervé Temime sont deux ténors du barreau français. Ces dernières années, Jean Veil a défendu quelques personnages célèbres dont Dominique Strauss-Khan  - dans le cadre de l’affaire de la MNEF et de la plainte de Tristane Banon- et l’ancien Président de la République Jacques Chirac lors de l’instruction de l’affaire des emplois fictifs de la mairie de Paris. En 2008, enfin, il est l’avocat de la Société Générale au cours du très médiatique procès Kerviel. Parmi ses autres clients, on compte également le Crédit Lyonnais dans l’affaire Tapie et les sociétés Elf, L’Oréal et BNP Paribas.


Hervé Temime s’est très vite illustré dans de très nombreux procès d’Assises. Il est reconnu depuis de longues années comme un spécialiste de la défense pénale des personnes physiques et morales, en droit pénal général comme en droit pénal des affaires. Il a assuré la défense de personnes impliquées dans de nombreux dossiers sensibles : Cogedim, Thomson/Lagardère, Executive Life, Agnès Le Roux-Agnelet, Erika, Angolagate, Clearstream, Mediator…"

The conference takes place at 6pm in the EDHEC Business School auditorium

372, Rue Verte - 59170 CROIX


Associate professor in Legal Entrepreneurship

Professeur associé en entrepreneuriat juridique  
BBA Entrepreneurship programs director

Responsable des programmes d'entrepreneuriat BBA


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04 avril 2014

Why does BMW produce hybrid cars ?

The german car brand recently launched new cars powered with an hybrid electric motor. This is part of a global investment of more than 2 billion euros including building a  new factory. One could wonder why so many European car brand like Renault and Volkswagen invested so much in electric cars compared to other solutions that could reduce consumption with less investment. As a magazine recently recalled [Note1], one of the main reasons is a legal one !


As part of its environmental strategy, the European Union adopted pieces of legislation regarding car gas emissions. According to EU law, car makers pay a  penalty if they produce cars emitting on average more than a defined level of CO2. In the future, car makers producing too much gas emitting cars could even be banned from the EU market. This penalty is quite high for a company like BMW as their cars are big and powerful ones and therefore more likely to produce CO2. They can not, as Peugeot does, compensate with a large number of small and low gas producing cars. The solution found by BMW was therefore to produce electric cars, producing 0 grammes of CO2. Even if they don't sell a lot of these cars, they save a huge amount of money in penalties and this makes their investment really profitable compared to other types of cars. Law therefore drives car makers' whole strategy in Europe!



Associate professor in European Legal Strategy, EDHEC Business school

ESPEME entrepreneurship program director


[Note1] Éric Wattez "2,6 milliards d'euros misés sur l'électrique", Capital, octobre 2013, p. 85 : "Même si BMW n'en vend que quelques milliers, un autre objectif sera rempli : avec la i3, la moyenne des émissions de CO2 de la gamme chute. De quoi satisfaire Bruxelles et continuer à vendre ses gros moteurs encore sacrément gourmands."


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21 février 2014

PAPREC : Compliance, ethics and law

PAPREC recycling company put in place a new code of ethics. They negotiated this document with their company employees. One of the provisions is that religious signs should be prohibited within the company [Note1].

Most news media spoke about this innovation on Monday, February 11, 2014, because such a prohibition is not clearly legal at the present time in France. PAPREC company recognized that the validity of such a prohibition was not clear but it was necessary for his company, fully accepted by the company employees’ representatives [Note2]. Its president therefore decided to accept this legal risk of non legal compliance as the advantages outweighed that risk. 

PAPREC’s president also said that this was a way of inducing the legislator to change the French legislation so that is complies with what he considers to be the good ethical behavior.

More and more, as the example of Sunday work also shows, companies manage their legal risk and balance it with their own interests, especially regarding its profitability, the management of its human resources, or its clients’ expectations



Associate professor in European Legal Strategy, EDHEC Business school

ESPEME entrepreneurship program director



[NOTE1] “Une entreprise privée interdit les signes religieux dans ses locaux », Le Monde, 10 February 2014,

[NOTE2] Ludwig GALLET, « Paprec: une charte de la laïcité abusive? », L’, 10 February 2014,




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08 février 2014

When the image sanction is more important than the monetary sanction



Companies need to manage their risk.

Legal risk management can include both a criminal sanction, a monetary one but also accessory sanctions the can have an impact on the consequences of the decision. Only calculating the financial consequences of the sole court decision would therefore be insufficient to fully assess the risk.


A very good example is the sanction against Google by the Commission Nationale Informatique et Liberté.


Google was sanctionned for violating French privacy law. The court sanctionned Google to pay the maximum possible fine, that is 150.000 euros. This sanction appears to be very light compared to Google's financial capacities. But the true sanction is elsewhere.

First, Google needs to stop their behaviour if they don't want to be sanctionned a lot more strongly. For a company, being sentenced to stop a profitable activity can be as such a real sanction.

Secondly, Google was sentenced to publish the CNIL decision on its home page. Such a sanction has a very wide effect. An advertising on Google's homepage for a whole day would probably cost a lot more than the 150.000 euros. In addition, this publication will be seen by Google's clients directly and therefore could have a very bad effect on a company's image, especially when this company on another hand communicates a lot on its compliance with good behaviour standards.


Legal risk managers should therefore not forget to take into account all of these dimensions of the consequences of court or administrative decisions.

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Associate professor in European Legal Strategy, EDHEC Business school

ESPEME entrepreneurship program director


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24 décembre 2013

Does Arnaud Montebourg use European Legal Strategy ?

In the political area, one needs to become an expert in a field in order to become an interesting person. Doctor Jérôme Cahuzac, when he was elected as a French National Assembly representative, decided to become an expert in budget issues at there was no expert representative in this field at that time, and thanks to that could become a budget minister a few years later. Minister Arnaud Montebourg could have done the same using European legal strategy.

In the European Union, countries get benchmarked one towards the other. France is compared to the other 27 countries. European funding is aimed at reducing discrepencies between member countries and the whole European strategy is a 10 year strategy. From 2000 to 2010, the European Union's aim was to make Europe the most intelligent area in the world. The 2020 strategy that was adopted 3 years ago switched to having Europe getting smart growth, sustainable growth, and inclusive growth. The European commission decided that the level of the industry in Europe should be 20%.

As Arnaud Montebourg often states, The European Union therefore developped a strong strategy towards innovation and developing the industry field. It happens that France has a 11% industry whereas Germany is up to 22% of its activity in this field. In France, very few people advocated a redevelopment of the industrial activities. A good European strategy analysis leads to consider that developing the industry is a great political point. Arnaud Montebourg not only was almost the only politician to strongly defend the industry, but could get strongly supported by everything happening in Europe, that leads to the redevelopment of industry in France.

As a consequence, Arnaud Montebourg could find the perfect political area to develop and become a minister. For sure, provided he stays a long time enough, his activity can lead to the redevelopment of industry and he will be able to politically use that success.

A good example of what can be European legal strategy in the political area !

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Research-lecturer in European Legal Strategy

ESPEME entrepreneurship program director

EDHEC Business school

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02 décembre 2013

Say on Pay, an inefficient legislation ?


There is a debate worldwide about the question of asking shareholders to give their say about the pay of their CEO.

According to a number of authors, CEOs’ pay would not be efficiently decided by the board of administrators in big listed companies. The reason would be that shareholders are numerous and don’t influence really the choice of administrators. Administrators would therefore be biased because there are often chosen by the CEO himself.

EDHEC Business School’s researcher Frédéric Palomino conducted a study about this question [Note1]. He analyzed a large number of studies worldwide about Say on pay to see whether it is efficient.

According to this study, Say on pay would probably be inefficient. As the study shows, “the several empirical studies conducted in countries where say on pay applies show that (i) this does not change the level of pay and (ii) say on pay is not greeted by shareholders. The only positive aspect of say on pay would be for extreme situations where not only the company’s profits are low and the CEO’s pay is abnormally high.”

“As a consequence, one can wonder whether such a regulation that imposes a high administrative cost to all companies to give an answer to a limited number of extreme situations is appropriate”.

This economic study directly influences the decision of legislators to pass a law.


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Lecturer in European Legal Strategy, EDHEC Business School

ESPEME entrepreneurship program director


[Note1] Frédéric PALOMINO, "Rémunération des dirigeants d'entreprise : que peut-on attendre du "say on pay" ?", EDHEC Position papers, November 2012,

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