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 !

 

Olivier BEDDELEEM

EDHEC Business School