16 Apr 2020

France: Economic measures to mitigate the effects of the COVID-19 outbreak

On March 16th 2020, the President of the French Republic decided to take measures to reduce contacts and travels to a strict minimum throughout the country as of March 17th at noon, for a minimum of 15 days. MSI's French member firm Schmidt Brunet Litzler provides an update on the measures that we introduced by the French government.

On March 16th 2020, the President of the French Republic decided to take measures to reduce contacts and travels to a strict minimum throughout the country as of March 17th at noon, for a minimum of 15 days. On March 27 th, the French Prime Minister announced the extension of containment measures until April 15 th.  Update: On April 13th these measures were extended until May 11th. People are authorized, provided they hold a signed certificate, to:
  • go to work, if remote working is not possible,
  • purchase supplies essantial to the professional activity and the basic necessities,
  • go to medical consultations that cannot be provided from a distance and cannot be postponed,
  • travel for compelling family reasons, for assistance to vulnerable persons or childcare,
  • carry out short journeys that should not exceed one hour per day and within a maximum radius of one kilometre around home (from April 8th exercise is only tolerated before 10 am or after 7 pm in Paris),
  • go to judicial or administrative summons,
  • participate in missions of general interest at the request of the administrative authority.
In response to the COVID-19 outbreak, the French government implemented exceptional support measures for businesses, to limit companies’ bankruptcies and to maintain jobs:
  • Granting of deferred payment deadlines regarding all tax and social security payments for companies that wish to benefit from them, without penalties or justification;
  • In the most difficult situations, direct tax rebates that can be decided on the basis of an individualized examination of applications;
  • Deferral of the payment of rents, water, gas and electricity bills for the smallest companies in difficulty;
  • Aid of up to 1 500 euros for the most affected very small businesses, the self-employed workers and micro-entrepreneurs (those having a turnover lower than €1 million, less than 10 employees and having lost more than 50% of their turnover in March 2020 compared to March 2019) thanks to a Solidarity Fund o €1 billion ;
  • A State guarantee of €300 billions on bank loans taken out by French firms;
  • Support from the State and the Banque de France (credit mediation) to reschedule bank loans;
  • Simplified and reinforcement of partial unemployment scheme (higher allowances, extension to other beneficiaries) and more flexible working time rules.
  • Support for the handling of disputes with customers or suppliers by the Ombudsman for Companies;
  • The recognition that the COVID-19 outbreak is a “case of force majeure” for their public procurement contracts. Consequently, for all State and local authority public procurement contracts, penalties for delays will not be applied;
  • Simplification and adaptation of the rules relating to the preparation, audit, review, approval and publication of company accounts and other documents that companies must provide (in particular with regard to deadlines);
  • Relaxation of the obligations of companies towards their customers and suppliers (refund arrangements) in particular for tourist and educational travel contracts.
Further measures might be taken by the French government in the coming days to strengthen these protection mechanisms.

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