The Gazette 1972

Civil Professional Associations in France by Maitre Marcel Catteron of the Paris Bar

articles of association must first be submitted for ap- proval to the President of the Bar (Batonnier) duly qualified in the area of practice. The Batonnier refers the request to his local Bar Council (Conseil de l'Ordre) in order to determine the lawfulness of the contract setting up this body. If this case is rejected, the claimants are entitled to lodge an appeal within a period of two months. This professional association is entitled to set up a subsidiary, provided that the firm is situated on the particular territory which submits to the jurisdiction of the local Court (Tribunal de Grande Instance). It follows that the basic provisions and principles of the previous decree of the 30th November 1969, have been superseded by the decree of July 1972. Therefore the exclusive use of the name of "Civil Professional Association" is granted to civil companies, enjoying the protection of some legal status, duly registered and authorised by the President of the Bar (Batonnier) and undertaking a professional activity by means of several members working in common. Thus it appears that the above decree concerning particularly the Barristers' profession, takes no account of the other lawyers, the profession of which is ruled by a specific law, such as that of juridical advisers (Conseils Juridiques) and companies who act as finan- cial advisers (Sociétés Fiduciaires). Let us now look on the means of application of this professional institution as seen from the point of view of experienced commercial lawyers. Of course, a few problems might arise in the future, especially on ac- count of (1) the disciplinary rules laid down by the different Bars and also (2) on financial questions such as the appreciation of the value of the shares during the running of the company whether taking place in the case of sale, winding up, death or retirement of the partners. The main reason is that the shares in such a Com- pany represent mostly an intellectual contribution, the value of which is somewhat subjective as compared with the assets in kind and in cash issued by the other partners. Of course this aspect of the nature of the shares is due to the essential nature of the Company and has been enacted by the law to facilitate the access of young lawyers. They are limited as regards their con- tribution more often to the level of their earnings and they would expect to participate with their own money in the rise of the Company as well as in their pro- fessional activities in the future. Their ambition is entirely reasonable and is looked at with favour by the law. Nevertheless, the matter might eventually in- volve for the partners some problems when the con- tract comes to an end, in the event for instance of the dissolution of the firm by means of a free sale and especially in the event of a compulsory liquidation ordered by a Court. Of course, the difficulties must not be overestimated if the partners, duly aware of their rights and liabilities, do pay full attention to the drafting of their contract - 2 3 7

The recent reform accepting the new status of French Legal Professions should interest practitioners. The subject deserves to be further and more explicitly ex- amined, but this cannot be done here at the moment. Our purpose is to consider summarily a survey on a newly developed form of Company accessible to mem- bers of liberal professions, such as solicitors (avoues), attorneys, barristers, etc. This institution was, up to recently regulated by a decree (Décret) of 30th November 1969, which has been recently amended by a later decree of the 13th July 1972. This purports to harmonise the 1969 decree with the statutory law issued on the 31st December 1971, which regulates and renews the lawyer's profession. Let us emphasise, from the outset, that in spite of the fact that the French Minister of Justice has attempted to foreshadow the future implications of the reform, having previously taken advice from all kinds of professions affected by the new statute, the decree has elicited, on the whole, more approval than criticism. Objections have mainly arisen from lawyers educated in the traditional individual manner who appraise mostly the personal link set up with their clients, a link based on mutual confidence and private relationship. On the other hand, most up to date lawyers favour the use of a collective partnership organisation which stresses the serious advantages to be derived from the sharing of both financial assets and intellectual con- tribution, thus facilitating team work and means of specialisation. This point of view appears to be especially realistic in view of the prospect arising from the expansion of business in the Common Market and the establishment of multinational firms in Europe and abroad. Let us now examine the main provisions of the said decree. These regulations apply to physical persons practising the liberal professions of the law. The rules establishing the profession are shown, as regards the decree as well as its practical running, as incorporating the following matters : (1) The assignment and transfer in whole or in part of shares; (2) the dissolution, liquidation and other forms of activity set out in a great number of articles of the said decree. The main and essential object ©f the professional association is the purpose of sharing in common that profession with those who have an identity of interest and of sharing profits and losses. This decree concerns especially the profession of barris- ters. The Continental idea of a practice in common of barristers registered in a particular Bar (inscrits dans un Barreau) or in different provincial Bars existing within the competence of the corresponding local Cour d'Appel, should be stressed. In any case, the minimum number of members practising individually or through the body of the Company, in any provincial Bar is five. Such a company must previously be registered and authorised by the President of the Bar (Batonnier) of the area from which it depends. If an association is established by means of barristers who belong to a Bar of another district in France acceding to it, the draft