Any individual or legal person, likely to be implicated or merely a third party, is obliged to respond to requests from the Financial Markets Authority (“AMF”) or face punishment for breach of obstruction.
The current financial market environment will undoubtedly give rise to AMF controls and investigations concerning the financial communication of listed companies but also on price manipulations or insider trading.
As part of their investigations, investigators and controllers may (i) be provided with any document, regardless of support, (ii) summon and hear anyone who may provide them with information, and (iii) access to the premises for professional use. On this occasion, they can also, under certain conditions, gather explanations on the spot.
The refusal of one of these requests is likely to be qualified by the Sanctions Commission as breach of obstruction1, whose monetary penalty can theoretically reach 100 million euros2.
If the principle seems simple, its application is ultimately much less so. The Sanctions Commission, which seems to be becoming increasingly sensitive on this subject, has recently issued three notable sanctions decisions that clarify its contours.
An obstacle to the manifestation of the truth
In its first decision of 7 May 2018 sanctioning a breach of obstruction, the Sanctions Commission clarified its scope by stating that it was “intended to mislead (investigators) about the content (of the evidence handed over), to conceal elements relevant to the investigation and, consequently, to obstruct the manifestation of the truth”.
In this case, the company’s head had deleted more than 38,000 emails from his e-mail prior to the delivery of a copy of the email to the AMF blatantly characterizing the refusal to disclose the requested material.
A breach applicable to any person requested
In its decision of 19 November 2019, which is currently the subject of several appeals, the Sanctions Commission sanctioned legal entities, which were not subject to the control of the AMF and who had been asked to obtain documents.
In this case, as part of the management company’s monitoring of compliance with its professional obligations, the companies belonging to the same group had expressly refused to hand over all of the required accounting documents.
It is clear from this decision that the AMF intends to prosecute and punish for failure to obstruct any person who has the status of third party in the review procedure – or investigation – regardless of any other breach of financial regulation.
As such, the persons who may be solicited are extremely broad (issuer, manager, employee, investment service provider, friend, relative, etc.), the only constraint being that requests for documents are made for the needs of investigation or control.
An objective failure
In its decision of 17 April 2020, the Sanctions Commission mainly characterized a breach of obstruction by a combination of elements which “can only be analysed by a refusal to disclose requested information, without the need to demonstrate its intentional character, in the case of an objective breach”.
The elements taken into account by the AMF in the basis of its decision are, on the one hand, the delay in responding preventing investigators from being able to apprehend the terms and conditions of acquisition of financial instruments under investigation and, on the other hand, the limitation of the documents finally provided.
In this regard, the AMF criticized the respondent company for submitting selected documents following a keyword search, when the request was clear and precise enough to identify them exhaustively.
Moreover, it is also apparent from this decision that elements not directly related to the purpose of the investigation should not be redacted, as they may nevertheless be necessary for investigators to carry out all relevant checks.
The AMF thus provided evidence of obstruction by a method similar to that of the cluster of clues, thus facilitating its characterization.
In conclusion, the greatest vigilance is essential when a person is called in the course of an investigation or a control of the AMF.
 This breach was introduced in 2013 as an alternative to the criminal offence of obstruction that is difficult to prove.
 The maximum amount of monetary penalty that can be imposed by the AMF Sanctions Commission.