French regulator gets day in court
French audit regulator is set to meet for a final showdown at the ECJ over its refusal to bring its rules into line with EU law
Neil Sherlock, KPMG’s head of public affairs
After two years of wrangling and ill tempered argument the French audit
regulator is set to meet for a final showdown at the European Court of Justice
over its refusal to bring its rules into line with EU law.
The two have been engaged in a tussle on paper for nearly two years but the
courtroom battle is now going ahead after the French made a last refusal to take
direction.
The EC has charged that France’s rules prevent non-French audit networks from
exercising their right to offer advisory and assurance services to French
companies outside of France, if they have provided advisory services to the
company in the two years preceding a proposed audit.
It began addressing France’s regulator, the Haut Conseil du Commissariat aux
Comptes, last year after lobbying from the top six accountancy networks. Before
involving the politicians, the firms had taken the matter to a French court,
which ruled in favour of the Haut Conseil in 2006.
The EC went through its usual protocol in addressing the matter, which took
more than 12 months, but to no avail as the French steadfastly refused to budge.
Neil Sherlock,
KPMG’s
head of public affairs, said he was surprised at the Commission’s moves
considering that the French have just taken over the rotating EU presidency.
‘The Commission is being quite gutsy in doing this as the French are
obviously driving the agenda now. But it could mean that they’ve decided that
they have a strong case and they must have a degree of confidence that they can
win, as do the firms,’ he said.
The French may drive the agenda but they hold no sway over the ECJ, which is
an independent court.
One way or another, it looks like there may be an end in sight to the
two-year old stalemate.