French Sunshine to Include Reporting of Fees

03.02.15 | By Greg Hawley

A major change is underway regarding transparency reporting rules in France. On Friday, the French Conseil d’Etat, the supreme court for administrative justice, announced a ruling that will expand the scope of French Sunshine Act.

The French Sunshine Act, the common name for the regulatory application of the Loi Bertrand, requires the reporting of contracts and benefits to HCPs and HCOs, for publication on a central database on a biannual basis. In a May 29, 2013 Circular, though, the Ministry of Social Affairs and Heath announced that “benefits” would not include remuneration for services rendered (i.e. fees for service). Last week’s decisions reverses this policy, arguing that by excluding fees for service, the Ministry exceeded its regulatory authority and failed to fulfil the purpose and parameters of the Loi Bertrand.

The full impact of last week’s decision will not immediately be known. The Ministry will still need to issue new regulations to replace what the Conseil d’Etat has stricken. The Ministry confirmed on Friday that rules will need to be modified, and explained that it is currently analyzing the decision to fully understand the legal consequences. The Ministry also emphasized that the Sunshine Act “continues to function.”

We do know that fee for service payments to HCPs and HCOs will now be reportable, with or without the consent of the recipient, but certain questions remain to be seen:

Firstly, when will changes be implemented? Considering the past tendency of the French government to impose rules and changes retroactively, companies should prepare for the need to report these fees for service for as far back as January 1, 2015; it is unlikely (though not impossible) that retroactive reporting will go further back than that. The current reporting period, which began on January 1, ends on June 30, with reporting due on August 1.

Second, how will these fee for service payments to be reported. Will they need to be reported in the same way as any other benefit? Or will companies be required to report agreed-to fees as part of contract reporting. While the former is most likely, either is possible.

This new ruling also sheds some light on another recent development in French transparency reporting. The LEEM, the French EFPIA member association, announced in 2014 that companies filing disclosures under the French Sunshine Act could forego publishing EFPIA disclosure reports in regards to payments to French HCPs and HCOs. Observers were surprised by this decision, since (at the time) the EFPIA Disclosure Code went beyond the French Sunshine Act by requiring publication of fee payments. This new development justifies the LEEM decision.