Due to the exclusive rights granted to them, Enedis and EDF, when renewing a concession contract, cannot be pitted against other parties. The current process for renewing concession contracts with all of the AODEs is based on a contract template drawn up in December 2017 by the FNCCR (the French national federation of licensing authorities), France Urbaine, Enedis and EDF.
Even though two decisions of the French Conseil d’État (Council of State) in July and September 2020 confirmed the compatibility of the exclusive rights granted to Enedis and EDF under, on the one hand, European Union law and, on the other hand, the constitutional principle of the administrative freedom of local authorities, the Group cannot exclude the possibility of these provisions being amended by legislation or following an unfavourable court ruling.
Summary: Risks of prohibited and unethical practices in the conduct of business by employees or third parties could put the EDF group at risk of non-compliance with regulations, or even violations of human rights or fundamental freedoms.
Criticality: ● Moderate
The international nature of the Group’s activities and the strengthening of regulatory frameworks that control unethical business practices, in particular, are likely to expose the Group, its employees or third parties acting on behalf of the Group to breaches of its ethical commitments or non-compliance that could damage its reputation or lead to civil or criminal sanctions and impact the Group’s financial performance.
Thirteen programmes have been set up to prevent risks relating to ethical breaches or non-compliance. These programmes cover the following topics:
These programmes are detailed in section 3.3.2 “Ethics, compliance and human rights”.
Summary: Proceedings or litigation could have a significant financial or reputational impact on the Group.
Criticality: ● Moderate
In the ordinary course of its business, the EDF group is involved in litigation, the proceedings or outcome of which could have a material adverse effect on its earnings or financial position.
In particular, the EDF group is subject in France to proceedings initiated by its competitors or by administrative authorities owing to its position in certain markets. Claims made against EDF could be considerable and could lead to the payment of compensation or a fine, or even lead to orders being issued that could have an impact on some of EDF’s activities. For example, in proceedings before the competition authorities in France or before the European Commission, the amount of fines may be as high as 10% of the consolidated revenues of the company concerned (or of the group to which it belongs, as the case may be). The EDF group may also be involved in litigation relating to commercial or fiscal disputes with significant stakes, the outcome of which is inherently unpredictable.
The EDF group considers that overall, in all the countries in which it operates, it complies with all the specific regulations in force, and particularly those relating to the conditions under which it carries out its nuclear activities. However, it cannot anticipate in this respect what may be decided by the supervisory and administrative or judicial authorities to which such matters are referred. These risks are monitored with particular vigilance and give rise to implementation of prevention policies (contractual policies, compliance policies, etc.). A procedure is in place to provide information to the Group’s legal department on actual or potential material litigation or other disputes.
The main proceedings in which the EDF group is involved are described in note 17.3 to the consolidated financial statements for the year ended 31 December 2022 and in section 7.1.5 “Disputes”.
