GECINA - REFERENCE DOCUMENT 2017

06

RISKS Risks

Environmental third-party liability 6.1.8.3 This coverage was instituted as early as 2007 to cover Gecina’s liability for damage suffered by third parties and damage to biodiversity when such damage is the result of the impact of the Group’s activities on the environment, and also any costs incurred from on-site pollution cleanup operations to neutralize or eliminate an environmental hazard. The program was renewed for two years on January 1, 2018. of supplier contracts The real estate risk assessment approach described in this chapter contains guidelines on the management of the insurance clauses and liability in the leases. Since 1998, liability law has been toughened considerably and made much more complex with the integration of European Directives harmonizing the legal provisions of Member States. In the aim of ensuring indemnification of the victim, origin of a third-party liability is no longer to be found solely in the fault but rather more and more in the responsibilities and competence required of professionals (the “deep pocket” principle). The importance of liability risk has to do with its complexity and growing importance as laws and regulations evolve. This risk is difficult to foresee. It materializes when court proceedings are initiated by one or more third parties without it being possible to prejudge the validity of their reasons. The court costs, and the expenses and internal costs of defense may also have major indirect effects on earnings and the company’s finances. Whatever the case, they can adversely affect Gecina’s image. Lease management and management 6.1.8.4

Like all other professionals, organizations or individuals, the Gecina group is bound by four types of commitment, which must all be followed: its technical commitments; control over them; its disclosure and advisory obligations; its contractual obligations. To each of them must be added the notion of security, which is increasingly taking the form of a quasi-performance guarantee. Although Gecina accepts in its commercial leases an equitable mutual appeal waiver clause with its tenants and the relevant insurers, the regulation specific to residential leases requires the tenant to take out insurance for damage that might be sustained by the lessor and for which the tenant may be judged liable. However, even though the regulations authorize the lessor to require an appeal waiver from tenants for damage they might sustain due to the owner’s fault, Gecina does not wish to systematically include such a clause in its leases out of concern for fairness towards its customers. 6.1.8.5 There was no significant claim in 2017 and until the date of publication of this document. Claims

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