Compliance and verification of compliance with all the laws and regulations of the countries where the Group does business is a must at EADS. Rapid changes in the industry and the overall global environment constantly present new legal or regulatory requirements which call for robust internal controls in the field of legal compliance. It has also resulted in the adoption in 2000 of EADS Insider Trading Rules.

Policy

• “EADS is committed to complying with antitrust and competition as well as humanitarian law, when applicable, in all of its activities and throughout the Group.
• EADS screens new customers and suppliers to ensure that they do not do banned business.”

The overall compliance with the law programme: Amongst the various areas of the law which require constant monitoring, it is worth mentioning a few examples that are of particular importance to EADS although the list is only indicative. Examples of this permanent monitoring process are: compliance with the laws and regulations governing competition, protection of the environment, public sector procurement and accounting and financial reporting.

Compliance with Corporate Governance standards is another area of focus. Governance practices are developed and monitored to fulfil the Board’s responsibility towards customers, shareholders and employees, to oversee the work of the management in the conduct of the Company’s business, and to serve the long-term interest of stakeholders.

Insider Trading Rules: The Dutch AFM, as well as other stock exchange authorities (the French AMF, the German BaFin, and the Spanish CNMV), which regulate the markets on which EADS securities are listed, impose certain rules upon EADS and require it to enforce these rules internally. Hence, EADS adopted in 2000, its Insider Trading Rules. EADS Insider Trading Rules belong to the best practise processes and apply to all EADS employees and even for some time after people retire or left the company. The guiding principle is that employees should freely perform any EADS securities transactions provided that they act in accordance with the EADS group’s policies which are set out in the EADS Insider Trading Rules. According to the rules, more than 2,500 managers are strictly subject to no-trading periods over the year. People in higher and top management functions have only very limited trading windows after each of the quarterly results publication. On top of this, those concerned also have to inform the ITR Compliance Officer in order to proceed with the transactions. All No-Trading Periods are widely communicated amongst the respective communities and people are personally informed by mail when they are subject to such trading restrictions.

Organisation

From an organisational standpoint, EADS Legal Affairs, in coordination with the Divisions’ and BUs’ legal departments, is responsible for designing, implementing and overseeing the policies and processes aimed at ensuring that EADS’ activities abide by all applicable laws and regulations. Teamwork amongst all the legal players is aimed at ensuring consistent and comprehensive legal processes in compliance with national requirements. Corporate Legal Affairs is also responsible for overseeing all litigation affecting the Group, as well as for the legal safeguarding of the Group’s assets, including intellectual property.

Extended networks of professionals (e.g. intellectual property) located close to operational players drive legal compliance activities. These professionals are capable of handling the requirements of the many jurisdictions that are relevant to EADS, not only in its “home countries” but abroad as well.

The COO Finance is the Insider Trading Rules Compliance Officer.

The Corporate Secretary with the support of Legal Affairs departments also plays an essential role in the setting up and administration of EADS Corporate Governance procedures as well as legal documentation underlying delegation of powers and responsibilities.

Finally, all those activities are audited by the Corporate Audit department which consists of a team of dedicated professionals who are familiar with the requirements and challenges of the Company’s international business.

Performance and Best Practices

Whatever the legal environment they are subject to, BUs are extremely vigilant in monitoring legal risks. They constantly ensure that regulations are applied and track any infringement risks so as to prevent them. This is based on basic processes:

• Training and awareness: a preventive approach is based on the combination of Company policies and cultural values supported by solid infrastructure for legal compliance, training initiatives and general employee awareness actions as well.
• Identifying and mitigating legal risks: Whatever the source of the legal compliance risk may be, EADS takes responsibility for finding the facts and analyzing the applicable laws; measures are then taken to deal with the situation in a proactive manner.

Sharing of information, especially within the CSR network and the community of legal professionals is designed to help the Company learn from mistakes, if any, thus using its experience to continue raising the bar in its processes.

The EADS Insider Trading Rules are regularly updated in order to take into consideration recent changes in European regulations as well as to ensure EADS adherence to best-in-class corporate governance standards. The EADS Insider Trading Rules are provided to the relevant Market Authorities for verification and confirmation.