Foreign acquisitions in France: controls reach a new record

The control of foreign investments in France (IEF) experienced another record year last year. According to Bercy’s report to be published on Thursday, some 328 acquisition projects deemed sensitive have been instructed by the Treasury office, up 31.2% compared to 2020.

Since 2017, the number of takeover projects, led mainly by the United States, the United Kingdom and Canada, and controlled by the State, will have more than doubled. In France in 2020, the jump had already been 27% (275 cases).

Strategic companies relate to increasingly broad sectors in recent years, ranging from defense and water supply to critical technologies (robotics, semiconductors) via biotechnologies or transport, and since January renewable energies .

“IEF control has been able to adapt to the challenges raised by the health crisis in 2021 to protect our strategic assets. However, this tightening of control has not harmed France’s growing attractiveness for foreign investment,” comments Finance Minister Bruno Le Maire.

The level of control recorded in France is one of the highest in Europe. The German Economy Ministry announced at the beginning of March that it had handled 306 cases of sensitive acquisitions last year.

France remains one of the very first contributors to the new cooperation mechanism for the screening of foreign acquisitions in the European Union. It accumulated 108 reports between October 2020 and October 2021, out of a total of 265 recorded by the EU.

“This cooperation has made it possible to inject momentum on a European scale and a majority of Member States now have a filtering mechanism. This momentum must continue,” said the minister.

More than half of redemptions subject to commitments

As everywhere in Europe, the French government is tightening the meshes of the net. International tensions linked to the war in Ukraine should not reduce its vigilance, despite the gradual exit from the pandemic.

Of the total cases investigated in 2021, less than half (124) were deemed eligible and authorized by the ministry. A high number (54% of the 124 files) were subject to conditions, relating for example to the maintenance of the head office and the research centers.

On the other hand, Bercy remains silent on the number of files rejected or withdrawn by the buyer in the face of the expectations of the administration. In January 2021, Bruno Le Maire rejected the Carrefour-Couche-Tard merger project for food safety, even before it was filed.

In 2021, health was at the center of concerns. “Between 2020 and 2021, requests for prior authorization in the sector have doubled”, underlines the Direction du Trésor in its report. Biotechnology in particular, introduced into the scope of controls in April 2020 in the midst of a pandemic, represented 26% of controlled purchasing projects in the name of public health.

“Among these files, half of the operations presented significant risks for public security, leading to their authorization under conditions by the Minister”, notes the Treasury.

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