Paris: France this week significantly strengthened its foreign investment screening regime by lowering the threshold that triggers government scrutiny of acquisitions in strategically important companies, a move aimed at protecting national security and strengthening economic sovereignty amid rising geopolitical tensions.
Under a decree issued by Prime Minister Sébastien Lecornu, non-European investors seeking to acquire stakes in French companies operating in sensitive sectors will now face stricter state oversight.
Previously, the French Ministry of the Economy reviewed transactions only when a non-European investor sought to acquire 25% or more of a French company listed on a regulated market outside the European Union. Under the new rules, government approval will now be required for acquisitions of 10% or more, substantially expanding the scope of state supervision over foreign investments.
Announcing the measure, Prime Minister Lecornu said safeguarding France’s strategic businesses was essential to protecting national sovereignty while ensuring companies continue to grow in a secure economic environment.
He stressed that France’s responsibility was not only to support the development of its industries but also to preserve national strategic interests in an increasingly uncertain global landscape.
According to the Prime Minister’s Office, the tighter screening mechanism is intended to prevent opportunistic acquisitions by non-European investors that could threaten national security or place strategically important French companies under undue foreign influence.
Despite the enhanced oversight, the government said it would seek to avoid unnecessary obstacles to investment and corporate fundraising. To balance security concerns with market efficiency, the new review process will operate under an accelerated procedure designed to provide investors with timely decisions.
Under the revised framework, foreign investors will be required to notify the French Treasury Directorate-General of planned transactions involving qualifying share purchases. The Ministry of the Economy will then have 10 days to determine whether the proposed investment warrants a more comprehensive national security review.
The strengthened investment screening regime forms part of France’s broader efforts to reinforce economic security in response to a rapidly evolving international environment marked by heightened geopolitical competition and increased strategic rivalry.
The policy also reflects recommendations contained in a parliamentary report calling for a fundamental shift in France’s approach to economic security. The report argued that the country’s existing investment protection framework should be reinforced as foreign acquisitions assume greater strategic significance in the current geopolitical climate.
By lowering the investment threshold for government intervention, France joins a growing number of countries tightening oversight of foreign acquisitions in sectors considered critical to national security, technological leadership and economic resilience, while seeking to maintain an attractive environment for legitimate international investment.
