A mandatory screening mechanism applies to activities affecting the public order, public security and national defence interests. Prior governmental approval is required for certain acquisitions by foreigners in specified sectors.
"Article L151-2
The Government may, in order to ensure the defence of national interests and by decree taken on the report of the Minister responsible for the economy:
1. Submit for declaration, prior authorization or control:
a) Foreign exchange transactions, capital movements and settlements of any kind between France and abroad;
b) The constitution, change of consistency and liquidation of French assets abroad;
c) The constitution and liquidation of foreign investments in France;
d) The import and export of gold and all other physical movements of valuables between France and abroad;
2. Prescribe the repatriation of debts owed to foreign countries outside the European Union arising from the export of goods, payment for services and, in general, all income or products abroad;
3. Authorize intermediaries to carry out the operations mentioned in 1, a and d above.
Article L151-3
I. – Foreign investments in an activity in France which, even occasionally, contributes to the exercise of public authority or falls within one of the following areas are subject to prior authorization from the Minister responsible for the economy:
(a) Activities likely to undermine public order, public security or the interests of national defence;
(b) Activities of research, production or marketing of weapons, munitions, powders and explosive substances.
A decree in the Council of State defines the nature of the above activities.
II. – The authorization given may be subject, where appropriate, to conditions aimed at ensuring that the planned investment will not harm the national interests referred to in I.
The decree mentioned in I specifies the nature of the conditions which may be attached to the authorization.
III. – The Minister responsible for the economy, if he finds that a foreign investment is or has been made in breach of the requirements of I or II, may order the investor not to proceed with the transaction, to modify it or to restore the previous situation at his own expense.
This injunction can only be issued after sending a formal notice to the investor to make his observations known within fifteen days.
In the event of non-compliance with the aforementioned injunction, the Minister responsible for the economy may, after having given the investor the opportunity to present his observations on the facts with which he is accused within a minimum period of fifteen days, without prejudice to the restoration of the previous situation, impose a financial penalty on him, the maximum amount of which is twice the amount of the irregular investment. The amount of the financial penalty must be proportional to the seriousness of the breaches committed. The amount of the penalty is recovered as the State's debts unrelated to tax and property.
These decisions are subject to full appeal.
The decree mentioned in I determines the methods of application of III." (Monetary and Financial Code, last amended by Order No. 2014-158 of February 20, 2014, Articles L151-2 and L151-3 [google translation])
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"Article L233-3
I.- Any person, natural or legal, is considered, for the application of sections 2 and 4 of this chapter, as controlling another:
1 ° When it holds, directly or indirectly, a fraction of the capital conferring on it the majority of voting rights in the general meetings of this company;
2 ° When it alone has the majority of the voting rights in this company by virtue of an agreement concluded with other partners or shareholders and which is not contrary to the interests of the company;
3 ° When it determines in fact, by the voting rights at its disposal, the decisions in the general meetings of this company;
4 ° When she is a partner or shareholder of this company and has the power to appoint or dismiss the majority of the members of the administrative, management or supervisory bodies of this company.
II.-It is presumed to exercise this control when it has, directly or indirectly, a fraction of the voting rights greater than 40% and no other partner or shareholder directly or indirectly holds a fraction greater than its own.
III.-For the application of the same sections of this chapter, two or more persons acting in concert are considered as jointly controlling another when they in fact determine the decisions taken in general assembly.[...]" (Commercial Code, version in force since 05 December 2015, Article L233-3 [google translation])
Monetary and Financial Code, last amended by Order No. 2014-158 of February 20, 2014, Articles L151-2 and L151-3
Commercial Code, version in force since 05 December 2015, Article L233-3
[<a href="https://www.legifrance.gouv.fr/codes/section_lc/LEGITEXT000006072026/LEGISCTA000006153982/2018-12-29/">Code</a>],[<a href="https://www.legifrance.gouv.fr/codes/article_lc/LEGIARTI000031564650/2021-08-11/">Code</a>]