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. On 1 January 2020, changes to France’s investment screening mechanism entered into effect. Among other measures, the changes lowered the trigger thresholds for the screening mechanism to 25%, down from 33.33% and added additional industry sectors to the list of sectors to which the review mechanism applies.  On 30 April 2020, in the context of the COVID-19 pandemic, the Arrêté du 27 avril 2020 added biotechnologies to the list of industry sectors to which France’s mandatory review mechanism applies. On 23 July 2020, the Décret n° 2020-892 du 22 juillet 2020 became effective, temporarily lowering the trigger threshold for the French FDI review mechanism to a 10% foreign shareholding, down from 25%, for FDIs made in listed companies. On 28 December 2020, the Decree n° 2020-1729 was adopted. It prolongs the application of the special regime adopted during the pandemic to control foreign investment from 31 December 2020 until 31 December 2021. Effective 25 December 2021, France extended the application of the temporary regime that lowers the trigger threshold for the French FDI review mechanism a second time until 31 December 2022. The extension was enacted by Decree no. 2021-1758 of 22 December 2021. The temporary regime was initially adopted in response to the specific circumstances resulting from the COVID-19 pandemic and lowers the trigger threshold for the French investment review mechanism to a 10% foreign shareholding, down from 25% for FDI in listed companies. The measure is applicable to non-EU, non-EEA investors only. On 22 December 2022, French authorities announced the extension of the application of the temporary regime that lowers the trigger threshold for the French FDI review mechanism for a third time until 31 December 2023. According to the announcement, the extension of the temporary regime to protect French enterprises operating in sensitive sectors is warranted by the actual economic context marked by an energy crisis.
"Extension to 2023 of the measure temporarily lowering the threshold triggering IEF control in French companies listed on a regulated market [...]
In order to protect against opportunistic non-European participations that could present threats to national security, the threshold triggering IEF control in listed French companies was lowered from 25% to 10% of voting rights.
The current economic context linked to the energy crisis does not allow the risks for these companies to be ruled out. Bruno Le Maire , Minister of the Economy, Finance, Industrial and Digital Sovereignty, and Olivier Becht , Minister Delegate to the Minister of Europe and Foreign Affairs, in charge of Foreign Trade, Attractiveness and French people living abroad, believe that it is therefore essential to ensure continued protection of these companies. Ministers asked that this temporary measure of lowering the threshold, which was to end on December 31, 2022, be maintained until December 31, 2023.
The terms of the measure to lower the threshold triggering the control will remain unchanged:
-it does not concern investors from an EU/EEA country;
-it only concerns investments made in companies listed on a regulated market;
-it is carried out according to an accelerated procedure: the foreign investor crossing the threshold of 10% of voting rights notifies the General Directorate of the Treasury. The Minister of the Economy, Finance, Industrial and Digital Sovereignty then has 10 days to decide whether the operation should be subject to further examination, on the basis of a full authorization request.[...]" (Extension to 2023 of the measure temporarily lowering the threshold triggering IEF control in French companies listed on a regulated market, Press Release No. 458, 22 December 2022 [google translation])
------------------------
"Article 1
Modified by Decree n°2021-1758 of December 22, 2021 - art. 1
Until December 31, 2022, constitutes an investment, within the meaning of article L. 151-3 of the monetary and financial code , the fact, for an investor mentioned in I of article R. 151-1 of the same code, to cross, directly or indirectly, alone or in concert, the threshold of 10% of holding the voting rights of a company governed by French law whose shares are admitted to trading on a regulated market.
The preceding paragraph is not applicable to a natural person having the nationality of a Member State of the European Union or of a State party to the agreement on the European Economic Area having concluded an administrative assistance agreement. with France with a view to combating fraud and tax evasion and domiciled in one of these States, nor to an entity of which all the members of the chain of control, within the meaning of II of Article R . 151-1 of the Monetary and Financial Code, come under the law of one of these same States or have nationality and are domiciled there. [...]" (Decree n° 2020-892 of July 22, 2020 relating to the temporary lowering of the control threshold for foreign investments in French companies whose shares are admitted to trading on a regulated market, last amended by Decree n° 2021-1758 of December 22, 2021, Article 1 [google translation])
------------------------
"Article L151-3
I. – Foreign investment in any activity in France which, even if only occasionally, is part of the exercise of public authority or pertains to one of the following domains is subject to prior approval from the Minister in charge of Economy:
a) Activities likely to jeopardise public order, public safety or national defence interests
b) Research in, and production or marketing of, arms, munitions, or explosive powders or substances
A decree issued following consultation with the Conseil d’État (French Supreme Administrative Court) specifies the nature of the above-mentioned activities.
II. - The authorisation granted may have special conditions attached to it to ensure that the planned investment does not jeopardise the national interests referred to in section I.
The decree referred to in section I specifies the nature and possibilities to revise the conditions which may be attached to the approval.
[...]
Article R151-1
I. In the context of an investment as referred to in Article R. 151-2, the following shall constitute an investor within the meaning of this Chapter:
a) Any individual of foreign nationality
b) Any individual of French nationality who is not domiciled in France within the meaning of Article 4 B of the French General Tax Code
c) Any entity governed by foreign law
d) Any entity governed by French law that is controlled by one or more of the persons or entities referred to in subsections a), b) or c) above
II. For the purposes of this Chapter, a chain of control shall be understood to mean the combination of an investor referred to in subsections c) or d) of section I above and the persons or entities that control it. All of the persons and entities in a chain of control shall constitute investors within the meaning of this Chapter.
III. The control referred to in this Article shall be assessed in accordance with Article L. 233-3 of the French Commercial Code or, when no control has been established on the basis of this Article, in accordance with section III of Article L. 430-1 of said Code.
Article R151-2
An investment, within the meaning of Article L. 151-3, is deemed to have been made when an investor as defined in section I of Article R. 151-1:
a) Acquires control, within the meaning of Article L. 233-3 of the French Commercial Code, of an entity governed by French law
b) Acquires all or part of a business activity of an entity governed by French law
c) Crosses, directly or indirectly, whether acting alone or in concert, the threshold of 25% of the voting rights of an entity governed by French law
Subparagraph c) shall not be applicable to individuals who are nationals of a Member State of the European Union or a State that is a signatory to the European Economic Area (EEA) Agreement in addition to a mutual administrative assistance agreement with France for the purposes of combating tax evasion and tax avoidance, and who are domiciled in one of those States, or to entities in which all the members of the chain of control, within the meaning of Article R. 151-1(II), are governed by the law of one of the abovementioned States or are nationals of and domiciled in one of these States.
Article R151-3
The activities mentioned in section I of Article L. 151-3 are as follows:
I. Activities, relating to the exercise of public authority, that are likely to jeopardise national defence interests or the maintenance of public order and public safety:
a) Activities, including those mentioned in Article L. 2332-1 of the French Defence Code, relating to weapons, munitions, explosive powders and substances intended for military use or relating to war material and assimilated materials covered by Parts III and V of Book III of the second part of the French Defence Code
b) Activities relating to dual-use items and technologies listed in Annex IV to Council Regulation (EC) No 428/2009 of 5 May 2009 setting up a Community regime for the control of exports, transfer, brokering and transit of dual-use items
c) Activities carried on by entities entrusted with the protection of national defence secrecy
d) Activities carried on in the information systems security sector, including as a subcontractor, for the benefit of an operator referred to in Articles L. 1332-1 or L. 1332-2 of the French Defence Code
e) Activities carried on by entities that have entered into a contract, either directly or as a subcontractor, on behalf of the Ministry of Defence for the provision of a good or service falling within the scope of an activity referred to in subsections a), b), c) or f)
f) Activities relating to cryptology resources and services mentioned in paragraphs III and IV of Article 30 and paragraph I of Article 31 of Act No. 2004-575 of 21 June 2004 on confidence in the digital economy
g) Activities relating to technical equipment or devices capable of intercepting communications or designed for the remote detection of conversations or data capture, as defined in Article 226-3 of the French Criminal Code
h) Activities relating to the provision of services by approved assessment centres under the conditions laid down in Decree No. 2002-535 of 18 April 2002 on the assessment and certification of the security offered by information technology products and systems
i) Gambling activities, with the exception of casinos
j) Activities relating to measures designed to deal with the illicit use of pathogens or toxic substances or to prevent the health consequences of such use
k) Activities relating to the processing, transmission or storage of data, the interference with or disclosure of which is liable to jeopardise the exercise of the activities referred to in subsections a) to j) of section I or II
II. Activities, related to the exercise of public authority, that are likely to jeopardise national defence interests or the maintenance of public order and public safety, insofar as they concern infrastructure, goods or services that are vital to guaranteeing:
a) The integrity, security and continuity of the energy supply
b) The integrity, security and continuity of the water supply
c) The integrity, security and continuity of the operation of transport networks and services
d) The integrity, security and continuity of the space operations referred to in Article 1(c) of Act No. 2008-518 of 3 June 2008 on space operations
e) The integrity, security and continuity of the operation of electronic communications networks and services
f) The fulfilment of the missions of the national police, the national gendarmerie and the civil security services, as well as the fulfilment of the public safety assignments of customs and those of approved private security companies
g) The integrity, security and continuity of operation of an establishment, facility or work of vital importance within the meaning of articles L. 1332-1 and L. 1332-2 of the French Defence Code
h) The protection of public health
i) The production, processing and distribution of the agricultural products listed in Annex I to the Treaty on the Functioning of the European Union, where these contribute to the objectives of national food safety referred to in paragraphs 1, 17 and 19 of section I of Article L. 1 of the French Rural and Maritime Fisheries Code
j) The publishing, printing and distribution of political and general information press publications, within the meaning of Article 4 of Act No. 47-585 of 2 April 1947 on the status of newspaper and periodical publication bundling and distribution companies, and online press services for political and general information within the meaning of Article 1 of Act No. 86-897 of 1 August 1986 on the reform of legal arrangements for the press
III. Activities, related to the exercise of public authority, that are likely to jeopardise national defence interests, public order and public safety, when they are intended to be carried out in connection with one of the activities referred to in section I or II:
a) Research and development activities relating to critical technologies, the list of which is defined by an order from the Minister in charge of Economy [as defined in the Order of December 31, 2019 relating to foreign investments in France, last amended by Order of September 10, 2021 relating to foreign investments in France [google translation][not reproduced here; see related link]
b) Research and development activities relating to the dual-use goods and technologies listed in Annex I to the abovementioned Council Regulation of 5 May 2009 [...]" (Monetary and Financial Code, last amended by Décret n°2021-721 of 4 June 2021, Articles L151-3, R151-1, R151-2 and R151-3 [unofficial translation])
---------------------------
"Article 1
Modified by Decree n ° 2020-1729 of December 28, 2020 - art. 1
Until December 31, 2021, constitutes an investment, within the meaning of Article L. 151-3 of the Monetary and Financial Code , the fact, for an investor mentioned in I of Article R. 151-1 of the same code, to cross, directly or indirectly, alone or in concert, the 10% threshold for holding the voting rights of a French company whose shares are admitted to trading on a regulated market.
The preceding paragraph is not applicable to a natural person possessing the nationality of a Member State of the European Union or of a State party to the agreement on the European Economic Area having concluded an administrative assistance agreement. with France in order to fight against fraud and tax evasion and domiciled in one of these States, nor to an entity including all the members of the chain of control, within the meaning of II of article R 151-1 of the Monetary and Financial Code, come under the law of one of these same States or have its nationality and are domiciled there.[...]" (Decree n ° 2020-892 of July 22, 2020 relating to the temporary lowering of the control threshold for foreign investments in French companies whose shares are admitted to trading on a regulated market, last amended by Decree n°2020-1729 of 28 December 2020, Article 1 [google translation])
---------------------------
"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])
Extension to 2023 of the measure temporarily lowering the threshold triggering IEF control in French companies listed on a regulated market, Press Release No. 458, 22 December 2022
Decree n° 2020-892 of July 22, 2020 relating to the temporary lowering of the control threshold for foreign investments in French companies whose shares are admitted to trading on a regulated market, last amended by Decree n° 2021-1758 of December 22, 2021, Article 1
Monetary and Financial Code, last amended by Décret n°2021-721 of 4 June 2021, Articles L151-3, R151-1, R151-2 and R151-3 
Order of December 31, 2019 relating to foreign investments in France, last amended by Order of September 10, 2021 relating to foreign investments in France [google translation]
Decree n ° 2020-892 of July 22, 2020 relating to the temporary lowering of the control threshold for foreign investments in French companies whose shares are admitted to trading on a regulated market, last amended by Decree n°2020-1729 of 28 December 2020, Article 1 
Commercial Code, version in force since 05 December 2015, Article L233-3

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