France gets tough on reviewing foreign direct investments screening

Last month the French Minister of Armed Forces formally blocked, for the first time ever, a foreign investment by a U.S. company. In addition the French Minister of Economy and Finance announced a one year extension to interim rules on foreign investment introduced in response to COVID-19 that were due to expire on 31 December 2020 and recently expressed his intention to use investment control powers to block the proposed takeover of Carrefour SA by a Canadian company. These developments reflect a broader push by France to strengthen the enforcement of its investment screening regime. Foreign investors looking to invest in French target companies or assets are advised to consider early on whether they may be subject to notification obligations and/or exposed to government review under the French screening regime.