Investor-State dispute settlement: a framework document for investment policy Community interpretation of the framework clause in investment agreements According to the FFIR, the approval procedure applies to investments in a French company whose activities belong to at least one of the strategic sectors covered by Article R. 151-3 of the French Monetary and Financial Code. The list of strategic sectors has expanded considerably in recent years. These strategic sectors include the following activities: The legal framework of joint interpretative agreements of investment agreements 2 The 2019 decree stipulates that this control must have been acquired on the basis of a release for foreign investment granted on the basis of the control test. We analyze the likely impact of regime changes on M&A activity and on the timing of foreign investment approval in France. Public consultation on the responsibilities of companies and investment agreements Under the new rules, a `chain of custody` includes an investor referred to in points (3) or (4) and all natural or legal persons exercising control over that investor. The 2019 decree stipulates that any natural or legal person who is part of the chain of custody is considered a foreign investor for the purposes of the French regulations on foreign investments. What are the main laws that directly or indirectly regulate the acquisition and investment of foreigners and investors on the basis of national interest? While France remains an economically attractive country despite the Covid-19 crisis, recording 1,215 foreign investments in 2020, it also reported a significant increase in the number of investments examined. In fact, the number of decisions rendered by CEECs has increased significantly in recent years, recording a significant increase of 50% in two years, from 184 decisions reviewed in 2018 to 216 in 2019 and 275 decisions in 2020. The French foreign investment regime has in the past applied different rules to foreign investors depending on whether the investor in question resided in or outside the European Union or the European Economic Area (EEA). The 2019 decree largely eliminated the distinction between European and non-European investors.
The 2019 decree defines a foreign investor as follows: the good news is that almost all transactions are concluded, although sometimes only after conditions have been imposed. Investors should have no reason to worry as long as this process is taken seriously. Note, however, that in the current context of international trade tensions, the Ministry of economy can be very strict and will not hesitate to block or postpone an agreement. FIRRMA specifically asked the US president to engage internationally to push allies and help them establish robust procedures for foreign investment screening and facilitate coordination between allied countries` foreign investment screening devices. In addition, with the implementation of FIRRMA, CFIUS has created a process in which allied countries with strong foreign investment screening regimes can be considered as having special status as an “exempt investor”. The PACTE law has given the Minister clearer and more comprehensive powers of appeal to enforce French regulations on foreign investments and the obligations of foreign investors: the granting of the French exemption for foreign investments is generally subject to the fact that the foreign investor contracts certain obligations towards the French State. The 2019 Decree provides that the obligations imposed on foreign investors are proportionate to the protection of the national interests of the France and must be aimed primarily at making foreign investments that may harm the national interests of the France, since 1966, subject to a prior declaration or approval by the EOM. This law was subsequently supplemented by Act No. 2004-1343 of 9 December 2004, which authorized the Ministry of Education to further regulate foreign investment, including through injunctions.
The MoE is not required to provide detailed reasons when approving a foreign investment or when it considers that the foreign investment does not fall within the scope of the review. The EEC has banned the acquisition of the pioneer of military solutions, Photonis, by the American defence manufacturer Teledyne. In December 2020, he ended a turbulent saga after nearly a year of negotiations between the French government and the American conglomerate. Initially, the French government focused on developing a set of commitments for Teledyne to protect the strategic interests of the France while maintaining its economic attractiveness. At the end of 2020, Teledyne had finally accepted a number of strict conditions, including the granting of a minority stake and a right of veto to the French public investment bank Bpifrance. But the French government, through its defense minister, made a last-minute about-face, concluding that Photonis` activities were too strategic to be managed by a non-French actor, regardless of possible commitments. Photonis was then bought by HLD, the French investment group, for 370 million euros, much less than the 500 million euros initially offered by Teledyne. Under the new rules, an investment by a non-EU or EEA investor is considered a covered investment below the threshold if the foreign investor directly or indirectly acquires more than 25% of the voting rights in a French company. The exemption from the threshold criterion for European foreign investors only applies if the relevant chain of custody does not include foreign investors from non-EU or non-EEA countries. The control test and the asset test remain unchanged. .