Disclaimer: This translation is a working translation only and is not legally binding.
7. What happens after the Minister has reached a decision?
If the investment does not fall within the scope of foreign direct investment screening in
France, no further action is required by the foreign investor.
If the investment is authorised with or without conditions by the Minister for the
Economy, the investor must file a disclosure within two months from the date on
which the investment is made. The disclosure must indicate the date on which the
investment was completed, the French target company’s new shareholder structure following
the investment, the size of the investment (the amount paid or an estimate including the
valuation method that was used), and any change in the ownership chain of the French
target company that occurred since the date on which the Minister granted authorisation
(Article 3 of the Order of 31 December 2019).
Any conditions tied to the Minister’s authorisation will be monitored by the relevant
ministerial departments throughout their entire duration.
8. What happens if an investment was carried out without
authorisation?
Any undertaking, agreement or contractual clause which directly or indirectly gives rise to
a foreign direct investment without the prior authorisation required by foreign direct
investment screening regulations is deemed null and void (Article L.151-4 of the Monetary
and Financial Code).
If a foreign direct investment was made without prior authorisation, and following an
adversarial procedure initiated by a notice to the investor from the Minister for the Economy,
the Minister may order the investor to implement one or more of the following
measures (Article L.151-3-1 of the Monetary and Financial Code):
1. Apply for authorisation to put the transaction in order. Screening is then performed
following the same procedures that apply to investors who seek authorisation prior to
making an investment;
2. Amend the transaction;
3. Return to the status quo ante at the investor’s expense.
Enforcement orders may be cumulatively accompanied by a daily penalty payment (Article
R.151-14 of the Monetary and Financial Code) to encourage compliance, and/or
precautionary measures to protect public order, public security and national defence (such
as suspending the investor’s voting rights tied to the transaction requiring authorisation;
assigning an agent to safeguard national interests within the French company; suspending,
restricting or temporarily prohibiting the investor from disposing of assets tied to sensitive
activities; prohibiting or restricting the investor from receiving dividends or stock
compensation tied to the transaction requiring authorisation).
The Minister may also impose a fine (Article L.151-3-2 of the Monetary and Financial Code)
up to the greater of:
1. twice the amount of the unauthorised investment
2. 10% of the target company’s annual turnover
3. €1m for an individual and €5m for an entity
Lastly, criminal measures may be imposed upon complaint by the Minister for the
Economy, in accordance with Article 459 of the Customs Code.
6
December 2022