France under fire for protectionist initiative[de] 

The new French government proposal to protect a number of industry sectors from foreign takeovers is putting new heat into the debate around industrial policy and the protection of 'national champions.' Ten French industry sectors, including biotechnologies, secure information systems, casinos and the production of vaccines, are to be protected from foreign bids  (see EurActiv 30 August 2005). The initiative is based on the assumption that many of these industries are directly or indirectly linked to matters of national security and therefore, according to European law, eligible for protection measures.

"This will of course be coherent with European legislation in the strictest sense," the French Minister for Economic Affairs told Europe 1. "Every member state has the possibility to define so-called 'strategic' areas, for instance defense or sensitive technological areas," a government spokesperson added in Le Monde.

Critics of the French initiative have now called the proposals a "classic case of Gallic double standards" as French companies in turn accumulate acquisitions in foreign countries. "It is hard to resist the conclusion that playing to the protectionist gallery is one of the ways in which the French government is trying to recover credibility from its stinging referendum defeat on the EU Constitution," writes the Financial Times. 

Despite the recent outcry following rumours about a bid from the US company PepsiCo for French food giant Danone, the proposal is not likely to cover the food industry.