Between Openness And Sovereignty: Foreign Investment In The Spotlight

Spotlight

As the presidential election approaches and geopolitical tensions intensify, France is navigating a delicate balance between attracting foreign investment and safeguarding its strategic interests. The French Treasury’s annual report, published on 24 September, reflects this inherent tension.

Balancing openness and sovereignty: foreign investment at the heart of current affairs

With the presidential election approaching and geopolitical tensions intensifying, France is navigating between openness to foreign investors and the protection of its strategic interests. The annual report of the Directorate General of the Treasury, published on 24 September, reflects this conflicting reality.

Screening remains brisk as scrutiny intensifies

The figures in the Directorate General of the Treasury’s 2025 annual report confirm the trend seen in previous years. In 2025, 418 foreign investment filings were submitted (compared with 392 in 2024 and 309 in 2023, versus barely 128 in 2014), meaning that the volume has more than tripled in ten years. For the sixth consecutive year, France remains Europe’s leading destination for foreign direct investment.

Of the decisions issued in 2025, 52% of transactions were deemed to fall within the scope of the screening regime, and 167 authorisations were granted. Of these, 49% were subject to conditions designed to safeguard national interests—a slight decrease from the record 54% recorded in 2024, but still a very high figure, well above the average in other European countries. France has, in fact, earned a reputation as the country that grants the highest percentage of conditional authorisations.

Investors remain predominantly non-European (67%), mainly from the United States, the United Kingdom and Switzerland. Half are now financial investors, compared with 44% in 2024, illustrating the increasing financialisation of equity investments in strategic sectors.

As for prohibitions (which are rarely made public), the report mentions seven over four years, a figure the authorities highlight to underscore the proportionality of their approach. However, this official figure does not necessarily reflect the reality: in practice, several applications for authorisation were voluntarily withdrawn by investors “before a refusal decision was issued, or where the investor anticipated difficulty in proceeding with the transaction under the conditions likely to be imposed by the Minister”, as the report itself states. In other words, investors withdraw their applications to avoid a formal refusal. The actual number of aborted transactions is therefore higher than it appears.

Foreign investment: a matter monitored at the highest level of the executive, amid growing parliamentary scrutiny

One revealing sign is that the latest amendment to the foreign investment regulations—a decree dated 30 July 2026—was accompanied by a statement signed by the Prime Minister himself, an unusually political gesture for a text presented as technical.

The Prime Minister’s intervention comes in a context in which Parliament is seeking to strengthen its powers over foreign investment screening.

The evaluation report on foreign investment screening, submitted on 22 May 2025 by MPs François Jolivet (Horizons) and Hervé de Lépinau (RN) on behalf of the Public Policy Evaluation and Oversight Committee, criticised the “insufficient targeting of screening tools”, “numerous flaws and vulnerabilities” and, above all, parliamentary oversight “designed to be ineffective”. Among the report’s many proposals were the creation of a parliamentary delegation for economic security, an expansion of the sectors subject to screening (to include digital platforms, data centres, AI and banking activities in particular), and the removal of legal obstacles to parliamentarians’ right to information.

Two private members’ bills have already translated this movement into proposed legislation. The first, tabled on 27 March 2026 by Philippe Juvin (LR), pursues four objectives: broaden the scope of screening (nuclear energy, media, sensitive data and economic security in the broad sense), codify the conditions for authorisation in legislation, strengthen parliamentary oversight (an individual right of referral and involvement of the Defence Committee), impose a principle of reciprocity with third countries, and subject influence activities relating to foreign investment screening transactions to oversight by the High Authority for Transparency in Public Life.

The second, tabled on 15 September 2026 by Aurélie Trouvé and Mathilde Panot (LFI-NFP), goes even further. For example, the bill seeks to introduce the concept of “productive sovereignty” and extend screening to activities whose disappearance would create foreign dependency or destabilise a local employment area.

From Parliament to the presidential campaign: a cross-party consensus

Parliamentary work is now making its presence felt in the presidential campaign. An unprecedented (and rare) consensus has now formed around the diagnosis: from the radical left to the liberal right, all candidates in the 2027 presidential election now support stronger protection for strategic assets.

The same trend in Brussels: the end of European naivety

This French momentum is echoed at European level. The new regulation on foreign investment screening, adopted on 17 June 2026, entered into force on 16 July 2026.

During the vote in the European Parliament, rapporteur Raphaël Glucksmann stressed the end of European naivety: “With this text, we are closing a chapter of European naivety. We are turning the page on the wilful blindness of Member States that allowed foreign actors to take control of sensitive sectors of our economy”.

The changes introduced by this new regulation are substantial: a mandatory screening mechanism in all 27 Member States and a minimum scope covering dual-use items, critical technologies, critical raw materials, financial services, transport, energy and electoral infrastructure.

For the most part, the French regime complies with the majority of the provisions of this regulation. Some adjustments will nevertheless be required before January 2028, notably to bring electoral infrastructure and all financial services (systemic credit institutions and financial messaging services) within the scope of activities subject to screening.

2027 is set to bring a host of proposals and potentially changes to foreign investment screening, which is likely to establish itself as one of the key issues in the presidential election.