FRANCE Law and Practice Contributed by: Raphaële Courtier, Sébastien de Monès, Victor Camatta and Jessica Chartier, Bredin Prat
non-deductibility of certain financial expenses can impact the acquirer’s cash flows and there- fore its ability to service its debt.
In addition to the foreign investment control pro- cedure described above, certain sectors are reg- ulated by specific independent authorities (eg, banking and insurance, media and broadcast- ing). The acquisition or divestment of a stake in companies from these sectors can be subject to prior authorisation from the relevant authorities. 9.2 Listed Targets Specific Regulatory Rules Acquisitions of French companies listed on a French regulated market (Euronext Paris) or on Euronext Growth, and of companies whose reg- istered office is in another EU/EEA member state but whose shares were first listed on a French regulated market, are regulated and super- vised by the French Financial Markets Author- ity ( Autorité des Marchés Financiers ) (AMF). The rules relating to voluntary or mandatory public tender offers are set forth in the AMF General Regulation and French Monetary and Financial Code. All tender offers must comply with the following general principles: • free interplay of offers and counter-offers; • equal treatment of, and access to, informa- tion for all securities-holders concerned in the offer; • market transparency and integrity; and • fairness in transactions and in competition among the offerors. The AMF is involved at several stages of the ten- der offer process: • it examines and determines the conformity of the draft offer and, ultimately, approves or rejects the filing of the offer. The statement of conformity encompasses the approval (visa)
9. Takeover Finance 9.1 Regulated Targets
As a general principle, financial relationships between France and foreign countries are not restricted, however foreign investment in busi- ness sectors deemed to be sensitive to public order, public safety or national defence interests require the prior authorisation from the Treasury Department of the French Ministry of Economy and Finances (the “Minefi” ). This procedure applies when a foreign inves- tor acquires the control of a French entity, all or part of a French entity’s business division, or, for non-EU/EEA investors, a direct or indirect stake representing more than 25% of voting rights of a French target (or 10% if the target is listed on a regulated market). As such, the Minefi’s prior authorisation may be required in case of exer- cise of security interests granted on the shares or business of the target company. The French Monetary and Financial Code lists the sectors which are considered sensitive by nature, as well as sectors in which the target may be considered sensitive depending on the result of “sensitivity test” . The Minefi will have the option to: • authorise the investment as presented; • authorise the investment under conditions that ensure the preservation of France’s inter- ests; or • refuse the investment based on certain grounds.
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