Press Release: Free movement of capital: Commission scrutinises French law establishing authorisation procedure for foreign investments in certain sectors

The European Commission on 4 April 2006 decided to send a formal request to France submit its observations on the provisions of Decree 2005-1739 of 30 December 2005, which created an authorisation procedure for foreign investments in certain sectors of activities that could affect public policy, public security or national defence. After informal dialogue on this text, the Commission expressed its concern that some of these provisions could act as a disincentive to investment from other Member States, in contradiction with EU Treaty rules on the free movement of capital (Article 56) and the right of establishment (Article 43).