US embassy cable - 05PARIS5961

UNCLAS PARIS 005961 
 
SIPDIS 
 
SENSITIVE 
 
STATE FOR EB/OIA - Wes Scholz and James Roseli 
Treasury for Office of International Investment - Gay Sills 
STATE PASS USTR 
 
E.O. 12958:  N/A 
TAGS: EINV, ETRD, ECON, FR, EUN 
SUBJECT: GOF LEAKS STRATEGIC SECTORS TO BE PROTECTED FROM 
FOREIGN TAKEOVERS 
 
Ref:  Paris 5441 
 
NOT FOR INTERNET DISTRIBUTION 
 
1.  (U) Summary.  The French Government is slowly unveiling 
the contents of an upcoming decree listing the specific 
strategic sectors to be shielded from foreign takeover (per 
reftel).  The State Council, France's highest administrative 
body, is currently reviewing the decree before its signature 
by the President.  The decree will also require approval 
from the EU Commission.  End Summary. 
 
2.  (U) French Industry Minister Francois Loos chose the 
business daily "Les Echos" for his announcement on August 30 
that the GOF intended to follow-up within "a few weeks" on 
Prime Minister de Villepin's July call for "economic 
patriotism".  The following day, the French daily claimed to 
have obtained a draft of the upcoming GOF decree, which, it 
said, should list the following ten sectors: armaments, 
security, communication interception equipment, computer 
security systems, dual civil-military technologies, 
cryptology equipment, businesses dealing with sensitive 
military information, biotechnology, pharmaceuticals 
(antidote production), and casinos. 
 
3.  (U) Economy and Finance Minister Thierry Breton, who 
oversees Loos, was more cautious in his remarks.  During a 
radio interview on August 30, he said: "Of course, as it is 
in all countries, it's a question of sensitive, very 
sensitive sectors, which essentially concerns sectors like 
defense, biotechnology, space technology, telecoms -- the 
sectors that are associated with our national heritage." 
 
4.  (SBU) COMMENT: Les Echos noted that France's strategic 
interests surprisingly did not seem to include oil or yogurt 
-- a barbed reference to the rumored takeover of Danone by 
PepsiCo, which had prompted Villepin's call for protection 
of French "industrial jewels."  To preempt concern from 
other EU members, Breton has pitched the proposed French 
action as being fully in line with existing EU decrees on 
freedom of investment, with an emphasis on reciprocity. 
However, the direction and effect of this economic policy 
are likely to be protectionist. 
Stapleton