In his commentary on the recent reforms of the French takeover bids regime, Professor Bonneau questioned whether France was still ‘a good member of liberalism.’ A quick look at the statistics demonstrates that indeed France has become relatively unattractive for foreign investors. It is true to say that along with British and German companies, French companies were the most attractive participants in the European wave of mergers and acquisitions between 1993 and 2001. However today, France suffers from a substantial negative takeover balance, with foreign companies investing only ?149,000,000 in takeovers of French companies, compared with the ?336,500,000 invested in foreign countries by French companies for the same purpose.
On 31 March 2006, European Directive 2004/25/EC on Takeover Bids (the ‘Directive’) was implemented into French law through Act No. 2006-387 (commonly called the ‘Loi Anti-OPA’). The objectives of the Directive are twofold: (1) to strengthen legal certainty in cross-border takeover bids; and (2) to ensure the protection of minority shareholders. Furthermore, the Winter Commission, which had the difficult task of paving the way for the drafting of the final proposal for the Directive, came to the conclusion that the Directive must also be considered as a further step towards an integrated securities market in Europe. With these observations in mind, it is difficult to imagine that the European legal institutions would enact a piece of legislation which is meant to render companies within Member States ‘takeover-proof’.
The French legislature has taken a peculiar approach to the subject of takeover bids. With the Loi Anti-OPA, the French Parliament drafted an act which tended to find a compromise between shareholder influence on defensive measures, and the reactive capacities of a company to raise a defence (‘réaction à chaud’). Economists saw the Loi Anti-OPA as a ‘financial and economical inconsistency aimed at defending national “champions” ’. Consequently, it is relevant to examine the French legislation prior to the recent Loi Anti-OPA as well as the Loi Anti-OPA itself in order to analyse its impact on the French takeover regime.European Company Law