France has lowered the foreign ownership threshold for sensitive firms to 10%, and for the first time explicitly includes cryptocurrency companies in the scope. The move, effective this week, tightens control over foreign investment in digital asset businesses operating in the country.
What the new rule covers
The threshold applies to direct or indirect foreign ownership of companies deemed sensitive, including those in the cryptocurrency sector. Previously, the threshold was higher for most industries, but the French government has now set a uniform 10% limit for all sensitive firms. Crypto exchanges, custodians, and other digital asset service providers are now explicitly listed as sensitive entities.
Why France is acting
The decision comes amid broader European efforts to regulate foreign investment in strategic sectors. France has been tightening its screening mechanisms for foreign direct investment over the past few years, and including crypto reflects growing concerns about national security and economic sovereignty in the digital asset space. The French government has not provided a detailed rationale, but the move aligns with similar actions by other EU member states.
Impact on crypto firms
Crypto companies with significant foreign ownership will need to review their shareholder structures. Any acquisition or increase in ownership that pushes foreign stake above 10% will require prior approval from the French authorities. This could affect international crypto exchanges looking to expand in France, as well as venture capital firms with non-French investors holding stakes in local crypto startups.
What happens next
The new threshold took effect immediately. Crypto firms operating in France should expect increased scrutiny from regulators, and those with foreign ownership near the limit may need to restructure or seek approval. The French government is expected to publish further guidance on compliance procedures in the coming weeks.
