PACTE Law and Privatization Dynamics: A Comprehensive Analysis and Strategic Guide

Extract

[...] Bercy can issue different measures all susceptible to appeal in full contentious proceedings situations must be distinguished: - Absence of prior authorization for foreign investments: - The minister may take a measure of injunction aimed at filing an injunction measure - If the protection of national interests is compromised, conservation measures: example suspension of voting rights - The minister may appoint a representative who will oversee within the company the preservation of national interests, He may hinder all decisions taken by the Board of Directors of the company - Lack of knowledge of the terms of the authorization given by the minister - PACTE goes further, Bercy can withdraw the authorization - Bercy can prescribe actions to the investor to enable him to comply with the authorization decision. The PACTE law demonstrates Bercy's powers over strategic enterprises. The minister of the Economy's powers of sanction have been strengthened. [...]

[...] The law adds new breaches that can lead to a pecuniary situation - Bercy can issue various measures all susceptible to appeal in full contentious proceedings. B. The reduction of public debt - 2 situations must be distinguished: [...]

[...] What are the new dynamics followed by the PACTE law in terms of privatization? - Introduction and detailed plan The PACTE law law on the growth and transformation of businesses of May 22, 2019) was implemented to simplify and modernize the legal framework for businesses, promote their growth, and support innovation. The law establishing the Action Plan for the growth and transformation of businesses has main objectives, which include the transformation of businesses in terms of governance, financing, as well as the creation of a more favorable environment for their development. [...]

[...] ACTION SPECIFIC: - The law has reduced the threshold of the state-held share from which a public enterprise can no longer be considered a 'public' enterprise. - It is now possible for the State to reduce its participation in these companies while remaining the majority shareholder. The State can transfer a large part of its shares while keeping a blocking minority (that is, a percentage of shares sufficient to prevent a major strategic change). The PACTE law dissociates the specific action of state participation. [...]

[...] The reduction of obstacles to control No threshold for state action, but specific action that can be instituted by decree if the protection of the state's interests requires it: - Economic Order - Public Security - Public Health - National Defense Alternative Conditions: - The company must belong to the scope of the state participation agency - The company has a listed title with of the company's capital held by BPI France In addition, the law allows the State to to sell participations in public companies without having to obtain the approval of Parliament, except in cases where this transfer concerns strategic companies (sensitive sectors, for example in the energy, transport, etc.). Before the Pact law, the privatization process involved a mandatory passage in front of Parliament to be validated. This procedure could lead to significant delays, or even political blockages if the opposition opposed it. This made privatizations longer and less predictable. The Pact law has simplified this procedure by allowing the State to privatize companies without the prior agreement of Parliament, except if it explicitly expresses opposition. [...]