BRUSSELS May 15 The European Commission will examine the legality of a French government decree allowing it to block foreign takeovers, the EU official in charge of the bloc's internal market said on Thursday, warning any such rule should not become protectionist.
"This is going to be examined very thoroughly against the backdrop of European legislation," Michel Barnier, the commissioner for the internal market, told a press conference.
"We will be looking at case law from the courts of justice ... and, of course, we will be looking at what's in the (European Union) treaties," Barnier said.
"We want to make sure that strategic interests are protected," he said, adding, however, that the new rule could be a "possible limitation to the free movement of capital".
Barnier said the French rule should not subject "all transactions of purchasing a company ... to a national authorization". "Clearly that would be protectionism," he said.
The French government issued a decree allowing it to block foreign takeovers of French firms in "strategic" sectors, throwing up a potential roadblock to General Electric's $16.9 billion bid for Alstom's energy assets. (Reporting By John O'Donnell; editing by Adrian Croft)