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If you are planning to invest in data centers in France, there’s one thing you can’t afford to overlook: regulatory approvals.
While merger control may apply, this article will deal specifically with foreign investment and foreign subsidy screenings in France and the EU.
Why data centers are in the spotlight
France is positioning itself as a key player in the global competition for artificial intelligence (AI) infrastructure. The French President announced during the ‘National AI Action Summit’ on February 10, 2025 that it was seeking to attract €109 billion in private investment for AI-related infrastructure. Central to this investment effort are data centers, which support advanced machine learning and large language models.
International investors have responded quickly, with commitments in the hundreds of millions of euros from companies based out of Japan, the United States and the United Arab Emirates. However, the government’s commitment does not exempt companies from applicable regulatory obligations. The following tips will help you determine whether these obligations apply to your situation.
Am I investing in a sensitive activity?
Concerns are growing in Europe about the impact that certain foreign acquisitions may have on security and public order.
To address these concerns, the European Union in 2019 set up a framework for the screening of foreign direct investments (FDI) into the EU, to make sure the European Union is better equipped to identify, assess and mitigate potential risks to security or public order (see EU Commission fact sheet).
France also relies on its national FDI screening mechanism, which triggers a mandatory notification to the French Ministry of the Economy. The investment cannot proceed until approval is granted.
- Tackle legal due diligence early, especially when sensitive sectors (such as defense-related data, critical technologies or energy infrastructure) are in play or when a company involved in a transaction has received foreign financial contributions
- Collecting information may require time and effort, especially since turnover and foreign financial contributions are autonomous concepts under EU rules and not directly reflected in company accounts
- Proactive dialogue with authorities can help streamline the review process and reduce uncertainty
- Be mindful of these issues in the deal planning process as applicable regulatory filings are accompanied by standstill obligations