France Still Business Friendly, Foreign Minister Argues
Saying no to Yahoo's bid to take a majority stake in French online video website Dailymotion does not mean the French government is anti-business, the country's foreign minister Laurent Fabius told CNBC on Monday.
Tech giant Yahoo last week ended talks to take a 75 percent stake in Dailymotion, owned by telecoms firms France-Telecom Orange, in a deal that would have valued the website at $300 million, according to media reports.
"With the Dailymotion case it was something different. The question was not about saying yes or no but about the proportion of the stake [Yahoo would take]," Fabius told CNBC Asia's "The Call."
"My understanding is that they [Yahoo] wanted to buy 75 percent, which means they would have taken control of it. And we were in favor of 50-50, which is why the deal didn't go through," Fabius said, adding: "But we are fourth in the world for foreign investment and we remain very open to foreign investment."
Fabius said that France, the euro zone's second biggest economy, remained business friendly despite negative headlines over the past year about high taxes that have damaged France's reputation as a destination for business.
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Last October, the government was forced to back down on plans to raise a capital gains tax on businesses that sell their firms after huge protests from entrepreneurs.
French President Francois Hollande also had to scrap plans last year for a 75 percent tax on those earning over a million euros, a high-profile campaign pledge, after a constitutional court said the measure was confiscatory.
In a bid to appease entrepreneurs who say that high taxes are a disincentive to starting a new business in France, the government last month announced new reductions on capital gains taxes from the sale of small firms.
"France remains the fifth economic power in the world, the fourth in terms of foreign investment. It's one of the best places for technology, for trade," Fabius said, answering a question about whether France remains a friendly place for business.
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"It is very true that when Francois Hollande was elected a year ago the situation was not that good. We have lost in terms of competitiveness and we have had to make a very special effort, especially on taxes even if it hasn't been very pleasant," he added. "We are at the beginning of a recovery I hope, but it takes time."
- By CNBC.Com's Dhara Ranasinghe, Follow her on Twitter: @DharaCNBC