THE European Commission was awaiting formal documents from Paris last night after the French Government outlined plans to shield companies in ten key industries from foreign takeover.

The Commission said that it would “scrutinise” new French legislation that in effect erects barriers around ten sectors and gives Paris powers to block hostile foreign bids for French businesses ranging from computer makers to casino operators.

“The principles of the single market and of the European Union’s treaty rules must be respected,” a Commission spokesman said.

France’s list of the ten sectors that will be protected — including defence, nuclear power, computer systems, biotechnology and the production of antidotes for life-threatening diseases — was released a month after Dominique de Villepin, the Prime Minister, called for patriotism to shape France’s economic policy.

Ironically, it also came on the day that the board of Britain’s BPB, the world’s biggest plasterboard maker, rejected a hostile £3.7 billion bid by France’s Saint-Gobain, claiming that the 720p-a-share offer undervalued the company’s growth prospects.

The French Finance Ministry said yesterday that its new laws were designed to stop strategic technologies from falling into foreign hands. Casinos were on the list in order to strengthen the fight against money-laundering, the ministry said.

Commission officials, who have been in close touch with French authorities as the strategic list has taken shape, pointed out that any deviation from the basic principle of the free movement of capital within Europe could be justified only on public security and defence grounds. They suggested that any intervention by the French Government to prevent a foreign takeover of one of its strategic champions would almost certainly be investigated by the Commission.

The French decree, announced by François Loos, the Industry Minister, means the Government will be able to veto bids for some of France’s biggest companies. Sanofi-Aventis, the pharmaceutical laboratory, and Alcatel, the communications group, could both turn to the French state for protection if subject to a hostile takeover bid.

So, too, could EdF, the state electricity operator, which is set to be floated on the stock market at the end of this year or early next year, and defence contractors such as Thales and Dassault.

Even Accor, the hotel and leisure group, could seek protection on the ground that it has a 34 per cent stake in Lucien Barrière casinos. The government decree will raise fears of a return to protectionism under M de Villepin’s premiership.

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