The marked tendency over the last few years of French companies coming to set up operations in Quebec will no doubt continue to accelerate for the following reasons:
- the dismal outlook in France continues to prevail with no improvement expected to come from the presidential elections in 2017 (which elections could even create further social tension);
- the strategy of French companies to initially invest in Quebec (thereby becoming comfortable with North American business practices) and to subsequently expand into the American market is once again attractive as the United states starts showing signs of economic recovery;
- the weakness of the Canadian dollar offers an attractive exchange rate for French purchasers; and
- the conclusion in 2014 of free-trade negotiations between Canada and the European Union with respect to the Comprehensive Economic and Trade Agreement (CETA) has raised a certain amount of interest among Europeans in general and the French in particular, even though the implementation of CETA will take at least another year.
The result from a legal perspective is that French businesses will be increasingly active in investing in Quebec, through the acquisition of businesses (particularly family-owned ones with no succession plan in place) or by entering into joint ventures in order to diversify their operations outside of France. In some cases the strategy will be based on CETA (arising notably from increased dairy-product quotas) but the tendency can be noted across all sectors of activity.
CETA will also lead to the opening up of public procurement markets to Europeans, not only at the federal level (as is typically the case with agreements of this nature – such as NAFTA) but at the provincial and territorial levels as well, which will constitute a radical change in current practices. Since France is a country of engineers (their spectacular successes over the years in infrastructure projects such as the Paris subway system, high-speed trains, the Millau bridge and even the Eiffel Tower are too often forgotten) it is easy to anticipate their interest in developing the public procurement market in Canada (claimed by some to represent at least 7% of our GDP…)