France to ban closure of profitable plants

France to ban closure of profitable plants
Photo: ArcelorMittal
The French parliament will within three months vote on a law banning profitable firms from closing down a plant and laying off workers without first seeking another company to take over the site, a minister said Friday.

Industrial Renewal Minister Arnaud Montebourg said this law would be "perfectly applicable" to the situation at an ArcelorMittal plant in eastern France, where the steel giant reportedly wants to shut two blast furnaces.

"We say: if there is someone ready to take over the site, we will proceed to a forced handover using the legal system," he told BFM television news.

"This is not expropriation, this is not nationalisation… You want to close, someone presents himself (seeking to take over the site), the judicial system fixes a price and you will be paid the market price," Montebourg said.

The promised law was an election pledge by the Socialist President Francois Hollande, who is under growing pressure to deal with rising unemployment rates.

Hollande on Thursday met steel tycoon Lakshmi Mittal to discuss the fate of the blast furnaces after a report that ArcelorMittal planned to shut them down.

Hollande's office said the president told Mittal of "the demands of the state and the government" concerning the Florange site which lies in what was once the heart of France's steel industry.

French unemployment topped three million for the first time in over a decade, data showed Wednesday, as the country faces a yawning budget gap like those plaguing its southern eurozone neighbours.

Hollande, who took power in May, on Friday will unveil his first budget, which is aimed at generating 30 billion euros in new taxes and savings to plug a budget gap and to kickstart the flagging economy.

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