Recent Articles
As climate change continues to be a pressing global issue, governments are striving to advance green technologies. In line with this effort, on 24 October 2023, France introduced the Green Industry Law (Loi Industrie Verte), marking significant progress. This comprehensive legislative package aims to reduce emissions from existing industries and attract new investments in low-carbon technologies. The law seeks to position France as a leading green industrial hub, accelerating industrial transformation.
One of the Green Industry Law's most significant impacts is its simplified procedures for establishing industrial sites. Historically, setting up operations in France has been complex, with many administrative obstacles. However, the new law cuts through red tape by simplifying procedures, notably for projects of national interest (projets d’intérêt national majeur). Part of this strategy is prioritizing industrial wasteland clear-ups and redeveloping brownfield sites into active, sustainable manufacturing districts.
A vital component of this legislation is a “green industry investments” tax credit (crédit d’impôt pour les investissements dans l'industrie verte) designed to provide strong incentives for firms to innovate and decarbonize. This tax credit was explicitly created to lower the cost of adopting cleaner technologies and updating existing processes within the industry. Examples include investments that directly help with environmental sustainability within driving mechanisms, such as projects for renewable energy, energy efficiency, carbon capture, and low-emission technologies.
This financial relief, which allows eligible companies to reduce their taxable income, significantly improves their cash flow. This makes ambitious green projects financially feasible, providing financial support for companies considering such investments. The government has designed this tax credit to be as accessible and meaningful as possible, ensuring that companies of all sizes, from start-ups to large industrial players, can benefit. This financial support may be the push many businesses need to invest in environmental innovation they might have considered too risky or costly.
Through well-designed incentives encouraging companies to develop emissions-reducing technologies, France sends a powerful message: sustainable investment is a moral obligation and a lucrative economic opportunity. The step is a part of the strategy to merge financial policy with ecosystem goals, easing and incentivizing corporate involvement in the national green transformation.
The law introduces the Triple E label
(label Triple E—Entreprise Exemplaire Environnementale). To qualify for this label, companies must demonstrate exemplary environmental performance, including significant reductions in carbon emissions, efficient resource usage, and adherence to sustainable practices across their operations. This certification is a mark of distinction for companies that embody environmental stewardship and set the benchmark for sustainable operations. The label also influences public procurement policies, as companies with the label are given priority for government contracts. By supporting environmentally virtuous companies, the French government fosters a sustainable business environment where sustainability becomes a competitive advantage.
The Green Industry Law meets the need for a tailored workforce to drive the green revolution. Acknowledging the need for more human capital, it further specifies parameters to train more engineers and technicians, enhancing the industry's appeal to young talent. France is also investing in education and training programs to ensure the workforce has the skills to lead in a sustainable industry.
At the European level, France’s legislative push is reflected in the finalization of the Net-Zero Industry Act effort by the European Union in February 2024. It is the first step in a broader plan to make Europe climate-neutral by 2050 and contains bold targets, including manufacturing at least 40% of the EU's clean technology needs by 2030. With new laws to fast-track permitting and defense provisions against non-Western competition, the EU is building a foundation that fosters the growth of green technology, encouraging self-sufficient sustainable innovation.
Together with the Net-Zero Industry Act, the Green Industry Law provides opportunities, though the concessions are limited. Although policy incentives and simplified regulations create an advantageous environment for investment, the environmental standards remain high. Rapid adaptations, continuous innovations, and strategic acquisitions will be required to stay ahead in this dynamic segment.
Companies must adapt to these new legislative changes to compete in a greener, more sustainable economic landscape. Green is the industry's future, and those ready for this shift will be best placed for long-term success.
Stay ahead of the curve with the latest legal insights, and updates from Axioma.
Thank you for subscribing to our newsletter!
We appreciate your interest and will keep you updated with the latest news and offers.
Oops! Something went wrong with your subscription.
Please try again later or contact our support team if the issue persists.
About the Firm
Resources
Contact
Tarik Zahzah
Avocat à la Cour | Attorney at Law
CNBF: 131266 | New York: 4532081
CDAAP, 11 Bd de Sébastopol
75001 Paris, France
Axioma Law. All rights reserved.