Please Note: Blog posts are not selected, edited or screened by Seeking Alpha editors.

Socialists At The Gates

|Includes: IBKR, Orange (ORAN)

If you're trading French stocks directly (through Euronext Paris or another ECN that does the French market and settles in France), be aware that from today (August 1) the fabled transaction tax is in effect. This tax is 0.20% of the notional value purchased.

Here's Interactive Brokers' (NASDAQ:IBKR) announcement:

Interactive Brokers would like to inform clients of the French Financial Transaction Tax (NYSE:FTT) enacted in March 2012 and which comes into force 1 August 2012. Key information regarding the tax is provided below:

Tax Rate: The rate is currently set at 0.20%

Tax Base: The tax is assessed on the purchase of certain French equities. The French Ministry of Finance has released a list of 109 French companies whose securities are subject to the FTT. The tax is due on the net position delivered on settlement date, as such purchases and sales which settle at a common depository will be eligible to be netted for determination of the tax.

Effective Date: The FTT is applicable to trades of August 1, 2012.

I said "Socialists" in the title, but the measure already comes from right-wing Sarkozy's government. Still, it's a socialist measure anyway.

Anyway, what matters is that any direct trading on French equities should take this new tax into account. It is possible to avoid the tax by dealing in CFDs or ADRs of French stocks traded in foreign markets, such as France Telecom (FTE) in the U.S.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.