In a wide-ranging bill setting defence spending for years to come, concern has focused on a single clause that broadens surveillance of citizens to content such as emails, photos and other data.
The adoption of the bill on Tuesday by France's parliament comes at a time of general concern over privacy following revelations by former NSA contractor Edward Snowden of widespread online eavesdropping by intelligence agencies in the US and other countries.
It also follows sharp protests in October by France that the United States stop snooping on Europeans after yet more revelations from the Snowden allegations.
But with the new law, France is now the source of concern over governments prying deeply into private lives in their fight against terrorism and organised crime.
ASIC, a Paris-based association that groups web players operating in France such as Facebook and Google, said yesterday the law "weakened the sector and raised many questions in terms of protection of freedoms."
"There is no doubt that this bill will weaken the French position in the European and international debate on the protection of personal data," it added.
The association has called on lawmakers opposed to the bill to take the matter to the Constitutional Council, France's top court.
The Paris-based Reporters Without Borders watchdog called the law "worrying" with provisions "that seriously violated the fundamental rights of citizens and privacy in particular."
The bill also allows interior, defence or finance ministry officials to request access to the data, and not an independent judge. These demands will be validated by an expert close to the Prime Minister.
According to ASIC, intelligence services were previously only allowed to obtain data from hosting services without a judge's authorisation in cases of prevention of terrorism.
Even then, the association said, access was limited to technical data that would allow them to identify who was behind an email address or who posted a video, and not actual content.
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