A threat to delay or disrupt transatlantic trade talks has been made by France, due to anger at the US threat to impose a massive fine on BNP Paribas for alleged sanctions breaches.

In a move signaling anger over what is seen as heavy-handed punishments, France is threatening to disrupt transatlantic trade talks if the US fines Paris-listed BNP Paribas with more than $10 billion for alleged sanctions breaches, the Financial Times reports.

BNP Paribas, which has a large wealth management operation – one of the biggest in the eurozone – is also France’s biggest bank, so its plight carries political risk.

In recent days media have reported that the firm faces a heavy fine for allegedly breaching sanctions against Iran, Sudan and Cuba. Although the bank has declined to comment to this publication on the matter, the bank said in its latest results report that it was preparing to book a cost far in excess of the $1.1 billion provision it set aside last year to cover litigation costs linked to sanctions issues.

Speaking about the prospect of such a big fine, Laurent Fabius, foreign minister, said: "This poses a very, very big problem.” It is, the FT said, the first public comment by the French government about the matter.

“We are in talks with the US for a transatlantic partnership,” Fabius was quoted as saying. “This trade partnership can only be established on a basis of reciprocity . . .  One cannot imagine that reciprocity can be the rule if at the same time there is a decision of this type.” Such a “unilateral” punishment would be “completely unreasonable,” he added.

The report said France is among those pressing for financial services to be included in the trade talks, which would amount to biggest regional trade agreement ever struck.

That France – one of the world’s largest economies and a large investor into the US – is bridling at such a fine may suggest that countries are becoming impatient with what might be seen as regulatory bullying by the US, although in defense the US would argue that sanctions against countries such as Iran must be taken seriously, given fears expressed by many nations about Iran’s nuclear ambitions, for example.

The threat to disrupt trade talks by the French may carry weight. According to the French-American Chamber of Commerce website, France is among the top five foreign investors in the US. More than 4,600 French firms do business in the US, which the website says account for over 650,000 jobs. In 2012, almost 200 new investment projects in the US were started by French firms. French exports to the US rose 12.8 per cent in 2012.

(Editor’s note: It is notable that France, a country that has been fierce about the activities of offshore tax jurisdictions such as neighboring Switzerland or Monaco, is angry that its biggest bank faces a harsh financial penalty for breaching sanctions rules. The reaction by French government officials looks, at first glance, far more angry and determined than the Swiss government in reaction to the UBS or Credit Suisse punishments, for instance. Even the UK government has, as far as one can measure, not made threats to disrupt trade deals when a UK-listed bank has been punished by the US. In part this may be due to historic differences between Washington DC and Paris about issues in the Middle East; France has – with caveats – taken a less hard-line view than the US and UK about that region. Even so, the ironies abound: France is reportedly seeking to introduce a small-scale version of America’s FATCA Act law to hunt down expat tax evaders. If countries want to strike poses about going after tax cheats or crooks, there needs to be more co-ordination not just on the rules, but the kind of punishments that are imposed on the miscreants.)