GEISPOLSHEIM, France - French President Nicolas Sarkozy said on Tuesday he would not let his country's literary heritage be taken away by a friendly large American company, in a thinly veiled challenge to Google

France is anxious to avoid French-language literature being swallowed by major international digitisation projects and is looking to create its own national digital champion.

We won't let ourselves be stripped of our heritage to the benefit of a big company, no matter how friendly, big or American it is, Sarkozy said, without naming Google.

At a public round table meeting in eastern France, the president said digitisation of books would be one of the projects financed by a planned national loan, which is due to pump billions of euros into strategic investments in 2010.

We are not going to be stripped of what generations and generations have produced in the French language, just because we weren't capable of funding our own digitisation project, he added.

Publishing is the latest creative industry to be jolted by the digital revolution, with Google planning a huge library of scanned books, electronic books becoming popular and governments struggling to keep up with rapid change in the private sector.

Google's book project is part of a settlement deal reached with the U.S. Authors Guild. The plan has been praised for bringing broad access to books but has also been criticized in some quarters on antitrust, copyright and privacy grounds.

Prime Minister Francois Fillon last month ordered a commission to look at how to prepare the publishing sector for a re-vamp, saying it was important to prevent the kind of damage from illegal downloads that hit the music and film industries.

In an open letter, Fillon listed several possible strategies starting with scanning the contents of Europe's libraries.

Other projects included applying Internet piracy laws to the publishing sector, asking publishers to propose ways of policing downloads, and developing the market for legal digital books.

Fillon said France would not accept another cultural industry being threatened by looting.

France's government has proposed some of the world's strictest online piracy legislation, and in September parliament approved a law that will allow authorities to disconnect repeat illegal downloaders.

The government has also urged the European Union to agree on a massive digitisation project, effectively taking on Google.

It is not the first time, France has challenged Google.

In 2005, French and German leaders announced to much fanfare that they would work together to develop a multimedia search engine dubbed Quaero (Latin for I Search) that many saw as a direct attack on Google. The project failed for lack of funds.

(Writing by Sophie Hardach, editing by Mark Trevelyan)

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