French investigators will probe Renault over suspected "cheating" in emissions tests of diesel motors, the Paris prosecutors office said Friday, causing shares in the automaker to fall sharply.
Renault reacted with a statement saying that its cars "are not equipped with cheating software affecting anti-pollution systems."
The company "complies with French and European regulations" and its vehicles "are compliant with the applicable standards," it said.
Following a massive emissions scandal involving Germany's Volkswagen, independent French experts found dangerously high levels of emissions from diesel engines of several carmakers, including Renault.
Prosecutors have ordered a probe be opened into "cheating on key parts (of vehicles)" and into the quality of the tests carried out.
Renault shares were trading 2. percent lower at 84.75 euros around 1300 GMT, having opened over one percent higher. They slumped by over four percent in an initial reaction to the news.
The probe comes after another global automaker, Fiat Chrysler, fell foul of US environmental standards on Thursday. The company was accused of having hidden software on diesel trucks that allowed them spew out excess emissions.
The Italian-American company immediately denied the charges and pledged to work with President-elect Donald Trump's adminstration to resolve the issue "fairly."
The shockwaves from Volkswagen's own emissions scandal are still reverberating around the global auto industry.
US officials said Wednesday the German giant will plead guilty to three criminal charges and pay a total of $4.3 billion (4.0 billion euros) in fines to settle the emissions cheating scandal known as "Dieselgate".
The US Justice Department also charged six Volkswagen executives deemed responsible for the conspiracy, five of whom are believed to be in Germany while one was arrested in Miami on Saturday.