Then why the government restrictions?

There is NO restriction in French cinema theaters, you must be confusing with Spain or South Korea where there are national quotas.

What your source says is about TV, they are wrong when they say it also concerns theaters. And, of course, like the good basher that you are, you didn't even bother checking.

Anyway, whatever preserves the diversity of our cultural offer, I wouldn't want it to end:
I would not want to live in a Europe where all cinema theaters from Paris to Varsaw, Lisbon to Stockholm, Athens to Dublin play the exact same movies in the exact same multiplex theaters of the exact same shopping malls with the exact same stores like it is throughout the US.

You might feel comfortable in a mono-cultural tasteless society where only universal products succeed, but this is not the European way of life, and not consistent with the European dream of "unity in diversity".