The legislation, proposed by Nicolas Sarkozy, France‘s tough-talking interior minister, triggered heavy criticism from the opposition and immigrant groups when it was first launched.
The law aims to attract skilled workers while excluding unqualified immigrants.
But critics say it will stigmatise foreigners, discriminate against the poor and undermine France‘s traditional role as a haven for the persecuted.
The bill had already been adopted by the lower house in May and approval on Friday was expected after an agreement in the joint committee of the Senate and lower house earlier this week.
Sarkozy told parliament that the law would give the government tools to promote “immigration of choice” and would mean immigrants would be better accepted by the rest of the society.
Before the law was adopted, Sarkozy said that November’s riots by youths in poor suburbs, where many immigrants live, showed the immigration and integration system was failing and needed a revamp.
But he faced accusations of racism and xenophobia and demonstrations when he visited Africa.
The law creates a three-year “skills and talents” residence permit to attract skilled workers but also allows in workers in sectors facing unskilled labour shortages.
It also makes it harder for resident immigrants to bring their families to France, requires newcomers to take French and civics lessons and ends their automatic right to a long-term residence permit after 10 years in France.