French meat processing company Spanghero knowingly sold horsemeat labelled as beef, the French government has said, reports the BBC.
Spanghero's licence is being suspended while a probe continues, agriculture minister Stephane Le Foll said.
The firm has denied the allegations, saying it only ever dealt in meat it believed to be beef.
A widening scandal over mislabelled horsemeat has affected at least 12 European countries.
Spanghero imported meat from Romania and sold it on to another company, Comigel, which made frozen ready meals at its factory in Luxembourg.
French consumer affairs minister Benoit Hamon said the meat left Romania clearly and correctly labelled as horse. It was afterwards that it was relabelled as beef.
"From the investigation, it would seem that the first agent or actor in this network who stamped 'beef' on horsemeat from Romania was Spanghero," Mr Hamon said.
There was "no reason to doubt the good faith" of the Romanian abattoir that originally provided the meat, Mr Hamon added.
The French government believes that the 'fraud' went on for six months and involved around 750 tonnes of meat.
Read more of this report from the BBC.