"France is firmly opposed to a boycott of Israel," Fabius said in a statement, while acknowledging that it was up to Orange's bosses to determine the company's commercial strategy.
And Orange boss Stéphane Richard, who sparked the row with a statement in Cairo on Wednesday that he would "like to withdraw from Israel", insisted that "we love Israel" and that the question was a "purely commercial point" over Partner's use of his firm's brand.
"This has nothing to do with Israel, we love Israel," he told the Israeli daily Yediot Aharonot. "We are in Israel, in the enterprise market, we invest money in innovation in Israel, we are a friend of Israel, so this has absolutely nothing to do with any kind of political debate, in which I don't want to be."
He claimed not even to be aware of the international boycott and divestment campaign that led to a report by five NGOs and two French trade unions claiming that Partner used labour in Jewish settlements in Palestinian territory.
Israeli Prime Minister Benjamin Netanyahu responded to Richard's initial statement with a call to the French government to "publicly renounce the miserable remarks and the miserable action of the company that is under its partial ownership".
And Partner's new boss, Isaac Benbenisti, made it clear he did not believe Richard's latest declaration.
"I do think the statements were political, I do think the remarks against Israel and Partner were a result of pressures exerted by pro-Palestinian elements, trying to sabotage Israel's relations in the world," he told Israeli army radio.
In 2014 France warned companies of risks connected to economic activity in the settlements, as Germany, Italy and the UK had already done.
In his statement on Friday Fabius stated that France and the European Union's stance on the settlements is "well known".
In December France's parliament voted in favour of recognising a state of Palestine.
The boycott and divest campaign received a fillip on Tuesday when the executive of the British students union, NUS, voted to support it, sparking an angry reaction from some Israeli politicians.