The European Commission has closed its investigation into the unlimited state guarantee provided toLa Poste because the new postal law transforming the French postal operator into a limited company
will put an end to it.The Commission has concluded that the conversion of La Poste into a public limited company(société anonyme) will effectively remove the special government guarantee that the postal operatorhas had as a public body. This follows the adoption of the new postal law by the French parliamenton 12 January.
In 2007, the EU launched an in-depth investigation into the state guarantee implicitlygranted to La Poste. The commission stated that the guarantee was unlimited, provided free ofcharge, and was not confined to universal postal service activities but also covered La Poste’scommercial activities. It thus conferred an economic advantage to La Poste over its competitors,which must operate without such a guarantee. “The guarantee therefore distorts competition on thepostal markets, which makes it incompatible with the common market,” the Commission claimed.
Under EU rules on existing state aid schemes, the Commission had recommended a year earlierin 2006 that France withdraws the guarantee by 31 December 2008. However, the French authoritiesdid not respond to these recommendations with discussion continuing until October 2009. In view ofthe time required to approve the legal instruments which would withdraw the guarantee, theCommission urges the French authorities to remove the guarantee by 31 March 2010 at the latest.
The EU stressed that its decision does not at all question the public service mission orpublic ownership of La Poste. It just considers the guarantee enjoyed by La Poste because of itsspecial status state aid incompatible with the common market which therefore must be withdrawn.European competition rules must apply equally to public and private enterprises, the Commissionadded. It reiterated that La Poste’s transformation into a public limited company on 1 March 2010is therefore a measure that will remove the state aid in question.
EU Competition Commissioner Neelie Kroes said: “In view of the fact that postal markets willsoon be fully open to competition, I welcome the adoption of legal measures to end a stateguarantee for La Poste, which also covers activities outside its public service remit.”
The draft postal law approved through the vote in the French National Assembly in Januarycontains two parts. One part implements the European directive for full postal liberalisation in2011 while the other deals with transforming La Poste into a limited company as of March 1, 2010.
Under a subsequent €2.7 billion capital increase, designed to raise financing for strategicgrowth, the French government would contribute €1.2 billion and the state-owned Caisse des Dépôts(CDC) a further €1.5 billion. La Poste’s current status as a public organisation (‘etablissementpublic industriel et commercial’) has legally prevented such a capital increase.
In July 2008, La Poste signed a public service contract with the French government covering2008-2012 confirming the company’s commitment towards four basic service areas and preparing it fortotal postal liberalisation in 2011. The contract included commitments to mail deliveries six daysa week and mail delivery quality targets, the maintenance of 17,000 postal service points acrossFrance, and public access to banking services. The contract was seen as an effort to calm postalunions which have always strongly opposed opening up La Poste to private investors.
