Brussels, 05/07/2004 (Agence Europe) - The matter of the special professional tax regime enjoyed by France Telecom could end with a summons for the French semi-public company. The Commission seems minded to call for the reimbursement of unpaid taxes under the professional tax and the real estate tax regimes between 1994 and 2003. According to the Financial Times, the sum total has not yet been decided on, but could be as much as several million EUR. In a report of November 2001, the Director General for Taxation of the French State set at 1,291 million EUR the total tax breaks enjoyed by France Telecom. The Director General for Taxation of the French Ministry of the Economy and Finances states, however, that this figure would be subject to corrections which have not yet been published.
If the Commission decides to make France Telecom pay, its directors say they are prepared to get the Court of Justice involved, and are determined to not pay up. The Commission may announce a decision without waiting for developments in the inquiry on another sensitive subject: the shareholder's loan allocated by the French State, in the form of a line of credit for a total of 9 billion EUR. Despite the fact that the French operator has never made use of this line of credit, the Commission's expert considers that this is illegal State aid (see EUROPE of 15 January). The fact of knowing it was there if it was needed, together with statements made by the French Economy and Finance Minister at the time, Francis Mer, would have served to reassure investors. The Commission must ascertain whether this reading is legally defensible, and will take the time to assess the impact of the Minister's words before taking position.
On the other affair current being looked into, that of the modification of conditions for a UMTS licence to be granted, the Commission must take position on this soon, as the Bouygues group has introduced an action for failure to act. The Commission may decide to bring new proceedings, or to reject the complaint.