26/05/2008 (Agence Europe) - On Tuesday 20 March, the European Commission decided to open an indepth investigation into the financing of retirement pensions of state employees working for France Télécom, which were introduced in 1997 at the time of the liberalisation of the telecommunications sector. The investigation is in response to a complaint from a competing telecommunications operator alleging that the reduction in France Télécom's retirement costs and the exemption from social security contributions constitute incompatible state aid. The French authorities argue that the reform simply removed a structural disadvantage for France Télécom which obliged them to finance the retirement cost of its state employees and that, as such, it does not constitute state aid. The Commission will therefore look in particular into whether the reduction in the charges borne by France Télécom following reform on the financing of retirement pensions of state employees constitutes state aid that is compatible with EC Treaty rules. (O.L.)