Transposition of Directives on the Postal Sector.

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In May 2005, the law on the regulation of postal activities transposing 1997 and 2002 European Union Directives was finally adopted. It provided for the gradual introduction of competition into the postal sector and defines the public service objectives to be met by the universal postal service.

On 12 May 2005, a bill relating to the regulation of postal activities was finally passed following a meeting of the joint committee of both houses, more than 18 months after it was first brought before Parliament for discussion. The law, which was more than two years late, transposed 1997 and 2002 European Directives into French law. The latter Directive pertained to the gradual introduction of competition into the postal industry.

Since 1 January 2003, the monopoly of the state Post Office (La Poste) (FR0502107F) has been limited to mail under 100 g, not exceeding three times the basic postage rate, (which currently stands at EUR 0.53), i.e. EUR 1.59. Starting on 1 January 2006, these thresholds are to be lowered to 50 g and 2.5 times the base rate.

The law sets out three key provisions.

• Competition is to be regulated. The state Post Office’s competitors will be required to obtain prior authorisation from the regulatory body. This authorisation will be issued for a period of 10 years by the Electronic Telecommunication and Postal Regulation Authority (Autorité de régulation des télécommunications électroniques et des postes, ARCEP), which is to replace the current Telecommunications Regulation Authority (Autorité de régulation des télécommunications, ART). The new body will have wider jurisdiction and will be responsible for monitoring the universal public service obligations - to be spelled out in detail in a State Council decree - of the postal sector. The new body will have the authority to issue opinions on postage rates and quality targets to be met by operators.

• The creation of a Postal Service Compensation Fund (fonds de compensation du service postal), to be used when the Post Office’s monopoly is no longer sufficient to fund the universal postal service.

The legislation also sets out the role of the Post Office, and its approximately 17,000 service points located throughout France, in physical planning. It stipulates that 'no more than 10% of a particular département’s population may live more than five kilometres or 20 minutes by car - taking into account the travel conditions specific to each area - from the nearest Post Office service point'.

In addition, it creates a National Postal Fund for Inter-Regional Compensation (fonds postal national de péréquation territoriale), within the state Post Office. The purpose of this fund is to support the national postal network, whose coverage is linked to topography, for example mountainous regions with specific access problems.

• The creation of a Post Office Lending Institution (Etablissement de crédit postal, ECP), as a subsidiary of the state Post Office no later than 1 January 2006. It will be able to provide loans to people who did not previously hold savings with it.

The legislation also removes all restrictions on the Post Office in terms of the recruitment of staff on a contract basis.

From the moment the bill was tabled, trade unions have criticised it, and more particularly this last provision (FR0502107F), which, in the long run, could have an impact on the status of the state Post Office staff. Currently, approximately 200,000 of the organisation’s workforce are civil servants and some 100,000 are not.

Banks represented by the French Banking Federation (Fédération bancaire française, FBF) have continued to oppose the creation of the Post Office Lending Institution. They have managed to have the Post Office excluded from consumer credit and accident insurance. They have also been successful in obtaining an agreement whereby the Court of Auditors will publish a report within two years on the relationship between the Lending Institution and the rest of the Post Office group.

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