Commission takes France to court

The European Union’s highest court is to take legal action against France for failing to recover illegal state aid from former monopoly France Telecom. Brussels says France Telecom got tax breaks of around one billion euros between 1994-2002. Johnathon Todd is the European Commission’s competition spokesman:

“It’s always better for member states to respect community law, so obviously we’d prefer to reach an agreement with France on recuperating the aid. before this gets to court, and before France pays fines, that would be the better solution, of course”

One problem is that the tax breaks have never been quantified; the figure is estimated at between some 800 million euros and 1.14 billion. France Telecom says that until the real figure is identified, nothing will be done, although the EU can slap a daily fine on the company until it pays up. The European Court of Justice could take two years to enforce payment.

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