Bloomberg News

EU Orders France to Amend France Telecom Pension Calculations

December 20, 2011

Dec. 20 (Bloomberg) -- European Union regulators ordered the French government to amend by July 2012 the way it calculates how much France Telecom SA must contribute to retiree costs for former state employees.

The European Commission said it could close a probe into state aid for Europe’s third-largest phone company if France includes the cost of risks, such as a guarantee for paying wages during a bankruptcy, to a contribution the company makes toward pensions for workers every year.

Under a 1997 government reform of the company’s pension funding, France Telecom was no longer required to ensure the financing of the retirement plan for its employees, who were considered government workers. The French government assumed responsibility for the pensions and the company was required to make a contribution.

--Editor: Christopher Scinta

To contact the reporter on this story: Aoife White in Brussels at awhite62@bloomberg.net.

To contact the editor responsible for this story: Anthony Aarons at aaarons@bloomberg.net.


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