28 May 2010 - The Court of Justice of the European Union annuls a decision of the European Commission - Gide Loyrette Nouel advises France Télécom:

Statements of support for France Télécom by the French authorities in 2002, as well as a proposed shareholder loan in the form of a EUR 9 billion government credit line in December 2002, do not constitute State aid incompatible with EU law.

This was the judgment issued by the General Court of the European Union on 21 May 2010.

In rejecting the Commission's argument, the General Court noted that, for a measure to be considered as State aid, it must first entail the granting of a specific financial advantage and, second, that advantage must come from State resources.

Since the French State's proposed shareholder loan was never accepted or acted on by France Télécom, the General Court found that this unilateral offer did not confer a financial advantage on France Télécom.

However, the General Court found that the government's statements and the announcement of the proposed shareholder loan did confer an advantage on France Télécom in that they helped to enhance the confidence of the financial markets and to improve the conditions France Télécom's refinancing.

Nevertheless, despite the advantage conferred on France Télécom, the Court judged that these measures did not entail the transfer of any State resources and could not, therefore, be considered as State aid. Indeed, as government statements were not legally binding, they could not be interpreted as a clear undertaking by the French State to provide specific financial assistance to France Télécom.

Consequently, the Court has annulled the European Commission's decision.

Legal counsel to France Télécom:
Gide Loyrette Nouel A.A.R.P.I., led by partner Stéphane Hautbourg, with Sophie Quesson and Laura Olza-Moreno.