ARCEP sets the final net cost of universal service for the year 2003 and operators’ contributions

Paris, 22 June 2005

For the second consecutive year, ARCEP calculated the final net cost of universal service obligations according to both the new regulatory framework introduced by the December 21^st 2003 law published in the January 1^st 2004 Journal officiel transposing the directive 2002/22/EC of the European Parliament and of the Council dated March 7^th 2002 concerning universal service obligations and users’ rights with respect to electronics communications networks and services, and to its decree no. 2004-1222 dated November 17^th 2004 which defines the conditions for applying this new measure.

From April 29^th to May 20^th 2005, ARCEP held a public consultation on the draft rules for the implementation of articles R. 20-33 to R. 20-39 of the Post and Electronic Communications Code. In its decision no. 05-0426 dated May 26^th 2005, ARCEP adopted the rules for calculating the final cost for 2003 and in its decision no. 05-0231 of March 17^th 2005, ARCEP set at 10.8% the final value of the capital return rate applied for 2003.

On these bases, in its decision no. 05-0472 dated June 21^st 2005, ARCEP evaluated the net cost of universal service obligations at €53.271 million for 2003, after deducting immaterial advantages. This amount corresponds to:

• €76.885 million for geographic averaging obligations
• plus €36.814 million for welfare expenses
• plus €23.549 million for operation of public telephone boxes installed on public property
• minus €84.007 million for immaterial advantages, deducted from the cost of universal service, all components combined
• plus €0.029 million for universal service fund management expenses

ARCEP will notify operators of the amount of their contribution upon publication of decision no. 05-0472 in the Journal officiel.