History

History

A. 1955-69: Start-up of the motorway system and formation of the first semi-public operating companies

The 18 April 1955 Act on the status of motorways enabled the government to hand over the construction and operation of sections of the country’s motorways to companies in which the State held a majority stake. Five such semi-public companies, known as Sociétés d’Économie Mixte Concessionnaires d’Autoroutes (SEMCAs), were formed between 1956 and 1963:

  • Société de l’autoroute Estérel - Côte d’Azur, Alpes (ESCOTA) in 1956
  • Société des Autoroutes du Sud de la France (ASF, ex-SAVR) in 1957
  • Autoroutes Paris-Rhin-Rhône (APRR, ex-SAPL) in 1961
  • Société des Autoroutes Paris-Normandie (SAPN) in 1963
  • Société des Autoroutes du Nord et de l’Est de la France (SANEF) in 1963.

Société du Tunnel Routier sous le Mont-Blanc (STMB) was set up in 1958, with the French government as majority shareholder. It has been operating the Mont-Blanc road tunnel since 1959. Renamed Société des Autoroutes et du Tunnel Routier du Mont-Blanc (ATMB), it won the concession to operate the ’Autoroute Blanche’ section of the French Alps motorway network in 1977.

Société Française du Tunnel Routier du Fréjus (SFTRF) was formed in 1962 and won the Fréjus Tunnel concession in 1974. In 1993, it was awarded the concession for the A43 motorway in the French Alps, known as ’Autoroute de la Maurienne’. At present, the French State holds a total stake of 84% in SFTRF, including a direct majority stake and indirect shares.

B. 1970-80: Deregulation of the motorway system and formation of private operating companies

In 1970, the French government decided to award concessions to private companies formed by construction contractors and banks. Four such privately held companies were set up between 1970 and 1973:

- Compagnie Financière et Industrielle des Autoroutes (Cofiroute)
- Société des Autoroutes Rhône-Alpes (AREA)
- Société de l’Autoroute de la Côte Basque (ACOBA)
- Société des Autoroutes Paris - Est - Lorraine (APEL).

Meanwhile, SEMCAs were given greater responsibility, in particular with regard to road-building.

C. 1981-93: Restructuring and introduction of the equalising mechanism

Economic conditions began to deteriorate in 1973, prompting the authorities to restructure the motorway system. The State took over three loss-making private companies (APEL, ACOBA, and AREA) and set up a mechanism for allocating resources equally among the SEMCAs. This system was managed by a public authority, Autoroutes de France (ADF), established in 1983.

SANEF and APEL merged to form SANEF at year-end 1985, reducing the number of operating companies to nine. Eight of these were SEMCAs (including ATMB, which is not funded by CNA).


In 1987, the government decided to strengthen the SEMCAs by injecting equity capital. At the same time, it abolished the system of cash advances that had been necessary to launch the construction of the motorway network.


On 1 January 1991, Société de l’Autoroute de la Côte Basque (ACOBA) merged with Société des Autoroutes du Sud de la France (ASF) to form a single company called ASF.

In 1992, ADF acquired a 49% stake in SFTRF.

By year-end 1993, several operating companies had reimbursed all their advances to the State, as the increase in toll income had enabled them to generate a cash-flow surplus.

This situation spotlighted the differences in the financial positions of the companies. A reform of the motorway system became necessary in view of the French government’s commitment to accelerate the motorway construction programme as from 1994.

D. The 1994 reform

The official decision to quicken the completion of the motorway master plan made it necessary to reorganise the SEMCAs and redefine the relationship between the State and the motorway sector. The reform has focused on two objectives:

a) To ensure the creditworthiness and mutual support of the SEMCAs through capital increases and the creation of three evenly-balanced regional operating units.

The equity of the six largest SEMCAs (AREA, ASF, APRR, ESCOTA, SAPN, and SANEF), originally capped at FRF28 million, has been raised to FRF 1.03 billion. The State has a direct 45% stake in AREA, APRR, and SANEF. Autoroutes de France (ADF) controls another 45%. Caisse des Dépôts et Consignations holds 8.5%, and the remainder is held by local entities.

Three regional operating units have been formed by turning some of the companies into subsidiaries of the operators with the strongest financial positions. As a result, ASF now holds a 95% stake in ESCOTA, SANEF holds a 98% stake in SAPN, and APRR holds a 97% stake in AREA.

b) To establish contractual links between the State and the SEMCAs.

Five-year planning agreements between the State and the operating companies stipulate the parties’ commitments with regard to works and investment, toll rates, and financial objectives. The agreements also define measurement standards for management, social and employment policy, user service, architectural design and construction, and environmental impact.

The first planning agreements were signed for the 1995-99 period. A second round of agreements covering 2002-2006 is under negotiation. Negotiations with ASF and ESCOTA have already led to the signing of contracts in March 2002.

E. The 2001 reform

The motorway financing arrangements set up in France under the 18 April 1955 Act enabled the country to build a modern motorway system virtually without contribution from the central-government budget. Today, the system must be reformed in order to adapt it to the present legal environment and enable it to operate more effectively in the new political and economic context.

Accordingly, the reform launched in 2000 has three objectives:

(1) to intensify competition for the awarding of new motorway concessions,

(2) to give the motorway system the financial resources it needs to complete its construction programme

(3) to ensure a greater neutrality as regards the choices between types of investment and between transport systems.

To reach these objectives, two series of measures are being implemented concerning
(1) the procedures for awarding motorway concessions and
(2) the operating conditions of the semi-public toll-motorway concession-holders (SEMCAs).

1. To broaden competition and allow new ope-rators to enter the market, the State has ended the system of ‘backing’ (adosse-ment). This practice consisted in partly financing new motorway sections with toll income from existing sections operated by the same company, whose concession wasextended for the purpose. In practical terms, backing was incompatible with a fair competition between candidates for new concessions, as it could give an advantage to existing concession-holders over new operators.

Henceforth, any public funding needed to ensure the financial balance of future motorway concessions will be supplied in the form of subsidies. The new sections, assigned under the provisions of the ‘Works Directive’* and the Sapin Act, will be covered by a specific contract. This procedure will allow a more effective comparison between competing bids.

2. SEMCA management structures and practices will be aligned more closely with those of private-sector enterprises in order to enable them to submit comparable bids (where appropriate) for new motorway projects. In particular, this entails the abro-gation of the advantages that SEMCAs have enjoyed until now: a State guarantee to take over any liabilities outstanding at the expiry of the concession; specific accounting procedures for amortisation and loss carry-forwards; and a waiver of the requirement to remunerate invested capital. In exchange, the SEMCAs’ concessions have been extended to match the longer concessions granted to private-sector operators.

Given the implications of the reform, the French authorities had decided to consult the European Commission on the reform arrange-ments, most notably the extension of the SEMCA concessions. In an opinion of 24 October 2000, the European Commission announced that it would raise no objection to the French government’s planned reform of the motorway-concession operating system.

After this consultation, the French government introduced the domestic legal provisions needed to implement the motorway reform.

Act 2001-1 of 3 January 2001, published in the Journal Officiel of 4 January, authorised the government to transpose EC directives by ordinance (ordonnance). This enabled the government to introduce measures to modernise the motorway operating system.

Ordinance 2000-273 of 28 March 2001 concerning the reform of SEMCA operations defined the new terms of the SEMCA concession contracts as communicated to the European Commission.

The ordinance stated that the concession extensions would be effective for the preparation of the 2000 financial statements, so as to apply the accounting reform to the 2000 accounts.

The ordinance was ratified by Act 2001-1011 of 5 November 2001.

The legal and financial regime of the SEMCAs having been adapted to standard company law, the French government was able to announce, on 16 October 2001, the opening of a minority share of ASF’s capital, along with an initial public offering (IPO). This was the first transaction of its kind.

The transaction consisted in putting a majority of the shares in ASF held by ADF on the market, and in increasing ASF’s capital by € 800 million. The IPO comprised an open-price offering in France, a global placement, and a special offer for employees.

The € 1.8 billion in proceeds from the sale of ASF shares held by ADF was transferred to the French State, under the terms of article 34 of the 2002 budget act (loi de finances) of 28 December 2001. _

Upon completion of the transaction, ADF continues to hold an 8.84% stake in ASF.

Subsequently, as announced by the government on 29 July 2004, Autoroutes Paris-Rhin-Rhône (APRR) increased its capital through an IPO on 25 November 2004.

The capital increase, totalling €1,300 million, comprised an open-price offering in France and a guaranteed global placement open to all investors, both French and non-resident. APRR also arranged a special €50-million offering for employees, who acquired a total of €34 million in shares.

The transaction lowered the combined equity stake of the French government and its public agency Autoroutes de France (ADF) in APRR from 98.92% to 70.22%.

These successive ‘capital openings’, followed by that of SANEF in March 2005, have strengthened the financial structure of the main concessionaires. They also raise the companies’ dividend-distribution capacity, in keeping with one of the objectives defined by the government at the 2003 Inter-Ministerial Committee on Regional Development (CIADT). The dividends paid to the State are now allocated to new national transport-infrastructure programs. The funds are channelled through the France National Agency for Transport Infrastructure Financing, established by Decree 2004-1317 of 26 November 2004.

F. Privatisation

On 18 July 2005, the government announced its decision to totally privatise APRR, ASF, and SANEF through a bidding procedure. Specifications were published on 22 August 2005. After consulting the Commission on Shareholdings and Transfers (CPT), the government selected the following buyers on 14 December 2005: Vinci for ASF, the Eiffage-Macquarie consortium for APRR, and the Abertis-AXA-Caisse des Dépôts-CNP-FFP-Prédica consortium for SANEF.

The respective privatisation decrees were published in the Gazette on 2 February for Sanef, 20 February for APRR and 8 March 2006 for ASF. Total proceeds from these sales amounted to €14,803,149,725, broken down as follows:

  • € 9,326,827,816 to the Government
  • € 5,476,321,909 to ADF

The terms of the concession agreements were amended alongside the privatisation process so as to include undertakings entered into by the buyers. The three companies’ Boards confirmed the undertakings thus entered into and approved the provisions contained in the amended agreements, which were subsequently duly approved by Council of State decrees.

Moreover, in addition to the concession terms, each operator’s five-year contract stipulates investments to be made and service level targets to be achieved over each five year period, and, in exchange for these changes, determines the level of toll price increases to be applied over the period.