Bercy goes APE

4 March 2003

France’s new State Shareholdings Agency promises a more transparent and rational approach to running government stakes in companies. The change is long overdue. The UK is doing something similar but the French could still teach it a thing or two.

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The French government is to create a new Public Shareholdings Agency (Agence des Participations de l'Etat, or APE) which will become a single state shareholder in nationalised and partprivatised companies. The creation of the new agency implements a report by senior private sector figures, which criticised confusion between the state's different roles towards the businesses it owns, combined with a lack of direction and weak corporate governance in those businesses.

The Treasury, long the pivot of the network of relationships between the French state and the economy, is to be stripped its shareholder role. The APE will be headed by Denis SamuelLajeunesse, a former Treasury official who has since been chief executive of the Lyonnaise de banque and of the Credit Industriel et Commercial, and will be able to hire staff from the private sector.

The changes come in the wake of the Treasury's E9bn bailout of France Telecom, and at a time when the former head of the Treasury, JeanClaude Trichet, is awaiting a verdict in his trial for helping stateowned Credit Lyonnais post false accounts.

In Britain, the government announced in November 2002 that it was setting up a Shareholder Executive destined to structurally improve its ability to function as a shareholder.

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