Formerly structured around the incumbent operator France Telecom, now called Orange, the telecommunication market revolves around five major operators:

The market is divided into several categories:

In 2010, Free became the fourth operator to obtain a licence for mobile services. It launched its first low cost offer in 2012, which boosted the competition between mobile operators and radically changed the face of the retail mobile telecommunication market.

In November 2014, French operator Numericable's mother company, Altice, acquired SFR, one of the oldest French telecommunication operators and beneficiary of a mobile operator licence. Altice also purchased MVNO Virgin Mobile France in December 2014.

Bouygues Telecom rejected both Iliad's (Free's mother company) informal purchase offer for EUR4 billion or EUR5 billion in 2014, and Altice's purchase offer of EUR10 billion in June 2015. In 2016, Orange tried to purchase Bouygues Telecom. After advanced negotiations, the deal was cancelled in April 2016.

Foreign companies can become operators of telecommunications since the performance of this activity is only subject to registration with the regulatory authority (Autorité de Régulation des Communications Électroniques et des Postes) (ARCEP) and the law does not include any restriction related to foreign ownership.

However, the acquisition or control by a company whose headquarters are not located in the EU (or in a country of the EEA that has concluded with France an international convention on assistance regarding the fight against fraud and tax evasion) of a company with its registered office in France and whose activity consists of providing equipment, products or services for ensuring the integrity, security and continuity of the operation of networks or electronic communications services, requires the authorisation of the Economy Minister.

The telecommunication regulatory framework includes various laws and decrees that have been codified in the French Postal Services and Electronic Communications Code (FPSECC). In addition, the Regulation (EU) 2015/2120 laying down measures concerning open internet access (Open Internet Access Regulation) sets out specific rules regarding the open internet.

Specific regulations can also be found in other codes, such as the French Consumer Code and the French Homeland Security Code.

The main authority in the French telecommunication sector is the Autorité de Régulation des Communications Électroniques et des Postes (ARCEP). ARCEP is the administrative authority in charge of regulating electronic communications.

In addition to ARCEP, the Minister in charge of Electronic Communications is granted special powers regarding the regulation of telecommunication in conjunction with ARCEP.

The Conseil Supérieur de l'Audiovisuel (CSA) is the administrative authority in charge of audio-visual communications, which encompass radio and television. Therefore, the CSA has exclusive competence for frequencies used for audio-visual communications.

The Agence Nationale des Fréquences (ANFR) is the administrative body that represents France in international reunions relating to the global allocation of frequencies. ANFR also updates the national table of allocation of frequencies and any other documents on the use of frequencies.

There is no specific competition law regulator for the telecommunication sector. All competition issues are handled by the Competition Authority (l'Autorité de la concurrence).

Telecommunication operators are defined as persons that wish to install and operate electronic communication networks open to the public or offer electronic communications services to the public (telecommunication operator activities). For activities that are not subject to a licence, telecommunication operators only have to be registered with Autorité de Régulation des Communications Électroniques et des Postes (ARCEP), by notifying ARCEP before starting such activities. Once notified, ARCEP delivers a receipt to the operator within three weeks.

Included in the definition of electronic communication networks are any installation or group of installations for the transfer or broadcast of electronic communication, as well as any other mean of electronic communication transmission. This definition is broad enough to encompass satellite networks, terrestrial networks and systems using the electric network (in so far as they transmit electronic communications).

The following activities fall outside the scope of telecommunication operator activities and, therefore, do not require registration as telecommunication operators:

In a law dated 6 August 2015, ARCEP has been granted the power to register on its own initiative an entity whose activity falls within the scope of telecommunication operator activities but that did not notify ARCEP.

Frequencies subject to authorisation. The use of frequencies can fall in the scope of telecommunication operator activities. However, the use of frequencies is not subject to a notification, but instead to ARCEP's authorisation. In fact, frequencies are considered a public resource, owned by the state. Therefore, the private use of frequencies is a private use of public resources and requires the prior authorisation of ARCEP.

These authorisations are granted by ARCEP under the form of an exclusive licence to use a specific range of frequencies, subject to the conditions and restrictions set out in the licence.

Licences must be granted on an objective, transparent and non-discriminatory basis. ARCEP can only reject a licence request for one of the following reasons:

There are two major procedures for the grant of licences:

ARCEP can now also issue licences for the use of frequencies for experimental purposes. In addition, for a maximum duration of two years, these licences can benefit from limited obligations under the telecommunication regulatory framework compared to regular licences issued under the two main procedures

Licence fees are either set by decree or by ARCEP.

Frequencies not subject to authorisation. Exceptionally, the use of frequencies that are not specifically allocated is not subject to ARCEP's authorisation. These frequencies, called "free frequencies", are only subject to the registration with ARCEP through the prior notification procedure if the activity falls within the scope of telecommunication operator activities. If free frequencies are used for an activity that does not fall in the scope of telecommunication operator activities, then no registration is required.

Free frequencies are used on short distances, with a wide range of applications (such as wifi, bluetooth, medical implants or intelligent transportation systems).

While the use of free frequencies does not require an authorisation, it still requires compliance with the technical conditions of use defined by ARCEP.

The fixed structured fee for telecommunication operators (EUR20,000 or an amount based on turnover) has been abolished by the French Finance Law of 2016 (No 2015-1785, dated 29 December 2015).

Since then, operators only have to pay fees depending on the resources they effectively use, such as for the:

In addition to these fees, French telecommunication operators must also comply with French taxes. There is a specific tax to the activity of telecommunication operators, set at 1.3% of the amount (excluding VAT) of the subscriptions and other sums above EUR5 million that are obtained from users as remuneration for providing electronic communication services.

Licensed telecommunication operators must comply with a set of general rules, which include obligations to periodically report to ARCEP, universal directory obligations, and obligations relating to number blocking, security, confidentiality and neutrality of communications, legal interception and data retention. Licenced operators do not need to renew their licence, but must comply with periodic requirements, such as paying the necessary fees, taxes and reporting to ARCEP.

In addition, licensed telecommunication operators must also comply with the specific terms of the licence. Licences' conditions and duration are not set in the regulation and Autorité de Régulation des Communications Électroniques et des Postes (ARCEP) discretionarily defines the terms of the licence.

In the licence, ARCEP determines the following conditions:

ARCEP's decisions granting licences are published on ARCEP's website and in the French Official Journal.

Licences can always be freely revoked by the French administration, or for cause, as a sanction by ARCEP.

Autorité de Régulation des Communications Électroniques et des Postes (ARCEP) can issue warnings and penalties for non-compliance with the various regulations applicable to telecommunications or with the terms of a licence.

The applicable telecommunication regulations also contain several criminal offences in case of non compliance, especially:

Autorité de Régulation des Communications Électroniques et des Postes (ARCEP) decisions can be challenged before administrative tribunals and courts. Appeals are grounded on the illegality of ARCEP's decision, for example when ARCEP did not have the power or exceeded its powers in issuing the decision.

These appeals before the administrative jurisdiction must be filed within two months of the notification or publication of the disputed decision. The relevant jurisdiction is the French Administrative Supreme Court for collegial decisions, and the local administrative tribunal for decisions issued by ARCEP's president or general director.

As an exception to the administrative jurisdiction's competence, decisions given in the case of dispute between operators can be appealed before the court of appeal of the judicial jurisdiction.

Any provider with significant market power (PSMP) can be requested to comply with at least one of the following obligations:

Autorité de Régulation des Communications Électroniques et des Postes (ARCEP) has the following tasks in relation to PSMPs:

The incumbent provider, Orange, having notably a monopoly on the local loop, is therefore considered as a PSMP on several markets, and therefore is subject to this specific regulation on the relevant markets.

PSMPs are also required to notify the ARCEP of any project related to the sale of their equipment and installations of local access.

Universal service obligations encompass:

A law dated 6 August 2015 supressed the fourth component of the universal service, which related to access to public phone booths or other public access to a telephone service.

Following a request for proposal for each component, one or more operators are chosen by the Minister of Electronic Communications to perform universal service obligations. If no proposal is made, the Minister then proceeds to designate operators.

All telecom operators must financially contribute to the provision of the universal service. This contribution is based on the annual turnover of the operator's electronic communication activity, which must be communicated to ARCEP annually.

Currently, France has not yet implemented a policy of structural separation and Orange is still the owner of the local loop. However, ARCEP now has the power to impose the structural separation of any vertically integrated PSMP, subject to the authorisation of the European Commission.

Nonetheless, as ARCEP and the government's position have been against imposing a structural separation, it seems unlikely that this measure will be implemented in the near future. Indeed, ARCEP's president declared in 2012 that the unbundling of the local loop, as operated in France, was retrospectively the best operating model.

However, ARCEP's president recently declared that ARCEP is concerned about the B2B optical fibre sector, for which ARCEP considers that the competition is unsatisfactory. Even if separation is not contemplated at this stage, ARCEP's president mentioned that in the event where the situation would not evolve, ARCEP would have to contemplate its options, including separation.

Any telecommunication operator must comply with rules relating to (Article 33-1, French Postal Services and Electronic Communications Code):

The allocation and use of spectrum is divided between several authorities:

ANFR is the administrative body that represents France in international reunions relating to the global allocation of frequencies, and that updates the national table of allocation of frequencies and any other documents on the use of frequencies.

The Prime Minister determines, after consulting ARCEP and CSA, the frequencies that are allocated to the administration and those that are allocated to ARCEP and CSA.

Besides the various administrative bodies that are allocated with frequencies (such as the Ministry of Defence, the Ministry of Home Affairs and the Civil Aviation), the authorities that can allocate frequencies are ARCEP and CSA. ARCEP can allocate frequencies for electronic communication services, while CSA can allocate frequencies for audio-visual communication services (mainly television and radio services).

Operators benefitting from a licence to use frequencies can assign totally or partially the rights granted under the licence to a third party, under certain circumstances:

Any telecommunication operator can offer to a third party, through a private contract between the parties, the means, equipment, software or services to enable the third party to provide electronic communication services. There is no required notification of these contracts, but ARCEP can request it.

Therefore, telecommunication operators having obtained a licence for the use of frequencies can sublicense the right to Mobile Virtual Network Operators (MVNOs).

In addition, ARCEP can require that providers with significant market power (PSMPs) have an available public offer for these sublicences and can be required to accept reasonable requests for sublicences.

Telecommunication operators benefit from servitudes over private properties enabling them to install or operate network equipment:

To use this servitude, telecommunications operators must notify the property owners and obtain the mayor's authorisation. However, operators do not have to pay fees to the owner of the property for the use of the servitude.

Telecommunication operators also have a right of access to public properties, in as much as this occupation of public domain is not incompatible with the domain's destination and capacity. The access to the public domain may be subject to the payment of reasonable fees proportionated to the use of the site and must be granted in a contract under transparent and non-discriminatory conditions.

A 29 April 2016 Ordinance, transposing the Directive 2014/61/EU on measures to reduce the cost of deploying high-speed electronic communications networks into French law, created a right of access to infrastructures. Before this ordinance, only providers with significant market power (PSMPs) could be required to offer access to their infrastructure or service by Autorité de Régulation des Communications Électroniques et des Postes (ARCEP).

Under Article L. 34-8-2-1 of the French Postal Services and Electronic Communications Code (FPSECC), public or private entities that make available or operate certain types of infrastructure must accept reasonable requests for access to their infrastructure from the managers of high speed networks open to the public. Infrastructures also include infrastructures enabling the operation of an electronic communication network that is established or used for the provision of electronic communication services to the public.

Access must be granted, even if the requesting entity is established in another member state of the EU, and it must be provided under equitable and reasonable modalities and conditions, including pricing conditions. The manager of the infrastructure must answer the request for access within two months of receiving the request.

Any refusal of access must be motivated by objective, transparent and proportionate criteria. If access is refused or the parties fail to agree on the terms, the matter can be referred to ARCEP.

Under Article L. 34-8-3 of the FPSECC, any operator, that has established in a building or is operating a line of electronic communication by optical cable to service end users, must accept reasonable requests for access from operators for offering electronic communication services to them. Access must be granted under transparent and non-discriminatory conditions, and its refusal must be motivated. For disputes regarding access requests, the parties can refer the issue to ARCEP.

Entities operating a network open to the public must accept interconnection requests.

An interconnection request can only be rejected by an operator if it is justified by the needs of the operator and the capacity of the requesting entity to satisfy this request. Any refusal must be motivated.

Operators with a monopoly on access to end users can be required to accept interconnection and access requests.

The pricing conditions for interconnection or access must be transparent and objective. Autorité de Régulation des Communications Électroniques et des Postes (ARCEP) can also request the justification of these pricing conditions.

Where an operator rejects a party's request for access to the operator's infrastructure, network or for interconnection, the party can ask ARCEP to arbitrate this dispute. ARCEP can then impose, in an objective, transparent, non-discriminatory and proportionate manner, the access or interconnection.

The general French Data Protection Regulation (based on the updated 6 January 1978 law No. 78-17) applies to the telecommunication sector. This framework will be modified by the Regulation (EU) 679/2016 on the protection of natural persons with regard to the processing of personal data and on the free movement of such data (General Data Protection Regulation). In addition to this framework, the French Postal Services and Electronic Communications Code (FPSECC) contains specific provisions related to data processing by telecommunication operators.

According to the FPSECC, telecommunication operators and persons whose professional activity is the offer of internet access must, subject to exceptions, delete or anonymise any traffic data.

The first exception is the duty to retain data for one year, in case the disclosure of the data is required by a juridical or administrative order, for the needs of investigating crimes or intellectual property infringements. Under this exception, the following data must be retained:

Under the second exception, the deletion or anonymisation of certain type of data can be postponed, at the operator's discretion, for purposes of:

Also, localisation data can only be processed during the communication for the sole purpose of its transmission and retained after the end of the communication if the user consented after being duly informed of the:

Generally, all data that can or must be retained must only relate to the identification of the users, the technical details and the localisation of the call. Telecommunication operators cannot in any case retain data on the content of the communication.

Finally, the French Data Protection Regulation also confers a special duty of notification to the French Data Protection Authority (CNIL) by telecommunication operators in the case of a breach of data. Here, CNIL is notified within 24 hours, with a complementary notification within 72 hours of the breach if further investigations were required. If the violation of data is likely to breach personal data security or the privacy of a subscriber or any other individual, the operator must notify the parties affected. This notification to the user is not mandatory, however, if the operator had taken appropriate measures to make this data undecipherable to unauthorised individuals. A similar notification process will be required under the General Data Protection Regulation. The General Data Protection Regulation provides for a similar notification requirement that will however be applicable to any data controller.

There are several criminal offences related to data protection, in particular:

Most data protection offences are punished by a sentence of five years of imprisonment and a EUR300,000 fine. Since legal entities can be sentenced to fines up to five times the stated amount, the fine amount can be up to EUR1.5 million.

Currently, CNIL can impose fines of up to EUR3 million. However, the General Data Protection Regulation will drastically increase the amount of the fines that can be imposed by CNIL. Depending on the obligation that is breached, the fines could go up to EUR20 million or up to 4 % of the total worldwide annual turnover for the preceding financial year.

The regulation of French intelligence was substantially modified in 2015, further to the Law No 2015-912 dated 24 July 2015 which dedicated a part of the French Code of Homeland Security to the regulation of intelligence.

Regardless of the measure requested, whether it is an interception of calls, or electronic communication or of communication data, the implementation of such a measure to collect intelligence is subject to the same principles and procedure:

The following are considered fundamental national interests:

No authorisation for interception of calls in relation to the performance of a profession or mandate can be granted against:

Authorisations for interception of calls can only be granted if the intelligence cannot be obtained by other legal measures. Authorisations are granted for a maximum of two months, renewable for the same duration by a similar request.

Telecommunication operators must delete or anonymise any collected traffic data, except when complying with a court order to disclose data.

As an exception to the above principle, and for the purposes of researching, noticing and pursuing criminal offences, the anonymisation or deletion of the following communication data must be delayed for one year:

There are two main types of communication data that can be obtained by intelligence measures:

An authorisation for the implementation of measures concerning communication data is granted for four months, and is renewable by a new request to the Prime Minister.

The French Code of Homeland Security also contains measures for specific issues, such as the prevention of terrorism.

Failure to comply with requests from authorised authorities for communication or interception of data is punishable by two years of imprisonment and a EUR150,000 fine (which can be increased up to EUR750,000 for legal entities), as well as the potential additional sentence of temporary or definitive interdiction to operate certain professional activities.

The interception, misappropriation, use or disclosure of correspondences issued, transferred or received through electronic communication is also punished by a sentence of one year of imprisonment and a EUR45,000 fine (which can be increased up to EUR225,000 for legal entities), as well as additional sentences.

Telecommunication operators must take any measure necessary to prevent the use of the data, other than as set out above (see Question 16).

Under the recent Directive (EU) 2016/1148 concerning measures for a high common level of security of network and information systems across the Union (Network and Information Security Directive), holders of internet exchange points may have to comply with specific security obligations. This Directive has not yet been transposed into French law.

Autorité de Régulation des Communications Électroniques et des Postes (ARCEP) mainly regulates wholesale prices and only exceptionally retail prices. ARCEP can impose obligations on providers with significant market power (PSMPs) to not use excessive pricing conditions as well as to use pricing reflecting the actual costs (see Question 8). In relation to this obligation to reflect actual costs, ARCEP can establish a price control for several years, and, therefore, define the methods of pricings and accounting that must be implemented by PSMPs.

Premium number rates must be set in accordance with the number plan issued by ARCEP. In this number plan, ARCEP determines the maximum premium rates applicable depending on the type of number used.

Currently roaming charges, applicable when the user is travelling within the European Economic Area (EEA), are set according to the maximum charge defined at a European level (Eurotariff) under the regulation of roaming. These maximum rates apply to:

On 27 October 2015, the European Parliament adopted a June 2015 agreement concerning the end of additional roaming charges in the EU.

However, operators could be allowed to require a small fee under certain circumstances, in the context of a "fair use" policy to prevent abuses. Similarly, operators are also entitled under certain circumstances to set a cap on the amount of data that can be used without surcharges when travelling in another EU country,

Autorité de Régulation des Communications Électroniques et des Postes (ARCEP) allocates telephone numbers, controls the use of telephone numbers and the definition of numbers qualifying as premium numbers. Only operators registered with ARCEP can request the allocation of numbers, which are granted for a maximum of 20 years, at ARCEP's discretion.

Operators obtaining telephone numbers must pay an annual fee per number, based on a unit called "a" and depending on the number of digits composing the number. The "a" is the fee corresponding to a regular ten digit phone number, and its value is set by the Minister of Electronic Communications but cannot exceed EUR0.023. The fees for telephone numbers range from (0.1 x a) for numbers with 13 or 14 digits, up to (20,000,000 x a) for numbers with one digit.

There are three major categories of telephone numbers:

ARCEP can also grant numbers and codes for experimentation purposes. For a maximum duration of two years, such numbers could be subject to limited obligations compared to numbers and codes issued under a regular attribution procedure.

Operators must take the necessary measures to transfer emergency calls for free to the relevant centre. After these calls, the operator must communicate to the emergency services the locality of the caller.

Emergency calls are defined as calls to public services tasked with:

Telecommunication operators must dispatch calls free of charge to the following numbers:

Telecommunication operators must provide their clients, at a reasonable cost, with an offer to preserve their telephone number where clients wish to change operator. Clients can keep their geographical number if they do not change their geographical location and can keep their non-geographical number, fixed or mobile, if they move within mainland France or within overseas territories.

This obligation benefits all operator clients and not just consumers.

Telecommunication operators cannot use premium numbers for the provision of aftersales support services. This also includes numbers used for user complaints.

All telecommunication service providers must also appoint an impartial and competent mediator that consumers can call for any dispute regarding the conditions of the contract or the execution of the contract. The modalities of intervention of this mediator must be easily accessible, quick, transparent for both parties and confidential.

There is a section in the French Consumer Code dedicated to the regulation of the offer of telecommunication services to consumers and non-professionals. Further to this specific regulation, telecommunication operators must comply with several obligations, and the main ones are discussed below.

Any contract signed with a telecommunication operator must contain specific information. These contracts cannot be concluded for more than 24 months. If the operator offers a term longer than 12 month, it must also:

Any modification of the contractual conditions must be notified to the consumer at least one month before their implementation and consumers can terminate the contract without any indemnity for the operator until four months after the implementation of the new conditions (unless these conditions have been expressly accepted).

Consumers cannot have a longer termination period than ten days imposed on them unless the consumer asks that the termination is effective more than ten days after the notification.

Any breach of the obligations set out in this section can give rise to an administrative fee of EUR3,000, which can be increased up to EUR15,000 for legal entities.

There is no regulation specific to the use of Voice over IP (VoIP) technology.

However, Autorité de Régulation des Communications Électroniques et des Postes (ARCEP) considers that VOIP providers can be within the scope of the French Postal Services and Electronic Communications Code's definition of telecommunication operators. VoIP providers that only enable calls between users of their software do not qualify as telecommunication operators. However, VoIP providers that enable users to make or receive calls between the VoIP software and users of the traditional telephone network qualify as telecommunication operators.

Therefore, this second category of VoIP providers should be registered with ARCEP through the notification procedure and will therefore be subject to the same obligations and restrictions as other operators (for example, emergency calls, payment of fees and potential interception of calls).

A 2016 report from the Body of European Regulators for Electronic Communications (BEREC) on Over The Top (OTT) services emphasised the need for a thorough reconsideration of the current regulation of Electronic Communications Services (ECS) and OTT services. It is expected that the issue of OTT services will be addressed in the next review of the ECS regulation framework.

The Open Internet Access Regulation contains the applicable provisions regarding net neutrality. Further to these provisions, Internet Service Providers (ISPs) have to treat all traffic equally, without slowing down or blocking access to online content or services, except in specific cases such as compliance with court orders, preventing network congestion or combating cybercrime.

Under Article 3(1) of the Open Internet Access Regulation, via their internet access service, end users have the right to access and distribute information and content, to use and provide applications or services, and to use terminal equipment of their choice, regardless of the:

However, the Open Internet Access Regulation was widely criticised because it enables ISPs to offer premium services with higher internet quality. This could potentially lead to the creation of a two-tier internet.

The Body of European Regulators for Electronic Communications (BEREC) issued guidelines in June 2016 on the application of Open Internet Access Regulation to ensure a homogenous application by national regulatory authorities across the EU.

The French Postal Services and Electronic Communications Code also states that operators must comply with the obligations of net neutrality set out in the Open Internet Access Regulation.

There are no specific provisions for the outsourcing of telecommunications services or their management.

Unified Communications are one of the notable trends in outsourcing transactions in the telecommunication sector, and especially Unified Communications as a Service (UCaaS).

The key providers of outsourced telecommunications include:

Several service providers and equipment providers have also made a successful entry into the market, such as Colt and Cisco.

One of the major technologies influencing outsourcing in the telecommunication sector is the cloud. For example, the trending offers of Unified Communications as a Service are outsourcing services based on the cloud.

The Web Real-Time Communication (WebRTC) technology, which enables telecommunications directly through web browsers, is also likely to greatly impact the outsourcing market of telecommunications in the near future.

As well as technologies, certain practices have also reinforced the need for telecommunication outsourcing. Increased staff mobility, connection with various devices, and nomadic or flexible working are examples of now common practices that have changed the telecommunication needs of businesses.

Before entering into an outsourcing contract, the client must ensure that it has and will retain a technical knowledge of the outsourced service. This will be crucial for the proper supervision of the execution of the contract.

The approach of the pre-contractual phase and implementation phase is vital to the success of an outsourcing deal.

Therefore, the provider must ensure that the client is properly informed of the suitability of the solution for its needs. More generally, the provider must communicate any information that is decisive to its consent. This duty to inform the client cannot be waived in the contract and compliance is therefore crucial. The contract must also provide for the collaboration of both parties, especially to determine the exact needs of the client and the technical solutions that may be implemented in light of the client's current systems. This collaboration should be realised by steering committees involving both parties.

A transition phase can also be included to allow the client to evaluate the opportunity of this solution and to eventually back out. However, a clause subjecting the right to exit the contract to the payment of penalties could be re-qualified by a judge as a liquidated damages clause. Therefore, the judge can review and potentially modify the penalty amount (decreased, if it is too substantial, or increased if it is derisory).

Where there is any regulatory obligation related to the provision of the services, the contract must clearly identify which party has the burden of these obligations.

The limitation of liability set out in the contract must provide a reasonable indemnification of the injured party, as these clauses are reviewed under strict scrutiny. Indeed, judges can void a liability limitation clause that would tend to nullify the party's essential obligation to perform (that is, if the compensation is derisory).

Special attention should be given to reversibility. Once the contract expires or is terminated, how will the services be transferred back to the client or its new provider?