Summary
The long-awaited reform of French seaports has finally led to the enactment of law no. 2008-660 of 4 July 2008. The French government's declared objective of this reform is to implement measures to restore the competitiveness of the French seaports from their current state. The main features of this reform are: redefinition of the role and responsibilities of the autonomous ports (ports autonomes), renamed 'major seaports' (grands ports maritimes); and the regrouping of all terminal operation activities that could be exercised by independent port operators.
Replacement Of Autonomous Ports Or State-Owned Seaports By Major Seaports
Until now, French seaports have not benefitted from the sharp rise in international container traffic as a means to enhance their commercial positioning. The autonomous ports (public undertakings with a dual public and private nature (établissement public mixte)) created by the law of 29 June 1965, suffered from inefficient governance. In addition, recurrent strikes since the early 1990s have seriously and durably undermined the credibility of the French ports and the shipping lines' trust in them.
The seven major seaports (Dunkirk, Le Havre, Rouen, Nantes-Saint-Nazaire, La Rochelle, Bordeaux and Marseilles) that replace them are public administrative institutions placed under the supervision of the French state. The law refocuses their activities on their main regulatory functions as port authorities: the enforcement of security and safety measures, the development and maintenance of the port infrastructures and domain, the management of land-based and fluvial services and the setting and regulation of tariff policy. To facilitate the carrying out of these assignments and to strengthen ports' land management, the new law plans a full transfer of port domain ownership to the major seaports, except the natural maritime public domain and the natural fluvial public domain, which will remain the property of the state.
The Regrouping Of All Terminal Operation Activities That May Be Exercised By Independent Port Operators
To achieve the objective of rationalisation, the major seaports will cease, subject to exceptions, to hold or operate terminal equipment in the context of purely commercial terminals and must transfer them to independent operators. These ports are bound to transfer such equipment within two years following the publication of the new law. The transfer of these assets shall be made, in priority, to local operators that are currently involved in the operation and development of French seaports.
Completing the reform implemented through the enactment of a 1992 law, which transformed cargo handling companies into full-fledge companies and their personnel into privately employed salaried staff, the new law also simplifies the organisation of the terminal operations by enabling overall integrated terminal operation as is the case in the main European and international ports. In doing so, the new law puts an end to the inefficiency caused by the duality of personnel categories whose tasks were highly overlapped; ie the dockworkers, employed by terminal operating companies, and the crane operators, autonomous ports' salaried employees.
Under transparent and non-discriminative selection procedures of bidders, a 'terminal agreement' may be awarded by the major seaports to operators. This agreement will grant operation rights over the public domain (authorisation d'exploitation du domaine public). It amends the legal framework whereby the operators were granted public domain use rights (convention d'occupation du domaine public), which deprived them of the freedom of setting their own tariff and did not incentivise investments by the operators in terminals that they operated. The agreement will regulate the technical and commercial conditions of the operation of the terminal. Customary provisions that usually appear in equivalent administrative contracts will also be provided in this agreement. As a result, the agreement's term will be set on the basis of a mutual agreement of the parties (unless the term is set within the framework of the procurement procedure) and will take into account the time necessary for the operator to amortise its financing and for the depreciation of its assets. In case of dispute, the competent jurisdiction would be the administrative court having territorial jurisdiction over the terminal.
Terminal operators will benefit from the transfer of full ownership of moveable terminal operation equipment and will benefit from rights in rem on immovable equipment under their operation after the transfer.
The law leaves it to the representatives of the unions and the employers to determine how the ports' employees assigned to terminal operations will be taken over by the terminal operators. It is their responsibility to reach a national framework agreement defining these conditions before 31 October 2008. In the absence of a framework agreement, the employment contracts of the relevant employees of the major seaports will be transferred to the operators. In such case, the new employers will be bound to grant to the employees the employment conditions that the major seaports had in place as at the date of the signature of the transfer agreement.
This briefing is also available in French at http://www.freshfields.com/locations/france/briefings/.
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