Salient features of the sector compared to other developed countries are the high degree of private sector participation using concession and lease contracts (gestion déléguée) and the existence of basin agencies that levy fees on utilities in order to finance environmental investments.

The government intends to increase the coverage to the sewer networks in rural areas, in particular in ecologically vulnerable zones.

The ECJ also found that 121 settlements breached the directive by discharging their waste waters into previously designated sensitive areas.

They find it hard to accept that the water tariff weighs essentially on urban users and that, in apartment buildings, it is included in the rent.

They do not understand that agricultural production is exempt from the Polluter-pays principle and that it continues to deteriorate the quality of groundwater with impunity.

Those who are dissatisfied about tap water quality complain mainly about high levels of chlorine and calcium carbonate.

Unlike in a few other countries (such as England and Wales, Portugal or Chile) there is no national regulatory agency in France that would approve tariffs and set and control service standards.

However, the Cour des Comptes (National Audit Entity) plays a role in monitoring water and sewer tariffs as well as expenditures by utilities.

[25] Among the 36,700 municipalities in France, at least 23,000 are part of 2,000 intermunicipal utilities with the specific purpose to provide water supply and – in some cases – sanitation services.

Municipal associations (établissements publics de coopération intercommunale, EPCI) play a key role in water and sanitation service provision in France.

14,885 syndicats intercommunaux serve a single purpose (SIVU), which in the case of some of them is water supply and/or sanitation.

Subsequent laws created new types of municipal associations that sometimes compete and overlap with the syndicats intercommunaux.

[27] A 2005 report by the Cour des Comptes also stated that the quality of the municipal associations is "not fully satisfactory".

Leaving private service providers apart, it is the largest utility in France, serving more than 4 million users.

While SEDIF owns its infrastructure, it has contracted out service provision to the private enterprise Veolia Eau.

Today, according to the Ministry of Environment 75% of water and 50% of sanitation services in France are provided by the private sector, primarily by two firms, Veolia and Suez.

In 2010 the lease contracts for Paris with Suez and Veolia expired and the water system returned to public management (remunicipalization).

[31][32] Since the early 1990s a number of measures have been undertaken to strengthen competition, to fight corruption and to improve transparency in the French water and sanitation sector.

A study by the Water Directorate of the Ministry of Environment, carried out by the consultancy TNS Sofres in 2006, showed the following impact of the law in the water and sanitation sector: However, it also noted that the decline in payments to private operators has not been passed on to consumers, because it is partially or fully compensated by increases in local taxes.

[34] In 2001 the Association of French Mayors has developed a standard contract for water supply and sanitation services that aims at strengthening the position of municipalities vis-à-vis private operators.

In the charter these entities commit themselves, among others, to the free choice of management models and the reversibility of these choices; objective comparisons between management models; to ensure transparency of costs and to equitably share gains in performance; and to strengthen local democracy and independent evaluations.

[36] In 2004 IGD issued a draft document containing 10 proposed performance indicators for water supply and sanitation.

Comparison of annual water and sanitation bills per capita in four EU countries Source: Metropolitan Consulting Group: VEWA – Vergleich europaeischer Wasser- und Abwasserpreise, 2006, p. 7 of the executive summary[41] Equalized costs net of subsidies and taking into account differences in service quality show a different picture: England and Wales have the highest tariffs, followed by France and Germany.

Tariffs in Italy remain the lowest, even taking subsidies and differences in service quality into account.

[45] In 2003 the Association of French Departments estimated that the renewal of the water supply distribution infrastructure alone would require investments of 53 billion Euro from 2004 to 2015 to replace 535,000 km of pipes (about 65% of the entire network).

Only in the case of municipalities with less than 3,000 inhabitants some limited tax revenue (general budget) is used to finance water and sanitation investments.

[47] The basin agencies finance themselves through charges for water abstraction and wastewater discharge by utilities and industries.

In 2002 the Court of Audit of France condemned decentralized cooperation by water agencies as contrary to their objectives.

In response, the conservative member of Parliament André Santini, President of the Council of the Water Agency for Seine-Normandie and President of SEDIF, the utility in charge of water supply in the region of Paris, introduced a law passed in 2005 named after himself and former Senator Jacques Oudin.

According to a 2002 study by the Association of French Departments, non-revenue water was actually slightly higher and stood at 28%.