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PARIS, France (April 6, 2000 – Orientation Oceania/SPC)---The French government is considering new legislation designed to replace the current tax exemption status for investments in its overseas territories and departments -- including French Polynesia, New Caledonia and Wallis and Futuna in the Pacific.

French overseas minister Jean-Jack Queyranne made the announcement Wednesday, saying a committee of the French National Assembly had been set up to look into the matter.

Under the current "Pons" law, named after a former right-wing overseas minister in the mid-eighties close to President Chirac, companies investing in France's overseas territories and countries benefit from substantial tax exemptions.

The purpose of the legislation was to boost development investments in overseas territories and departments.

Queyranne, who is a member of French Prime Minister Lionel Jospin's socialist government, said the Pons law (which expires at the end of 2002) did not bring the expected outcomes, especially in terms of employment generation.

"The current law will not be modified without prior consultation, but it calls for improvement", Queyranne said in a release.

"(The revising process) will be carried out with the view of more efficiency in the distribution of public funds."

The 42-point project, called "Overseas Orientation Bill," aims at "economic development" that involves institutional and administrative reforms.

The French Cabinet, at its weekly meeting, endorsed it on Wednesday.

It now must be submitted to the French Parliament.

French President Jacques Chirac has already expressed reservations about the project, saying he wondered "whether (it) fully responds to the expectations of France's overseas collectivities."

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