PARIS Total (TOTF.PA) has been placed under formal investigation in an eight-year-old case over suspected bribery relating to the United Nations Oil-for-Food programme during Saddam Hussein's regime in Iraq, it said.
A French criminal probe into the affair was closed in 2007, and the prosecutor's office last year recommended dismissing the case against Total's chief executive and other current and former employees.
But a new investigating magistrate decided in early 2010 to place the company under formal investigation on "bribery charges as well as complicity and influence peddling," Total said in its annual report published late last week.
"This formal investigation has been pronounced eight years after the beginning of the investigation without any new evidence being added to the affair," Total said.
"The company believes that its activities related to the 'Oil-for-Food' programme have been in compliance with this programme," Total added.
Total's shares were up 1.8 percent at 0914 GMT (10:14 a.m. British time), outperforming a 0.7 percent rise in the French benchmark CAC 40 index .FCHI.
The United Nations Oil-for-Food Programme ran from 1996 to allow Iraq to export oil for imports of food and other humanitarian goods to relieve the impact of UN economic sanctions imposed on Saddam Hussein's regime.
It ended in November 2003 after sanctions were lifted following the U.S.-led invasion of Iraq. A UN report subsequently revealed corruption on a global scale, with more than $10 billion (6.5 billion pounds) misdirected.
A number of current and former Total employees, including Chief Executive Christophe de Margerie, formerly president of its Exploration and Production division, had been placed under criminal investigation for possible charges.
However, the criminal investigation was closed in 2007, and the case was transferred to the prosecutor's office, which subsequently recommended it should be dismissed.
It is the investigating magistrate, however, who decides whether or not a case should be pursued in France, meaning Total may now have to appear in court, although the prosecutor's office could still appeal.
An independent investigation was carried out into the U.N. Oil-for-Food programme by former U.S. Federal Reserve Chairman Paul Volcker.
Total said the Volcker report had "discarded any bribery grievance within the framework of the 'Oil-For-Food' programme."
(Reporting by James Regan and Thierry Leveque; Editing by Jon Loades-Carter and Erica Billingham)