SECURITIES AND EXCHANGE COMMISSION

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON. D.C.. 20549

DIVISION OF

CORPORATION FINANCE

January 26, 1996

Richard H. Rowe, Esq.

Proskauer Rose Goetz & Mendelsohn LLP

1233 Twentieth street, N. W., Suite 800

Washington, D.C. 20036-2396

ACJ

r- eii ~ Ll

SlON

-5( tC)

RUL

RE: TOTAL

PUBLI~

AVA TT .ARt

i /;Z0(t-~

Dear Mr. Rowe:

In regard to your letter of January 25, 1996 our response

thereto is attached to the enclosed photocopy of your

correspondence. By doing this, we avoid having to recite or

summarize the facts set forth in your letter.

Sincerely,

;q~ tf ~

Martin P. Dunn

Chief Counsel

,.

PROSKAUER R~ GOETZ.& M ENDElSOHN LLP

1233 TWENTIETH STREET NW

SUITE 800

NEW YORK

LOS ANGELES

WASHINGTON DC 20036-2396

EUROPEAN COUNSEL:

(202) 416-6800

OUBARRY LEVEOUE

BOCA RATON

CLIFTON NJ

FAX: (202) 416-6899

LE OOUARIN & VEIL

PARIS

PARIS - BRUSSELS

RICHARD H. ROWE

MEMBER OF THE FIRM

(202) 416-6820

January 25, 1996

1933 Act Section 2(1)

1933 Act Form S-8

1940 Act Section 2(a)(36)

ReI. 33-4790

BY HA DELIVRY

Martin Dunn

Chief Counsel

Division ôf Corporation Finance

Jack W. Murphy

Associate Director (Chief Counsel)

Division of Investment Management

to

a

Oì

-"

(-- -,~

~:::

­ ; Ç-)

rv

0,

... l-~)

c, ::)

(­

..,,

-

0"

j

r),., "

~

- 1:

-D

'.

"--;

h,)

..

1'0

-C"

("1

Securities and Exchange Commssion

450 Fift Street, N.W.

Washington, D.C. 20549

Re: TOTAL

File No. 1-10888

Employee Share Subscription Arrangement

-­

Dear Messrs. Dunn and Murphy:

We are writing on behalf of TOTAL, a foreign private issuer

organized under the laws of the Republic France, to request a no action or

interpretive response from your Divisions, with respect to an aspect of TOTAL's

contemplated share subscription arrangement for employees of certain of its U.S.

subsidiaries (the "Plan"). Specifically, we request that the Divisions concur in our

view that a provision of the Plan, required by French law, that prohibits transfers

PROSKAUER

Martin Dunn

January 25, 1996

Page 2

of shares acquired by employees under the Plan for a period of five years would

not result in the creation of separate interests under the Plan, which interests

would constitute separate securities for purposes of Section 2(1) of the Securities

Act of 1933, as amended (the" 1933 Act"), or Section 2(a)(36) of the Investment

Company Act of 1940 (the II 1940 Act"), as interpreted in Securities Act of 1933

Release No. 4790 (July 13, 1965) ("ReI. 33-4790") and subsequent releases. In

the alternative, we request that the Divisions indicate that they would not

recommend any action to the Commission should TOTAL proceed to implement

the Plan as described herein, including imposition of the required five year

restriction on transfers of shares acquired under the Plan.

The shares to be acquired under the Plan wil be TOTAL Shares,

nomial value 50 Francs each ("Shares"), represented by American Depository

Shares ("ADSs"), in turn represented by American Depository ReceiptS ("ADRs").

Each ADS wil represent one-half of a Share. The Shares wil be registered under

the 1933 Act on Form S-8.

TOTAL wishes to commence offers under the Plan to U.S.

employees in early 1996 (the "Offer Date"). This commencement date.

...

~'

is

necessary to coordinate offers under the Plan with offers under TOTAL's global'

plan (the "Global Plan") to non-U.S. employees. Certin aspects of the Global

Plan vary from countr to countr. . The variations for the offering to U. S.

employees are reflected in

the Plan.

Accordingly , TOTAL would appreciate a response to this request as

soon as is feasible.

Background

TOTAL is a foreign private issuer, organized under the laws of the

Republic of France. As reflected in its Anual Report on Form 20-F for the year

ended December 31, 1994, it is a leading international integrated oil and gas

company based in France with operations in approximately 80 countries, including

the U.S. TOTAL has over 50,000 employees world-wide, approximately 8,800 of

whom are located in the U.S. It is expected that approximately 2,500 U.S.

employees wil be offered Shares under the Plan.

TOTAL is subject to the periodic reporting provisions of Section 13

or 15(d) of the Securities Exchange Act of 1934, as amended (the" 1934 Act"), as

the result of public offerings in the U.S. in 1991 and 1992 and the listing of its

:­

PROSKAUER

Martin Dun

January 25, 1996

Page 3

Shares and ADSs, represented by ADRs, on the New York Stock Exchange

("NYSE"). Each ADS represents one-half of a Share. The Shares and ADSs sold

under the Plan also wil be listed on the NYSE. The principal market for the

Shares is the Paris Bourse. The Shares also are listed on the London Stock

Exchange and quoted on SEAQ InternationaL.

Filings by TOTAL under the 1934 Act are reviewed by Branch 3.

The Plan

TOTAL's shareholders authorized issuance of Shares to employees at

their Anual General Meetig on June 2, 1993. It has not yet been determed

whether the Plan wil be qualified as a stock purchase plan under Section 423 of

the U.S. Internal Revenue Code.

The Plan provides for, a one-time purchase of newly issued Shares by

employees of designated U.S. subsidiaries of TOTAL who have been employed by

TOTAL or a subsidiary for at least six full months for the U.S. Dollar equivalent

on a designated business day preceding the first day. of the subscription period, of

245 French francs per Share. The per Share price in French francs represents a

stock price (the average trading price for the

Shares on the Bourse for the 20 trading days prior to September 5, 1995, the date

that decided to implement the offering

to employees). The Shares, represented by ADSs, may be paid, at the option of

the employee, either in full in cash upon execution and delivery of the subscription

agreement or though payroll deduction in equal installments over two years. An

employee may not acquire Shares under the Plan for a purchase price in excess of

25% of the employee's gross annual remuneration and the market value (price on

the Paris Bourse multiplied by the U.S. dollar/French franc exchange rate on the

Offer Date multiplied by the number of Shares to be purchased) of the Shares

purchased may not exceed $25,000.

20% discount from the benchmark,

of the meeting of TOTAL's Board Directors

..

R

PROSKAUER

Marti Dunn

January 25, 1996

Page 4

TOTAL anticipates that for convenience in admistration, the ADSs

so purchased wil be issued for the account of the purchasing employee and

deposited with The Bank of New York, the depository under TOTAL's ADR

arrangement. The ADRs representing the ADSs wil be held for the employee's

benefit in a custodial account at the Bank of New York (the "Custodian"), under a

custody agreement (the "Custody Agreement") with TOTAL on behalf of the plan

participants. The Custodian wil have no investment management functions. Its

sole functions wil be to hold the ADRs in safekeeping, receive dividends on the

Shares and pay the dividends over to the beneficial owners, exercise any voting

rights with respect to the Shares provided to holders of ADRs solely upon the

,instrctions of the beneficial owner (the Custodian may not vote any shares with

respect to which no such intrctions are received) and deliver ADRs upon the

instrctions of the beneficial owner or his or her representative upon termination

of the required holding period.

However, based upon considerations of cost, TOTAL may determine

to forego the custodial arrangement described above and, intead, provide for

issuance to the employees who subscribe for Shares under the Plan of ADRs

bearing legends disc10singthe restrictions on transfer of the deposited Shares

Shares from

the ADR depositary at any time, but the Shares would remain subject to the

applicable restrictions on transfers and bear appropriate legends describing those

restrictions.

described below. Employees would be permitted to withdraw their

Employees who subscribe for Shares under the Plan wil become

holders of ADRs, with all the rights of ADR holders, including the right to receive

dividends and other distributions on their Shares and to instruct the Custodian to

exercise any voting rights they have as ADR holders. Employees who subscribed

for shares under the Plan may elect to receive their dividends in cash or Shares

under TOTAL's dividend reinvestment plan ("DRIP") to the same extent as other

ADR holders. (TOTAL's DRIP was the subject of a no action letter, dated March

2, 1993, from the Division of Corporation Finance.)

However, as required by French law and for purposes of equitable

treatment of TOTAL's employees worldwide and fairness to all its shareholders,

the Plan provides that Shares acquired by an employee may not be transferred for

a period of five years from the date of issuance, except that fully paid shares may

be transferred as the result of the employee's retirement or other termination of

employment, marriage, birth or adoption of a third or subsequent child, divorce, if

the employee has custody of at least one child. This five year holding period is

"

l

PROSKAUER

Martin Dunn

January 25, 1996

Page 5

compelled by French law. Also, since Shares sold at a diScount pursuant to

TOTAL's Global Plan for non-U.S. employees are required to be held for five

years, with certain exceptions, it would be unfair to participants in the Global Plan

and TOTAL's other shareholders, including many in the U.S., for U.S. employees

to be able to acquire shares at a substantial discount and not be subject to

comparable restrictions on transfers of their Shares.

Upon termination of the five-year holding period, the Shares wil be

freely transferable by the employee.

Although the Plan contemplates a one-time offering, TOTAL may

from time-to-time make other offerings to its U.S. employees on terms

substantially similar to those of the Plan.

Basis For Five Year Holding Period

Weare advised that, pursuant to the French statute authorizing ths

-:

type of share purchase plan (i.e. containing the discount from market price and

other terms and restrictions, including favorable tax treatment in France), the

Shares purchased under the Plan must be held for a minimum of five years from

the dat~ on which they are purchased, with the exceptions described under "the

.~

!

Plan" above.

We have been advised that the five year withdrawal restriction is set

forth in the French statute (Ord. No. 86-1134, October 21, 1986) that authorized

French companies of group savings plans having the

characteristics of Total's Global Plan as described in this letter.

the implementation by

Article 26 of that statute reads as follows:

Except in the cases listed by the decree of the Conseil

d'Etat contemplated by Article 13 (withdrawals in

certain special circumstances), the shares or interests

acquired for the account of the employees (Law No.

94-640 of July 25, 1994) "and of ex-employees

II are

delivered to them at the expiration of a minimum time

period of five years counting as of the date of the

acquisition of the securities. (Translated)

--

PROSKAUER

Martin Dunn

January 25, 1996

Page 6

Thus, the five year holding period is a statutory requirement of the Global Plan

pursuant to which Total's U.S. Plan wil be implemented and is applicable to U.S.

employees participating in the Plan.

The Staff may be familar with offerings of shares at a discount by

other French companes, Société Nationale Elf Acquitaine, for example, to their

U.S. employees where the employees' holding period was less than five years.

However, the shares that were sold to those employees were sold in secondary

offerings by the French State. We are advised that those offerings were not

governed by Ord. No. 86-1134, but by the French "Privatisation" law, Ord. No.

93-923, July 19, 1993.

As indicated, although required by French law, TOTAL also

believes it would be unfair to the paricipants in the Global Plan and its other

shareholders to permt U.S. employees to receive a discount from the prevailing

market price for Shares without imposing the same five year holding period on

them.

.,"

"

Discussion

ReI. 33-4790 principally addressed the applicabilty of Section 2(3)

of the 1933 Act to open market employee stock purchäse plans. However, under

the caption "Plan Participations as Separate Securities," the Commission indicated

that where, among other factors, limitations exist "on the rights of employees to

withdraw . . . securities held in custody . . . a separate security may be created,

which wil be required to be registered under the Securities Act of 1933 and the

issuer of which maybe an investment company required to register under the

Investment Company Act of 1940. II (A footnote to the quoted passage indicates

that provision for reinvestment of dividends on a voluntary basis wil not of itself

create a separate security.) Subsequently, the Staff, in confirming the foregoing

position, stated that the reason for the position "is that such factors tend to place

the employee in a position where he is relying on the plan managers to protect (the

employee's) investment." Securities Act of 1933 Release No. 6188 (February 1,

1980) ("ReI. 33-6188"), LA.5.a. Stock Purchase Plans.

In our view, since a participant in the Plan would be in no sense

relying on "plan managers

II (there are no "plan managers") to protect the

participant's investment, there is no principled rational for concluding, as a matter

of law or policy, either under the 1933 Act or the i 940 Act, that the feature of the

plan prohibiting, as required by French law and for reasons of equity and fairness

PROSKAUER

Martin Dunn

January 25, 1996

Page 7

to other shareholders, transfers of Shares acquired under the Plan for a five year

period, subject to the exceptions described under liThe Plan" above, results in the

creation of a separate security.

Nor do we believe that the fact that the Shares issued under the Plan

may be held in custody during the required holding period, as a means of

enforcing the limitations on transfer and for convenience of admiistration,

faciltating payments of dividends on and voting of, the Shares, constitutes the

II to whom the participants wil look to for protection of their

Custodian a ii

manager

investments. The participants wil be at risk on their Shares during the entire

required holding period and no action by the Custodian can increase or diminish

that risk or in any other manner affect the participants' investments or rights in the

Shares.

We also note that General Instrction A(I)(ii) to Form F-6 permits

an exception from the requirement that a holder of ADRs be entitled to withdraw

the deposited securities at any time for restrictions on withdrawal imposed for .

purposes of ii compliance with any laws or governmental regulations relating to

ADRs or the withdrawal of deposited securities. ii

We believe

that our position-is supported by judicial and

administrative interpretations of the term ii security" and the policies underlying the

1933 Act and the 1940 Act and apparent administrative acquiescence in plans with

holding period features compelled by law, economic considerations, such as tax

consequences, or by considerations of equity.

Interests in the Plan, if any, clearly would not constitute any of the

instrments, agreements or rights enumerated in Section 2(1) of the 1933 Act or

Section 2(a)(36) of the 1940, except possibly an "investment contract. ii IIi our

view, the plan wil not result in the creation of an investment contract. An .

investment contract requires: (1) an "investment of money;" (2) in a "common

enterprise;" (3) "with an expectation of profits; II (4) "from the efforts of others."

See ReI. 33-6188. II.A.2.d. Voluntary. Contributory Plans. While release 33­

6188 addressed issues under the 1933 Act, there is no apparent reason why there

should be a different analysis for purposes of the 1940 Act.

The "investment of money" under the Plan wil be in the Shares, not

in a separately managed plan.

.

1,

PROSKAUER

Martin Dunn

January 25, 1996

Page 8

Once the Shares are purchased, there wil be no II common

enterprise" either horizontally among the participants, except as shareholders, or

vertically with TOTAL or any manager, except the relationship between TOTAL

and all its shareholders.

Any "expectation of profit

II wil be from owning the Shares; not a

separate interest in the Plan.

Any profits wil not be "from the efforts of others," other than

TOTAL's efforts to enhance the value of Shares held by all of its shareholders

equally.

Thus, interests in the Plan, if any, wil not be investment contracts

and, thus, wil not be securities for purposes of the 1933 Act or the 1940 Act.

This view is supported by various interpretive or II no action" letters

issued since 1980 by the Staff of both Divisions with regard to both the 1933 Act

and the 1940 Act, examples of which are discussed below.

1

'~f

In Gifford-Hil Company. Inc. (avaiL. January 8, 1988), the Staff of

both Divisions took no action positions with respect to an employee stock purchase

plan under which employees could not withdraw from the plan for the first 12

months of participation and could not sell any security purchased under the plan

for six months after its purchase. Those limitations were imposed solely to

comply with the Companes Act of 1985 of Great Britain, as the result

of the

fmancial assistance provided to the employees to purchase shares under the plan.

Securities to be issued under the plan were to be registered on Form S-8.

In E.!. dupont de Nemours & Co. (avaiL. September 27, 1982), the

Staff of both Divisions to no action positions, based on the facts presented and

"policy considerations," with respect to an employee stock ownership plan that

imposed a minimum two-year holding period on shares paid for either with

employee or matching employer contributions that was mandated by U.K. tax law

as to employer contributions. Indeed, in order to obtain the most favorable tax

treatment under U.K. law a holding period of seven years would be required,

although not mandated under the plan. See also, discussion of TRASOPs below.

-­

PROSKAUER

Martin Dunn

January 25, 1996

Page 9

The contractual limitations on withdrawals of shares purchased with

employee contributions was designed to coincide with the statutory restrictions and

preserve the matching employer contribution feature of the plan. For a five

business day period prior to the commencement of the holding period, employees

could withdraw the shares purchased with their own funds if they were wiling to

forego matchig employer contributions; incur adverse tax consequences; and pay

brokerage commissions and charges. It would appear, therefore, that acceptace

of the two-year holding period for such shares was economically compelled and

the early withdrawal right ilusory.

16, 1982, from Dupont's counsel concerning

their request refers to an attached no action letter from the Staff to Beneficial

Corporation, U.K. regarding a plan similar to the Dupont plan, which provided for

a thee-year withdrawal restriction. However, we have been unable to locate the

Beneficial letter on any of our research systems.

A letter, dated

April

In Roadway Express. Inc. Employee Stock Savings Plan (avail

September 20, 1982), the Division of Corporation Finance took a no action l

position with respect to a plan that prohibited withdrawal for a period of six

months of shares purchased with matching employer contributions by employees

with less than five years service. These limitations were imposed by the Internal

Revenue Service as a

condition to qualification of the plan under Section 401 of

the Internal Revenue Code. The request did not address any 1940 Act issues nor

was any 1940 Act issue raised by the Staff in its letter.

a no action letter was issued

by the Staffs of both Divisions with respect to a plan similar to that involved in the .

Dupont letter described above, except that to two year holding period was imposed

on B;P. employees seconded to the U.S., not due to U.K. tax law, but to allow

seconded employees to participate in a plan with substantially the same features as

the share scheme available to B.P. employees in the U.K.

In B.P. America (avail June 5, 1989),

In addition to the no action letters discussed above, which are by

way of example, but by no means all of the favorable letters addressing the issue

(we are not aware of any relevant unfavorable responses), there are instances

where there has been open disclosure of plans with holding periods of up to five

years, where no "no action" position has been sought, but no action has been taken

by the Commission.

PROSKAUER

Martin Dunn

Januar 25, 1996

Page 10

For example, in Shaw. Pittman. Pott & Trowbridge (avaiL. April

14, 1988), the Staffs of both Divisions took a no action position with respect to

several German bank that provided for five

year holding periods. The incoming request and the Staffs response addressed

issues under Rule 504 of Regulation D and registration of foreign banks under the

1940 Act and expressly addressed neither the separate security nor the holding

period issues, although the Staffs' letter states that counsel to the banks

represented during a telephone conversation that the plans did not involve the

creation of separate investment companies in the manner discussed in ReI. 33­

4790.

employee stock purchase plans of

French

Also, Société Nationale Elf Aquitaine ("Elf"), another integrated

oil and gas company, on January 27, 1994, registered on Form S-8

(Registration No. 33-74532) shares to be sold

under a 1994 Share Participation

Plan for U.S. and Canadian Resident Employees and Former Employees, but did

not register any separate interests in that plan. The Elf plan provided for thee

subscription options. Under the first option, shares were acquired at a 20%

discount, were paid 50 % down and 50 % in one year and had to be held in custody .:.

shares were acquired at a 20% discount,

paid by monthly payroll deductions over two years and had to be held in custody

for two years. Under the second option

for two years. Under the third option, shares were fully paid, with no discount,

and were freely withdrawable. Under all thee options, if shares were held for

specified periods of time, the employee would receive additional shares for no

additional consideration. At the end of any prescribed holding period, shares could

be freely withdrawn. (As noted above, under "Basis For Five Year Holding

Period", the holding periods for shares offered under the Elf plaIi are governed by

a different French statute than that governing the holding period for Shares issued

under the TOTAL Plan.) We are not aware of any no action letter issued to Elf

with respect to the holding period issue.

While, with the exception of the German bank plans that were the

discussed above, the periods under the plans

that have been the subject of the Staffs no action letters have ranged from one to

subject of the Shaw, Pittman letter

two, or perhaps three, years, we do not believe that differences in the lengths of

the holding periods should make a difference, as a matter of policy, particularly

where, as in the case of the TOTAL Plan, the Plan permits the exceptions to the

withdrawal restrictions described under "the Plan" above.

PROSKAUER

Martin Dunn

January 25, 1996

Page 11

In each of the letters discussed above that expressly addressed

holding periods, the holding periods were imposed to comply with the provisions

of corporate or tax law or to conform parallel plans with plans required to comply

with those laws. The TOTAL Plan for its U.S. employees imposes a holding

period both to comply with French law and for reasons of fairness.

Where the holding period is imposed for such purposes and the plan

is not managed within the meanig of ReI. 33-6188, it should not matter whether

the holding period is six months, one year, two years, thee years, five years, as

wil be the case with the TOTAL plan, or even longer. Indeed, we note that the

Staff of the Division of Corporation Finance in 1980 and again in 1981 took a

generic no action position under Section 2(3) of the 1933 Act with respect to

registration of employer shares issued under Tax Reduction Stock Ownership Plans

("TRASOPs"), despite the fact that the Internal Revenue Code required shares

acquired by employees under a TRASOP to be held for seven years. See ReI. 33­

6188, III.B.2. TRASOPs; Securities Act of 1933 Release No. 6281 (January 15,

1991) ("Release 33-6281"), II.A. Release No. 33-6281 expressly states that

TRASOPs being subject to a mandated seven year holding period wil not, by

itself, require registration of employee "interests in a TRASOP under the 1933 Act.

We also believe that there is no purpose or policy to be served by

registration of interests in the Plan, if any, under either the 1933 Act or the 1940

Act. What is there to register? The employee's interest in the Plan would seem to

be inseparable from their interests in their Shares, which are to be registered under

the 1933 Act and are issued by a company that is not an investment company by

definition. Cf. ReI. 33-6188, III.B.2. Section 3(a)(2) (interest in plan inseparable

from an employee's aliquot interest in the plan's share in the funding vehicle,

which is exempt; thus, interests in the plan are exempt); Securities Act of 1933

Release No. 6768 (April 14, 1988), n.8 and accompanying text (interests that

would be separate securities in compensatory benefit plans also are exempted from

1933 Act registration pursuant to Rule 701).

Moreover, no purpose would be served by registration of the Plan

under the 1940 Act. The Plan, as opposed to the participants, wil not be

investing, reinvesting or trading in securities. There are no managers of the plan

and the plan wil not be organized, operated, and managed in the interests of

officers, directors, investment advisers of TOTAL or affiliated persons or present

any of the other risks that the 1940 Act was enacted to regulate. See 1940 Act

Sec. 1.

.~

.

PROSKAUER

Martin Dunn

January 25, 1996

Page 12

Employees wil receive full and fair disclosure about the terms of the

Plan and about TOTAL and the Shares in accordance with the provisions of Form

S-8 and participants wil receive annual account statements from the Custodian.

However, if interests in the Plan were deemed separate securities required to be

registered under the 1933 Act, the Plan would be required to fie annual reports on.

Form ll-K pursuant to Section 15(d) of the 1934 Act.

No purpose would b~ served by the Plan fiing annual reports on

Form ll-K under the 1934 Act, since aU.-the Plan's assets would consist of Shares,

it would have no liabilties or revenues or income, and its expenses, principally

custodial fees, wil be the obligations of TOTAL not the Plan.

Conclusion

Based on the factors discussed above, we do not believe that

interests in the Plan would be separate securities for purposes of either the 1933

Act, or the 1940 Act or that the plan would be required to register under the 1940

Act. Accordingly, we respectfully request that the Division concur in our view

that no separate interests in the Plan would be created that constitute separate

securities for purposes of the 1933 Act or the 1940 Act, or indicate that they wil

recommend no action to the Commssion should TOTAL proceed to implement the

Plan as described herein.

For the convenience of the Staff, seven copies of this letter are

enclosed for each Division.

Should the Staff have any questions or desire any additional

information, please telephone the undersigned at (202) 416-6820 or Ronald R.

~mitte,

~c-

Papa, Esq. at (212) 969-3325.

Richard H. Rowe

Enclosures (7 for each addressee)

--

PROSKAUER

Marin Dunn

Januar 25, 1996

Page 13

cc: Charles de Bollardiére

Emmanuel de Guilebon

Ronald R. Papa, Esq.

Delia Spitzer, Esq.

Jeffey P. Riedler, Chief, Branch 3

Paul Dudek, Chief, Offce of International

Corporate Finance

..

";l

. PUBLIC

January 26, 1996

RESPONSE OF THE OFFICE OF CHIEF COUNSEL

DIVISION OF CORPORATION FINANCE

Re: TOTAL

Incoming letter dated January 25, 1996

Based on the facts presented, the Division will not

recommend enforcement action to the Commission if TOTAL, in

reliance on your opinion as counsel that registration is not

required, operates the share subscription arrangement for

employees of certain of its U.S. subsidiaries (the "Plan") in the

manner described in your letter without registration under the

Securities Act of 1933 of participation interests in the Plan.

The Division of Investment Management has asked us to inform

you that, on the basis of the facts presented in your letter and

your representations that the Plan complies with the conditions

set forth in Lucky Stores Inc. (pub. avail. July 6, 1974), il

except with respect to the five-year withdrawal restriction that

is required under French law, á/ the Division of Investment

Management would not recommend enforcement action to the

Commssion if TOTAL implements the Plan without registering the

Plan under the Investment Company Act of 1940.

Because these positions are based upon the representations

the

made in your letter and in telephone conversations with

staff, it should be noted that different facts or conditions

might require different conclusions. Moreover, the responses

only express the Divisions i positions on enforcement action and

do not purport to express legal conclusions with respect to the

questions presented.

~~

Sincerely,

Anita Klein

Special Counsel

,.

.

1/ See also First Arkansas Bankstock Corp. (pub. avail. Sept.

8, 1977); Ameribanc, Inc. (pub. avail. Sept. 17, 1982).

2/ Telephone conversation on January 5, 1996 between Richard

Rowe of Proskauer Rose Goetz & Mendelsohn, counsel to TOTAL,

and Natalie Bej of the staff.