Royal Mail has set aside £18m to cover the costs of settling a competition inquiry by the French authorities.

The privatised postal service said the French regulator, the Autorité de la Concurrence, was still investigating the case of alleged breaches of competition laws by one of its subsidiaries, GLS France. However, Royal Mail had agreed in principle to settle.

The fine will not be set until next year but Royal Mail said it had made a provision of £12m to pay the French authorities and £6m to cover legal expenses and the cost of complying with the ruling.

By agreeing to settle and provide compliance commitments now, Royal Mail said it would benefit from a reduction to any fine.

Royal Mail announced in July that its subsidiaries had received a notice from the French competition authority alleging breaches of competition laws as part of a wider investigation into the parcel delivery industry in France. The British company warned that any fine could be significant.

Royal Mail’s costs are less than half those of TNT Express, the Dutch parcel delivery company, which last month set aside €50m (£39m) to settle the French investigation. Royal Mail’s shares rose 1.2% after its announcement.

Royal Mail was caught by the inquiry via its French parcel delivery business GLS France, a loss-making part of its otherwise profitable and fast-growing European parcel business. The British company has refused to give details of the alleged breaches but FedEx of the US, which was also under investigation, said the French authority had alleged anti-competitive behaviour at trade association meetings.