The controversial French copyright bill, locally known as the DADVSI (droit d’auteur et droits voisins dans la societe de l’information), faces further dilution after the country’s constitutional council took issue with some points of the legislation Thursday.

The French parliament voted in an already watered down version of the copyright bill on June 30, potentially leaving Apple’s presence in the country secure.

Concern had been sparked among digital music retailers following suggestions that Apple, and others like it, could be forced to open up their Digital Rights Management (DRM) technology or exit the country.

But amendments to the bill offered retailers a loophole to avoid requests to reveal proprietary information on DRM by allowing them to strike deals with record labels and artists allowing the restriction of content to certain formats or systems.

But retailers could now be cheering further concessions as a source close to the proceedings told telecoms.com that “the constitutional council took the decision yesterday that three points of the text, as adopted on June 30 2006, were not in accordance with the French constitution.”

It is not yet clear exactly which three points of the legislation were disputed.

More on this story as it develops.