Villepin, 55, faces up to five years in jail and a 45,000 euro ($66,000) fine if convicted of "complicity in slander, complicity in the use of forgeries, dealing in stolen property and breach of trust" in the case that dates back to 2004.

Bitter rivalry

He has repeatedly denied any wrongdoing and maintains that the case would have never gone to trial had it not been for Sarkozy's "meddling" in the judicial process.

The trial is shaping up as a showdown between the two men, whose mutual hatred is legendary in French political circles.

In the weeks leading up to the trial, Villepin has waged a media offensive, accusing Sarkozy of being "a bit twisted" for insisting that the Clearstream affair was a plot to sabotage his bid for the presidency.

Sarkozy reportedly vowed to "hang up whoever did this on a butcher's hook".

"Some day, he will have to explain his relentlessness," Villepin said last week. "This is not without consequences for the office of president, on the human and political level."

Intrigue

The proceedings will also cast light on the murky dealings of French intelligence and of one of the world's top aerospace companies, EADS.

In video


De Villepine fights for his political survival

A former EADS vice-president and Villepin ally, Jean-Louis Gergorin is also on trial as is the former head of an EADS research centre, Imad Lahoud, who has reportedly confessed to falsifying the list.

Also on trial are management consultant Florian Bourges, accused of stealing Clearstream documents, and journalist Denis Robert, who broke the story.

Among the star witnesses are former spymasters including Yves Bertrand of the RG police intelligence and Mike Turner, former head of Britain's defence giant BAE Systems.

General Philippe Rondot, a former intelligence official whose notes - seized by investigators - detail secret meetings that appear to incriminate Villepin, is to testify early next month.

Chirac's name came up at the outset in connection with the Clearstream case, but he was never formally investigated, has denied all knowledge of the affair and has not been called to testify.

Villepin is expected to take the stand to defend himself next week.

"This is the trial of an era," said Robert, the investigative journalist among the five defendants.

"It is the trial of a kind of French political practice, where spooks and the powers that be use the legal system as a political tool."

"We see that inside domestic intelligence circles there was a rift between those who were loyal to Villepin and those who were close to Sarkozy," he told the AFP news agency.

Villepin's trial comes five years after another prime minister, Alain Juppe, was convicted of corruption in an illegal party financing scheme and given a 14-month suspended sentence and a one-year ban on holding public office.

The hearings are scheduled to run until October 23 at the same Paris criminal court where Marie Antoinette, the French queen, was sentenced to the guillotine in 1793 during the French Revolution.