items = txt.readlines()
txt.close()
output = open('file_name', 'w', encoding='utf-8')
for string_fin in items:
    if '\xc3\x83\xc2\xa9' in string_fin:
        string_fin = string_fin.replace('\xc3\x83\xc2\xa9', '\xc3\xa9')
if '\xc3\x83\xc2\xab' in string_fin:
    string_fin = string_fin.replace('\xc3\x83\xc2\xab', '\xc3\xab')
output.write(string_fin)
output.close()
Python3: Convert Latin-1 to UTF-8