11.1.2012   

EN

Official Journal of the European Union

C 9/45

—

is pleased that the European Commission is on the same wavelength as the CoR proposal that a distinction be made between: 1) situations where de minimis public service compensation does not affect intra-Community trade; 2) compensation granted to local and social public services that exceeds the de minimis thresholds but which, because of the way these services are organised and the current state of internal market development, does not affect intra-Community trade; and 3) compensation granted to other EU or cross-border public services governed by sectoral directives or regulations;

—

requests once again that the threshold be raised to EUR 800 000 per year;

—

calls on the Commission not to include the local authority population criterion among the conditions for applying the new de minimis regulation;

—

opposes the introduction by the Commission of an assessment of economic efficiency in SGEI compensation; in the Committee's view, neither Article 106 nor a unilateral decision or directive from the Commission, on the basis of paragraph 3 thereof, provide sufficient legal basis for any such legislative proposal. The remit of the Commission, in its capacity as European competition authority, by no means extends to the conditions for the efficient allocation of public resources by Member States' public authorities.

Rapporteur-general

Mr Karl-Heinz LAMBERTZ (BE/PES), First Minister of the Belgian German-speaking Community

Reference documents

Revised opinion of the Committee of the Regions in connection with document CdR 150/2011 fin, in accordance with Rule 52 of the Rules of Procedure – ECOS-V-016

1.

welcomes the Commission's proposal for a legislative package on State aid in the form of public service compensation;

2.

considers this proposed revision to be a major political initiative for local and regional authorities in that it aims to frame new, clear and proportionate rules on the compatibility of the various forms of funding public services, with the internal market and thus to provide the legal certainty and predictability needed for the development of public services in the EU; regrets, however, that the Commission has not achieved its own goal of (i) providing more clarity as regards issues of applicability and implementation and (ii) minimising the administrative burden, especially for those concerned;

3.

considers that the general architecture of the mechanism for monitoring State aid proposed by the European Commission should take better account of the local, cross-border and EU dimensions of the public services, the various ways in which they are organised and the real extent of the risk that they might negatively affect intra-Community trade, and feels that the proposals only partially reflect this;

4.

is pleased that the European Commission is on the same wavelength as the CoR proposal (1) that a distinction be made between: 1) situations where de minimis public service compensation does not affect intra-Community trade and is thus not subject to State aid control; 2) compensation granted to local and social public services that exceeds the de minimis thresholds but which, because of the way these services are organised and the current state of internal market development, does not affect intra-Community trade to an extent that would be detrimental to the EU's interests; and 3) compensation granted to other EU or cross-border public services governed by sectoral directives or regulations, or in cases where the undertakings concerned have a cross-border or supra-national structure;

5.

is pleased that the draft communication clarifies and updates various notions and concepts in EU law which apply to SGEIs, especially as regards developments in the case-law of the EU Court of Justice; regrets, however, that the Commission has failed to establish clear criteria based on the requirements of the ECJ for determining what is an economic activity, its local reference and its relevance to the internal market, with the result that there is broad scope for interpretation when carrying out checks and legal uncertainty remains;

6.

emphasises, in this connection, that Article 14 TFEU, which is part of the Treaty's provisions of general application, provides a new legal basis for the European Parliament and the Council to establish – by means of regulations – the principles and conditions enabling services of general economic interest to fulfil their particular purpose; therefore calls on the Commission to place the process of clarifying the key concepts, which are not set out in the Treaty, on a formal footing with a proposal for a Council and European Parliament regulation based on Article 14 TFEU;

7.

considers that the present proposal for a communication does not release the Commission from its commitment to present a quality framework for services of general interest;

8.

welcomes the Commission's intention to raise the threshold set by the de minimis regulation (2), below which State aid is not subject to State aid control, so as to exclude from the scope thereof all local public services relying on the local voluntary sector and local social microenterprises, which relate in particular to social development, such as social inclusion, the prevention of exclusion, care for the elderly, community work and the promotion of cultural, sporting and socio-educational activities. This proposal is based on the fact that there is zero risk of this kind of public service affecting trade between Member States;

9.

regrets, however, that the Commission is content merely to propose raising the threshold from EUR 200 000 over three years to EUR 150 000 per year, which would only cover local facilities with fewer than four employees; therefore, requests once again that the threshold be raised to EUR 800 000 per year, in order to cover all local facilities with fewer than 20 employees whose only funding is compensation granted by public authorities, provided that the local services concerned are provided free of charge within a defined area;

10.

calls on the Commission not to include the local authority population criterion among the conditions for applying the new de minimis regulation. Population size is largely irrelevant when it comes to measuring the impact of an authority's economic activity on trade between Member States. Moreover, it would be wrong to take as a basis reasoning which would be liable to lead to discrimination between entities (municipalities, regions, state, etc.). If population were taken as the sole criterion, this would also fail to take into account the fact that these local services can be part-financed by several public authorities of varying size and at different levels, in keeping with the principle of freedom to organise and provide public services, enshrined in the Treaty. Lastly, it would be wrong to penalise pooling of services, particularly where there are joint municipal authorities. Thus, steps to ascertain the local, limited nature of services must be based on a range of indicators that take account, in particular, of the geographical location of an authority and the range of potential public service users involved. Such steps should take account of the situation of regions that suffer from severe and permanent natural or demographic handicaps, in accordance with Article 174 of the Treaty on the Functioning of the European Union, and provision thus made for differentiation of support measures. The EUR 5 million restriction on turnover should be lifted;

11.

is pleased to note that the Commission takes transparency very seriously and excludes all non-transparent aid that cannot be precisely calculated from the scope if its regulation;

12.

in line with the proportionality principle enshrined in the Treaty, endorses the Commission's approach of taking into account the exclusively local nature of certain public services, and the proposal to extend the a priori compatibility decision beyond hospitals and social housing bodies to include other social services as well;

13.

feels that the introduction of the new concept of ‘essential social needs’ is a source of considerable confusion for local and regional authorities and their partners, because it overlaps with the existing concepts of social services of general interest and social services excluded under Article 2(2)(j) of the Services Directive; therefore urges the Commission to give preference to the concept of social services within the meaning of Article 2(2)(j) of the Services Directive, which leaves it up to the Member States and local and regional authorities to define the boundaries in accordance with the subsidiarity principle, and to specify that the list of services given by way of example in the proposal for a decision on the application of Article 106(2) of the Treaty on the Functioning of the European Union is neither definitive nor exhaustive;

14.

calls on the Commission not to halve the annual compensation threshold for application of this decision but to keep it at EUR 30 million per year;

15.

calls on the Commission not to make exemption from notification dependent on a maximum duration of the act of entrustment, in line with the principles of free administration and free organisation of public services by Member States' public authorities;

16.

calls on the Commission not to make exemption from notification for social services dependent on these services being performed solely by undertakings specifically entrusted with this task, provided that the provisions of the Directive on the transparency of financial relations between Member States and public undertakings (see references) are applied and cost accounting is carried out by the undertakings concerned;

17.

considers that, when local and regional authorities launch a call for tenders in a bid to comply with the fourth criterion of the Altmark judgment for public service compensation, they must be able to set quality criteria to determine the most economically advantageous tender, rather than opt for the tender offering the lowest price;

18.

feels that the proposed new definition of ‘reasonable profit’ on the basis of the rate of return on capital and other profit level indicators is so complex that it will be unusable for a large number of sub-national authorities;

19.

calls on the Commission: to include in its definitive review proposals all of the forms that public service compensation can take, given the wide discretionary power of local and regional authorities as regards funding public services, including compensation in the form of long-term investment aid required for funding local public service infrastructure; not to limit its compatibility rationale just to annual operating subsidies; and to clarify the specific conditions for assessing the absence of overcompensation in the case of long-term investment aid, particularly in property and land infrastructure;

20.

points out to the Commission that other objective criteria should also be taken into consideration, which in principle offset the risk of negatively affecting intra-Community trade, distorting competition or creating cases of cross-subsidisation; such objective criteria include the limited territorial remit of certain operators governed by local and regional authorisation schemes, the limited scope of some public or private operators set up specifically to provide a particular public service in a given area and not pursuing any commercial activity on the market, and the not-for-profit nature of certain social undertakings which re-invest their profits in funding for the public service they operate, this being deductible from future compensation;

21.

suggests that, in accordance with the subsidiarity and proportionality principles set out in the Treaty, the Commission's final decision make it incumbent on the public authorities granting the compensation to take all necessary steps to prevent, detect and offset any overcompensation, given that it is directly in the interests of the local and regional authorities to prevent any such situation from occurring. By the same token, the appeals procedures available in the event of overcompensation being detected should be simplified for undertakings which are actually and directly penalised;

22.

proposes to the Commission that implementation of these provisions be conditional on:

23.

points out that it opposes the introduction by the Commission of an assessment of economic efficiency in SGEI compensation; in the Committee's view, neither Article 106 nor a unilateral decision or directive from the Commission, on the basis of paragraph 3 thereof, provide sufficient legal basis for any such legislative proposal. The remit of the Commission, in its capacity as European competition authority, by no means extends to the conditions for the efficient allocation of public resources by Member States' public authorities. This exclusive role exercised by the Commission, under the supervision of the European Court of Justice, is limited to ensuring the conformity of public service compensation that does not meet the conditions laid down by the Court in its Altmark judgment and thus falls under the rules governing the prohibition and control of State aid;

24.

rejects the requirement that the Member States provide proof of the need for a public service in the form of a market survey, on the basis that it constitutes an encroachment on the exclusive right of the Member States to organise and design services of general interest.