Abstract
The object of the revised SGEI package is to specify the conditions under which State aid for such services can be found to be compatible with Article 106(2) TFEU. Within the package, the revised SGEI Framework establishes a more prescriptive methodology for determining the compensation to the undertaking entrusted with offering the SGEI, as well as enhanced efficiency incentives. This chapter surveys the revised financial and economic tests for determining appropriate SGEI compensation, commenting on the theoretical basis and practical implementation of these tests.
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Notes
- 1.
European Commission, Communication from the Commission on the application of the European Union State aid rules to compensation granted for the provision of services of general economic interest OJ 2012 C 8/4.
- 2.
European Commission, Commission Decision of 20 December 2011 on the application of Article 106(2) of the Treaty on the Functioning of the European Union to State aid in the form of public service compensation granted to certain undertakings entrusted with the operation of services of general economic interest, OJ 2012 L7/3.
- 3.
European Commission, Communication from the Commission, European Union framework for State aid in the form of public service compensation, OJ 2012 C8/15.
- 4.
European Commission, ‘State aid: Commission adopts new rules on services of general economic interest (SGEI)’, Press Release IP/11/1571, 20 December 2012.
- 5.
Almunia, J. ‘Reform of the State aid rules for Services of General Economic Interest (SGEI) and decisions on WestLB, Bank of Ireland and France Telecom’, speech to Brussels press conference, 20 December 2011.
- 6.
Regulation (EC) No 1370/2007 of the European Parliament and of the Council of 23 October 2007 on public passenger transport services by rail and by road and repealing Council Regulations (EEC) Nos 1191/69 and 1107/70, OJ 2007 L 315/1. See the chapter by Maxian Rusche and Schmidt in this volume.
- 7.
Supra n 5.
- 8.
Supra n 6.
- 9.
Supra n 3, para 13.
- 10.
The net cost calculation should take into account the costs that the service provider is expected to avoid as well as the revenues it is expected not to receive, in the absence of the pso.
- 11.
Oxera (2003).
- 12.
The drawbacks are described in Niels et al. 2011, p. 156.
- 13.
Supra n 2, para 19.
- 14.
Oxera (2003).
- 15.
Supra n 3, para 39.
- 16.
Supra n 3, para 38.
- 17.
Supra n 3, paras 40–41.
- 18.
Supra n 3, para 43.
- 19.
CJEU, Case C-280/00 Altmark Trans GmbH and Regierungspräsidium Magdeburg v Nahverkehrsgesellschaft Altmark GmbH (‘Altmark’) [2003] ECR I-7747.
References
Niels G, Jenkins H, Kavanagh J (2011) Economics for competition lawyers. OUP, Oxford
Oxera (2003) Assessing profitability in competition policy analysis. OFT Economic discussion paper 6 July
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Kavanagh, J. (2013). Financing Services of General Economic Interest: The European Commission’s Economic Tests. In: Szyszczak, E., van de Gronden, J. (eds) Financing Services of General Economic Interest. Legal Issues of Services of General Interest. T.M.C. Asser Press, The Hague, The Netherlands. https://doi.org/10.1007/978-90-6704-906-1_8
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