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Towards a clearer interaction between the State Aid rules and the rules on Public Procurement

Towards a clearer interaction between the State Aid rules and the rules on Public Procurement Global Competition Law Centre Bruges 30 September 2011 Tanja Struve German County Association Council of European Municipalities and Regions. Public Procurement and the Altmark judgement.

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Towards a clearer interaction between the State Aid rules and the rules on Public Procurement

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  1. Towards a clearer interaction between the State Aid rules and the rules on Public Procurement Global Competition Law Centre Bruges 30 September 2011 Tanja Struve German County Association Council of European Municipalities and Regions

  2. Public Procurement and the Altmark judgement • Fourth Altmark criterion • Social, greenand innovative considerations will replacethelowestpriceaward („the least costforthe Community“) • CEMR demand:nobindingcriteriawhichwouldoverloadtheprocurementproceduresandcreateevenmorebureaucracyand administrative burdenfortheawardinglocalauthorities • Localauthoritiesshoulddecidewithintheprincipleoflocalselfgovernment - asalreadycurrentlyapplicable - wheathertotakeintoaccounttheseconsiderationsor not. • Question: Byusingsocial, greenand innovative criteria do localpublicauthoritiesincreasetheriskofgranting State Aid?

  3. Public Procurement and the Altmark judgement • Fourth Altmark criterion • The required comparison analysis by PP procedure will lead to more PP tendering procedures • Problem: Within the relevant market there is often no other operator offering the needed service of general economic interest • CEMR demand: Rejection of the comparison analysis by PP procedure because of the excessive administrative burden for local authorities without any added value in theses cases • The possibility to entrust an undertaking with SGEI without PP procedure must always be available!

  4. De-minimis Regulation for SGEI • Restriction to Local authorities of max. 10.000 inhabitants • The threshold for the exemption is arbitrary and irrelevant and in any case too low and consititutes therefore discrimination between different local authorities (cities, counties, municipalities) • The number of inhabitants does not necessarily reflect the importance of the local authority when buying services • Internal administrative structures fall within the competences of the member states

  5. De-minimis Regulation for SGEI • RestrictiontoLocalauthoritiesof max. 10.000 inhabitants • CEMR demand:contradictionhinderingtheincreasinglyneededpublic-publiccooperationparticularly in rural areaswithincreasingdemographicdifficulties • ECJ: „a public authority has the possibility of performing the public interest tasks conferred on it by using its own resources, without being obliged to call on outside entities not forming part of its own departments, and that it may do so in cooperation with other public authorities” (Coditel C-324/07; COM vs Germany C-480/06) • Question:HowdoestheCommissionensure in thefuturereformof PP thatthesecooperations will not behinderedby State Aid (and also PP) rules?

  6. De-minimis Regulation for SGEI • Increaseofthethresholdsupto 150.000€/tax year • The raisingofthethresholdswhich will allowfor a differentiationbetween large network SGEI andlocalminor SGEI is positive. • Demand: Possibilityofcumulativedispensationto 3 yearsperiod (at least 450.000€) in order toallowmoreflexibilityforsmallerinvestments. • CEMR demand: Withinthe PP reformprocess, thresholdsshould also beincreased in order to cover onlycontractswith relevant impact on theinternalmarket, currentthresholdsparticularlyforservicesandgoodsaretoolow. • Question:How will theCommissioncreateconsistancy in termsofthresholds in thefuture PP reform?

  7. General Block Exemption Decision • The reductionofthresholdfrom 30 millionto 15 millionis not consistantwiththedifferentiationmadebetween large network SGEI andlocal SGEI. • Positive: exemptionofnewcategoriesofsocialservicesfromthenotificationrequirementirrespectiveoftheamout (healthservices, childcare, accesstotheemploymentmarket, socialhousing, careandsocialinclusionor vulnerable groupsofpopulation). • CEMR demand:thislistofexemptedcategoriesshouldbeextendedtotheserviceswhicharelisted in Annex II part B oftheDirective 2004/18/EC in order tobecompatibleandcoherent (in Annex II B ambulanceservicesshouldbeaddedaspredominatelyhealthservices)

  8. Conclusion • State Aid rules and PP rules have a common aim and should therefore be consistent and not contradict each other. • State Aid rules and PP rules should be synchronised and allow public authorities and local practitioners to apply them in a context of legal certainty.

  9. Thank you for your attention!

  10. Contact: Tanja Struve Rechtsanwältin German County Association Deutscher Landkreistag Brussels Office Europabüro Avenue des Nerviens 9 - 31 B - 1040 Brussels Tel.: +32 (0) 2 740 16 - 32 Fax: +32 (0) 2 740 16 - 31 E-Mail: Tanja.Struve@eurocommunalle.org Website: www.Landkreistag.de

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