Brussels, 03/05/2011 (Agence Europe) - In a speech delivered in Brussels on 2 May as part of the EPC Policy Dialogue, European Commission Vice-President with responsibility for Competition Joaquín Almunia set out the broad thrust behind the new rules which will apply, with effect from 1 December, to the funding of services of general economic interest (SGEI).
These rules will replace the framework decision which has been in force since 2005 (the Monti-Kroes package) and the Commission is getting down to the work of gathering the final observations of interested parties, following a wide-ranging consultation in 2010 and a communication published in March (see EUROPE 10343).
The Commission, he said, must ensure that pubic funding of these services does not affect competition in the internal market. The new rules, based on Article 106, give it exclusive power to assess compensation from states for the provision of public services.
After briefly setting out the conditions that the current package imposes in terms of notification and funding of public service provisions, Almunia took stock of the shortcomings in the current rules revealed by the consultation, shortcomings the Commission must try to remedy. Thus, for example, the rules seem not to be sufficiently flexible for many small social services providers (those offering advice to people in difficulty, assistance for the homeless, etc); they are not always properly understood and, as a result, are often not applied; some of their points seem vague (the notion of economic activity, the exact definition of SGEI, the notion of an effect on trade between member states, the conditions to be met to qualify for public aid, etc).
He set out the general objectives the Commission hoped to attain: - focusing scrutiny on the public financing of the services that have a significant impact on the internal market; - making the services “more efficient” without straining public budgets; - clarifying, simplifying and diversifying its rules. He detailed a number of improvements, such as a closer definition of notions such as “economic activity” and “reasonable profit”, simplification of the rules for certain types of small-scale public services, checking for over-compensation only once the contract comes to an end, introducing different block-exemption requirements for different services, etc. The commissioner also put forward a number of suggestions for large-scale bodies on, inter alia, improving efficiency over the life of the contract and calls for tender. (F.G./transl.rt)