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State Aid control

Services of general economic interest (public services)

Services of general economic interest (SGEI) are economic activities that public authorities identify as being of particular importance to citizens and that would not be supplied (or would be supplied under different conditions) if there were no public intervention. Examples are transport networks, postal services and social services.


State aid rules and compensation for services of general economic interest

State aid control comes into play when these services are provided by a company and financed through public resources, in particular because overly generous compensation could enable the service providers to cross-subsidise their other commercial activities, and thereby distort competition.

In its 2003 Altmark judgement, the European Court of Justice held that public service compensation does not constitute State aid
when four cumulative conditions are met:

  • the recipient undertaking must have public service obligations and the obligations must be clearly defined;
  • the parameters for calculating the compensation must be objective, transparent and established in advance
  • the compensation cannot exceed what is necessary to cover all or part of the costs incurred in the discharge of the public service obligations, taking into account the relevant receipts and a reasonable profit;
  • Where the undertaking which is to discharge public service obligations is not chosen pursuant to a public procurement procedure which would allow for the selection of the tenderer capable of providing those services at the least cost to the community, the level of compensation needed must be determined on the basis of an analysis of the costs of a typical well-run company.

Where at least one of the Altmark conditions is not fulfilled, the public service compensation will be examined under State aid rules.


Legislation in force

  (This page contains the legislation currently in force as well as public consultations on the revision of the rules and the previous legislative package.)

The new State aid package for SGEI

Frequently asked questions on the application of State aid rules to SGEIs

Guide on the application of the EU rules on state aid, public procurement and the internal market to servics of general economic interest, and in particular to social services of general interest

This guide provides answers to the most frequent questions asked by public authorities, service users and providers, and other stakeholders. It addresses, for example, the scope of Member States to define SGEI, the requirements for the legal act that entrusts the provider with the SGEI and the rules on how the provider can receive compensation for the provision of the SGEI.

This version takes into account the new state aid rules on SGEI adopted in December 2011 and April 2012.
bg cs da de el en es et fi fr hu it lt lv mt nl pl pt ro sk sl sv (18.02.2013).
Press release: Commission publishes updated Guide on services of general economic interest (SGEI)

An information service is also available to answer further questions on the application of EU rules to SGEIs.

Member States reports on the application of the SGEI decision

Related links

Archive

  
go to consultation carried out in 2010
Services of General Economic Interest(includes links to recent reports)