Social Services of General Interest (SSGI)

Social Services of General Interest
scheme means any procedure under which a provider is in effect required to take steps in
order to obtain from a competent authority a formal decision, or an implied decision,
concerning access to a service activity or the exercise thereof. 94 Such schemes may in future
be maintained only if they are non-discriminatory and justified by an overriding reason
relating to the public interest.
2. Competition law
2.1. Current situation and problem description
Another important gate where Community law enters national law is that of
competition rules laid down by the EC Treaty. The provision of social services is frequently
organised, coordinated or otherwise influenced by government entities or by entities for
which the State traditionally takes particular responsibility. As far as this may affect
competition in the social sector, such conduct might, under certain circumstances, be subject
to antitrust rules under Art 81 EC.
Another typical characteristic of the social sector is that certain social services, such as
probation services, assistance services to refugees, etc., are basically only required by public
entities. If these service-demanding entities act as entities which control the markets (markets
that need to be appropriately defined), the requirements of Art 82 EC need to be observed.
Examples would be the enforcement of unreasonable prices or business conditions 95 or
discriminatory conditions that would place individual providers at a competitive
disadvantage. 96
2.2. Social entities as undertakings within the meaning of competition law
Application of competition rules will depend on compliance with a number of
characteristics irrespective of the special provisions of Art 86(2) EC. The definition of the
concept of undertaking is of key importance in this context. The supply and demand
behaviour of public entities will come under competition rules whenever it concerns
economic activities. The problem is similar to that of providing a distinction for the
fundamental freedoms. 97 Moreover, the Court of Justice ruled in its most recent case-law 98
that also the demand-side behaviour of public entities that engage in non-economic activity on
the supply side would be exempt from the scope of competition rules. The criteria used by the
ECJ are of great relevance to the social sector. 99
Previous considerations in this study have addressed the circumstances under which
the provision of any given service should be seen as an economic activity. This is different
from the issue of whether also the demand for any given service (or merchandise) may in
itself constitute an economic activity and thus be subject to competition law. This can be of
94 see Art 4(6) SD.
95 for more details see Eil 24 ff with added references
96 see Eilmansberger (FN 95) Art 82 par. 35 ff with references.
97 see also section I.1 above.
98 Joined Cases C-264/01, C-306/01, C-354/01 and C-355/01, AOK Bundesverband, ECR 2004, I-2493; and
Case C-205/03 P, FENIN, ECR 2006, I-6295. for more see Krajewski/Farley, Non-economic activities in
upstream and downstream markets and the scope of competition law after FENIN, ELR 2007, 109; critique
(“detrimental effect on social welfare”) Roth, commentary on FENIN judgment, CMLR 2007, 1131, 1140,
also invoking national case-law contrary to German and UK competition law.
99 see for instance Case C-475/99 Ambulanz Glöckner, ECR 2001, I-8089.
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