Social Services of General Interest (SSGI)

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Subsidies allocated for the construction of service areas for road haulage vehicles in Tenerife cannot affect trade between Member States: Commission Decision NN 29/02, Spain – Aid for the installation of service areas on Tenerife, OJ 2003 C 110/14. Restriction on trade between Member States is to be denied concerning subsidies for regional theatre productions which, owing to their language-specific characteristics, have no international diffusion and whose catchment area is limited to about 50 km: Commission Decision N 257/2007, subsidies for theatre productions, OJ 2007 C 173/1; in this sense also Commission Decision N 448/2005, Theatre, musical and dance, OJ 2006 C 89/6. 44 another Member State. ECJ Case C- 70/95 Sodemare, ECR 1997, I-3395, par. 36ff. of 13-3-2008, Case C-454/06, pressetext Nachrichtenagentur, par. 114.
Social Services of General Interest II. Need for legal policy action and requirements for a possible legal instrument on social services of general interest 1. Legal basis If Community lawmakers are to take action on the issue of social services the Treaty has to provide some legal basis for them to act within the limits of the powers conferred upon them by this Treaty. De lege lata Art 86(3) EC would be the first option, as it gives the Commission the power to address appropriate directives or decisions to Member States for the purpose of regulating services of general economic interest. 173 However, case-law of the Court of Justice concerning reliance on this provision in liberalising telecommunication markets 174 shows that Art 86(3) EC cannot be used as a general legislative basis for regulating services of general interest. This is why the Commission later suggested taking further steps of liberalisation on the basis of Art 95 EC, which has led to greater involvement of the European Parliament under the co-decision procedure. De lege ferenda Art 16(3) EC (=Art 14(3)) of the Treaty of Lisbon creates a suitable legal basis. Under this provision the European Parliament and the Council may adopt regulations relating to services of general economic interest wherein they establish the principles and set the conditions for their operation. Ordinary legislative procedure is to be applied for this purpose. But Art 16 EC links this legal basis with specific requirements which limit Community lawmaking powers, while also according wide discretionary powers. For one thing, the principles and conditions, particularly economic and financial conditions, are to be such that they enable SGEIs to fulfil their missions. For another thing, a legal act according to Art 16 EC must not prejudice the competence of Member States, in compliance with the Treaties, to provide, to commission and to fund such services. This has to be borne in mind when defining the contents for such a legal act. Certain guidance can be sought from primary law provisions. The ‘principles and conditions, particularly economic and financial conditions’ mentioned in the Treaty certainly also include rules relating to the funding of services of general interest and the granting of special or exclusive rights to ensure operation of services of general interest. Hence the legal act could be used to better define certain aspects of these areas. In addition, a legal act on the basis of Art 16 EC would also be a suitable instrument for clarifying a number of horizontal questions raised in the first part of this paper. 2. Details on the contents of such a possible legal act 2.1. The distinction between economic and non-economic activities As pointed out in the first part, distinction between economic and non-economic activities is still subject to very unclear criteria. Case-law can only provide very rough outlines. This has led to considerable legal uncertainty especially in the social sector. This could be remedied by a new legal act providing clear distinction. This would have the major advantage of lifting questions of distinction to a political level, i.e. have the European Parliament and Council decide in an ordinary legislative procedure. 173 for the possibilities and limits of the Commission’s lawmaking powers see Cruz, Beyond Competition: Services of General Interest and European Community Law, in de Burca, EU Law and the Welfare State (2005) 169, 198 ff with added references. 174 Joined Cases C-271/90, C-281/90 and C-289/90, Spain v Commission, ECR 1992, I-5833. 45
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