OPINION OF ADVOCATE GENERAL

POIARES MADURO

delivered on 10 November 2005 1([1](#Footnote1))

**Case C-205/03 P**

**Federación Española de Empresas de Tecnología Sanitaria (FENIN), formerly Federación Nacional de Empresas, Instrumentación
Científica, Médica, Técnica y Dental**

(Appeal – Organisations managing the Spanish national health system – Concept of undertaking – Terms of payment imposed on suppliers of medical goods and equipment)


1.     In order for an entity to be subject to Community competition law, it must be classified as an undertaking. Although the EC
Treaty makes frequent reference to the concept, it does not define it and it has instead been clarified in case-law, which
gives it a functional content. It has been established that an entity engaged in an economic activity is an undertaking for
the purposes of Articles 81 EC to 86 EC, irrespective of its legal status and the way in which it is financed. ([2](#Footnote2)) While it is accepted that certain tasks in the public interest such as the maintenance and improvement of air navigation
safety ([3](#Footnote3)) and the protection of the environment ([4](#Footnote4)) are not economic in nature, it is less easy, where activities are linked to the operation of the national social security
system, to determine when they may be classified as non‐economic, since the case-law in this field undertakes a case-by-case
analysis, and asks whether the principle of solidarity requires that the application of the Community competition rules be
excluded. It is difficult to specify the circumstances in which that principle will result in an activity being classified
as non-economic in nature.

2.     The question at the heart of this case concerns the purchase of medical instruments by a public body responsible for the management
of the Spanish national health system (‘the SNS’). Two issues are of particular importance. It is necessary, first, to establish
whether the fact that the activity carried on by that body is subject to the principle of solidarity prevents it being classified
as an undertaking and, secondly, whether it is possible to separate its purchasing activities from those of providing health
services.

3.     The Federación Española de Empresas de Tecnología Sanitaria (‘FENIN’) has appealed against the judgment of 4 March 2003 in
Case T‐319/99 *FENIN* v *Commission* [2003] ECR II-357 (‘the judgment under appeal’) by which the Court of First Instance of the European Communities confirmed
the decision of the Commission of the European Communities rejecting a complaint, which held that competition law did not
apply to the body in question, on the basis that it was not an undertaking. By this appeal, the Court of Justice is called
upon to rule on whether that conclusion accords with the concept of an undertaking, as it is defined in case-law.

I –  **Background to the appeal**

4.     The judgment under appeal shows that the dispute originates in a decision of the Commission of 26 August 1999 (‘the contested
act’) not to allow a complaint submitted by FENIN seeking a declaration that 26 public bodies, including three ministries
of the Spanish Government, which run the SNS, had infringed Article 82 EC by paying sums invoiced to them by FENIN only after
a considerable delay, amounting to 300 days on average.

5.     FENIN is an association of the majority of undertakings which market medical goods and equipment used in Spanish hospitals.
On 12 December 1997, it submitted a complaint to the Commission alleging that the organisations managing the SNS were in a
dominant position on the Spanish market for medical goods and equipment and that they had abused that position by delaying
payment of their debts. FENIN submitted additional observations to the Commission on 12 May 1998. By letter of 2 December
1998, the Commission informed the appellant of its provisional decision to reject the complaint. FENIN replied to the Commission
by observations dated 10 February 1999. The contested act definitively rejected FENIN’s complaint, first, on the ground that
‘the 26 ministries and other organisations in question [were] not acting as undertakings when they [participated] in the management
of the public health service’ and, secondly, that ‘the demand of the 26 ministries and other organisations [could not] be
dissociated from the subsequent supply which they provide’. The Commission deduced from that that the organisations in question
were not acting as undertakings and were accordingly not subject to Article 82 EC.

6.     By application lodged at the Registry of the Court of First Instance on 10 November 1999, FENIN brought an action for the
annulment of the contested act on the ground inter alia that the Commission had committed a manifest error of assessment in
the application of Articles 82 EC and 86 EC. The Commission maintained that, in assessing the position of the SNS, it had
applied the functional criterion of the definition of an undertaking, as laid down by the Court of Justice in *Poucet and Pistre*. ([5](#Footnote5))

7.     In the judgment under appeal, the Court of First Instance dismissed the action brought by FENIN and held that the Commission
had correctly applied the concept of an undertaking within the meaning of Articles 82 EC and 86 EC. That Court adopted a three-stage
approach in reaching that conclusion. First, in paragraph 36 of the judgment, it distinguished between purchasing and supplying
activities, stating that ‘it is the activity consisting in offering goods and services on a given market that is the characteristic
feature of an economic activity ... , not the business of purchasing, as such’. The Court of First Instance went on to hold
that ‘it would be incorrect, when determining the nature of that subsequent activity, to dissociate the activity of purchasing
goods from the subsequent use to which they are put’. It is therefore necessary to consider whether or not the use of the
purchased goods amounts to an economic activity. The Court of First Instance based its analysis on *Poucet and Pistre* and *FFSA and Others*, ([6](#Footnote6)) in order to hold, in paragraph 39 of the judgment under appeal, that ‘the SNS, managed by the ministries and other organisations
cited in the applicant’s complaint, operates according to the principle of solidarity in that it is funded from social security
contributions and other State funding and in that it provides services free of charge to its members on the basis of universal
cover’. Accordingly, the purchasing activities linked to an activity which was not of an economic nature were classified in
the same way. The organisations covered by FENIN’s complaint were accordingly not undertakings for the purposes of Articles
82 EC and 86 EC.

8.     FENIN’s appeal is against that part of the judgment under appeal. FENIN relies on the single ground of appeal that the Court
of First Instance incorrectly interpreted the concept of an undertaking within the meaning of Community competition law. By
the first part of the appeal, FENIN submits that the Court of First Instance was wrong in failing to hold that the purchasing
business was an economic activity and that it incorrectly linked the nature of the purchasing activity to that of the service
subsequently provided. By the second part, FENIN argues in the alternative that the Court of First Instance should have held
that the purchasing activity is an economic activity because the subsequent activity, namely the provision of medical care,
is economic in nature. In its submissions in reply, the Commission maintains that the analysis undertaken by the Court of
First Instance in the judgment under appeal is consistent with the interpretation of the concept of an undertaking for the
purposes of Community competition law, as adopted in case-law. The Commission also contends that the second part of the appeal
is inadmissible, since it was put forward for the first time at the stage of the appeal. Furthermore, that plea is tantamount
to challenging the assessment of the facts by the Court of First Instance, which cannot be the subject of an appeal. The United
Kingdom and the Kingdom of Spain have intervened in support of the Commission’s position. They consider that neither purchasing,
as such, nor the provision of medical care constitute an economic activity.

9.     Before examining in turn the two parts of the single ground of appeal, it is appropriate to give preliminary consideration
to the concept of an undertaking within the meaning of Community competition law, as established by the case‐law of the Court.
Reference will also be made to the practice of the courts and competition authorities of the Member States.

II –  **Preliminary issue: the concept of an undertaking**

10.   As was mentioned above, the classification of an entity as an undertaking for the purposes of Community law depends on the
economic nature of the activity carried on by it. As each activity carried on by the entity falls to be analysed separately,
it is quite possible for an entity to be treated as an undertaking as regards some of its activities, while others fall outside
the sphere of competition law. ([7](#Footnote7)) In order to differentiate between economic and non-economic activities, the case‐law relies on concurrent criteria, which
are used either cumulatively or alternatively. It is necessary to set these out, since the basis of FENIN’s appeal is that
the Court of First Instance wrongly applied that case-law.

A –    *Case-law relating to the concept of an undertaking*

11.   The use of a comparative criterion, which lies at the root of a functional and wide-ranging approach to the concept of an
undertaking, dates from the judgment in *Höfner and Elser*. The Court held that the activity concerned was economic in nature, since ‘employment procurement has not always been, and
is not necessarily, carried out by public entities’. ([8](#Footnote8)) In his Opinion in *Poucet and Pistre*, Advocate General Tesauro adopted the same reasoning and considered that the activity in question could be carried on only
by a public body and could not be assimilated with the insurance activities carried on by private undertakings. He therefore
concluded that the entity in question was not an undertaking. ([9](#Footnote9)) The judgment in *Ambulanz Glöckner* offers a further illustration of the use of the comparative criterion by the Court: health organisations providing services
on the market for emergency and ambulance services were held to be undertakings, because ‘such activities have not always
been, and are not necessarily, carried on by such organisations or by public authorities’. ([10](#Footnote10))

12.   Where there is no competitive market on which a number of undertakings act in competition, the question of the economic nature
of an activity and the application of the comparative criterion become more difficult. So that the absence of effective competition
on a market does not lead to its automatic exclusion from the scope of competition law, the comparative criterion therefore
extends the concept of an economic activity to include any activity capable of being carried on by a profit-making organisation.
([11](#Footnote11)) While the Court does not undertake that comparison as a matter of course, it refers in nearly all its judgments relating
to the concept of an undertaking to *Höfner and Elser*, which remains the starting point for its analysis. However, that comparative criterion would, literally applied, enable
any activity to be included within the scope of competition law. ([12](#Footnote12)) Almost all activities are capable of being carried on by private operators. Thus, there is nothing in theory to prevent the
defence of a State being contracted out, and there have been examples of this in the past. Accordingly, in its subsequent
judgments, the Court elaborated on that concept by linking it to participation in a market.

13.   The second criterion developed by case-law for the purposes of classifying an activity as economic in nature is that of participation
in a market or the carrying on of an activity in a market context. While in *Höfner and Elser* the economic nature of the activity stemmed only implicitly from participation in a market, since the State allowed private
undertakings to participate in the market, in other cases the Court has established a clear link between participation in
a market and the carrying on of an economic activity. In holding that Italian customs agents are undertakings, the Court described
their activities as follows: ‘they offer, for payment, services consisting in the carrying out of customs formalities, relating
in particular to the importation, exportation and transit of goods, as well as other complementary services such as services
in monetary, commercial and fiscal areas’. ([13](#Footnote13)) In subsequent judgments, the Court directly assimilated participation in a market with the economic nature of the activity
carried on. Thus, it stated in *Pavlov and Others* and *Ambulanz Glöckner* that ‘any activity consisting in offering goods and services on a given market is an economic activity’. ([14](#Footnote14)) It is not the mere fact that the activity may, in theory, be carried on by private operators which is decisive, but the fact
that the activity is carried on under market conditions. Those conditions are distinguished by conduct which is undertaken
with the objective of capitalisation, which is incompatible with the principle of solidarity. That allows it to be determined
whether a market exists or not, even if the legislation in force prevents genuine competition emerging on that market. By
contrast, where the State allows partial competition to arise, the activity in question necessarily implies participation
in a market.

14.   That is the context in which the references in case-law to the capacity to commit infringements of competition law can be
understood, as the basis for categorising an entity as an undertaking. ([15](#Footnote15)) Even if no profit-making activity is carried on, there may be participation in the market capable of undermining the objectives
of competition law. The Court’s case-law should not be interpreted as meaning that that criterion is sufficient to establish
that an entity is to be classified as an undertaking, but it supports a conclusion that competition law should apply.

15.   Apart from the criteria set out above, which have led the Court to hold in various cases that an entity was an undertaking,
it is also relevant to consider the case-law where the Court has classified certain activities as ‘non‐economic’. Such a classification
allows, a contrario, the scope of Community competition law to be defined. The Court will look to the nature, the aim and
the rules which govern an activity. ([16](#Footnote16)) That analysis has led to it excluding from the scope of competition law tasks in the public interest such as the maintenance
of air navigation safety ([17](#Footnote17)) and the protection of the environment, ([18](#Footnote18)) as those activities are considered to form part of the essential functions of the State. ([19](#Footnote19)) More generally, all cases which involve the exercise of official authority for the purpose of regulating the market and not
with a view to participating in it fall outside the scope of competition law. ([20](#Footnote20))

16.   Although the health sector is more and more open to competition, most commonly as a result of reforms introduced by the national
legislature, ([21](#Footnote21)) entire parts of the sector remain the exclusive preserve of the activity of the State. In any event, competition law can
apply to the sector only in so far as solidarity does not predominate in it. In order to determine the degree of solidarity
involved, the Court has adopted, in the judgments it has delivered on the subject, a range of tests for determining whether
compulsory membership of pension, insurance or retirement schemes complies with competition law. In two cases, it held that
the activity in question was not economic in nature, and in three cases it reached a contrary conclusion.

17.   In *Poucet and Pistre*, the question arose as to the compatibility with competition law of compulsory membership of a social security scheme. There
being no particular activity at issue in the case, the Court referred to the nature of the organisations concerned. The operative
part of the judgment states that ‘the concept of undertaking within the meaning of Articles 85 and 86 of the Treaty does not
encompass organisations charged with the management of social security schemes of the kind referred to in the judgments of
the national court’. In order to reach that conclusion and without indicating the degree of importance it attached to each
element taken in isolation, the Court noted that ‘those schemes pursue a social objective and embody the principle of solidarity’.
([22](#Footnote22)) Consideration of the manner in which the principle of solidarity is embodied should form the basis of the classification,
([23](#Footnote23)) while the ‘exclusively social’ function fulfilled by those organisations ‘is based on the principle of national solidarity
and is entirely non‐profit-making’. The Court also noted that ‘the benefits paid are statutory benefits bearing no relation
to the amount of the contributions’. ([24](#Footnote24))

18.   In *Cisal*, it was necessary to determine whether compulsory membership of a national insurance scheme against accidents at work and
occupational diseases satisfied the requirements of Articles 82 EC and 86 EC. The Court held that the organisation concerned,
the Istituto nazionale per l’assicurazione contro gli infortuni sul lavoro (Italian national institute for insurance against
accidents at work, ‘the INAIL’), operated in accordance with the principle of solidarity ([25](#Footnote25)) and that it was subject to the control of the State, which set the level of contributions and determined that membership
was to be compulsory. The Court therefore held that the INAIL did not carry on an economic activity, with the result that
competition law did not apply.

19.   The question before the Court in *FFSA and Others* related to the monopoly of management of an old-age insurance scheme conferred on a mutual fund. Upon analysis, the Court
held that the bodies managing the supplementary and optional retirement scheme were undertakings. It emphasised the fact that
membership of the retirement scheme was optional, that the scheme was managed in accordance with the principle of capitalisation
and that benefits were calculated on the basis of contributions made. Competition with life-assurance undertakings was thus
impliedly acknowledged to exist. Lastly, although elements of solidarity were present, they could not alter the conclusion
that the bodies were undertakings.

20.   A Netherlands sectoral pension fund which was considered by the Court in *Albany*([26](#Footnote26)) was also held to be an undertaking for the purposes of competition law. Three factors were referred to, namely the fact that
membership of the fund was optional, the fact that the fund was managed in accordance with the principle of capitalisation
and the fact that benefits were proportionate to contributions, from which it was deduced that an element of competition was
involved between the fund and life-assurance companies in the private sector. The pursuit of a social objective, the fact
that the fund was non-profit-making, the requirement of solidarity and the statutory restrictions applying were not sufficient
to ‘deprive’ the activity carried on of its economic nature. The solidarity established by the fund was limited, because its
benefits extended only to its members.

21.   Similar reasoning was adopted in *Pavlov and Others*. The Court described the similarities between the supplementary pension scheme for doctors in the Netherlands and a private
undertaking managing life assurance, and went on to hold that the requirements of solidarity imposed on the organisation could
not affect the fact that it was an undertaking.

22.   Finally, reference should be made to *AOK-Bundesverband and Others*, where the issue before the Court was not one of membership of a retirement scheme or a fund, but the setting by sickness
funds in Germany of maximum amounts to be paid for medicinal products. Although it was open to it to do so, the Court did
not exclude the possibility of the funds being classified as undertakings on the ground that their duties involved the regulation
of the market. It reached its conclusion on the basis of the manner in which the State had implemented the concept of solidarity,
since the nature of the competition which existed in the health insurance sector meant that market conditions could not be
created. Nevertheless, it should be noted that, in paragraph 58 of the judgment, the Court expressly left open the possibility
of the organisations in question acting as undertakings when ‘they engage[d] in operations which have a purpose that is not
social’.

B –    *The criterion applied at national level*

23.   A study of comparative law shows that the national law of the Member States adopts criteria similar to those developed by
the Court. It will be useful to give some examples, since they show how the national authorities and national courts have
interpreted the concept of an undertaking. The criteria used by the Community Courts are to be found in German ([27](#Footnote27)) and Spanish ([28](#Footnote28)) decisions. It appears that a State body will be considered to be an undertaking subject to competition law where it carries
on an activity on a market and that activity is capable of having anti‐competitive effects.

24.   The judgment of the Competition Commission Appeal Tribunal in England in *BetterCare* v *The Director General of Fair Trading* ([29](#Footnote29)) is particularly noteworthy. North & West Belfast Health & Social Services Trust (‘N&W’) was required under statute to provide
nursing home and residential care services for elderly persons. N&W was the owner of residential and nursing homes, some of
which were managed by private undertakings. One of those undertakings, BetterCare, complained that N&W was abusing its dominant
position since, as the sole purchaser of BetterCare’s services, it was forcing it to agree to unduly low prices. The Tribunal
held that the decisive factor was the fact that N&W engaged in commercial transactions in services with private undertakings
which managed the homes, with the result that its activities were of a commercial nature. The Tribunal also held that the
management of homes and the provision of nursing care were a matter for the private sector and that, in that context, N&W
was in competition with private operators. Lastly, the Tribunal noted that N&W was in a position to infringe competition law.

25.   The fact that an activity is carried on by a State entity in satisfaction of a statutory requirement may go towards it being
held not to be of an economic nature under Finnish law. The competition authority nevertheless held that a public hospital
accused of charging predatory prices for laboratory and radiology services on the private market could be considered to be
subject to competition law. ([30](#Footnote30)) Similarly, in Swedish case-law, the exercise of a power by a public authority is not subject to competition law provided
it is undertaken on the basis of a statutory requirement. ([31](#Footnote31)) By contrast, the Irish authorities merely distinguish between economic activities and the exercise of regulatory functions
or those involving the organisation of the workforce. The Irish competition authority accordingly held that a health authority
responsible for administering health services and the provision of hospital services in a particular area which held fixed
assets under lease was carrying on an economic activity. ([32](#Footnote32))

C –    *The applicable criterion*

26.   In seeking to determine whether an activity carried on by the State or a State entity is of an economic nature, the Court
is entering dangerous territory, since it must find a balance between the need to protect undistorted competition on the common
market and respect for the powers of the Member States. ([33](#Footnote33)) The power of the State which is exercised in the political sphere is subject to democratic control. A different type of control
is imposed on economic operators acting on a market: their conduct is governed by competition law. But there is no justification,
when the State is acting as an economic operator, for relieving its actions of all control. On the contrary, it must observe
the same rules in such cases. It is therefore essential to establish a clear criterion for determining the point at which
competition law becomes applicable. In principle, the rules of competition law apply only to economic operators who participate
on a market and not to States, save where they pay aid to undertakings (Articles 88 EC to 92 EC). However, the need for consistency
means that if a State ratifies decisions taken by undertakings ([34](#Footnote34)) or if it conducts itself in practice as an economic operator, Articles 81 EC to 86 EC may apply to it. It should be added
that Article 86(2) EC would be rendered redundant if competition law were no longer to apply as soon as the State is present
on a market. ([35](#Footnote35))

27.   It is true that to introduce a requirement of competition in sectors which have no market characteristics would be meaningless.
That would risk imposing a requirement on Member States to justify their position under Article 86(2) EC as a matter of course
and would represent an unlimited extension of the scope of competition law. Above all, the State does not primarily act as
an operator on the market, since one of its main roles is to put in place systems for redistribution. In that context, since
action by the State is governed only by an objective of solidarity, it bears no relation to the market. Competition law applies
to it only in so far as the bodies responsible for achieving the objectives of solidarity are to be treated as undertakings.
By contrast, that law will not apply if the exercise of the activity does not involve the pursuit of an objective of capitalisation
in any way, with the result that there can be no market. The State is none the less under a duty to act consistently: it is
free to withdraw certain activities from the market only on the condition that it effectively implements the principle of
solidarity and gives effect to redistribution policies. In effect, the State assumes two distinct roles, depending on whether
it is acting as an operator on a market or whether it is acting for political purposes, inspired by considerations of solidarity.
But it cannot shelter behind the pretext of solidarity in order to avoid economic operators being subject to competition law.

28.   Two cases fall to be distinguished. First, if private organisations and public bodies carry on the same activity, competition,
even of a limited and circumscribed nature, may have a role to play between them. The fact that the two kinds of entity carry
on the same activity means that the services provided are similar and that they respond to the same demand on the market.
The Court does not use the comparative criterion to mean that any activity where the State plays a role must be liberalised,
but none the less seeks to avoid a situation where public bodies may act in competition with undertakings while at the same
time claiming immunity from competition law. *Höfner and Elser* may be interpreted in the light of that approach. It appears that a decisive factor in the Court’s reasoning was the State’s
inability to satisfy the demand presented by the market, since, in practice, it allowed its exclusive rights in the recruitment
field to be encroached on by private companies. ([36](#Footnote36)) It remains open to the State to combine market conditions in this sector with restrictions, such as the obligation to provide
a universal service. ([37](#Footnote37)) Organisations placed under the control of the State will then be treated as undertakings entrusted with the operation of
services of general economic interest, as defined in Article 86(2) EC. It will be necessary to determine whether the conditions
specified in that article are satisfied, that is to say whether the application of the competition rules does not prevent
them achieving their task. It is at this point that social requirements will be taken into account in the light of the objective
of maintaining undistorted competition. ([38](#Footnote38))

29.   Secondly, where the State has reserved to itself a statutory monopoly for carrying on an activity, which means that no effective
competition can arise, the possibility none the less remains that it is acting as an operator on the market, as the existence
of such a monopoly will not change the nature of the activity in question. ([39](#Footnote39)) Within that framework, on the basis of relevant factors, it will be necessary to establish whether the activity is organised
in such a way that the requirements of solidarity are satisfied in all material respects or whether, on the contrary, it operates
on the basis of the market and pursues an objective of capitalisation. The inability of the organisation in question to break
even without a contribution from the State will be evidence that it is the first of these situations which applies.

30.   Whatever the field in question, the degree of solidarity put in place by the State may be more, or less, strong. In the insurance
sector, as the Court has held in its case-law regarding membership of retirement or sickness funds, there are three factors
which allow the degree of solidarity to be measured: whether membership is compulsory, the link between the contributions
payable and the risk to which the insured is exposed, or, on the other hand, where solidarity is relevant, with his income,
and, lastly, the relationship between the benefits dispensed and the contributions paid. ([40](#Footnote40))

31.   Where it is a question of measuring the degree of solidarity involved in the provision of a service, the relevant parameters
are different. A guarantee of universal access to users, whether in the field of health, telecommunications or energy, implies
solidarity in so far as any differences in actual costs are eliminated in favour of a uniform price. Nevertheless, the constraints
imposed by universality of access are not, by themselves, capable of rendering the activity concerned non‐economic in nature.
A higher level of solidarity is achieved where the service in question is available free of charge, as there is then no connection
between the cost of providing the service and the price paid by the user. One final factor is decisive in determining that
a sector does not operate under market conditions. If public and private entities provide the same services, any analysis
will have to be undertaken within the framework of Article 86(2) EC. By contrast, if health care services may be delivered
only by bodies controlled by the State, which are obliged to treat all patients coming to them free of charge, there can be
no question of market forces being involved, and the activity will then be guided solely by the principle of solidarity.

32.   Although the present case involves the health sector, it can none the less be distinguished from the cases referred to above.
The judgment under appeal shows, that while the SNS manages the health insurance system in Spain, it is also responsible for
providing health care services to its members. If the relationships of the recipients of the health care with the organisation
in charge of the national health system were at issue, it would be appropriate to rely on the criteria for assessing the degree
of solidarity of the system, as developed by the Court since *Poucet and Pistre*. However, the point raised by the appeal is a different one, as it involves the economic nature, on the one hand, of the
provision of free health care services to members and, on the other, of the purchase of medical goods and equipment from suppliers
(paragraph 40 of the judgment under appeal). In order to address that point, it will be necessary, in the light of the analysis
set out above, to determine whether the judgment under appeal was correct in holding that those activities are not economic
in nature.

III –  **Assessment of the ground of appeal**

33.   After dealing with the Commission’s objections as to admissibility, I shall first consider the second part of the appeal,
as, if the Court of First Instance was incorrect in classifying the provision of free health care services by the SNS as non-economic
in nature, its conclusion would thereby be affected. Secondly, I shall address the connection between the purchases and the
use to which they are put, which forms the subject-matter of the first part of the appeal.

A –    *Admissibility*

34.   The Commission submits that the second part of the ground of appeal raised by FENIN is inadmissible because it was never raised
at first instance and because it relates to questions of fact.

35.   According to the Commission, FENIN did not, in its written pleadings before the Court of First Instance, raise the issue that
the activity carried on by the organisations managing the SNS as providers of health care services does not constitute an
economic activity.

36.   It must however be noted that in reply to a question put by the Court of First Instance on 8 February 2002 regarding the judgment
in *Smits and Peerbooms*, ([41](#Footnote41)) the appellant commented on the economic characteristics of health services provided free of charge. Accordingly, since the
classification of that activity, which the SNS carries out, formed part of the discussion before the Court of First Instance,
it should be held that it formed part of the subject-matter of the dispute before it.

37.   Furthermore, the Court of First Instance addressed that question in paragraph 40 of its judgment, where it held that the activity
was non‐economic in nature. It is settled that a party may challenge the reasoning which forms the basis of the ratio of the
judgment. ([42](#Footnote42)) The second part of the ground of appeal should therefore be declared to be admissible.

38.   The classification of an activity as economic or non-economic, as undertaken in paragraph 39 of the judgment under appeal
in relation to the free provision of health services, is a matter which is subject to review by the Court under the appeal
and is not a finding of fact. ([43](#Footnote43)) It follows that none of the grounds of inadmissibility raised by the Commission is such that the second part of the appeal
should be rejected.

B –    *The nature of the activity comprising the free provision of health services to members of the SNS*

39.   In paragraph 39 of the judgment under appeal, the Court of First Instance held that ‘the SNS, managed by the ministries and
other organisations cited in the applicant’s complaint, operates according to the principle of solidarity in that it is funded
from social security contributions and other State funding and in that it provides services free of charge to its members
on the basis of universal cover’. Applying the case-law of the Court of Justice regarding the concept of an undertaking, the
Court of First Instance deduced from that that ‘in managing the SNS, these organisations do not ... act as undertakings’.

40.   According to the appellant, the Court of First Instance committed two errors of law, the first in failing to give a functional
interpretation to the concept of an economic activity, and the second in giving a wide interpretation to the principle of
solidarity.

41.   The appellant maintains that the first error arises from the failure of the Court of First Instance to classify each activity
of the SNS separately. That Court classified the activities of the SNS from an overall perspective, without taking account
of the fact that the SNS both provides compulsory health insurance cover to its members and is required to provide them with
health care services free of charge. Even if the fact of being insured implies a right to treatment, the provision of health
care services can be considered separately from the requirement to have insurance. While the compulsory insurance requirement
may be governed by the principle of solidarity, so long as competition between health service providers prevails, those insured
remain free to choose who will treat them.

42.   The judgment under appeal shows that the SNS is indeed entrusted with both those activities. It is also clear that, rather
than classifying each activity separately, the Court of First Instance adopted a single, global, classification of the SNS.

43.   Case-law shows that it is essential to consider each activity carried out by an organisation separately, in order to determine
whether it should be classified as an economic activity. ([44](#Footnote44)) A separate classification, on the basis of each activity undertaken, is all the more necessary where a public body is concerned,
as it can act as an economic operator in relation to only one activity, while at the same time carrying on functions that
are non-economic in nature.

44.   In classifying the SNS from a global perspective, without considering its activity as a provider of free health care separately,
the Court of First Instance therefore erred in law. However, that error would have no bearing on the conclusions reached in
the judgment under appeal if the activity of providing free health care were itself to be classified as non-economic in nature.
([45](#Footnote45))

45.   The appellant contends that the Court of First Instance was wrong to classify the activity of providing free health care as
non‐economic by giving a wide interpretation to the concept of solidarity. That part of the appeal bears on the main issue
which the Court of Justice has to dispose of in this case, namely whether the activity of the SNS in providing free health
care services was correctly classified as non-economic.

46.   In order to reach the conclusion that the SNS carried out an activity that was non-economic in nature, the Court of First
Instance interpreted *Poucet and Pistre*, *FFSA and Others* and *Albany* and held in paragraph 38 of the judgment under appeal ‘that the organisations managing the health funds ... were fulfilling
an exclusively social function, that their activity was based on the principle of national solidarity and, lastly, that they
were non-profit-making, the benefits paid out being statutory benefits that bore no relation to the level of contributions’.

47.   However, the criterion laid down by the Court in those judgments does not form the appropriate basis for classifying the nature
of an activity of providing health care. While, as mentioned above, in the judgments relied on by the Court of First Instance
the Court of Justice considered whether compulsory membership of a sickness or insurance fund was compatible with Community
competition law, it is clear that the activity which falls to be classified is not that of compulsory health insurance, which
is also carried on by the SNS, but rather that of the provision of health care. Accordingly, the degree of solidarity which
exists in that sector must be assessed in the light of factors other than those which apply to the activity of a sickness
or insurance fund. ([46](#Footnote46))

48.   As the Court has given numerous rulings regarding medical activities in the context of the freedom to provide services, it
may be helpful to draw a parallel with that case-law in order to assess the nature of the provision of free health care services
by the SNS to its members.

49.   Under Article 50 EC ‘services shall be considered to be “services” within the meaning of the Treaty where they are normally
provided for remuneration, in so far as they are not governed by the provisions relating to freedom of movement for goods,
capital and persons’. ([47](#Footnote47)) More generally, the Court has ruled that ‘medical activities fall within the scope of Article 60 of the Treaty’. ([48](#Footnote48)) In that regard, it is worth quoting Advocate General Tesauro, who stated that the social security sector does not constitute
‘an island beyond the reach of Community law’, ([49](#Footnote49)) so that national rules relating to it do not fall outside its scope. The Court has held that the autonomy of the Member States
as regards the organisation of their social security systems does not preclude the application of the fundamental freedoms.
([50](#Footnote50)) However, it is left to national legislation to determine ‘first, the conditions concerning the right or duty to be insured
with a social security scheme and, second, the conditions for entitlement to benefits’. ([51](#Footnote51))

50.   The fact that the State is involved in financing medical benefits does not mean that a medical activity does not fall to be
classified as a service. ([52](#Footnote52)) Case-law has also determined that the mere fact that a medical benefit may be provided free of charge to the patient is not
sufficient to take that activity out of the scope of Article 49 EC. Indeed, the Court expressly held in *Smits and Peerbooms* that health services provided free of charge by hospitals are services within the meaning of Article 49 EC. It is not relevant
that the service is not paid for by its recipients, since ‘payments made by the sickness insurance funds ... are indeed the
consideration for the hospital services and unquestionably represent remuneration’. ([53](#Footnote53))

51.   At first sight, it appears desirable to adopt the same solution in the field of the freedom to provide services and in that
of freedom of competition, since those provisions of Community law seek to attain the common objective of the completion of
the internal market. ([54](#Footnote54)) However, the scope of freedom of competition and that of the freedom to provide services are not identical. There is nothing
to prevent a transaction involving an exchange being classified as the provision of services, even where the parties to the
exchange are not undertakings for the purposes of competition law. ([55](#Footnote55)) As stated above, ([56](#Footnote56)) the Member States may withdraw certain activities from the field of competition if they organise them in such a way that
the principle of solidarity is predominant, with the result that competition law does not apply. By contrast, the way in which
an activity is organised at the national level has no bearing on the application of the principle of the freedom to provide
services. Thus, although there is no doubt that the provision of health care free of charge is an economic activity for the
purposes of Article 49 EC, ([57](#Footnote57)) it does not necessarily follow from that that the organisations which carry on that activity are subject to competition law.

52.   In the present case, it does not appear that the activity of providing health care to its members carried on by the SNS is
of a different kind from that which was carried on by the public hospitals in *Smits and Peerbooms*. While it does not comprise only hospital care, it none the less includes such care. Similarly, if patients do not pay medical
practitioners the amount owing in respect of treatment provided to them, those practitioners are nevertheless remunerated.
But, in order to determine whether that activity should be subject to competition law, it is necessary to establish whether
the State, with a view to adopting a policy of redistribution by entrusting that activity exclusively to State bodies which
would be guided solely by considerations of solidarity, intended to exclude it from all market considerations.

53.   The judgment under appeal shows that the SNS is obliged to guarantee universal cover to all its members free of charge. However,
the Court of First Instance did not state whether the requirements of the market are entirely satisfied by public bodies or
whether private organisations having the characteristics of an undertaking take part in it as well. The essential information
for concluding that the activity of providing health care of the SNS is of a non-economic nature is therefore not available.

54.   It appears that the Ley 15/1997 of 25 April sobre habilitación de nuevas formas de gestión del Sistema Nacional de Salud ([58](#Footnote58)) authorises the SNS to sub-contract the provision of health care to private entities. The replies of the Spanish Government
to the question put to it by the Court of First Instance on 15 January 2002 also show that some health care is provided by
the private sector. The case should therefore be referred back to the Court of First Instance for it to make the necessary
findings in fact in order to determine whether public and private health sectors coexist in Spain or whether the solidarity
which exists in the provision of free health care is predominant.

55.   In any event, were it to be concluded that the SNS carries on an economic activity, that would not call into question the
social objectives pursued by the SNS, because such a conclusion does not preclude the implementation of the principle of solidarity,
whether in relation to the method of financing by social security and other State contributions or in relation to the provision
of services provided to members free of charge on the basis of universal cover. The application of competition law and a recognition
that certain sectors must be subject to special rules are not mutually incompatible. On the contrary, the purpose of Article
86(2) EC is precisely to provide a basis for conferring exclusive rights on undertakings entrusted with the operation of services
of general interest. ([59](#Footnote59)) The likely effects of making certain activities carried on by undertakings entrusted with the operation of services of general
interest subject to competition law do not lead to a reduction in social protection any more than do those which arise from
the application of the principle of freedom of movement to the health sector. In both cases, Community law seeks to incorporate
principles of openness and transparency into health systems originally conceived on a national scale. ([60](#Footnote60))

56.   In the present case, however, although it is clear that the SNS is indeed entrusted with providing health services free of
charge to its members on the basis of universal cover (paragraphs 39 and 40 of the judgment under appeal), by contrast, the
management role of the SNS, which is imposed on the ministries and other organisations referred to in the complaint, is not
clearly defined. An organisation can be classified as an undertaking by reason of the economic activities it carries on only
if it is the actual medium through which the activities in question are carried on. ([61](#Footnote61)) Thus, even if it were established that the SNS was to be regarded as an undertaking for the purposes of competition law,
it would still be necessary to be satisfied that the organisations referred to in FENIN’s complaint are the medium through
which those activities are carried on. The Court of First Instance would have to make a finding in this regard if it were
to conclude that the activity of providing health care carried on by the SNS was economic in nature.

57.   For the reasons set out above, I propose that the Court should uphold the second part of the appeal and refer the case back
to the Court of First Instance for it to make the findings in fact necessary to determine whether or not the activities of
the organisations which manage the SNS are economic in nature and, accordingly, whether the Commission’s rejection of FENIN’s
complaint was well founded.

C –    *The link between the purchasing activity and the nature of the activities for which the goods or services are intended*

58.   Were the Court to decide, contrary to what is proposed, to uphold the judgment under appeal in so far as it classifies the
provision of free health care as a non-economic activity, it would remain necessary to consider the first part of the ground
of appeal, which challenges the connection made between the nature of the purchasing operation and the subsequent use of the
goods acquired.

59.   In the first part of the ground of appeal, FENIN criticises paragraph 36 of the judgment under appeal, which states that ‘it
is the activity consisting in offering goods and services on a given market that is the characteristic feature of an economic
activity, not the business of purchasing, as such’. The Court of First Instance went on to hold that ‘it would be incorrect
... to dissociate the activity of purchasing goods from the subsequent use to which they are put’, and that ‘the nature of the
purchasing activity must ... be determined according to whether or not the subsequent use of the purchased goods amounts to
an economic activity’.

60.   FENIN contests the link made by the Court of First Instance between the nature of a purchase and that of its subsequent use.
The link is founded on an incorrect interpretation of the case-law, gives rise to practical difficulties and reduces the effectiveness
of Community competition law.

61.   FENIN submits, in the first place, that the case-law on which the Court of First Instance relied in its analysis, namely *Commission* v *Italy* ([62](#Footnote62)) and *Consiglio Nazionale degli Spedizionieri Doganali* v *Commission*, ([63](#Footnote63)) does no more than classify the provision of goods or services on a market as an economic activity, without ruling on the
nature of a purchasing activity. Those cases are accordingly irrelevant for the purposes of holding that a purchase does not
constitute an economic activity.

62.   It is true that one of the criteria which is relevant for classifying an entity as an undertaking is its participation in
a market. The essential characteristic of a market is that it involves exchanges between economic operators in the form of
supplies and purchases. In that context, it is impossible to see how the one can be made subject to review under competition
law while the other is excluded from it, as the two are reciprocal. None the less, that analysis does not of itself invalidate
the reasoning of the Court of First Instance which led it to treat the classification of a purchase as being dependent on
its subsequent use.

63.   In the second place, FENIN maintains that the judgment under appeal and the judgment in *Pavlov and Others* are inconsistent. In the latter case, the Court of Justice held, in determining whether membership by medical practitioners
of a retirement fund was economic in nature, that membership was closely linked to their professional activities and was thus
to be regarded as belonging to that, economic, activity. ([64](#Footnote64)) As Advocate General Jacobs proposed, ([65](#Footnote65)) the Court distinguished between activities related to the medical practitioners’ economic sphere and activities related to
their personal sphere. Only intermediate demand, in contrast to final demand, may be considered to belong to the economic
sphere. ([66](#Footnote66)) On the other hand, demand by private individuals, which is always final demand, is outside the scope of competition law.

64.   The judgment under appeal is not inconsistent with this analysis in any way. Where public organisations carry out both economic
activities and activities of another kind, it is only demand which is linked to their economic activities which may fall within
the scope of competition law. By contrast, purchases intended for use in non‐economic activities are comparable to final demand
by consumers and are not subject to competition law. But it cannot be denied in the present case that the purchase of medical
goods and equipment is linked to the activity of the SNS in providing health care services.

65.   The appellant claims that, in determining whether the purchasing activity of the SNS was economic in nature, the Court of
First Instance should have considered whether it was liable to have anti-competitive effects in order not to create ‘unjustified
areas of immunity’. However, such a criterion cannot be accepted, since it would amount to subjecting every purchase by the
State, by a State entity or by consumers to the rules of competition law. On the contrary, as the judgment under appeal rightly
pointed out, a purchase falls within the scope of competition law only in so far as it forms part of the exercise of an economic
activity. Moreover, if the appellant’s argument were to be adopted, the effectiveness of the rules relating to public procurement
would be reduced. ([67](#Footnote67)) The link established between the conduct complained of by the complainants and the non‐economic activity of the organisation
referred to was also at the heart of the reasoning applied in *Eurocontrol* in order to hold that competition law did not apply. It was held that the receipt of a payment by Eurocontrol was not economic
in nature, since it was made in the course of carrying out a non-economic activity.

66.   *Ambulanz Glöckner*, which was cited by the appellant in support of its position, confirms on the contrary the approach taken by the Court of
First Instance, since the Court of Justice did not accept in that case that the refusal of a public authority to grant an
authorisation to a carrier should be considered under Article 81 EC, as that decision did not represent the exercise of an
economic activity but, on the contrary, sought to regulate and circumscribe it. Thus, where a purchase is linked to the performance
of non-economic functions, it may fall outside the scope of competition law. That conclusion is consistent with the economic
theory according to which the existence of a monopsony does not pose a serious threat to competition since it does not necessarily
have any effect on the downstream market. Furthermore, an undertaking in a monopsonistic position has no interest in bringing
such pressure to bear on its suppliers that they become obliged to leave the upstream market. ([68](#Footnote68)) There is therefore no reason to set aside the judgment under appeal on the ground that it incorrectly interpreted the case-law
relating to whether or not a purchase is an economic activity.

67.   Finally, FENIN argues that the interpretation of the Court of First Instance was wrong in that it gives rise to a number of
practical difficulties. It maintains that at the time of purchase, it is effectively impossible to distinguish between purchases
intended for economic activities and those to be used for non‐economic activities.

68.   It is true that it is sometimes difficult to separate economic activities from those which are not economic when they are
carried on by the same body or organisation. However, and contrary to what the appellant contends, that difficulty does not
change the criterion for determining whether competition law applies, which is that of the exercise of an economic activity.
The inevitable result of that criterion thus remains that organisations carrying on mixed activities are subject to competition
law only in respect of that part of their activities which is economic in nature. ([69](#Footnote69)) If the appellant’s reasoning were to be adopted, whenever a body carried on an economic activity, it would be subject to
competition law as regards all its activities. Such a conclusion would be incompatible with the functional criterion of an
undertaking which has been established in case-law.

69.   As none of the arguments set out in the first part of the appeal has established that the purchase of medical goods and equipment
by the SNS should have been dissociated from the provision of health care services, the judgment under appeal should be upheld
in that regard.

IV –  **Conclusion**

70.   In the light of the above considerations, I propose that the Court should:

(1)      uphold the second part of the appeal and refer the case back to the Court of First Instance of the European Communities for
it to make the findings of fact necessary to determine whether or not the activity of the organisations managing the Spanish
national health service is economic in nature and, accordingly, whether the rejection by the Commission of the European Communities
of the complaint submitted by the Federación Española de Empresas de Tecnología Sanitaria (FENIN) was well founded;

(2)      dismiss the first part of the appeal.

---

[1](#Footref1) – Original language: Portuguese.

---

[2](#Footref2) – Case C-41/90 *Höfner and Elser* [1991] ECR I-1979.

---

[3](#Footref3) – Case C-364/92 *SAT Fluggesellschaft**(‘Eurocontrol’)* [1994] ECR I-43.

---

[4](#Footref4) – Case C-343/95 *Diego Calì & Figli* [1997] ECR I-1547.

---

[5](#Footref5) – Joined Cases C-159/91 and C-160/91 [1993] ECR I-637.

---

[6](#Footref6) – Case C-244/94 [1995] ECR I-4013.

---

[7](#Footref7) – Case 118/85 *Commission* v *Italy* [1987] ECR 2599, paragraph 7: ‘the State may act either by exercising public powers or by carrying on economic activities
of an industrial or commercial nature by offering goods and services on the market’.

---

[8](#Footref8) – *Höfner and Elser*, paragraph 22.

---

[9](#Footref9) – Point 12 of the Opinion in *Poucet and Pistre*.

---

[10](#Footref10) – Case C-475/99 [2001] ECR I-8089, paragraph 20.

---

[11](#Footref11) – See paragraphs 67 and 27, respectively, of the Opinions of Advocate General Jacobs in *Ambulanz Glöckner* and Joined Cases C-264/01, C-306/01, C-354/01 and C-355/01 *AOK‐Bundesverband and Others* [2004] ECR I-2493.

---

[12](#Footref12) – J.Y. Chérot, ‘Le droit communautaire de la concurrence fonde-t-il un ordre concurrentiel?’ in *L’ordre concurrentiel: mélanges en l’honneur d’A. Pirovano,* 2003, criticises that comparative method and states that ‘not only can every activity in theory be carried out by private
enterprise, but also, experience shows that every activity has at one time or another in history been carried out by private
enterprise’ (p. 569). See also L. Idot, ‘La notion d’entreprise en droit de la concurrence, révélateur de l’ordre concurrentiel’
in the same work: ‘[i]f such a definition is adopted, everything may become an “economic activity” at some point’ (p. 528).

---

[13](#Footref13) – Case C-35/96 *Commission* v *Italy* [1998] ECR I-3851, paragraph 37. Reference may also be made to earlier case-law: Case 118/85 *Commission* v *Italy*, cited above in footnote 7, paragraph 3, where the Court stated: ‘it is not contested that the Amministrazione autonoma dei
monopoli di stato exercises an economic activity inasmuch as it offers goods and services on the market in the manufactured
tobacco sector’.

---

[14](#Footref14) – Joined Cases C-180/98 to C-184/98 *Pavlov and Others* [2000] ECR I-6451, paragraph 75, and *Ambulanz Glöckner*, paragraph 19. See also Case C-309/99 *Wouters and Others* [2002] ECR I-1577, paragraph 47, and Case C-82/01 P *Aéroports de Paris* v *Commission* [2002] ECR I-9297, paragraph 79.

---

[15](#Footref15) – *FFSA and Others,* paragraph 21, according to which ‘the mere fact that the CCMSA is a non‐profit‐making body does not deprive the activity
which it carries on of its economic character, since ... that activity may give rise to conduct which the competition rules
are intended to penalise’. See also the Opinion of Advocate General Jacobs in Case C-218/00 *Cisal* [2002] ECR I-691, at paragraph 71: ‘the underlying question is whether that entity is in a position to generate the effects
which the competition rules seek to prevent’.

---

[16](#Footref16) – At paragraph 30 of the judgment in *Eurocontrol*, the Court stated: ‘taken as a whole, Eurocontrol’s activities, by their nature, their aim and the rules to which they are
subject’ are not of an economic nature. See also paragraph 23 of the judgment in *Diego Calì & Figli*: such an activity ‘by its nature, its aim and the rules to which it is subject’ is connected with the exercise of powers
which are those of a public authority.

---

[17](#Footref17) – *Eurocontrol*.

---

[18](#Footref18) – *Diego Calì & Figli* concerned the prevention of pollution in the port of Genoa.

---

[19](#Footref19) – The fact that an activity is treated as fulfilling a constitutional function in the Member State concerned may be evidence
that it is a task in the public interest. See paragraph 22 of *Diego Calì & Figli*.

---

[20](#Footref20) – Case T-313/02 *Meca-Medina and Majcen* v *Commission* [2004] ECR II-0000, paragraph 41.

---

[21](#Footref21) – See, for example, the facts which arose in *AOK-Bundesverband and Others*, and T. Hervey and J. McHale, *Health Law and the European Union*, Cambridge, 2004, p. 136.

---

[22](#Footref22) – Paragraph 8 of the judgment in *Poucet and Pistre*.

---

[23](#Footref23) – Paragraph 16 of the judgment in *Poucet and Pistre*.

---

[24](#Footref24) – Paragraph 18 of the judgment in *Poucet and Pistre*.

---

[25](#Footref25) – In paragraphs 38 to 40 of *Cisal*, it is stated that solidarity was evidenced by the fact that contributions were not systematically proportionate to the risk
insured against, nor were the benefits paid strictly proportionate to the insured person’s earnings.

---

[26](#Footref26) – Case C-67/96 [1999] ECR I-5751.

---

[27](#Footref27) – See J.W. Van de Gronden, ‘Purchasing Care: Economic Activity or Service of General (Economic) Interest?’, ECLR 2004, No
2, p. 87, in particular p. 90. The position of health insurance funds is different, as they have not been subject to competition
law since the entry into force on 1 January 2004 of a law modernising health insurance. In that regard, see W. Jaeger, ‘Die
gesetzlichen Krankenkassen als Nachfrager im Wettbewerb’, ZWeR 2005, No 1, p. 31.

---

[28](#Footref28) – By a decision of 29 January 1997, *Cruz Roja Española* (Expte R 179/96), the national Anti-Trust Tribunal held that the Spanish Red Cross acted as an economic operator when it
carried patients in ambulances, since it offered those services in a context of free competition and did not merely administer
publicly‐provided funds for charitable purposes.

---

[29](#Footref29) – Case No 1006/2/1/01 [2002] Competition Appeal Reports 299.

---

[30](#Footref30) – Kilpailuvirasto, 17 March 2000, dnro 343/61/1997.

---

[31](#Footref31) – The national competition directorate has held, for example, that decisions of the national office for medicinal products
to license a medicinal product fall within that category.

---

[32](#Footref32) – Decision No 358 of the competition authority of 12 October 1994 in *FDB* v *Southern Health Board*.

---

[33](#Footref33) – Article 152(5) EC provides: ‘Community action in the field of public health shall fully respect the responsibilities of
the Member States for the organisation and delivery of health services and medical care’. In relation to the organisation
of social security, Article 137(4) EC states: ‘the provisions adopted pursuant to this article shall not affect the right
of Member States to define the fundamental principles of their social security systems and must not significantly affect the
financial equilibrium thereof’. See also Case 238/82 *Duphar and Others* [1984] ECR 523, paragraph 16, and Case C-158/96 *Kohll* [1998] ECR I-1931, paragraph 41. Article 36 of the Charter of Fundamental Rights of the European Union (OJ 2000 C 364, p.
1) also provides: ‘[t]he Union recognises and respects access to services of general economic interest as provided for in
national laws and practices, in accordance with the Treaty establishing the European Community, in order to promote the social
and territorial cohesion of the Union’.

---

[34](#Footref34) Case 136/86 *BNIC* [1987] ECR 4789, and Case C-35/96 *Commission* v *Italy* [1998] ECR I-3851.

---

[35](#Footref35) – While Article 16 EC emphasises the need for guaranteeing the operation of services of general economic interest, it does
not constitute a restriction on the scope of Article 86(2) EC, but instead provides a point of reference for the interpretation
of that provision.

---

[36](#Footref36) – *Höfner and Elser*, paragraph 25.

---

[37](#Footref37) – See Case C-393/92 *Almelo* [1994] ECR I-1477, paragraph 48: ‘such an undertaking must ensure that throughout the territory in respect of which the concession
is granted, all consumers, whether local distributors or end-users, receive uninterrupted supplies of electricity in sufficient
quantities to meet demand at any given time, at uniform tariff rates and on terms which may not vary save in accordance with
objective criteria applicable to all customers’, and Case C-320/91 *Corbeau* [1993] ECR I-2533.

---

[38](#Footref38) – See J. Baquero Cruz, ‘Beyond Competition: Services of General Interest and European Community Law’, in Collected Courses
of the Academy of European Law, vol. XIV/2, *EU Law and**the Welfare State: In Search of Solidarity*, edited by G. de Burca, Oxford, 2005.

---

[39](#Footref39) – For example, the broadcasting of audiovisual programmes was at one time reserved to State entities and is now also undertaken
by private operators.

---

[40](#Footref40) – In that regard, see A. Winterstein, ‘Nailing the Jellyfish: Social Security and Competition Law’, [1999] ECLR, No 6, p.
324; E. Mossialos and M. McKee, *EU Law and the Social Character of Health Care*, Brussels, P.I.E.-Peter Lang, 2002, p. 34.

---

[41](#Footref41) – Case C-157/99 [2001] ECR I-5473.

---

[42](#Footref42) – Article 113 of the Rules of Procedure of the Court. By contrast, pleas directed against superfluous reasoning are inadmissible:
Case C-35/92 P *Parliament* v *Frederiksen* [1993] ECR I-991; Case C-244/91 P *Pincherle* v *Commission* [1993] ECR I-6965, paragraph 25; and Case C-39/93 P *SFEI and Others* v *Commission* [1994] ECR I-2681, paragraph 23.

---

[43](#Footref43) – Order of 11 July 1996 in Case C-325/94 P *An Taisce and WWF UK* v *Commission* [1996] ECR I-3727, paragraph 28; Case C-278/95 P *Siemens* v *Commission* [1997] ECR I-2507, paragraph 44.

---

[44](#Footref44) – *AOK-Bundesverband and Others*, paragraph 58, and Case 118/85 *Commission* v *Italy*, paragraph 7; point 114 of the Opinion of Advocate General Cosmas in Case C-411/98 *Ferlini* [2000] ECR I-8081.

---

[45](#Footref45) – Case C-30/91 P *Lestelle* v *Commission* [1992] ECR I-3755, paragraph 28; and Case C-367/95 P *Commission* v *Stryaval and Brink’s France* [1998] ECR I-1719, paragraphs 46 and 47.

---

[46](#Footref46) – See above, points 30 and 31 of this Opinion.

---

[47](#Footref47) – Joined Cases 286/82 and 26/83 *Luisi and Carbone* v *Ministero del Tesoro* [1984] ECR 377, paragraph 9; Case C-385/99 *Müller-Fauré and van Riet* [2003] ECR I‐4509, paragraph 38; and Case C-56/01 *Inizan* [2003] ECR I-12403, paragraph 16.

---

[48](#Footref48) – Case C-159/90 *Society for the Protection of Unborn Children Ireland**(‘Grogan’)* [1991] ECR I-4685, paragraph 18.

---

[49](#Footref49) – Point 17 of his Opinion in Case C-120/95 *Decker* [1998] ECR I-1831 and Case C‐158/96 *Kohll* [1998] ECR I-1931.

---

[50](#Footref50) – *Kohll*, paragraph 21; *Smits and Peerbooms*, paragraph 54; *Müller-Fauré and van Riet*, paragraph 39; and *Inizan*, paragraph 17.

---

[51](#Footref51) – *Kohll*, paragraph 18.

---

[52](#Footref52) – Point 41 of the Opinion of Advocate General Tesauro in *Decker* and *Kohll*; paragraph 58 of the judgment in *Smits and Peerbooms*. For a different view, see the Opinion of Advocate General Ruiz‐Jarabo Colomer in *Smits and Peerbooms*, points 42 to 49.

---

[53](#Footref53) – Paragraph 58 of the judgment in *Smits and Peerbooms*.

---

[54](#Footref54) – K. Mortelmans, ‘Towards convergence in the application of the rules on free movement and competition?’, CMLRev. 2001, p.
613; point 22 of the Opinion of Advocate General Van Gerven in Case C-145/88 *B & Q* [1989] ECR 3851; *Meca‐Medina and Majcen* v *Commission*, paragraph 42.

---

[55](#Footref55) – Bodies responsible for managing health insurance, as in *Cisal*, are not undertakings for the purposes of competition law, but the rules governing them may none the less not prohibit the
insurance of employees from other Member States without being inconsistent with the principle of the freedom of movement of
workers.

---

[56](#Footref56) – See above, at points 27 to 29 of this Opinion.

---

[57](#Footref57) – *Smits and Peerbooms*.

---

[58](#Footref58) – Cited in note 17 of Annex V to the appeal (BOE No 100, of 26 April 1997, p. 13449).

---

[59](#Footref59) – *Ambulanz Glöckner*.

---

[60](#Footref60) – Davies, G., *Nationality Discrimination in the European Internal Market*, Kluwer, The Hague, 2003, Chapter 9, Free Movement of Welfare, in particular pp. 183 and 184.

---

[61](#Footref61) – See, by way of analogy, my Opinion in Case C-8/03 *BBL* [2004] ECR I-10157, point 16.

---

[62](#Footref62) – Case C-35/96, cited in footnote 13.

---

[63](#Footref63) – Case T-513/93 [2000] ECR II-1807.

---

[64](#Footref64) – *Pavlov and Others*, at paragraph 79: ‘[t]he medical specialist’s membership of such a scheme stems from the practice of his profession’. And
at paragraph 80: ‘[t]he link between the payment of contributions by every self-employed medical specialist to the same supplementary
occupational pension scheme and professional practice is also especially close for the reason that the scheme is characterised
by a high degree of solidarity between all medical practitioners’.

---

[65](#Footref65) – Paragraph 115 of the Opinion in *Pavlov and Others*.

---

[66](#Footref66) – L. Arcelin, *L’entreprise en droit de la concurrence français and communautaire,* Litec, 2003, p. 223.

---

[67](#Footref67) – Case C-76/97 *Tögel* [1998] ECR I-5357.

---

[68](#Footref68) – See F. Scherer and D. Ross, *Industrial market structure and economic performance*, Boston Houghton Mifflin, 1990, p. 517, and R. Noll, ‘“Buyer power” and economic policy’, *Antitrust Law Journal*, vol. 72, 2005, p. 589.

---

[69](#Footref69) – See Case 118/85 *Commission* v *Italy*; *Eurocontrol*; *AOK‐Bundesverband and Others*; and the Opinion of Advocate General Jacobs in *Ambulanz Glöckner*, paragraph 72.