Opinion of the Advocate General — ECLI:EU:C:2013:242
Date: 2013-04-16
Language of the case: Dutch
Subject matter: General provisions;Energy;Right of establishment;Free movement of capital;Approximation of laws;Freedom to provide services
Procedure: Reference for a preliminary ruling
Origin: Netherlands

Summary — Judgment of the Court (Grand Chamber), 22 October 2013 1. Free movement of capital and liberalisation of payments — Restrictions — National legislation prohibiting the privatisation of system operators and links with undertakings which generate/produce, supply or trade electricity or gas — Not permissible — Rules governing the system of property ownership — Principle of neutrality — No effect (Arts 63 TFEU and 345 TFEU) 2. Free movement of capital and liberalisation of payments — Restrictions — National legislation prohibiting the privatisation of system operators and links with undertakings which generate/produce, supply or trade electricity or gas — Justification based on overriding reasons in the public interest — Competition, transparency and non-discrimination — Whether permissible — Conditions — Proportionality — Assessment by the national court (Arts 65 TFEU and 345 TFEU) 1. Article 345 TFEU must be interpreted as covering rules within a Member State which prohibit privatisation, which have the effect that shares held in an electricity or gas distribution system operator active in that Member State must be held, directly or indirectly, by the public authorities identified by the national legislation. However, that interpretation does not mean that Article 63 TFEU does not apply to provisions of national law which prohibit the privatisation of electricity or gas distribution system operators, or, further, which prohibit (i) ownership or control links between companies which are members of the same group as an electricity or gas distribution system operator active in that Member State and companies which are members of the same group as an undertaking which generates/produces, supplies, or trades in electricity or gas in that Member State and (ii) engagement by such an operator and by the group of which it is a member in transactions or activities which may adversely affect the operation of the system concerned. First, Article 345 TFEU is an expression of the principle of the neutrality of the Treaties in relation to the rules in Member States governing the system of property ownership. In that regard, the Treaties do not preclude, as a general rule, either the nationalisation of undertakings or their privatisation. It follows that a prohibition of privatisation which precludes ownership by any private individual of shares in an electricity or gas distribution system operator active in a Member State falls within the scope of Article 345 TFEU. However, Article 345 TFEU does not mean that rules governing the system of property ownership current in the Member States are not subject to the fundamental rules of the FEU Treaty, which rules include, inter alia, the prohibition of discrimination, freedom of establishment and the free movement of capital. Secondly, a prohibition of privatisation which means that no private investor can acquire shares or interests in the capital of an electricity or gas distribution system operator active in the Member State concerned and which includes, additionally, group prohibitions and prohibitions of activities which may adversely affect system operation which hinder or impose qualitative restrictions on cross-border investment constitute restrictions on the free movement of capital within the meaning of Article 63 TFEU. (see paras 29, 30, 33, 34, 36-38, 43-48, operative part 1) 2. As regards rules entailing the prohibition of privatisation which have the effect that shares held in an electricity or gas distribution system operator active in the Member State concerned must be held, directly or indirectly, by the public authorities identified by the national legislation, rules which fall within the scope of Article 345 TFEU, the objectives which underlie the choice of the legislature in relation to the adopted rules governing the system of property ownership may be taken into consideration as overriding reasons in the public interest to justify the restriction on the free movement of capital. While Article 345 TFEU may not justify a restriction on the rules relating to the free movement of capital, that does not thereby mean that the interest underlying the legislature’s choice of public or private ownership of the electricity and gas distribution system operator cannot be taken into consideration as an overriding reason in the public interest. In particular, the reasons underlying the choice of the rules of property ownership adopted by national legislation within the scope of Article 345 TFEU constitute factors which may be taken into consideration as circumstances capable of justifying restrictions on the free movement of capital. As regards national legislation which prohibits electricity and gas distribution system operators (i) having links with undertakings which generate/produce, supply or trade electricity or gas or (ii) engaging in activities which may adversely affect system operation, the objectives of combating cross-subsidisation in the broad sense, including exchange of strategic information, in order to achieve transparency in the electricity and gas markets, and to prevent distortions of competition may, as overriding reasons in the public interest, justify restrictions on the free movement of capital caused by such national legislation. It is also necessary that the restrictions at issue are appropriate to the objectives pursued and do not go beyond what is necessary to attain those objectives, which it is for the referring court to determine (see paras 52, 53, 55, 66-68, operative part 2)