Judgment — ECLI:EU:C:2016:637
Date: 2016-09-07
Language of the case: French
Court formation: Fifth Chamber
Subject matter: Competition;Energy;Approximation of laws
Procedure: Reference for a preliminary ruling
Origin: France

Summary — Judgment of the Court (Fifth Chamber), 7 September 2016 1. Approximation of laws — Measures of approximation — Common rules for the internal market in natural gas — Directive 2009/73 — Imposition of public service obligations on operators — Fixing of prices of supply of natural gas — Classification as an obstacle to the achievement of a competitive market in natural gas (European Parliament and Council Directive 2009/73, Art. 3(1)) 2. Approximation of laws — Measures of approximation — Common rules for the internal market in natural gas — Directive 2009/73 — Imposition of public service obligations on operators — Fixing of prices of supply of natural gas — Lawfulness — Conditions — Pursuit of an objective of general economic interest — Member States’ discretion — Limits (Arts 14 TFEU and 106 TFEU; Protocol No 26 annexed to the EU and FEU Treaties; Charter of Fundamental Rights of the European Union, Art. 36; European Parliament and Council Directive 2009/73, Art. 3(1) and (2)) 3. Approximation of laws — Measures of approximation — Common rules for the internal market in natural gas — Directive 2009/73 — Imposition of public service obligations on operators — Fixing of prices of supply of natural gas — Lawfulness — Conditions — Observance of the principle of proportionality — Necessity of the measure — Criteria for assessment (Art. 106 TFEU; European Parliament and Council Directive 2009/73, Art. 3(2)) 4. Approximation of laws — Measures of approximation — Common rules for the internal market in natural gas — Directive 2009/73 — Imposition of public service obligations on operators — Fixing of prices of supply of natural gas — Lawfulness — Conditions — Non-discriminatory nature of the measure (European Parliament and Council Directive 2009/73, Art. 3(1) and (2)) 1. Article 3(1) of Directive 2009/73 concerning common rules for the internal market in natural gas must be interpreted as meaning that intervention by a Member State consisting in requiring certain suppliers, including the incumbent supplier, to offer to supply natural gas to final consumers at regulated tariffs constitutes by its very nature an obstacle to the achievement of a competitive market in natural gas as provided for in that provision, and that obstacle exists even though the intervention does not preclude competing offers from being made at lower prices than those tariffs by any supplier in the market. Although it does not follow from any provision of Directive 2009/73 that the price of supply of natural gas must be fixed exclusively by the play of supply and demand, that requirement follows from the very purpose and general scheme of the directive, the aim of which is to pursue the achievement of an internal market in natural gas that is entirely and effectually open and competitive and in which all consumers can freely choose their suppliers and all suppliers can freely supply their products to their customers. A determination of tariffs resulting from intervention by the public authorities necessarily affects the play of competition, and legislation requiring natural gas to be offered on the market at a specified price is therefore contrary to the objective of the achievement of an open, competitive market in natural gas as provided for in Article 3(1) of Directive 2009/73. Moreover, the fact that the undertakings concerned by the regulated tariffs can also freely determine what they offer in the market cannot call into question the finding that the State intervention in question affects the play of competition. The mere existence of two segments of the market, namely the segment in which prices are established outside the play of competition and the segment in which their determination is left to market forces, is incompatible with the creation of an internal market in natural gas that is open and competitive. (see paras 26, 31-33, operative part 1) 2. State intervention in the fixing of the price of supply of natural gas to the final consumer may be accepted within the framework of Directive 2009/73 concerning common rules for the internal market in natural gas if three conditions are satisfied. First, the intervention must pursue an objective of general economic interest, secondly, it must comply with the principle of proportionality, and, thirdly, it must lay down public service obligations that are clearly defined, transparent, non-discriminatory and verifiable, and guarantee equal access of EU gas undertakings to consumers. As regards the first condition, the existence of a general economic interest, the interpretation of that condition must be set in the new context following from the entry into force of the Treaty of Lisbon, which includes, as well as Article 106 TFEU, Article 14 TFEU, Protocol (No 26) on services of general interest, annexed to the EU Treaty, as amended by the Treaty of Lisbon, and the FEU Treaty, and the Charter of Fundamental Rights of the European Union, which has acquired the same legal value as the Treaties, in particular Article 36 of the Charter on access to services of general economic interest. The Member States are thus entitled, while complying with EU law, to define the scope and organisation of their services of general economic interest. They may in particular take account of objectives pertaining to their national policy. In this respect, in the assessment which the Member States must carry out, in accordance with Directive 2009/73, to determine whether, in the general economic interest, public service obligations should be imposed on undertakings operating in the gas sector, it is for the Member States to reconcile the objective of liberalisation with the other objectives pursued by the directive. In this context, since Article 3(2) of Directive 2009/73 contains a non-exhaustive list of things which may the subject of public service obligations, the Member States remain free, in compliance with EU law, to define which objectives of general economic interest they wish to pursue by imposing public service obligations. Those obligations must, however, always be aimed at attaining one or more objectives of general economic interest. It follows that Article 3(2) of Directive 2009/73, read in the light of Articles 14 TFEU and 106 TFEU and Protocol (No 26) on services of general interest, annexed to the EU Treaty, as amended by the Treaty of Lisbon, and the FEU Treaty, must be interpreted as allowing the Member States to assess whether, in the general economic interest, public service obligations relating to the price of supply of natural gas should be imposed on undertakings operating in the gas sector, in order in particular to ensure security of supply and territorial cohesion, provided that, first, all the conditions set out in Article 3(2) of the directive are satisfied, specifically the non-discriminatory nature of such obligations, and, secondly, that the imposition of those obligations complies with the principle of proportionality. (see paras 36, 37, 40, 44, 45, 50, 73, operative part 2) 3. Article 3(2) of Directive 2009/73 concerning common rules for the internal market in natural gas must be interpreted as not precluding a method of determination of prices based on taking costs into consideration, provided that the application of the method does not have the consequence that the State intervention goes beyond what is necessary for achieving the objectives of general economic interest pursued. It follows from the very wording of Article 106 TFEU that the public service obligations which Article 3(2) of the directive allows to be imposed on undertakings must comply with the principle of proportionality and, therefore, that those obligations may, from 1 July 2007, compromise the freedom to determine the price of supply of natural gas only in so far as is necessary to achieve the objective of general economic interest which they pursue and, consequently, for a period that is necessarily limited in time. With respect to intervention based on the principle of covering all the costs of the incumbent supplier by applying a formula representing its costs of supply and a methodology for assessing its costs other than those of supply, drawn up following an annual analysis of the development of costs by the regulatory authority, the requirement of necessity means in principle that the component of the gas price must be identified in which intervention is necessary in order to achieve the objective pursued by the State intervention. It is for the national court to assess whether the method of intervention in prices used does not go beyond what is necessary for achieving the objectives of general economic interest pursued and whether there are no appropriate measures that are less restrictive. The requirement of necessity must also be assessed with regard to the scope ratione personae of the measure in question and, more particularly, its beneficiaries. (see paras 53, 65-67, 73, operative part 2) 4. As regards the third condition for State intervention in the fixing of the price of supply of natural gas to the final consumer to be acceptable within the framework of Directive 2009/73 concerning common rules for the internal market in natural gas, namely that the State intervention must lay down public service obligations that are clearly defined, transparent, non-discriminatory and verifiable, and guarantee equal access of EU gas undertakings to consumers, Article 3(2) of Directive 2009/73 allows public service obligations to be imposed generally on undertakings operating in the gas sector, not on certain undertakings specifically. Moreover, Article 3(1) of the directive provides that the Member States must not discriminate between natural gas undertakings as regards their rights or obligations. In this framework, the system of designating undertakings responsible for public service obligations may not exclude a priori any of the undertakings operating in the gas distribution sector. (see paras 70, 71)