Case T-137/10

Coordination bruxelloise d’institutions sociales et de santé (CBI)

v

European Commission

‛State aid — Public hospitals — Subsidies granted by the Belgian authorities to public hospitals belonging to the IRIS association — Decision at the end of the preliminary stage — Decision declaring the aid compatible with the internal market — Service of general economic interest — Definition of public service mission — Proportionality of compensation for public service’

Summary — Judgment of the General Court (Fifth Chamber), 7 November 2012

Competition — Undertakings entrusted with the operation of services of general economic interest — Subject to Treaty rules — Assessment of the compatibility of State financing with the common market — Assessment having regard to the cost borne by the undertaking in providing the service, irrespective of its economic efficiency

State aid — Concept — Measures designed to compensate for the cost of public service missions assumed by an undertaking — Distinction between the Altmark test, designed to determine the existence of aid, and the test under Article 86(2) EC, enabling the compatibility of aid with the common market to be established

State aid — Planned aid — Examination by the Commission — Preliminary review and main review — Compatibility of the aid with the common market — Difficulties of assessment — Commission’s duty to initiate the main review procedure — Serious difficulties — Scale of the area of investigation and complexity of the matter under consideration capable of indicating the existence of serious difficulties

Competition — Undertakings entrusted with the operation of services of general economic interest — Compensation for the costs generated by the public service mission — Member States' discretion — Limits — Control by the Commission — Obligation to make a different assessment of each of the compensation measures established

Competition — Undertakings entrusted with the operation of services of general economic interest — Compensation for the costs generated by the public service mission — Member States’ discretion — Hospital sector — Freedom as to the organisation and provision of health service — Limits — Compliance with the principle of equal treatment where private operators participate in the public service

Competition — Undertakings entrusted with the operation of services of general economic interest — Compensation for the costs generated by the public service mission — Assessment of the compatibility of aid with the common market — Criteria — Hospital sector — Lack of commercial dimension to be taken into account

State aid — Planned aid — Examination by the Commission — Preliminary review and main review — Compatibility of the aid with the common market — Difficulties of assessment — Commission’s duty to initiate the main review procedure — Circumstances allowing the existence of such difficulties to be established — Insufficiency or incompleteness of the Commission’s examination in the preliminary investigation procedure — Judicial review — Limits

Actions for annulment — Natural or legal persons — Measures of direct and individual concern to them — Commission decision finding State aid compatible with the common market without opening the formal investigation procedure — Action brought by the parties concerned within the meaning of Article 88(2) EC — Action designed to safeguard the procedural rights of the persons concerned — Admissibility — Pleas capable of being invoked

See the text of the decision. (see paras 58, 59)

See the text of the decision. (see paras 72-77, 164, 233)

In the light of the particular nature of the service of general economic interest mission in certain sectors, it is appropriate to show flexibility with regard to the application of the Altmark judgment and the criteria laid down therein for the classification of a measure as State aid. With regard to the public hospital service, it is necessary, when applying Article 86(2) EC and the Altmark criteria, to take into consideration the lack of a commercial dimension to the public service in question, its classification as a service of general economic interest being explained more by its impact on the competitive and commercial sector. (see paras 86, 88)

The application of Article 86(2) EC in the hospital sector must take account of respect for the responsibilities of the Member States for the definition of their health policy and the organisation and delivery of health services and medical care. That consideration stems, inter alia, from Article 152(5) EC. In accordance with those considerations, the Member States organise their national health systems according to principles which they choose; in particular, hospital public service obligations may include both obligations imposed on all hospitals and additional obligations imposed only on public hospitals, in view of their greater importance for the proper running of the national health system. However, since the organisation of the delivery of health services determined by a Member State involves the imposition of public service obligations on private operators, that fact must be taken into account when assessing the aid measures adopted in the sector. In particular, where different requirements are imposed on the public and private bodies entrusted with the same public service, which presupposes a different level of costs and compensation, those differences must be clearly shown in their respective mandates, inter alia, in order that it may be verified that the subsidy is compatible with the principle of equal treatment. (see paras 92-95)

In competition matters, Member States have a wide discretion to define what they regard as the services of general economic interest and that that definition can be questioned by the Commission only in the event of manifest error. The scope of the General Court’s review of the Commission’s assessments necessarily takes that limitation into account. That review must nevertheless ensure respect for certain minimum criteria relating, inter alia, to the presence of an act of the public authority entrusting the operators in question with a service of general economic interest mission, and to the universal and compulsory nature of that mission. In that regard, a body may be regarded as endowed with the exercise of the public power if it is composed of a majority of representatives of the public authority and if, when adopting a decision, it must satisfy a certain number of criteria of general interest. Therefore, for an entity’s decisions to be classified as public acts, its bodies must be composed of persons with public-interest duties and the public authorities must have an effective means of controlling the decisions. As regards the choice of legal form of a mandating act or acts, Member States have a wide discretion, the mandate entrusting the public service mission being capable of being defined in several different acts, both those laying down the general rules in the area and those addressed specifically to certain institutions. The mandate may also encompass contractual acts, provided that they emanate from the public authority and are binding. That is so a fortiori where such acts give effect to the obligations imposed by the legislation. (see paras 99-101, 107-109, 111, 112)

The parameters on the basis of which the compensation is calculated must be established in advance in an objective and transparent manner, to avoid it conferring an economic advantage which may favour the recipient undertaking over competing undertakings. However, there is nothing to prevent the national legislature from allowing the national authorities a certain discretion. On the contrary, the Member State has a wide discretion not only when defining a service of general economic interest mission but also when determining the compensation for the costs connected with the services of general economic interest. The parameters must, however, be defined in such a way as to preclude any abusive recourse to the concept of a service of general economic interest on the part of the Member State. In that regard, the Member States being free to choose how to comply with that condition in practical terms, provided the rules for determining the compensation are objective and transparent, the Commission’s assessment for that purpose must be based on an analysis of the actual legal and economic considerations which governs the setting of the amount of the compensation. Thus, where a Member State resorts to several compensation measures, if the Commission fails to make a separate assessment of the financing parameters relating to one of those measures, it carries out an incomplete examination of the aid measure concerned. Even if it were conceded that these were compensations serving only to make up for a long delay in payments, which must subsequently be repaid, they may conceivably give the beneficiaries an advantage, however temporary, and may therefore be classified as different compensation measures. (see paras 189, 191, 192, 214, 215)

In State aid matters, the scale of the area of investigation covered by the Commission during the preliminary examination and the complexity of the matter under consideration may indicate that the procedure at issue considerably exceeded what is normally required for an initial examination carried out pursuant to the provisions of Article 88(3) EC. That circumstance constitutes probative evidence of the existence of serious difficulties. (see para. 285)

The fourth criterion laid down by the Altmark judgment, based on an analysis of costs for a typical, well run and adequately provided undertaking, which must, where the choice of the undertaking entrusted with performing the public service obligations is not made in the context of a public contract procedure, be used in order to determine the necessary level of compensation and thus detect the possible existence of State aid, is not taken into account for assessing the compatibility of aid measures under Article 86(2) EC. (see paras 289, 292)