Commission Directive 2000/52/EC of 26 July 2000 amending Directive 80/723/EEC on the transparency of financial relations between Member States and public undertakings
Date: 2000-02-28
Institutions: European Commission
Subjects: EU Member State, economic relations, public sector

29.7.2000

EN

Official Journal of the European Communities

L 193/75

COMMISSION DIRECTIVE 2000/52/EC

of 26 July 2000

amending Directive 80/723/EEC on the transparency of financial relations between Member States
and public undertakings

THE COMMISSION OF THE EUROPEAN COMMUNITIES,

Having regard to the Treaty establishing the European
Community, and in particular Article 86(3) thereof,

Whereas:

(1)

(2)

(3)

(4)

(5)

Commission Directive 80/723/EEC (1), as last amended
by Directive 93/84/EEC (2), requires Member States to
ensure that financial relations between public authorities
and public undertakings are transparent. Directive 80/
723/EEC requires certain financial
information to be
retained by Member States and supplied to the Commis-
sion when requested, while other information has to be
supplied in the form of annual reports.

by

States

adopted

the Member

Various sectors of the economy which were character-
ised in the past by the existence of national, regional or
local monopolies have been or are being opened partly
or fully to competition in application of the Treaty or by
rules
the
Community. This process has highlighted the impor-
tance of
rules on competition
the
contained in the Treaty are fairly and effectively applied
in these sectors, in particular that there is no abuse of a
dominant position within the meaning of Article 82 of
the Treaty, and no State aid within the meaning of
Article 87 of the Treaty unless it is compatible with the
common market, without prejudice to the possible
application of Article 86(2) of the Treaty.

ensuring that

and

In such sectors Member States often grant special or
exclusive rights to particular undertakings, or make
payments or give some other kind of compensation to
particular undertakings entrusted with the operation of
services of general economic interest. These undertak-
ings are often also in competition with other undertak-
ings.

for

According to Article 86(2) and (3) of the Treaty it is, in
principle,
the Member States to entrust certain
undertakings with the operation of services of general
the Commission
economic interest
being responsible for ensuring the proper application of
the provisions of that Article.

they define,

that

Article 86(1) of the Treaty requires that, in the case of
public undertakings and undertakings to which Member
States grant special or exclusive rights, Member States
must neither enact nor maintain in force any measure
contrary to the rules contained in the Treaty. Article
86(2) of the Treaty applies to undertakings entrusted
with the operation of services of general economic
interest. Article 86(3) of the Treaty requires the Commis-

(1) OJ L 195, 29.7.1980, p. 35.
(2) OJ L 254, 12.10.1993, p. 16.

sion to ensure the application of
the provisions of
Article 86 and to address appropriate directives or deci-
sions to Member States. The interpretative provisions
annexed to the Treaty by the Protocol on the system of
public broadcasting in the Member States state that the
provisions of
the Treaty establishing the European
Community shall be without prejudice to the compet-
ence of the Member States to provide for the funding of
public service broadcasting in so far as such funding is
granted to broadcasting organisations for the fulfilment
of the public service remit conferred, defined and orga-
nised by each Member State, and in so far as such
funding does not
and
competition in the Community to an extent which
would be contrary to the common interest, while the
realisation of the remit of that public service shall be
taken into account. In order to ensure the application of
the provisions of Article 86 of the Treaty the Commis-
sion must have the necessary information. This entails
defining the conditions for achieving transparency.

conditions

trading

affect

(6)

(7)

Complex situations linked to the diverse forms of public
and private undertakings granted special or exclusive
rights or entrusted with the operation of services of
general economic interest as well as the range of activi-
ties that might be carried on by a single undertaking and
liberalisation in the
the different degrees of market
various Member States could complicate application of
the competition rules, and particularly Article 86 of the
Treaty. It is therefore necessary for Member States and
the Commission to have detailed data about the internal
financial and organisational structure of such undertak-
ings, in particular separate and reliable accounts relating
to different activities carried on by the same under-
taking. Such information is not always available or is not
always sufficiently detailed or reliable.

Such accounts should show the distinction between
different activities,
the costs and revenues associated
with each activity and the methods of cost and revenue
assignment and allocation. Such separate accounts
should be available in relation to, on the one hand,
products or services in respect of which the Member
State has granted a special or exclusive right or entrusted
the undertaking with the operation of a service of
general economic interest, as well as, on the other hand,
for each other product or service in respect of which the
undertaking is active. The obligation of separation of
accounts should not apply to undertakings whose activi-
ties are limited to the provision of services of general
economic interest and which do not operate activities
outside the scope of these services of general economic

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Official Journal of the European Communities

29.7.2000

(8)

(9)

(10)

interest. It does not seem necessary to require separation
of accounts within the area of services of general
economic interest or within the area of the special or
exclusive rights, as far as this is not necessary for the
cost and revenue allocation between these services and
products and those outside of the services of general
economic interest or the special or exclusive rights.

interest

the importance of

Requiring Member States to ensure that the relevant
undertakings maintain such separate accounts is the
most efficient means by which fair and effective applica-
tion of the rules on competition to such undertakings
can be assured. The Commission has adopted a
Communication on services of general
in
Europe (1) in which it emphasises their importance. It is
necessary to take account of
the
sectors concerned, which may involve services of general
interest, the strong market position that the relevant
undertakings may have
vulnerability of
emerging competition in the sectors being liberalised. In
accordance with the principle of proportionality it is
necessary and appropriate for the achievement of the
basic objective of transparency to lay down rules on
such separate accounts. This Directive confines itself to
what is necessary in order to achieve the objectives
pursued in accordance with the third paragraph of
Article 5 of the Treaty.

and the

for all economic activities throughout

In certain sectors provisions adopted by the Community
require Member States and certain undertakings to main-
tain separate accounts. It is necessary to ensure an equal
treatment
the
Community and to extend the requirement to maintain
separate accounts to all comparable situations. This
Directive should not amend specific rules established for
the same purpose in other Community provisions and
should not apply to activities of undertakings covered by
those provisions.

In view of the limited potential impact on competition
and in order to avoid imposing an excessive adminis-
trative burden it is not necessary, at this time, to require
enterprises with a total annual net turnover of less than
EUR 40 million to maintain separate accounts. In view
of the limited potential for an effect on trade between
to
Member States,
require separate accounts in relation to the supply of
certain categories of services. This Directive should apply
without prejudice to any other rules concerning the
provision of
information by Member States to the
Commission.

is not necessary, at

this time,

it

(11)

In cases where the compensation for the fulfilment of
services of general economic interest has been fixed for
an appropriate period following an open, transparent
and non-discriminatory procedure it does not seem

(1) OJ C 281, 26.9.1996, p. 3.

necessary at this time to require such undertakings to
maintain separate accounts.

(12) Article 295 of the Treaty provides that the Treaty is in
in Member States
no way to prejudice the rules
governing the system of property ownership. There
should be no unjustified discrimination between public
and private undertakings in the application of the rules
on competition. This Directive should apply to both
public and private undertakings.

(13)

The Member States have differing administrative terri-
torial structures. This Directive should cover public
authorities at all

levels in each Member State.

(14) Directive 80/723/EEC should therefore be amended

accordingly,

HAS ADOPTED THIS DIRECTIVE:

Article 1

Directive 80/723/EEC is amended as follows:

1. The title is replaced by the following:

‘Commission Directive 80/723/EEC of 25 June 1980 on the
transparency of financial relations between Member States
and public undertakings as well as on financial transparency
within certain undertakings.’

2. Articles 1 and 2 are replaced by the following:

‘Article 1

1.
The Member States shall ensure that financial relations
between public authorities and public undertakings are
transparent as provided in this Directive, so that
the
following emerge clearly:

(a) public funds made available directly by public authori-

ties to the public undertakings concerned;

(b) public funds made available by public authorities
through the intermediary of public undertakings or
financial

institutions;

(c) the use to which these public funds are actually put.

2. Without prejudice to specific provisions laid down by
the Community the Member States shall ensure that the
financial and organisational structure of any undertaking
required to maintain separate accounts is correctly reflected
in the separate accounts, so that
the following emerge
clearly:

(a) the costs and revenues associated with different activi-

ties;

(b) full details of the methods by which costs and revenues

are assigned or allocated to different activities.

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Official Journal of the European Communities

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Article 2

1.

For the purpose of this Directive:

service or to operate the same activity in the same
geographical area under
substantially equivalent
conditions.

(a) “public

authorities” means

including the State and regional,
territorial authorities;

all public

authorities,
local and all other

A dominant

2.
authorities
directly or indirectly in relation to an undertaking:

the public
shall be presumed when these authorities,

influence on the part of

(b) “public undertakings” means any undertaking over
which the public authorities may exercise directly or
indirectly a dominant influence by virtue of their owner-
ship of it, their financial participation therein, or the
rules which govern it;

(c) “public undertakings operating in the manufacturing
sector” means all undertakings whose principal area of
activity, defined as being at least 50 % of total annual
turnover, is in manufacturing. These undertakings are
those whose operations fall to be included in Section D
— Manufacturing (being subsection DA up to and
including subsection DN) of the NACE (Rev.1) classi-
fication (*);

(d) “undertaking required to maintain separate accounts”
means any undertaking that enjoys a special or exclusive
right granted by a Member State pursuant to Article
86(1) of the Treaty, or that is entrusted with the opera-
tion of a service of general economic interest pursuant
to Article 86(2) of the Treaty and receives State aid in
any form whatsoever, including any grant, support or
compensation,
in relation to such service and which
carries on other activities;

(e) “different activities” means, on the one hand, all prod-
ucts or services in respect of which a special or exclusive
right is granted to an undertaking or all services of
general economic interest with which an undertaking is
entrusted and, on the other hand, each other separate
product or service in respect of which the undertaking is
active;

(f) “exclusive rights” means rights that are granted by a
Member State to one undertaking through any legisla-
tive, regulatory or administrative instrument, reserving it
the right to provide a service or undertake an activity
within a given geographical area;

(g) “special rights” means rights that are granted by a
Member State to a limited number of undertakings,
through any legislative, regulatory or administrative
instrument, which, within a given geographical area:

— limits to two or more the number of such undertak-
ings, authorised to provide a service or undertake an
activity, otherwise than according to objective,
proportional and non-discriminatory criteria, or

— designates, otherwise than according to such criteria,
several competing undertakings, as being authorised
to provide a service or undertake an activity, or

— confers on any undertaking or undertakings, other-
wise than according to such criteria, any legal or
regulatory advantages which substantially affect the
ability of any other undertaking to provide the same

(a) hold the major part of the undertaking's subscribed

capital; or

(b) control the majority of the votes attaching to shares

issued by the undertakings; or

(c) can appoint more than half of the members of the
undertaking's administrative, managerial or supervisory
body.

(*) OJ L 83, 3.4.1993, p. 1.’

3. In Article 3,

‘Article 1’

is replaced by ‘Article 1(1)’

4. The following Article 3a is inserted:

‘Article 3a

1.
To ensure the transparency referred to in Article
1(2), the Member States shall take the measures necessary
to ensure that for any undertaking required to maintain
separate accounts:

(a) the internal accounts corresponding to different activi-

ties are separate;

(b) all costs and revenues are correctly assigned or allo-
cated on the basis of consistently applied and objec-
tively justifiable cost accounting principles;

(c) the cost accounting principles according to which
separate accounts are maintained are clearly estab-
lished.

2.
Paragraph 1 shall only apply to activities which are
not covered by specific provisions laid down by the
Community and shall not affect any obligations of
Member States or undertakings arising from the Treaty or
from such specific provisions.’

5. Articles 4 and 5 are replaced by the following:

‘Article 4

1.
As far as the transparency referred to in Article 1(1)
is concerned, this Directive shall not apply to financial
relations between the public authorities and

(a) public undertakings, as regards services the supply of
which is not liable to affect trade between Member
States to an appreciable extent;

(b) central banks;

(c) public credit institutions, as regards deposits of public
funds placed with them by public authorities on
normal commercial terms;

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(d) public undertakings whose total annual net turnover
over the period of the two financial years preceding
that in which the funds referred to in Article 1(1) are
made available or used has been less than EUR 40
million. However,
institutions the
corresponding threshold shall be a balance sheet total
of EUR 800 million.

for public credit

As far as the transparency referred to in Article 1(2)

2.
is concerned, this Directive shall not apply
(a) to undertakings, as

services

regards

the supply of
which is not liable to affect trade between Member
States to an appreciable extent;

(b) to undertakings whose total annual net turnover over
the period of the two financial years preceding any
given year in which it enjoys a special or exclusive
right granted by a Member State pursuant to Article
86(1) of the Treaty, or in which it is entrusted with
the operation of
economic
interest pursuant to Article 86(2) of the Treaty is less
than EUR 40 million; however, for public credit insti-
tutions the corresponding threshold shall be a balance
sheet total of EUR 800 million;

service of general

a

(c) to undertakings which have been entrusted with the
services of general economic interest
operation of
pursuant to Article 86(2) of the Treaty if the State aid
in any form whatsoever, including any grant, support
or compensation they receive was fixed for an appro-
priate period following an open, transparent and non-
discriminating procedure.

that

shall

States

ensure

Article 5
1. Member
information
concerning the financial relations referred to in Article
1(1) be kept at the disposal of the Commission for five
years from the end of
the financial year in which the
public funds were made available to the public undertak-
ings concerned. However, where the same funds are used
during a later financial year, the five-year time limit shall
run from the end of that financial year.
2. Member
information
concerning the financial and organisational structure of
the
undertakings referred to in Article 1(2) be kept at

ensure

States

shall

that

disposal of the Commission for five years from the end
of the financial year to which the information refers.

States

shall, where

the Commission
3. Member
considers it necessary so to request, supply to it
the
information referred to in paragraphs 1 and 2, together
with any necessary background information, notably the
objectives pursued.’

6. In Article 5a(3),

‘ECU’

is replaced by ‘EUR’.

7. In Article 6(1),

‘Article 5(2)’

is replaced by ‘Article 5(3)’.

Article 2

Member States shall bring into force the laws, regulations
and administrative provisions necessary to comply with this
Directive by 31 July 2001 at the latest. They shall forthwith
inform the Commission thereof.

Article 1(2) of Directive 80/723/EEC, as amended by this
Directive, shall apply with effect from 1 January 2002.

those provisions,

When Member States adopt
they shall
contain a reference to this Directive or be accompanied by
such a reference on the occasion of their official publication.
Member States shall determine how such reference is to be
made.

Article 3

into force on the 20th day
This Directive shall enter
following that of its publication in the Official Journal of the
European Communities.

This Directive is addressed to the Member States.

Article 4

Done at Brussels, 26 July 2000.

For the Commission

Mario MONTI

Member of the Commission