Opinion of the European Economic and Social Committee on the "Green Paper on Services of General Interest" (COM(2003) 270 final)
Date: 2003-12-11
Institutions: European Economic and Social Committee
Subjects: ESC opinion, services of general interest

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Opinion of the European Economic and Social Committee on the ‘Green Paper on Services of
General Interest’

(COM(2003) 270 final)

(2004/C 80/20)

On 22 May 2003 the Commission decided to consult the European Economic and Social Committee,
under Article 262 of the Treaty establishing the European Community, on the ‘Green Paper on Services
of General Interest’.

The Section for Transport, Energy, Infrastructure and the Information Society, which was responsible for
preparing the Committee’s work on the subject, adopted its opinion on 24 November 2003. The
rapporteur was Mr Hernández Bataller and the co-rapporteur was Mr Hencks.

At its 404th plenary session of 10 and 11 December 2003 (meeting of 11 December), the European
Economic and Social Committee adopted the following opinion by 72 votes to seven with six abstentions.

1.

Introduction

1.1.
The concept of services of general interest is under-
stood differently across the European Union, with perceptions
varying between the Germanic, Nordic, Latin and English-
In some EU Member States the very
speaking countries.
concept of public service does not exist. There are, however,
some quite similar ideas and closely corresponding situations,
reflecting values shared by all European countries. (Examples
include, ‘beheer van diensten’ in the Netherlands, ‘gestione di
pubblica utilità’ in Italy, ‘public utilities’ in the United Kingdom,
‘Daseinsvorsorge’
in
France.) (1)

and ‘service public’

in Germany,

1.2.
The concept and characteristics of services of general
interest have been defined in various Community documents,
and this definition, although not yet consolidated, continues
to be essentially valid today. Accordingly:

— service of general interest covers market and non-market
services which the public authorities class as being of
general
interest and subject to specific public service
obligations;

— service of general economic interest refers to market
services which the Member States and the Union subject
to specific public service obligations by virtue of general
interest criteria (2), especially concerning universal service,
in sectors such as electronic communications, energy and
postal services.

issued in 1996 (3) and
In its communications
1.2.1.
2000 (4),
the Commission emphasised the importance of
services of general interest in Europe, stressing that they are a
key element in the European model of society. This model is
off-bounds, as is clearly shown by the fact that the European
Union excluded education, health and culture from the WTO
negotiations in Cancún (10 to 15 September 2003) with the
specific aim of safeguarding the general interest.

1.2.2.
objectives in these communications:

The Commission takes account of four essential

— to ensure that services of general economic interest

function efficiently;

— to ensure that services are correctly classed as being of

general economic interest;

— to ensure that there are no adverse repercussions on
markets open to competition outside the public service;
and

— to ensure that all citizens have access to essential services.

1.3.
Community law stipulates compliance with specific
in particular the principles of
procedures and principles,
transparency, non-discrimination and proportionality, and
permits the setting-up and smooth functioning of services of
general economic interest. In the absence of specific regulations
adopted by the Council, the Member States enjoy far-reaching
authority to determine their services of general economic
interest as well as how these are run, including any public
funding that may be necessary.

(1) OJ C 368, 20.12.1999, point 1.1.
(2) OJ C 241, 7.10.2002, point 1.1.

(3) OJ C 281, 26.9.1996.
(4) OJ C 17, 19.1.2001.

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There is however a lack of symmetry in the Treaties between
the provisions of competition law under which services of
general economic interest are considered as derogations from
Article 86(2) et seq, and the positive recognition of services of
general economic interest in Article 16, which does not
constitute a legal basis.

Both state aid policy and social and territorial cohesion policy
serve to cushion against market shortcomings, although the
former is designed to prevent distortions of competition and
the latter to actively promote social and territorial cohesion.

Article 36 of the Charter of Fundamental Rights (1) recognises
and respects access to services of general economic interest in
order to promote social and territorial cohesion. In addition,
access to these services normally implies strengthening another
fundamental right, such as the right to free movement of
persons in transport services or the right to privacy and secrecy
of communication in postal services.

1.4.
In response to the request of the Nice European
Council of December 2000, the Commission presented a
report on services of general interest (2) to the Laeken European
Council in December 2001. In it, the Commission indicated
its intention to establish a Community framework for state aid
granted to undertakings entrusted with the provision of
services of general economic interest, and for implementing
evaluation of their performance, with the aim of enhancing
the legal certainty surrounding public service compensation.

1.4.1.
Historically, the Commission has tended to consider
that compensation paid by a state to undertakings entrusted
with the provision of a service of general economic interest
does not constitute state aid in that it is limited to the actual
costs incurred in fulfilling public service obligations.

The Court of First Instance in its judgments in the
1.4.2.
cases FFSA (3) of 27 February 1997 and Televisión portuguesa
of 10 May 2000 (4), ruled that compensation for the actual
costs incurred in fulfilling public service obligations does
constitute state aid in accordance with the provisions of
Article 87(1) of the Treaty.

Nonetheless,

Justice in its Ferring
the Court of
1.4.3.
judgment (5) of 22 November 2001 ruled that compensation
granted by a Member State and which did not exceed the
amount needed in order to fulfil a public service obligation
was not an advantage for the undertaking receiving the
compensation and as such did not constitute state aid. The
Court stressed that any compensation amounts over and above
costs necessary in order to fulfil a public service obligation
could be considered to be state aid, and thus be in breach of
Article 86 of the Treaty.

1.4.4.
The Court of Justice, meeting in plenary session,
delivered a judgment on 24 July 2003 (6), revising its earlier
case-law (7) and stipulating that certain conditions must be
fully satisfied in order to exclude such public subsidies
(compensation) from the scope of Article 87(1) of the EC
Treaty:

— the recipient undertaking must actually have public
service obligations to discharge, and the obligations must
be clearly defined;

— the parameters on the basis of which the compensation
is calculated must be established in advance in an
objective and transparent manner;

— the compensation cannot exceed what is necessary to
cover all or part of the costs incurred in the discharge of
public service obligations, taking into account the relevant
receipts and a reasonable profit for discharging those
obligations;

— where the undertaking which is to discharge public
service obligations is not chosen pursuant to public
the level of compensation
procurement procedures,
needed must be determined on the basis of an analysis of
the costs which a typical undertaking, well run and
suitably equipped to meet the necessary public service
requirements, would have incurred in discharging those
obligations, taking into account the relevant receipts and
a reason profit for discharging the obligations.

(1) Article 36 of the Charter states that ‘The 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’.

(2) COM(2001) 598 final.
(3) Case T-106/95; judgment confirmed by a ruling of the Court of

Justice on 25 March 1998 (case C-174/97).

(4) Case T-46/97.

(5) Case C-53/00.
(6) Case C-280/00, Altmark Trans GmbH, Opinion of Advocate

General Léger delivered on 19 March 2002.

(7) Case C-53/00, judgment of 22 November 2001. Advocate General
Léger discussed the content of this judgment in particularly critical
terms in his Opinion on Case C-280/00, specifically in points 58-
61, 76-82 and 87-89.

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2. The Green Paper on Services of General Interest

2.1.
The green paper consists of five main parts plus an
introduction and an operational conclusion. The first part
outlines the background; the second part discusses the scope
of Community action in the area of services of general interest;
the third part provides a number of elements for a possible
common concept of services of general economic interest, on
the basis of existing sector-specific legislation; the fourth part
looks at issues related to the way services of general interest
are organised, financed and evaluated, and the fifth part
addresses the international dimension of services of general
interest. The Green Paper is accompanied by an annex which
sets out public service obligations in more detail, as derived
from existing sector-specific legislation, and the policy instru-
ments available to ensure compliance with these obligations (1).

2.2.
Services of general interest, which include services of
both general economic and non-economic interest, are com-
plex and constantly evolving. They cover a broad range of
different types of activity of differing scale and nature. The
organisation of these services varies according to the cultural
traditions, history and geographical conditions of each Member
State and the characteristics of the activity concerned,
in
particular technological development (2).

2.3.
The European Union respects this diversity and the
roles of national, regional and local authorities in ensuring the
well-being of their citizens and in guaranteeing democratic
choices regarding, among other things, the level of service
quality. This diversity explains the various degrees of Com-
munity action and the use of different instruments. The Union
also has its own role to play in those areas where it has
exclusive powers. Moreover, throughout the European Union
services of general interest raise a number of questions and
issues that are common to different services and different
competent authorities (3).

The debate that this Green Paper intends to launch

2.4.
raises questions with regard to:

— the scope of possible Community action in accordance
with the Treaty in full respect of
the principle of
subsidiarity and the possible granting of additional legal
powers to the Community;

— the principles that could be included in a possible
framework directive or other general instrument concern-
ing services of general interest and the added value of
such an instrument;

— the definition of good governance in the area of organis-
ation, regulation, financing and evaluation of services of
interest in order to ensure greater economic
general
competitiveness and efficient and equitable access for all
to high-quality services meeting their needs;

— any measures that could help increase legal certainty and
ensure a coherent and harmonious interaction between
the objective of maintaining high-quality services of
general interest and rigorous application of competition
and internal market rules (4).

3. General comments

The Committee has already stated its view on most of
3.1.
the issues raised by the Commission in the Green Paper in
Opinions CES 949/99 and CES 860/2002. In the latter in
particular (5) it stated that:

‘... there is a need for the Commission to present a proposal
for a framework Directive consolidating the political principles
governing services of general economic interest and giving
Member States the flexibility they need in this area. This legal
instrument should highlight the importance placed by the
European Union on services of general interest and European
citizens’ inherent right to access these services, and — in order
to provide greater legal security — should clarify some
concepts relating to Community law, while fully respecting
the principle of subsidiarity’.

The EESC emphasises that this framework directive (6) needs
to be adopted in particular in order to define the concepts
used by the Treaties and sectoral directives, as well as the
conditions for intervention by the various operators, especially
those responsible for providing services of general interest at
regional or local level.

(1) Point 13 of the Green Paper.
(2) Point 10 of the Green Paper.
(3) Point 11 of the Green Paper.

(4) Point 12 of the Green Paper.
(5) OJ C 241, 7.10.2002, point 4.4.
(6) ‘Framework law’ in the terminology used in the draft Constitution

for Europe.

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As regards the scope of Community action,

in
3.1.1.
addition to its
suggestion that a framework Directive,
accompanied by other, sector-specific proposals, be drawn up,
the Committee (1) feels that ‘... Article 3 of the EC Treaty
should include a reference to the provision of services of
general interest in the list of activities to be undertaken by the
Community to achieve its objectives’. The EESC is pleased to
note that the draft constitution produced by the Convention
on the Future of Europe strengthens and amplifies the present
Article 16, with a view to providing an adequate legal basis for
legislation.

As the EESC has argued elsewhere (2), the Com-
3.1.2.
mission should, for example by means of a communication,
establish criteria which would enable bodies providing services
for non-profit purposes in this field to continue doing so, in
order to secure the necessary clarity and transparency. The
common aim of these criteria would in any case be to ensure
efficient provision of services.

The EESC considers it important

3.1.3.
for the public
authorities to apply the principle of participatory democracy,
in order to promote a culture of dialogue and participation (3),
especially among organisations providing social services on a
non-profit basis. Such organisations must continue providing
these services, since they protect the most vulnerable individ-
uals, create or maintain the social fabric and promote solidarity
among citizens. The EESC therefore repeats that social services
need to be treated differently from the vast number of actors
responsible for services of general interest (4).

3.1.4.
The requirements of subsidiarity and proportionality,
and the issues of relevance and scale, are closely interlinked
and should be taken fully into account. The Committee feels
that (5) ‘... the future Community framework should establish
a mechanism allowing subsidiarity to be applied according to
functional as well as territorial criteria’.

The EESC therefore stresses that by virtue of the principle of
subsidiarity, it is up to the relevant national, regional and local
authorities to define, organise, finance and monitor services of
general interest.

(1) OJ C 241, 7.10.2002, point 4.1.2.
(2) EESC opinion on private not-for-profit services in the context of
services of general interest in Europe, OJ C 311, 7.11.2001.
(3) Communication from the Commission on European governance:

better lawmaking, COM(2002) 275 final, p. 3.

(4) EESC opinion on private not-for-profit services in the context of
interest in Europe, OJ C 311, 7.11.2001,

services of general
point 4.1.d) of the opinion.
(5) OJ C 241, 7.10.2002, point 4.3.

The EESC draws attention to the fact that the primary
3.1.5.
objective of services of general interest is access for all citizens,
consumers and businesses to public services; when such
services are provided by a publicly or privately-owned
enterprise operating in the commercial sector, the profit- or
competitiveness-seeking criterion must under no circum-
stances be allowed to result in the disappearance of services
for some citizens. Services must be uninterrupted and equally
accessible to all even where, due to geographical or technical
circumstances in particular, service provision is not economi-
cally profitable. In such cases, the administrative, tax-related,
legal and technical derogation measures necessary for service
provision, including State aid by way of exception from the
Community system, must be authorised and encouraged.

3.2.
As regards those principles that could be included in a
framework Directive or other general instrument concerning
services of general
the Committee has already
expressed the following view (6):

interest,

‘As a citizens’ right, services of general economic interest
should operate according to the following guidelines:

Equality: all citizens are entitled to equal access to services of
general interest. The term equality is to be understood not as
an obligation of uniformity, rather as prevention of any
unjustified discrimination based on social or personal status in
relation to service provision.

Universality: for services supplied, basic services should be
universally provided.

Reliability: the provision of services of general interest should
be continuous, regular and uninterrupted. Irregular operation
or suspension of services will be restricted to specific cases laid
down in the regulation governing the sector.

Participation: users should participate actively in the develop-
ment of services of general
interest. The purpose of such
participation is to protect citizens’ rights with regard to the
adequate provision of services and to promote the cooperation
of the service-providers.

Transparency: service-providers will ensure that users receive
full information on the service provision, especially on the
public service obligations and tariffs.

(6) OJ C 368, 20.12.1999, point 5.3 (in full).

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To this end, service-providers will inform the users of the
financial and technical arrangements for the provision of
services and of any changes affecting the service, publishing
the texts containing the relevant regulation.

Environmental protection: the definition and operation of
services of general economic interest should take account of
environmental protection requirements as a key component
of social and territorial cohesion.’

Simplification of procedures: as far as possible service-pro-
viders will simplify the procedures to be followed by users and
will supply the appropriate explanations.

Moreover, where possible they will use standard forms, striving
to simplify and explain the methods of subscribing to and
paying for the services.

In all cases, service-providers will introduce internal procedures
for addressing complaints made by users. These procedures will
be accessible, easy to understand and implement, ultimately
ensuring that the service-providers take account of the com-
plaints made by users and consumers’ associations, and will
facilitate the right to bring a complaint before the regulator
and, generally speaking, access to the legal system.

interest, meaning,

The EESC again calls for these principles to be included. The
principle of reversibility of services of general interest should
be added to them. In this regard, the EESC calls for the
introduction of a principle of ‘reversibility’ of services of
general
in the light of the principle of
subsidiarity and Treaty Article 295, firstly, a guarantee for
service users that any de facto or de jure situation is periodically
scrutinised by the Member State authorities and secondly, that
the Member States and their regional and local authorities are
left free to decide how they wish to organise the supply of
services of general interest. Amongst other things, this entails
the possibility that, following an objective assessment in the
interests of the users and employees concerned, ownership of
such services may be returned from the private to the public
sector.

Profitability and efficiency: services of general economic
interest will be supplied efficiently and profitably. Providers
will adopt the measures necessary to achieve these objectives.

As regards the organisation (1), regulation (2), finan-
3.3.
cing (3) and assessment of these services, the Committee has
laid down the following guidelines:

Quality of services: service-providers will identify the factors
influencing the quality of services and, on this basis, publish
quality and quantity standards which they will pledge to.

— regarding organisation, in accordance with the principle
of the freedom to choose the method of management,
either direct or indirect; in the latter case, each public
authority will choose the operators for the various
services of general interest for which it is responsible;

Compliance with these standards will not be negotiable.
Exceptions to these standards will only be granted if it is
advantageous to users and will be monitored by users in
periodic meetings.

— regarding regulation, regulators — either individuals or
bodies — will perform tasks related to assessment,
monitoring and intervention;

Adequate provision of services: services of general economic
interest will be adapted to changes in the needs of the
community and to technical and economic progress.

— regarding financing, the relationship between the oper-
ators of these services and the authorities responsible
must be laid down in a contract defining, in particular,
the pricing principles and main methods of financing.

Evaluation of results: the arrangements for providing public
services will be periodically reviewed by the service-provider.
To do so, service-providers will collect information on, inter
alia, user-satisfaction.

Cooperation between service-providers: even if the service is
provided in a competitive environment, service-providers will
strive to cooperate to ensure compliance with these principles.

The EESC repeats that the principle of free administration by
the territorial public authorities should be applied, and calls
for the criteria used in assessing services of general interest to
be diversified and to take special account of quality of service.
From the financial point of view, the concept of compensation
for the costs incurred by public service obligations should be
defined.

Affordable price: the conditions for access to these services
should be at a price citizens can afford. The guiding principle
should be “reasonable cost”.

(1) OJ C 241, 7.10.2002, point 4.12.
(2) OJ C 241, 7.10.2002, point 4.11.
(3) OJ C 241, 7.10.2002, point 4.13.

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to measures that could be used to
3.4. With respect
reinforce legal certainty, the Committee has already suggested
the following:

4. Responses to the Green Paper

— Services of general interest must be defined at the most
appropriate level and with due respect for the various
European, national and territorial levels. Furthermore, it
is the responsibility of public authorities to take account
of new social needs and technological changes, in particu-
lar those in the information society, in order to define the
aims and obligations of public service (1) and of universal
service content.

— When public authorities decide to assign service manage-
ment to a third party, and when special and/or exclusive
rights are granted, the management of these services must
be entrusted with due respect
for public tendering
rules (2).

— In order to improve democratic participation and the
participation of citizens, the users must be consulted (3).

— The access to information, consultation and participation
of workers and their representatives is essential (4).

— In order to distinguish between economic and non-
economic activities, services associated with national
education systems and the mandatory membership of a
basic social security scheme, and services provided by
not-for-profit social, charitable and cultural entities, must
be exempt from competition rules and provisions relating
to the internal market, but not from the principles of
Community law (5).

3.5.
The Committee agrees that the Union should promote
a high level of consumer protection at every stage of service
provision:

— at the pre-contractual stage, with accessible, sufficient
and relevant information and truthful advertising;

The Green Paper on services of general interest, published by
the Commission on 21 May 2003, sets out to launch a wide-
ranging consultation exercise on the four areas listed in
point 2.4 above. The EESC would emphasise the importance
of this debate at a time when the European Union is reshaping
its approaches and its institutions for the future, and is
preparing to receive ten new Member States.

The EESC believes that the questions raised by the European
Commission in the Green Paper provide a realistic basis for
developing the social and civil dialogue announced by the
Commission President, Romano Prodi, in October 2002 with
a view to defining a strategy on services of general interest, in
which all the relevant players must be involved. The EESC is
ready to make its contribution.

The list of areas concerned by the questions contained in the
Green Paper should not however be considered exhaustive:
additional areas should include a chapter on citizens’ rights
regarding services of general interest.

Similarly, the Green Paper barely mentions social services.
Although these are dealt with separately in the Charter of
Fundamental Rights, they are part of services of general interest
and represent a key element in the European social model.
them to
There is currently a growing trend to subject
competition law.

The Green Paper contains thirty questions across ten chapters,
to which the Commission invites replies and contributions.

In addition to the replies to the questions raised provided by
the EESC in earlier opinions, and which are set out above, the
EESC wishes to make the following specific points.

— at the contractual stage, with clear contracts containing
no unfair terms, with affordable prices and pre-established
conditions of quality;

4.1. What kind of subsidiarity?

— at the post-contractual stage, through the introduction
of
flexible, straightforward and effective out-of-court
complaints procedures, where possible with standard
forms and automatic compensation for service short-
comings, except
force majeure or under
unforeseeable circumstances.

in cases of

(1) OJ C 241, 7.10.2002, point 4.8.2.
(2) OJ C 241, 7.10.2002, point 4.12.1.
(3) OJ C 241, 7.10.2002, point 4.14.
(4) OJ C 241, 7.10.2002, point 4.15.
(5) OJ C 241, 7.10.2002, point 4.17.

Services of general interest, whose essential role is to
4.1.1.
help enhance all citizens’ quality of life, come under an area
where there is a need for particularly active implementation of
the principles of subsidiarity, proportionality and proximity.

4.1.2.
The aim should be to reconcile respect for the
diversity of organisational and regulatory methods, arising
from historical, traditional and institutional factors, and from
the different kinds of service, with the process of European
integration. The result should be differentiated responses
according to the type of service concerned — trans-European,
cross-border, national, regional or local — in order to promote
maximum efficacy.

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the European Union,

The responsibilities of

the
4.1.3.
Member States and sub-national bodies, together with methods
for cooperation between them, should be clarified in line with
these factors. Each public authority should be recognised as
being free to choose how to organise and run the services of
general interest for which it is responsible, the purpose being
to ensure the level of quality required to meet the fundamental
and essential needs of users and the general public.

4.1.4.
The Union’s responsibilities regarding services of
general interest cannot be restricted to completing the internal
market and careful implementation of competition law. The
Union must guarantee the fundamental rights, and contribute
to the Union’s economic, social and territorial cohesion, to
social
for balanced and
sustainable development by promoting high-quality, effective
services of general interest, and must guarantee the possibility
of legal redress for individuals.

inclusion and to encouragement

4.1.5.
The Union should also consider developing common
services of general interest at European level such as Galileo,
the single European sky, etc.

the objectives of

the EU in Article 3 of

4.1.6.
In this regard, while recalling that it would like
promotion of services of general interest to be included as one
of
the future
Constitution, the EESC welcomes the relative progress rep-
resented by the Convention’s draft, which amplifies and
strengthens the present Article 16 concerning services of
general interest, converts it into a legal basis (‘European laws
shall define these principles and conditions’ Article III-6), and
includes services of general economic interest under the
‘clauses of general application’.

The EESC would like to see a dynamic approach to
4.2.2.
social services, exploring this issue in depth. All those con-
cerned must be involved in the process, on the basis of a civil
dialogue.

4.2.3.
The EESC also calls for the point of view of business-
es, in their capacity as users of services of general interest, to
be taken into account. Wherever they are located — and
especially in rural or inaccessible areas, such as island and
upland regions — businesses must have access to services
under the same conditions of availability and cost as businesses
in areas, such as urban ones, where access to services is easier.
The Member States must be permitted and encouraged to
adopt special derogation measures, including in the field of
taxation, and to create forms of positive legal or economic
discrimination enabling these services to be maintained in
inaccessible areas, as well as to introduce special measures to
assist businesses established in such areas. The EESC calls for
this provision to be included in the framework directive.

4.2.4.
The EESC does not see a ‘general legal framework’
and ‘sector-specific legislation’ as opposed, suggesting rather
that their mutual advantages be combined.

4.3.

Economic and non-economic services

4.2.

Sector-specific legislation and general legal framework

4.2.1.
consolidate:

The EESC calls for a directive or framework law to

— the principles governing services of general interest,

— the main thrust of Community law,

— the ways of financing public service or universal service

obligations,

— the choice of organisation and regulation methods,

— performance assessment procedures, and

— users’ rights,

in order to ensure greater legal and economic certainty for all
those concerned, while giving the Member States the flexibility
they need in this area.

4.3.1.
The line between economic and non-economic is
blurred, risky and uncertain, and is today generating forms of
growing legal uncertainty. There is a need for clarification.

All services of general interest provided, even if on a
4.3.2.
non-profit or voluntary basis, represent a given economic
value without, however, falling within the scope of competition
law. Moreover, a service may simultaneously be commercial
and non-commercial. By the same token, a service may be of
a commercial nature without the market necessarily being in a
position to provide a service matching the general approach
and principles governing services of general interest.

4.3.3.
The purpose is not to distinguish between ‘economic’
and ‘non-economic’ services, but to ensure active implemen-
tation of the principle of subsidiarity. The Union should recall
the types of service to which common competition law does
not apply (services of sovereign or national, regional or local
interest, the compulsory education system, health care and
social protection, or cultural, charitable, social, solidarity/
donation-based activities, etc.).

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Framework law and sector-specific legislation must
4.3.4.
clearly define the principles and regulatory arrangements for
other services, complementing common competition law;
this legislative definition enables further developments to be
undertaken when necessary.

for which it is responsible, and of the ensuing public service
or universal service obligations. It decides either to manage
these obligations in-house, or to entrust them to an outside
operator, entailing open tendering procedures. In both cases,
the relevant authority separates regulatory responsibilities and
activities from the operating function.

4.4. A common set of obligations

4.4.1.
The public service obligations listed in the Green
Paper are still all too often referred back to the Member
States and whatever action they may take, while the Union’s
responsibilities are under-developed (except with regard to
universal service, which is defined at Community level).

The Union must assume its own responsibilities
4.4.2.
where promotion of
its economic, social and territorial
cohesion is concerned; the same should apply to the creation
of trans-European networks, environmental protection, health,
safety and security.

4.4.3.
The EESC believes that the Union should take greater
account of the changing way in which universal service is
defined. In those sectors where it has been defined, the original
content has remained static although technological and econ-
omic change has been widespread and rapid.

4.7.

Financing

4.7.1.
The relevant authority decides how to finance public
service or universal service obligations, with complete trans-
parency and in accordance with the principle of pro-
portionality. European rules must provide long-term security
for the financing of these obligations.

4.7.2.
In the EESC’s view, the possible options for financing
obligations should not be restricted, or preference given only
to direct public funding from the budget: this would contradict
the principles of subsidiarity and proportionality. Each method
has its own features which may be best suited to a particular
sector or objective, so that those responsible for ensuring
compliance with service of general interest obligations must
be able to choose their management and funding methods and
combine their respective advantages.

4.4.4.
In addition, the Union should carefully consider for
which other sectors it might envisage guaranteeing access for
all citizens to basic services of general interest (water and
sewage, basic banking service, housing, etc.).

4.7.3.
In view of the limited funding capacity of some of
the new Member States, the Union should make the necessary
means available to them to promote the development of
effective services of general interest.

4.5.

Sector-specific obligations

4.8.

Evaluation

4.5.1.
Safety, security of supply and environmental protec-
tion clearly have a sector-specific dimension, but they also
often possess a broader dimension. Some could be included
within the common set of obligations.

4.5.2.
Similarly, issues of access to networks, interoperabi-
lity and interconnection, like aspects specific to cross-border
zones, are not restricted to single sectors, but should be
covered by more developed Community policies.

4.6. Definition of obligations and choice of organisation

4.6.1.
As part of the active implementation of the subsidiar-
ity principle, each relevant authority makes a transparent
definition of the objectives of the services of general interest

The definition of services of general

4.8.1.
interest, the
objectives assigned to them, the way they are organised and
regulated, and the way they are financed change over time and
from place to place. At the same time, Community regulations
seek the best on-going balance between application of com-
mon competition law and these objectives.

For these two reasons, in addition to exchanges of
4.8.2.
best practice and benchmarking, evaluation of the performance
of services of general interest is a vital objective if the European
Union is to make progress in enhancing their quality and
efficacy. Due consideration should be given to defining the
needs of users and the general public, and to service quality
and practical arrangements for provision, as well as to
economic aspects, when establishing evaluation criteria. This
entails users and the general public having the means to voice
their needs.

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Since the objectives of the various actors involved in
4.8.3.
services of general interest are not the same, they should all be
involved in shaping evaluation methods and assessing their
results. Evaluation must not be the exclusive preserve of any
of the actors.

Users to whom services of general

4.8.4.
interest are
directed in accordance with their needs and aspirations should
be involved in evaluation, through their representatives.

4.8.5.
In this regard, the EESC — which represents the key
actors involved in services of general interest — could play a
role in evaluation procedures.

4.9. Trade policy

4.9.1.
The exemptions applying to services of general
economic interest must be clearly advocated and upheld by

the European Union in the negotiations on the General
Agreement on Trade in Services (GATS).

4.9.2. More generally, within these negotiations, the Euro-
pean Union must not allow the methods it has defined for
organising and regulating services of general economic interest
to be called into question, and it must promote its fundamental
values, especially in its relations with developing nations.

4.10. Development cooperation

4.10.1.
Creation of infrastructure in many areas of services
of general interest requires heavy investment, with low short-
term returns. This factor weighs heavily upon indebted
developing countries with major development needs (e.g. in
the water sector). The Community should therefore focus
particularly on cooperation in creating such infrastructure.

Brussels, 11 December 2003.

The President

of the European Economic and Social Committee

Roger BRIESCH

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APPENDIX

to the opinion of the European Economic and Social Committee

The following amendments, which received at least one quarter of the votes cast, were rejected in the course of the
discussion (Rule 54(3) of the Rules of Procedure).

Point 3.1

Delete and replace by following text:

‘3.1.
The Committee has stated its view on most of the issues raised by the Commission in the Green Paper in
Opinions CES 949/99 and CES 860/2002. In the latter it supported the need for a framework Directive consolidating
the political principles governing services of general economic interest and giving Member States the flexibility they
need in this area.’

Point 3.1.1

Delete and replace by following text:

‘3.1.1.
After studying the Green Paper and relevant Court rulings (paragraphs 1.4.2-1.4.4) the Committee has
come to a different conclusion. The primary goal must be to ensure the autonomous rights and obligations of
Member States and regional and local authorities to ensure and arrange for the provision of services of general
interest. As noted in more detail elsewhere in this Opinion, the services themselves are diverse and continually
developing, making it impossible to give clear definitions. In addition, the Court rulings have clarified the problems
concerning compatibility with State aid rules. Under these circumstances, a framework Directive or other general
instrument at the EU level would only lead to confusion, lack of clarity and difficulties of interpretation between the
different levels of legislation.’

Insert a new point 3.1.2

‘3.1.2.
New legislation at the Union level should only be developed for specific sectors in order to open and
harmonise markets, when seen beneficial for European consumers and other actors, as is the case for telecommuni-
cations, energy and some others. In these cases strict rules on provision of universal and public service are and must
be included in respective sectorial Directives.’

Reason

Self-explanatory.

Point 3.2 (present version)

Change wording of first sentence:

‘3.2.
As regards those principles that should be respected by relevant authorities and actors, could be included in
a framework Directive or other general instrument concerning services of general interest, the Committee has already
expressed the following view...’

Reason

See the amendment to point 3.1.

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Point 4.1.6

Delete last part:

‘4.1.6.
“In this regard, while recalling that it would like promotion of services of general interest to be included as
one of the objectives of the EU in Article 3 of the future Constitution, the EESC welcomes the relative progress
represented by the Convention’s draft.” which amplifies and strengthens the present Article 16 concerning services
of general interest, converts it into a legal basis (“European laws shall define these principles and conditions”
Article III-6), and includes services of general economic interest under the “clauses of general application”.’

Reason

See the amendment to point 3.1. (All-embracing) European law is not desirable.

Point 4.2

Delete the whole point.

Reason

See the amendment to point 3.1. The major issue of social services is examined elsewhere in the section opinion and
the text contained in point 4.2 could be included there.

Point 4.3.4

Delete the first three words.

‘4.3.4.
Framework law and sSector-specific legislation must clearly define the principles and regulatory
arrangements for other services, complementing common competition law; this legislative definition enables further
developments to be undertaken when necessary.’

Reason

See the amendment to point 3.1.

Result of the vote

For: 28, against: 52, abstentions: 5.