COMMUNICATION FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT, THE COUNCIL, THE EUROPEAN ECONOMIC AND SOCIAL COMMITTEE AND THE COMMITTEE OF THE REGIONS  A Quality Framework for Services of General Interest in Europe
Date: 2011-12-20
Institutions: European Commission
Subjects: EU programme, banking, energy use, monetary crisis, postal service, provision of services, public contract, public transport, services of general interest, single market, social services, telecommunications

EUROPEAN COMMISSION 

Brussels, 20.12.2011 
COM(2011) 900 final 

COMMUNICATION FROM THE COMMISSION TO THE EUROPEAN 
PARLIAMENT, THE COUNCIL, THE EUROPEAN ECONOMIC AND SOCIAL 
COMMITTEE AND THE COMMITTEE OF THE REGIONS 

 A Quality Framework for Services of General Interest in Europe  

 
 
 
 
  
 
COMMUNICATION FROM THE COMMISSION TO THE EUROPEAN 
PARLIAMENT, THE COUNCIL, THE EUROPEAN ECONOMIC AND SOCIAL 
COMMITTEE AND THE COMMITTEE OF THE REGIONS 

 A Quality Framework for Services of General Interest in Europe  

1. 

INTRODUCTION 

The current economic and financial situation has highlighted more than ever the fundamental 
role of services of general interest (SGI) in the European Union (EU). In areas such as health 
care, childcare or care for the elderly, assistance to disabled persons or social housing, these 
services  provide  an  essential  safety  net  for  citizens1  and  help  promote  social  cohesion. 
Services of general interest in the field of education, training and employment services play a 
key role in the growth and jobs agenda. In the knowledge economy, schools, training centres 
and universities have to be of the highest quality to guarantee that young people are equipped 
with new skills for new jobs. At the same time, the budget constraints that currently confront 
public administrations and the need for fiscal consolidation make it necessary to ensure that 
high-quality services are provided as efficiently and cost-effectively as possible. 

The President's Political Guidelines of 20092 already refer to the modernisation of the services 
sector as one way to boost new sources of growth and social cohesion and state we "need to 
give a boost to the overall development of the social and health's services sector, for instance 
by  establishing  a  quality  framework  for  public  and  social  services,  thus  recognising  their 
importance  in  the  European  model  of  society"3.  Europe  20204  reconfirmed  the  need  to 
develop new services, delivered both physically and on-line, that generate growth and create 
jobs. This can include innovative services of general interest.  

While  the  Treaty  has  always  ensured  that  Member  States  have  the  flexibility  to  provide 
quality services of this type, the Treaty of Lisbon has introduced new provisions: Article 14 of 
the Treaty on the Functioning of the European Union (TFEU), and Protocol nº 26 on services 
of general interest. It has also given Article 36 of the Charter of Fundamental Rights the same 
legal value as the Treaties. It is in this new context that the Commission has decided to bring 
together in a single quality framework the comprehensive set of actions which it is pursuing 
on  services  of  general  interest.  This  will  ensure  that  in  the  coming  years  the  regulatory 
environment at EU level continues to reinforce the social dimension of the single market, to 
take  better  account  of  the  specific  nature  of  these  services,  and  to  meet  the  challenge  of 
delivering  them  in  a  way  which  incorporates  the  values  of  quality,  safety  and  affordability, 
equal treatment, universal access and users' rights recognised in the Protocol.  

1 

2 
3 
4 

There  is  EU  legislation,  notably  in  the  field  of  migration,  which  ensures  that  -  subject  to  certain 
conditions  -  some  categories  of  legally  residing  third-country  nationals  enjoy  equal  treatment  with 
nationals as regards access to and supply of goods and services made available to the public. 
"Political guidelines for the next Commission". Brussels, 3 September 2009. 
"Political guidelines…", page 24. 
"Europe 2020: A Strategy for smart, sustainable and inclusive growth" COM(2010) 2020). 

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The objective of this Communication, which is also a follow-up to the Single Market Act5, is 
to present the quality framework which consists of three complementary strands of action:  

– 

– 

– 

these  services.  The  Commission 

Enhancing clarity and legal certainty on how EU rules apply to services of general 
economic  interest  (SGEI),  and  revising  the  rules  when  necessary  to  ensure  that 
specific  needs  are  catered  for.  This  constant  review  is  essential  given  the  evolving 
nature  of 
this 
Communication reforms of two key sets of rules - for State aid for services of general 
economic interest and for public procurement - both of which will increase flexibility 
and simplification for Member States when providing these services. These reforms 
also  aim  at  increasing  consistency  between  both  policies  and  to  deliver  greater 
assurance to stakeholders who fully comply with the public procurement rules that, 
under certain conditions, they also fulfil the relevant State aid requirement under the 
Altmark  judgment.  This  should  provide  more  legal  certainty  and  simplification  to 
public authorities and undertakings. 

is  presenting  alongside 

Ensuring  access  to  essential  services:  the  Commission  will  take  forward  its 
commitment to ensure access for all citizens to essential services in specific sectors 
building  on  recent  actions  in  the  field  of  basic  banking,  postal  services  and 
telecommunications.  

Promoting  quality:  the  Commission  will  reinforce  its  commitment  to  promoting 
quality in the field of social services, and will use these achievements in this area as a 
model for other services of general interest. 

Basic concepts 

The debate on services of general interest suffers from a lack of clarity on terminology. The 
concepts are used interchangeably and inaccurately. Stakeholders have asked the Commission 
to provide clarity. In doing so, however, the Commission is bound by EU primary law and the 
Court's case-law. Moreover, the concepts are dynamic and evolve.  

Service  of  general  interest  (SGI):  SGI  are  services  that  public  authorities  of  the  Member 
States  classify  as  being  of  general  interest  and,  therefore,  subject  to  specific  public  service 
obligations  (PSO).  The  term  covers  both  economic  activities  (see  the  definition  of  SGEI 
below)  and  non-economic  services.  The  latter  are not  subject  to  specific  EU  legislation  and 
are not covered by the internal market and competition rules of the Treaty. Some aspects of 
how  these  services  are  organised  may  be  subject  to  other  general  Treaty  rules,  such  as  the 
principle of non-discrimination. 

Service  of  general  economic  interest  (SGEI):  SGEI  are  economic  activities  which  deliver 
outcomes in the overall public good that would not be supplied (or would be supplied under 
different  conditions  in  terms  of  quality,  safety,  affordability,  equal  treatment  or  universal 
access)  by  the  market  without  public  intervention.  The  PSO  is  imposed  on  the  provider  by 
way of an entrustment and on the basis of a general interest criterion which ensures that the 
service is provided under conditions allowing it to fulfil its mission.  

Social  services  of  general  interest  (SSGI):  these  include  social  security  schemes  covering 
the main risks of life and a range of other essential services provided directly to the person 

5 

"Single Market Act: twelve levers to boost growth and strengthen confidence" (COM(2011) 206)  

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that play a preventive and socially cohesive/inclusive role6. While some social services (such 
as  statutory  social  security  schemes)  are  not  considered  by  the  European  Court  as  being 
economic  activities,  the  jurisprudence  of  the  Court  makes  clear  that  the  social  nature  of  a 
service  is  not  sufficient  in  itself  to  classify  it  as  non-economic7.  The  term  social  service  of 
general interest consequently covers both economic and non-economic activities. 

Universal  service  obligation  (USO):  USO  are  a  type  of  PSO  which  sets  the  requirements 
designed  to  ensure  that  certain  services  are  made  available  to  all  consumers  and  users  in  a 
Member  State,  regardless  of  their  geographical  location,  at  a  specified  quality  and,  taking 
account of specific national circumstances, at an affordable price. The definition of specific 
USO are set at European level as an essential component of market liberalization of service 
sectors, such as electronic communications, post and transport.  

Public service: Public service is used in article 93 TFEU in the field of transport. However, 
outside this area, the term is sometimes used in an ambiguous way: it can relate to the fact that 
a service is offered to the general public and/or in the public interest, or it can be used for the 
activity of entities in public ownership. To avoid ambiguity, this Communication does not use 
the  term  but  follows  the  terminology  "service  of  general  interest"  and  "service  of  general 
economic interest". 

2. 

INSTITUTIONAL SETTING: CHANGES INTRODUCED BY THE TREATY OF LISBON 

The  Treaty  of  Lisbon,  Protocol  nº  26  on  Services  of  General  Interest  and  Article  36  of  the 
Charter of Fundamental Rights underline clearly the importance of services of general interest 
in  the  EU,  and  set  out  the  principles  that  guide  the  EU  approach  to  these  services.  They 
provide a sound basis for pursuing a flexible and pragmatic approach which is essential in this 
field  given  the  differences  in  needs  and  preferences  that  stem  from  different  geographical, 
social and cultural situations. 

The  Protocol  establishes,  for  the  first  time  at  primary  law  level,  the  fundamental  principles 
which  apply  to  services  of  general  interest.  It  makes  clear  that  the  principles  need  to  be 
adapted  to  the  different  services  at  stake  and,  therefore,  no  “one  size  fits  all”  approach  is 
possible. It also confirms that the provisions of the Treaties do not affect the competence of 
Member  States  to  provide,  commission  and  organise  non-economic  services  of  general 
interest.  The  need  to  distinguish  between  economic  and  non-economic  activities  remains, 
however,  and  a  case-by-case  analysis  continues  to  be  necessary  since  the  nature  of  these 
activities  evolves  constantly.  It  is  for  this  reason  that  the  Commission  keeps  the  situation 
under review as explained in Section III below. 

According  to  Article  14  TFEU,  “the  Union  and  the  Member  States,  each  within  their 
respective  powers  and  within  the  scope  of  application  of  the  Treaties,  shall  take  care  that 
such  services  operate  on  the  basis  of  principles  and  conditions,  particularly  economic  and 
financial  conditions,  which  enable  them  to  fulfil  their  missions”.  This  Article  creates  the 
possibility for the Union to legislate in the field of services of general economic interest by 
setting  the  principles  and  conditions,  particularly  economic  and  financial  conditions,  which 

6 

7 

"Implementing the Community Lisbon programme: Social services of general interest in the European 
Union" (COM(2006) 177 final of 26 April 2006). 
Joined  Cases  C-180/98  to  C-184/98  Pavlov  and  Others  [2000]  ECR  I-6451,  paragraph  118;  Case  C-
218/00 Cisal and INAIL, [2002] ECR I-691, paragraph 37; and Case C-355/00 Freskot [2003] I-5263. 

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enable  them  to  fulfil  their  missions,  using  a  regulation  and  through  the  ordinary  legislative 
procedure.  It  makes  clear  that  any  such  regulation  must  be  "without  prejudice  to  the 
competence of Member States, in compliance with the Treaties, to provide, to commission and 
to  fund  such  services".  This  acknowledges  the  fact  that  the  organisation,  delivery  and 
financing of such services are primarily for Member States to decide at national, regional or 
local  level.  Various  public  consultations  and  an  on-going  dialogue  with  stakeholders  will 
continue to examine the need for legislation based on Article 14 TFEU. The consensus at this 
stage seems to be that this not an immediate priority8. The Commission is of the view that a 
sectoral approach, where tailor-made solutions can be found to concrete and specific problems 
in different sectors, is more appropriate at this stage.9  

The Commission will keep under review the need to revise existing sectoral legislation which 
includes universal service obligations, and the possible need to create new universal service 
obligations  in  other  sectors.  The  Commission  will  also  analyse  the  appropriateness  of 
establishing the principles and conditions which enable specific public services to fulfil their 
missions on the basis of Article 14 TFEU. Respect for the existing diversity of services and 
situations within the EU will remain a guiding principle in the Commission's assessment. 

3. 

A QUALITY FRAMEWORK FOR SERVICES OF GENERAL INTEREST IN EUROPE 

Over the years, the demand for services of general interest and the way they are provided has 
changed  significantly.  Services  which  the  State  traditionally  delivered  directly  have 
increasingly  been  outsourced  by  national,  regional  and  local  authorities,  and  are  now  often 
provided  by  the  private  sector  (either  profit  or  not-for-profit).  This  change  in  approach  is 
driven by processes of deregulation, by changes in government policies, and changes in users' 
needs and expectations. Since many of these services are of an economic nature, the internal 
market and competition rules apply to them, in so far as the application of such rules does not 
obstruct  the  performance,  in  law  or  in  fact,  of  the  particular  tasks  assigned  to  them.Indeed 
having  access  to  a  range  of  offers  on  the  price  and  quality  of  services  can  bring  significant 
choice and benefits for public authorities. While some stakeholders are concerned about the 
impact of these rules, in particular on social services, the Commission is convinced that they 
can be applied in a way that takes into account specific needs and that enhances the provision 
of the services. The rules must of course be revised on an on-going basis to ensure that they 
can continue to provide the necessary flexibility for public authorities to respond to evolving 
needs of the society and keep up to date with technological change.  

The  Commission's  approach  to  providing  a  quality  framework  is  based  on  three  strands  of 
action: first, increasing clarity and legal certainty on the EU rules that apply to these services; 
second, providing the tools that enable Member States to ensure that citizens have access to 

8 

9 

A recent example is the European Parliament Resolution of 5 July 2011 on the future of social services 
of general interest (2009/2222(INI)), point 48: "Considers that an EU framework regulation on SGEI, 
permissible under Article 14 TFEU, is not the central issue at this time". 
It should be noted that Article 14 TFEU makes clear that its application is without prejudice to articles 
93, 106 and 107 TFEU which establish the role of the European Commission in the control of State aid 
and the conditions under which derogations from the application of this control can be granted to SGEI. 
This  is  explained  further  in  the  Communication  on  the  application  of  the  European  State  aid  rules  to 
compensation granted for the provision of services of general economic interest (C(2011)9404) adopted 
alongside this Communication.  

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essential services and reviewing the situation on a regular basis; and third, promoting quality 
initiatives in particular for social services which address particularly important needs. 

1. Strand 1: Increasing clarity and legal certainty 

The Commission  aims  to  ensure  that  the EU regulatory framework  which  has an  impact on 
the way services of general economic interest are organised, financed and provided, enables 
them to accomplish their public service mission. To do so, the Commission has an on-going 
dialogue with stakeholders from all sectors to identify areas where the legal framework may 
need to be clarified or amended. Two examples of this commitment are the revisions of the 
State  aid  rules  for  services  of  general  economic  interest  and  the  public  procurement  rules 
which accompany this Communication.  

In these reforms, the Commission has sought to achieve further consistency between State aid 
and  public  procurement  policies  to  the  benefit  of  stakeholders.  To  the  extent  possible,  the 
Commission  has  created  a  more  coherent  framework.  The  Commission  considers  that  full 
compliance  with  open  or  restricted  public  procurement  procedures  awarded  on  the  basis  of 
either  the  lowest  price  or,  under  certain  conditions,  the  most  economically  advantageous 
tender means that the contract is awarded at the "least cost to the community" as required by 
the Court as one of the conditions for excluding the existence of State aid. 

1.1. The revision of the State aid rules for services of general economic interest 

The  EU  rules  which  apply  to  the  public  financing  of  services  of  general  economic  interest 
adopted by the Commission in 2005 have proved to be effective. However, the Commission 
and  stakeholders  agree  that  they  can  be  made  clearer,  simpler  and  more  proportionate  to 
ensure an easier application and, hence, to promote a more efficient delivery of high quality 
services,  to  the  benefit  of  citizens.  The  reform  has  three  objectives:  to  clarify  the  basic 
concepts  relevant  to  SGEI,  to  simplify  the  State  aid  rules  for  small  services  organised  at  a 
local level and which have a limited effect on trade between Member States, and to introduce 
a more targeted treatment of other services, so as to better differentiate medium size services 
and social services, on the one hand, and, on the other hand, large-scale activities with a clear 
EU wide dimension which will be subject to a more effective competition scrutiny. 

On  the  basis  of  these  objectives,  the  Commission  has  adopted  or  proposed  a  number  of 
important changes:  

• 

• 

• 

First, a new Communication addresses a number of issues that have raised questions 
of interpretation at national, regional and local level.  

Second, in future a larger number of social services will be exempted (irrespective of 
the amount of compensation) from the ex ante notification and assessment process by 
the  Commission,  if  they  fulfil  some  basic  conditions  of  transparency,  correct 
definition and no overcompensation. This list now includes, in addition to hospitals 
and  social  housing,  services  of  general  economic  interest  meeting  social  needs  as 
regards  health  and  long  term  care,  childcare,  access  to  and  reintegration  into  the 
labour market, and the care and social inclusion of vulnerable groups.  

Thirdly, there will be a deeper and more focused scrutiny of large aid measures, for 
example in the field of network industries, which may have a significant impact on 
the  functioning  of  the  Internal  Market.  For  these  cases,  Member  States  will  be 

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required  to  include  in  the  compensation  mechanism  incentives  for  efficiency  gains 
over the life of the contract, tailored to the needs of specific sectors.  

• 

Finally, the Commission is proposing a new de minimis rule specifically for services 
of general economic interest which will exclude the existence of aid and, hence, the 
need for Commission scrutiny for amounts of aid up to €500.000 over a three year 
period.  For  certain  sectors,  in  particular  transport  and  public  broadcasting,  special 
sectoral rules continue to apply.  

1.2. The reform of the rules on public procurement and concessions 

The Commission is also proposing a significant reform of the rules on public procurement and 
concessions  which  will  promote  better  quality  in  the  provision  of  the  services  of  general 
economic interest. 

First, the reform provides for specific treatment for social and health services. These will be 
subject  to  a  lighter  regime  which  takes  into  account  their  specific  role  and  characteristics. 
They will be subject to higher thresholds and will have to comply only with transparency and 
equal treatment obligations. In addition, in order to encourage a quality approach, the reform 
promotes  the  use  of  the  economically  most  advantageous  tender  criterion  which  means  that 
Member States do not have to award such services on the basis of the lowest price alone. 

Second,  there  is  now  greater  legal  certainty  on  how  EU  public  procurement  rules  apply  to 
relations  between  public  authorities.  "Public-public  cooperation"  concerns  situations  where 
public  entities  such  as  local  authorities  cooperate  in  order  to  fulfil  public  tasks.  While  the 
public  status/legal  nature  of  parties  to  a  public  contract  is  not  in  itself  sufficient  to  exclude 
related contracts from the scope of EU public procurement directives, the reform clarifies, in 
line with European Court of Justice case-law, the cases where such contracts are not covered 
by  EU  public  procurement  rules.  The  new  rules  will  ensure  that  the  application  of  public 
procurement rules will not interfere with the freedom of public authorities to decide how to 
organise and carry out their public service tasks. In turn, there are provisions to ensure that 
public-public  cooperation  does  not  cause  distortions  of  competition  in  relation  to  private 
economic operators. 

Third,  the  reform  recognises  the  importance  in  certain  circumstances  of  a  procedure  with 
negotiation  and  prior  publication  when  awarding  contracts  for  the  provision  of  services  of 
general  economic  interest,  and  has  ensured  that  this  is  part  of  the  tool  box  available  for 
contracting authorities.Similarly, the Commission has proposed to enable public authorities to 
take into consideration as award criteria the life cycle of the requested products, services or 
works. This reform will also help to ensure that contracts are not awarded on the basis of the 
lowest price only but adequately reflect increased environmental and societal considerations.  

Finally,  the  reform  will  introduce  a  new  self-standing  regime  for  concessions.  This  is 
particularly  important  for  services  of  general  economic  interest  as  concession  contracts  are 
traditionally  used  to  deliver  public  services  or  utilities  obligations.  The  key  features  of  the 
public procurement reform will also apply to concessions, and, as for procurement contracts, 
there will be new rules on the modification of existing contracts. In some sectors, concessions 
can be granted from 20 up to 100 years and, as a consequence are more likely to need to be 
revisited  during  their  lifetime.  On  the  basis  of  the  case  law  of  the  Court,  the  Commission 
proposes to introduce new provisions which specify under which conditions a modification of 

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the  terms  of  a  concession  contract  is  allowed  without  a  new  competitive  tendering,  and 
provisions to ensure compliance with the equal treatment and non discrimination principles.  

The reform of the public procurement rules is one of the twelve priority actions of the Single 
Market Act which the Commission has confirmed in the Annual Growth Survey 2012 should 
be fast-tracked. The Commission therefore calls on the Parliament and the Member States to 
reach agreement on these proposals by the end of 2012.  

1.3. Communication and information actions on how to apply EU rules 

The  Commission  is  committed,  to  helping  public  authorities,  service  providers,  users  and 
other  stakeholders  to  better  understand  and  apply  EU  rules  to  services  of  general  economic 
interest,  in  response  to  the  questions  and  requests  for  explanations  that  have  been  raised  by 
stakeholders.The Commission has taken a number of actions in this area.  

At the end of 2010, the Commission published a new guide10 which covers three key issues: 

– 

– 

– 

how Member States can finance these services in compliance with State aid rules; 

how public authorities can use public procurement rules and, at the same time, ensure 
quality, innovation, continuity and comprehensiveness of social services, 

how Internal Market rules and, in particular, the Services Directive, apply to social 
services  without  preventing  Member  States  from  regulating  them  to  guarantee 
quality and accessibility. 

This guide has replaced the document on Frequently Asked Questions and takes into account 
developments  in  case-law,  Commission  decisions,  changes  to  the  legislative  framework, 
discussions  within  the  Social  Protection  Committee  (SPC)11  and  questions  received  from 
stakeholders  through  the  Interactive  Information  Service  (IIS)12.  The  IIS  is  an  on-line 
service which provides information to citizens, service providers, public authorities and other 
stakeholders  and  allows  them  to  raise  questions  about  EU  law  and  services  of  general 
economic  interest.  Since  it  started  to  work  in  January  2008,  the  Commission  services  have 
replied to nearly 200 questions through this service. 

The Commission has also produced a guide on "buying social"13 which is a tool to help public 
authorities to buy goods and services in a socially responsible way in line with EU rules. It 
highlights  the  contribution  which  public  procurement  can  make  to  social  policy.  The 
document  contains  practical  examples  on  a  broad  range  of  social  issues,  such  as  promoting 
equal  opportunities  and  employment  opportunities,  improving  labour  conditions,  social 
inclusion of vulnerable persons, such as disabled persons, and compliance in substance with 
the  provisions  of  the  fundamental  ILO  conventions.  A  new  edition  of  "Buying  Green!  A 
handbook  on  green  public  procurement"14  was  published  in  October  2011.  The  handbook 
provides guidance on how to reduce the environmental impacts of public sector consumption 

10 

11 

12 
13 
14 

Guide  to  the  application  of  EU  rules  on  State  aid,  public  procurement  and  the  internal  market  to 
services of general economic interest, and in particular to social services of general interest (SEC(2010) 
1545. 
"Report  by  the  Social  Protection  Committee  on  the  application  of  Community  law  to  SSGI"  of 
November 2008 
See: http://ec.europa.eu/services_general_interest/index_en.htm 
http://ec.europa.eu/social/BlobServlet?docId=6457&langId=en 
Available at: http://ec.europa.eu/environment/gpp/buying_handbook_en.htm 

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and  how  to  use  green  public  procurement  to  stimulate  innovation  in  environmental 
technologies, products and services. 

The  Commission  Staff  Working  Paper  on  public-public  cooperation15  summarises  and 
explains the case-law of the ECJ on how public procurement rules apply to situations where 
public  entities  such  as  municipalities  cooperate  in  order  to  fulfil  public  tasks  conferred  on 
them  (see  above  Section  1.2).  It  should  contribute  to  the  better  understanding  of  the  legal 
provisions in order to mitigate legal risks surrounding this form of cooperation between public 
authorities.  

The Commission pays specific attention to the social services sector. The biennial reports on 
social services of general interest16 published in 2008 and 2010 monitored developments in 
the social services sector and fostered dialogue at European level. . The Commission has also 
helped  successive  Council  Presidencies  in  organising  the  SSGI  Forums  which  have  been 
essential in sharing information and promoting dialogue and better understanding of the rules 
among stakeholders. The Commission is committed to support future rotating Presidencies of 
the  Council  to  organise  the  4th  European  Forum  on  Social  Services  of  General  Interest  in 
around twelve months' time. 

The  Commission  will  continue  to  work  within  the  Social  Protection  Committee  which, 
working with all relevant institutional and civil society stakeholders, will prepare a report by 
the end of 2013 on the application of EU rules to SSGI. 

2. Strand 2: Ensuring access to essential services 

The  sectoral  legislation  adopted  at  EU  level  has  always  carefully  balanced  the  need  to 
increase competition and the use of market mechanisms with the need to guarantee that every 
citizen  continues  to  have  access  to  essential  services  of  high  quality  at  prices  that  they  can 
from 
instance, 
afford.  This  has  been 
for 
telecommunications  and  postal  services 
the 
to 
Commission's  annual  Consumer  Markets  Scoreboard17  monitors  the  performance  of  around 
30  services  markets  with  regard  to  comparability,  trust,  problems  and  complaints,  overall 
satisfaction, switching and choice.  

transport  and  energy.  In  addition, 

the  network 

the  case, 

industries 

in 

Given that users' needs and technologies evolve constantly, it is necessary to review regularly 
both existing universal services obligations and the need to introduce new ones. The examples 
below  illustrate  the  pro-active  approach  which  the  Commission  takes  in  this  field.  Member 
States remain free to extend existing universal service obligations, or to introduce new ones, 
provided that the measures comply with EU law. 

2.1. Postal services 

15 

16 

17 

Commission Staff Working Paper concerning the application of EU public procurement law to relations 
between contracting authorities ('public-public cooperation') SEC(2011) 1169 final, of 4 October 2011. 
SWD – First and Second Biennial Reports on social services of general interest, SEC(2008) 2179 and 
(SEC(2010) 1284 
For 
http://ec.europa.eu/consumers/consumer_research/editions/docs/6th_edition_scoreboard_en.pdf. 
some of these services, such as electricity or bank accounts, the Commission has carried out in-depth 
market studies (available on the same website). 

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The Third Postal Directive18 is a milestone in the reform of postal markets in Europe which 
began in 1992. It has brought many benefits to citizens, including improvements in the quality 
of service and new, innovative postal delivery services. The Directive defines the minimum 
requirements  regarding  the  scope  of  the  universal  service  obligation:  a  high  quality  postal 
service must be provided (at least) five working days a week, throughout the entire territory, 
at  affordable  prices  for  all  users  for  basic  letters  and  parcels  of  certain  weights,  and  for 
registered  and  insured  items.  It  also  contains  provisions  to  ensure  the  high  quality  of  the 
postal  universal  service  and  the  Commission  is  monitoring  how  it  is  being  implemented.  It 
has recently set up a European Regulators Group for Postal Services (ERGP)19 which works 
on  issues  such  the  financing  of  the  universal  service  obligation  and  monitoring  of  market 
outcomes20.  The  Commission  has  also  created  a  Postal  Users  Forum,  which  had  its  first 
meeting in December  2011  and  brought together end-users – both individual customers and 
businesses – with other stakeholders includingoperators and trade unions, to look at evolving 
consumer needs in a changing communication environment and with a view to the sustainable 
development of the sector. 

In the context of its work on e-commerce the Commission will present a Green Paper on the 
cross-border parcel delivery in 2012. This will focus on issues such as the quality of cross-
border postal delivery services and their pricing to identify solutions for obstacles experienced 
by consumers and business. The Commission also intends to present the results of two studies 
on the pricing behaviour of postal operators and its effects on the markets, and the principles 
to calculate the net cost of the postal universal service obligation (USO). By the end of 2013 it 
will present the Fourth Report on the Application of the Postal Services Directive. 

2.2. Basic banking services  

Access  to  basic  payment  services  under  fair  conditions  is  important  for  financial  and  social 
inclusion and to allow consumers to benefit fully from the single market. In early 2011, the 
Commission did an impact assessment to examine whether EU legislation was needed in this 
area.  Having  considered  all  options,  the  European  Commission  decided,  at  this  stage,  to 
propose  a  Recommendation21.  It  aims  to  ensure  that  basic  payment  services  and  a  payment 
card  are  offered  to  every  EU  citizen  and  resident  who  does  not  already  have  a  payment 
account  in  the  Member  States  where  they  seek  to  open  one.  This  basic  payment  account 
should be provided either free or at a reasonable charge by payment services providers. The 
Recommendation  sends  a  clear  message  to  Member  States  and  providers  about  what  is 
expected while leaving flexibility at national level on how to achieve it.  

The  Recommendation  also  provides  criteria  for  assessing  how  Member  States  have 
implemented it and to see whether further action is necessary. On the basis of a review and 
impact  assessment  which  it  will  carry  out  in  2012,  the  Commission  will  decide  whether 
further action is necessary in this area.  

2.3. Transport 

18 

19 

20 
21 

Directive 2008/6/EC  of  the European Parliament  and  of  the  Council, of 20  February 2008,  amending 
Directive 97/67/EC with regard to the full accomplishment of the internal market of Community postal 
services  
Commission  Decision  of  10  August  2010  establishing  the  European  Regulators  Group  for  Postal 
Services, OJ C 217. 
Documents available on the website of ERGP: http://ec.europa.eu/internal_market/ergp/index_en.htm 
Commission Recommendation on access to a basic payment account (C(2011)4977). 

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Public service obligations in the transport sector are laid down in specific pieces of legislation 
for  air  services,  inland  transport  and  maritime  transport22.  This  sector-specific  legislation 
establishes  the  principles  that  Member  States  should  follow  when  defining  public  service 
obligations in each transport mode.  

The  2011  White  paper23  on  transport  states  that  a  higher  share  of  travel  by  collective 
transport, combined with minimum service obligations, will allow increasing the density and 
frequency of service, thereby generating a virtuous circle for public transport modes.  

The attribution of public service contracts defining public service obligations in the different 
transport  modes  must  respect  the  principles  of  transparency,  non-discrimination  and  award 
following  a  competitive  tendering  procedure.  This  can  best  be  achieved  by  means  of  open 
public  tender  procedures.  The  quality  of  passenger  transport  services  will  be  of  increasing 
importance  in  the  coming  years,  given  the  ageing  population  and  the  need  to  ensure  that 
public  (collective)  transport  is  an  attractive  alternative  to  individual  transport,  helping  to 
achieve resource efficiency and fuel security objectives. The creation of a dynamic, open rail 
market  should  bring  significant  benefits  for  passengers  in  terms  of  quality,  efficiency  and 
volume  of  services  offered)  and  for  the  public  authorities  and  tax  payers  through  reduced 
public funding for public service contracts. 

In 2012, the Commission intends to make a proposal on the opening of the market for national 
passenger services in 2012. This follows the opening of the market for freight services and for 
international  passenger  services.  The  Commission  will  also  consider  revising  the  public 
service regulation for inland transport in 2012 to generalize competitive tendering procedures 
for the award of public service contracts for the railway sector. While Member States have a 
wide margin of discretion in identifying areas where it is necessary to impose public service 
obligations  for  passenger  transport  services,  to  be  sustainable  these  services  need  to  be 
efficient, high quality and provided in a stable financial context. Mandatory tendering should 
help to ensure this.  

2.4. Energy 

The Third Energy  Package entered into force on 3 March 2011.  It defines universal  service 
obligations, contains clear provisions on public service obligations and consumer protection 
for  both  electricity  and  natural  gas  and  provides  for  the  protection  of  vulnerable  customers 
against  energy  poverty24.  Measures  adopted  on  the  basis  of  these  Directives  must  be  in  the 
general interest, clearly defined, transparent, non-discriminatory and verifiable, and guarantee 
equality  of  access  of  EU  electricity  and  gas  companies  to  EU  national  consumers  and  vice 
versa. 

22 

23 

24 

Regulation (EC) nº 1008/2008 of the European Parliament and the Council, of 24 September 2008, on 
common  rules  for  the  operation  of  air  services  in  the  Community  (Recast)  and  Regulation  (EC)  No 
1107/2006  of  the  European  Parliament  and  the  Council,  of  5  July  2006,  concerning  the  rights  of 
disabled persons and persons with reduced mobility when they are travelling by air; Regulation (EC) nº 
1370/2007  of  the  European  Parliament  and  the  Council  of  23  October  2007  on  public  passenger 
transport service by rail and by road and repealing Council Regulations (EEC) nº 1191/69 and 1107/70; 
Council  Regulation  (EEC)  No  3577/92  of  7  December  1992  applying  the  principle  of  freedom  to 
provide services to maritime transport within Member States (maritime cabotage). 
White  Paper  -  Roadmap  to  a  Single  European  Transport  Area.  Towards  a  competitive  and  resource 
efficient transport system. COM(2011) 144 
Directive 2009/72/EC on electricity and 2009/73/EC on natural gas. 

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To  promote  the  implementation  of  competitive,  energy  efficient  and  fair  retail  markets  the 
Commission established the Citizens' Energy Forum25 in 2008 as a regulatory platform based 
on  the  experience  gained  in  previous  fora.  The  Commission  Staff  Working  Document  "An 
Energy  Policy  for  Consumers"26  took  stock  of  the  consumer  benefits  that  existing  energy 
policy  measures  provide.  It  identified  a  range  of  EU  legislative  and  policy  initiatives  that 
contribute directly or indirectly to improving consumer welfare in the energy sector.  

In  line  with  the  European  Council  Conclusions  of  December  2011,  Member  States  should 
implement  the  Third  Energy  package  fully  and  as  quickly  as  possible.  The  Commission 
underlines the importance in this context for Member States to define clearly the concept of 
vulnerable customers. The Commission plans to organise a 5th meeting of the Citizens' Energy 
Forum  in  November  2012  to  continue  fostering  stakeholders'  dialogue  on  key  issues such 
as the  protection  of  vulnerable  customers, 
the  optimal retail  market model,  price 
transparency, and the possible benefits of smart meters on energy demand management. 

2.5. Electronic communications 

The Universal Service Directive in the field of electronic communications27 provides a social 
safety-net  where  market  forces  alone  do  not  deliver  affordable  access  to  basic  services  for 
consumers,  particularly  where  they  live  in  areas  which  are  difficult  or  costly  to  service,  or 
who have low incomes or disabilities. The safety-net concept covers three specific objectives: 
availability,  affordability  and  accessibility.  The  Commission  has  recently  adopted  a 
Communication on universal service in e-communications28 reporting on the outcome of the 
public consultation in 2010 and the third review of the scope of universal service obligation in 
electronic communications. One of the key questions addressed is what role universal service 
obligations  should  play  in  meeting  the  objective  "broadband  for  all".  From  the  analysis  the 
Commission  concludes  that  there  is  currently  no  need  to  modify  the  scope  of  the  universal 
service  obligation  at  EU  level.The  analysis  also  concludes  that  further  guidance  on  how  to 
implement  the  universal  service  rules  is  needed  given  the  risk  of  divergent  national 
approaches  and  the  potential  financial  implications  for  industry.  The  Commission  will  put 
forward  this  guidance  in  2012  and  it  will  help  to  tackle  the  risk  of  social  exclusion  while 
allowing,  according  to  the  principle  of  subsidiarity,  for  account  to  be  taken  of  different 
national  circumstances,  the  need  to  minimise  market  distortions,  and  to  avoid  imposing  a 
disproportionate burden on the sector29. 

3. Strand 3: Promoting quality – the example of social services of general interest 

Social services of general interest play a major role in European societies by contributing to 
social protection and social inclusion. At the same time, demand for these services increases 
as the ability to finance them becomes more constrained, currently as a result of the economic 

25 
26 
27 

28 

29 

http://ec.europa.eu/energy/gas_electricity/forum_citizen_energy_en.htm 
SEC(2010) 1407 final, of 11 November 2010. 
Directive 2002/22/EC of the European Parliament and of the Council, of 7 March 2002, on universal 
service and users' rights relating to electronic communications networks and services (Universal Service 
Directive) , as amended by Directive 2009/136/EC. 
"Universal service in e-communications: report on the outcome of the public consultation and the third 
periodic review of the scope in accordance with Article 15 of Directive 2002/22/EC" (COM(2011) 795 
final of 23 November 2001). 
Note  that  paragraphs  20  to  30  of  the  Community  Guidelines  for  the  application  of  State  aid  rules  in 
relation  to  rapid  deployment  of  broadband  networks  (OJ  C  235  of  30  September  2009,  p.  7)  make 
specific reference to the definition of SGEI in the electronic communication sector. 

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crisis and, in the longer term, of demographic ageing. The Commission, the Member States 
and stakeholders representing service users and providers have undertaken a number of recent 
initiatives in the area of social services' quality. 

In  200730,  the  Commission  announced  a  strategy  to  support  the  quality  of  social  services 
across  the  EU.  As  a  follow-up,  the  Commission  has  supported,  via  the  PROGRESS 
programme31,  European  initiatives  to  develop  tools  for  quality  definition  and  measurement 
and  has  supported  the  development,  within  the  Social  Protection  Committee  of  a  voluntary 
European Quality Framework for social services. 

3.1. Projects supported by the PROGRESS programme 

From 2008 to 2010, the PROGRESS programme financed eight projects to develop tools for 
the  definition,  measurement,  assessment  and  improvement  of  social  services  quality  with  a 
special  focus  on  long-term  care.  All  the  projects  had  trans-national  partnerships  and 
exchanged  good  practices  among  public  authorities,  service  providers  and  other  actors  with 
different cultural backgrounds and dealing with different legal and administrative context and 
different  socio-economic  conditions.  Practically  all  projects  highlighted  the  importance  of 
involving users in the definition and evaluation of social services quality32.  

In  2012  the  Commission  will  support  a  number  of  new  transnational  projects  through  the 
PROGRESS programme aimed at implementing the voluntary European Quality Framework 
in different Member States and in a variety of sectors; 

3.2.  The  Social  Protection  Committee:  voluntary  European  Quality  Framework  for 
social services 

In  October  2010,  the  Social  Protection  Committee  adopted  a  voluntary  European  Quality 
Framework for social services. It aims to develop a common understanding of the quality of 
these services within the EU. It is designed to be flexible enough to be applied to a variety of 
social  services  in  the  national,  regional  and  local  context  in  all  Member  States  and  to  be 
compatible with existing national quality approaches. It identifies principles and criteria that a 
social service should comply with to address the needs and expectations of the service user. 
The  Framework  also  includes  elements  for  a  methodology  which  should  help  public 
authorities  to  develop  at  the  appropriate  level  quality  tools  (standards  or  indicators)  for  the 
definition, measurement and evaluation of social services quality. The framework includes a 
rights-based  focus  and  can  help,  for  example,  to  increase  the  protection  of  children's  rights, 
when moving from institutional childcare to alternative care systems.  

3.3. Statute for a European Foundation 

Foundations which have as their mission to provide public benefit play an increasing role in 
providing and financing social services of general interest in the EU. However, they still face 
difficulties  in  establishing  themselves  in  other  Member  States  or  pooling  their  assets  on  a 
cross-border basis. There is a need to enable foundations of general interest to be established, 

30 

31 

32 

"Services of general interest, including social services of general interest: a new European commitment" 
(COM(2007) 725 final of 20 November 2007). 
PROGRESS  is  the  EU  programme  for  employment  and  social  solidarity  which  provides  financial 
support to implementation of the objectives of the European Union's Social Agenda. 
Commission Staff Working Document "Second Biennial Report on social services of general interest" 
(SEC(2010) 1284 final, of 22 October, pp. 59-66. 

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to operate and to finance themselves on a cross-border basis, subject to adequate supervision. 
This  would  allow  them  to  reduce  the  administrative  burdens  created  by  the  complexity  of 
running  operations  in  various  Member  States.  This  would  ultimately  free  up  more  of  their 
resources to promote the wellbeing of EU citizens. 

To bring about these benefits, the Commission will table a proposal in 2012 to create a statute 
for a European Foundation which will exist alongside national forms and be optional.  

4. 

CONCLUSIONS 

The  current  economic  and  financial  crisis  is  a  reminder  of  the  central  role  that  services  of 
general interest play in ensuring social and territorial cohesion. At the same time, the crisis is 
having a significant impact on the public sector as finances are squeezed, and it is essential 
that every effort is made to maintain the provision of these services and improve their quality. 
This Communication shows that the Treaties provide the European institutions and Member 
States with the necessary legal tools to do this. The European Commission is fully committed 
to playing its role by putting in place a quality framework for these services, as seen in the 
two  proposals  on  the  revision  of  State  aid  rules  applicable  to  services  of  general  economic 
interest  and  on  public  procurement  and  concessions  which  it  has  tabled  in  parallel  to  this 
Communication.  It  will  also  deliver  a  series  of  other  actions  in  the  coming  months  which 
taken together will give the EU a sound quality framework for SGI for the coming years. It 
will take this work forward as part of its broader commitment to put the social economy and 
social  innovation  at  the  heart  of  its  work  under  the  Europe  2020  strategy,  as  seen  most 
recently in its Social Business Initiative33 which supports the development of new and socially 
innovative ways of doing business and providing services. 

33 

"Social Business Initiative – Creating a favourable climate for social enterprises, key stakeholders in the 
social economy and innovation" (COM(2011) 682 final of 25 October 2011) 

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