Commission of the European Communities v Italian Republic.
Date: 2007-07-18
29. It is clear from settled case‑law that service concessions are excluded from the scope of Directive 92/50 (see, inter alia, Case C‑231/03 Coname  [2005] ECR I‑7287, paragraph 9, and Case C‑458/03 Parking Brixen  [2005] ECR I‑8585, paragraph 42).
30. The Italian Government having, on various occasions, stressed that it is clear from national case‑law that agreements such as the agreements at issue must be classified as service concessions, it must be noted as a preliminary point that the definition of a public service contract is a matter of Community law, with the result that the classification of the agreements at issue under Italian law is irrelevant for the purpose of determining whether they fall within the scope of Directive 92/50 (see, to that effect, Case C‑264/03 Commission  v France  [2005] ECR I‑8831, paragraph 36, and Case C‑220/05 Auroux and Others  [2007] ECR I‑0000, paragraph 40).
31. The question whether the agreements at issue should or should not be classed as service concessions must therefore be considered exclusively in the light of Community law.
32. In that respect, it is necessary, first, to point out that the agreements at issue provide for the payment by the Commissioner to the operator of a royalty the amount of which is fixed in euros per tonne of waste transferred by the municipalities concerned to that operator.
33. As the Court has previously held, it follows from the definition in Article 1(a) of Directive 92/50 that a public service contract within the meaning of that directive involves consideration which is paid directly by the contracting authority to the service provider ( Parking Brixen , paragraph 39). Accordingly, a royalty of the type for which the agreements at issue provide is capable of characterising a contract as one for pecuniary interest within the meaning of Article 1(a), and accordingly as a public contract (see, as to the payment of a fixed sum per dustbin or container by a town to an enterprise with exclusive responsibility for the collection and treatment of waste, Case C‑29/04 Commission  v Austria  [2005] ECR I‑9705, paragraphs 8 and 32).
34. Secondly, it is clear from the case‑law of the Court of Justice that a service c oncession exists where the agreed method of remuneration consists in the right of the service provider to exploit for payment his own service and means that he assumes the risk connected with operating the services in question (see Case C‑324/98 Telaustria and Telefonadress  [2000] ECR I‑10745, paragraph 58; the order in Case C‑358/00 Buchhändler‑Vereinigung  [2002] ECR I‑4685, paragraphs 27 and 28; and Parking Brixen , paragraph 40).
35. It must be stated that the method of remuneration for which the agreements at issue provide does not consist in the right to exploit for payment the services in question, nor does it involve the assumption by the operator of the risk connected with operating them.
36. Not only is the operator essentially remunerated by the Commissioner by means of a fixed royalty per tonne of waste transferred to it, as pointed out at paragraph 32 of the present judgment, but it is not in dispute that, under the agreements at issue, the Commissioner undertakes, first, that all the municipalities concerned will transfer all of the remaining part of their waste to the operator and, secondly, that a minimum annual quantity of waste will be transferred to it. The agreements at issue provide, moreover, for the adjustment of the amount of the royalty if the annual quantity of waste actually transferred falls below 95% or exceeds 115% of the guaranteed minimum quantity, in order to ensure the economic and financial equilibrium of the operator. They also provide for the annual adjustment of the royalty in the light of trends in the costs of staff, raw materials and maintenance work, and of an economic index. The agreements provide moreover for a renegotiation of the royalty if, owing to a change to the legislative framework, the operator is faced with investment above a certain level in order to comply with the new legislation.
37. Having regard to the foregoing, the agreements at issue must be considered to be public service contracts subject to Directive 92/50 and not service concessions outside the scope of that directive.
39. Concerning, first, the fact that the operators are in a position, over and above the receipt of the agreed royalty, to benefit from the financial returns connected with the sale of electricity produced during the processing of waste, it is necessary to point out that Article 1(a) of Directive 92/50, which defines what is a public contract, refers to ‘contracts for pecuniary interest’ and that the pecuniary interest in a contract refers to the consideration paid to the contractor on account of the provision of services designated by the contracting authority (see, to that effect, Auroux and Others , paragraph 45).
40. In the present case, it is evident that the consideration received by the operator in return for the provision of services designated by the Commissioner, namely the processing of transferred waste with energy recovery, consists essentially in the payment of the amount of the royalty by the Commissioner.
41. Even assuming that the income from the sale of electricity could also be regarded as consideration for the services designated by the Commissioner – owing, in particular, to the fact that in the agreements at issue the Commissioner undertakes to facilitate its sale to third parties – the mere fact that the operator would accordingly be able, over and above the remuneration received by way of consideration from the Commissioner, to obtain income incidentally from third parties in consideration for its provision of services is insufficient to prevent the agreements at issue from being classified as public contracts (see, by analogy, Auroux and Others , paragraph 45).
43. The same is also true of the fact that the treatment of waste comes within the general interest. In that respect, it should moreover be pointed out that, as is clear from Annex I A to Directive 92/50, ‘[s]ervices within the meaning of Article 8’, to which the directive is capable of applying, include the category of ‘[s]ewage and refuse disposal services; sanitation and similar services’, which the Court has previously held to cover inter alia services for the collection and treatment of waste (see, to that effect, Commission  v Austria , paragraph 32).