Almunia: Competition policy in 2010 and the reform of State Aid rules on the services of general economic interest (SGEI)

12 July 2011

Almunia's speech to the ECON committee focused on the report for competition policy in 2010, and included a short update on the new State Aid rules for the services of general economic interest which are to be adopted at the end of the year.

Almunia presented the following main innovations of the new SGEI:

• The Commission will  introduce a de minimis rule specific to SGEI which would still exclude any Commission’s scrutiny for small amounts of compensation. To ensure the truly local nature of the services provided, this rule could also be made dependent on other criteria, such as the very limited size of the local authority concerned or the limited size of the service provider.

• Second, the EC will extend the range of social services that are exempted from the notification obligation, which at present include only hospitals and social housing.

• Finally, the EC will propose that DG COMP's scrutiny ensures that the services are provided as efficiently as possible. Under the current package, compensation granted for the provision of the services can cover all the costs incurred by the provider plus a reasonable profit margin. This means that some of the costs compensated by Member States may be due to low efficiency levels in the provision of such service, and this may distort the functioning of markets and harm the quality of service.

• As to the process, the reform is in the final stretch: the texts will be finalised during the summer and published for public consultation by mid-September. They will then be discussed with the Member States in October and – if everything goes to plan – the new rules will be adopted by the end of January 2012. Almunia said he would be happy to discuss this issue again in the autumn, before final adoption of the package.

Full speech

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