Vrijheid van vestiging: Frankrijk en Italië gedaagd wegens exclusieve concessies hydroelectrische installaties (en)

The Commission has decided to take France to the European Court of Justice for its legislation giving preference to outgoing concession-holders when concessions for works using hydraulic power come up for renewal. The Commission will do the same in the case of Italy with regard to its national legislation giving similar preference to the outgoing concession-holder and, in the Trentino-Alto Adige Region, to local public bodies. However, the decision concerning Italy is suspended for four months as legislative amendments designed to abolish these preferences are being prepared at national level. Lastly, the Commission has made a formal request to Spain to amend the law which does not provide for a competitive procedure for the award of hydroelectric concessions. This request takes the form of a reasoned opinion, the second stage of the infringement procedure laid down in Article 226 of the EC Treaty. If there is no satisfactory reply within two months, the Commission may refer the matter to the Court.

France

The Commission has decided to take France to the Court of Justice on account of Article 12 of French Decree No 94/894 of 13 October 1994. It grants preference to outgoing concession-holders when concessions for works using hydraulic power are being renewed and awarded. This benefits companies which hold a concession and which are thus already established in France. This system is likely to ensure that existing holders retain their concessions for an indefinite period, since when a concession expires they may if they wish invoke preference to secure the concession for a further period.

A system of this kind distorts the selection procedure by interfering with the equal treatment of different economic operators. In practice, it becomes extremely difficult if not purely theoretical for other operators to bid for such concessions, since potential candidates are naturally discouraged from the outset from taking on the complex technical work of drawing up and submitting bids to take part in a competitive procedure which is subject to such conditions.

Such a system is consequently incompatible with the principle of the freedom of establishment which prohibits restrictions on the cross-border exercise of economic activities, including in particular any form of direct or indirect discrimination between Community operators.

The preference in question cannot be justified on grounds of the safety of installations or the security of energy supplies, as the measure is not in itself suitable to achieve such aims and is in any case disproportionate.

It can be replaced by less restrictive alternatives, such as compliance with a precise set of specifications, inspections, penalties, etc.

Italy

For similar reasons, the Commission has decided to take Italy to the Court of Justice.

The Commission contests the preference given under Article 12 of Decree No 79 of 11 March 1999 ("Bersani Decree") to an outgoing concession-holder whose bid is equivalent to those submitted by competitors when concessions for the production of hydroelectric power are being renewed. It also contests the provisions of Article 11 of Legislative Decree No 463 of 11 November 1999, concerning the Autonomous Region of Trentino-Alto Adige, which gives preference to local public bodies and companies belonging to them. This preference cannot be justified on grounds of protecting local authorities and local autonomy.

However, this decision by the Commission to refer the matter to the Court of Justice is suspended for four months in view of the legislative amendments which are being prepared in Italy. Indeed, after the publication in April 2005 of the national Community law, which empowers the Government to amend the legislative texts mentioned in a reasoned opinion of January 2004, the Italian authorities are currently working on a draft legislative decree designed to eliminate all the preferences referred to above.

Spain

The Commission has decided to send Spain a reasoned opinion concerning that country's legislation on the award of hydraulic concessions. There is in fact no provision in Spanish Laws No 29/1985 (water) and No 54/1997 (electricity) for a competitive procedure for the award of such concessions, with the result that they may be awarded in a discretionary manner.

According to the Court of Justice (Telaustria case), the lack of open competition among potential candidates represents in itself an infringement of the Treaty, and in particular of the principle of the freedom of establishment laid down in Article 43 of the EC Treaty, because of its failure to comply with the principle of non-discrimination and especially with the principles of transparency and equal treatment. In particular, according to the Court, if a system of prior administrative authorisation is to be justified, it must in any case be based on criteria which are objective, non-discriminatory and known in advance, to ensure that the national authorities' power of discretion is circumscribed and is not used arbitrarily.

Moreover, the period of 75 years indicated in the Spanish law for the right of concession considerably strengthens the privileged position of current holders of water concessions.

For the latest information on infringement proceedings involving the Member States, please consult the following website:

http://europa.eu.int/comm/secretariat_general/sgb/droit_com/index_en.htm