The European Commission adopted a revised package of EU state aid rules for the assessment of public compensation for services of general economic interest (SGEI). With this new package, the Commission intends to clarify key state aid principles and introduces a diversified and proportionate approach with simpler rules for SGEIs. The responsible for the Committee of the Regions considers that on the overall approach to public services, much work remains to be done.

The new legislative package which revise the EU state aid rules for the assessment of public compensation for services of general economic interest (SGEI) has been adopted by the Commission. The package clarifies key state aid principles with a local scope or pursue a social objective, while better taking account of competition considerations for large cases. The Commission already proposed to modify the EU state aid rules in 2007.

The new rules clarify basic notions such as 'economic activity' to facilitate the application of the rules by national but also regional or local governments. Member States are largely free to define which services are of general interest. But, the Commission must ensure that public funding granted for the provision of such services does not unduly distort competition in the Internal Market.

Among the measures proposed in the package it is highlighted that all social services become exempted from the obligation of notification to the Commission, regardless of the amount of the compensation received. The services concerned must meet social needs as regards health and long term care, childcare, access to and reintegration in the labour market, social housing and the care and social inclusion of vulnerable groups. Other SGEIs are exempted provided the compensation amount is less than €15 million a year.

On the other hand, the Commission also proposes to set a minimum compensation amount for all other services below which the measure is deemed free of aid. The SGEI de minimis amount would be set at €500,000 over three years. According to Karl-Heinz Lambertz, responsible for the report on this topic at the Committee of the Regions, while the Commission proposes to raise it to 500.000 euros over three years, this is still far short of the 800.000 euros per year proposed by the CoR. In addition, it is proposed that whenever possible, the SGEI should be entrusted through an open and transparent public tender to ensure the best quality at the cheapest cost for taxpayers who pay for the services.