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Re-Communalisation: The Impact of the In-House Privilege and National Public Pricing Law on European State Aid Law

DOI https://doi.org/10.21552/estal/2018/2/10

Christian Koenig, Beatrice Wilden


The re-communalisation of public services is an attractive opportunity for public authorities to fund and offset loss-making public undertakings within a municipal ‘Querverbund’. On the other hand, it gives rise to conflicts with European State aid law that have often been neglected. This article aims to illustrate potential legal pitfalls in this context by reference to a case study, taking up an example of re-communalisation in the water management sector. Focussing on the existence of an advantage, it is discussed whether municipal authorities are entitled to rely on the in-house privilege under public procurement law in order to exempt themselves from the obligation to carry out transactions in line with normal market conditions. Closer attention is paid to the relevance of national public pricing law in and its impact on the notion of advantage under European State aid law: The article claims that the pricing of public contracts pursuant to national public pricing law on a cost-price basis is not an appropriate method to establish a transaction´s compliance with market conditions.

Univ-Prof Dr iur Christian Koenig LLM (LSE) is a director at the Centre for European Integration Studies (ZEI) and a member of the Faculty of Law, University of Bonn. Beatrice Wilden is a student at the University of Bonn (with a year abroad at the University of Oxford) and student assistant to Prof Dr Koenig. The case study is based on case SA.48706.

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