2.7.2008 EN Official Journal of the European Union L 172/15 DECISION No 626/2008/EC OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL of 30 June 2008 on the selection and authorisation of systems providing mobile satellite services (MSS) (Text with EEA relevance) THE EUROPEAN PARLIAMENT AND THE COUNCIL OF THE EUROPEAN UNION, Having regard to the Treaty establishing the European Community, and in particular Article 95 thereof, Having regard to the proposal from the Commission, Having regard to the opinion of the European Economic and Social Committee (1), After consulting the Committee of the Regions, Acting in accordance with the procedure laid down in Article 251 of the Treaty (2), Whereas: (1) As confirmed by the Council in its conclusions of 3 December 2004, effective and coherent use of radio spectrum is essential for the development of electronic communications services and contributes to stimulating growth, competitiveness and employment; access to spectrum must be eased to improve efficiency and promote innovation as well as greater flexibility for users and more choice for consumers, while taking account of general interest objectives. (2) The European Parliament, in its resolution of 14 February 2007 entitled ‘Towards a European Policy on the Radio Spectrum’ (3), emphasised the importance of communications for rural and less developed regions, for which the diffusion of broadband, lower frequency mobile communications and new wireless technologies could provide efficient solutions to achieving universal coverage in the 27 Member States with a view to the sustainable development of all areas. The European Parliament also noted that Member States’ regimes for spectrum allocation and exploitation differ widely and that those differences represent serious obstacles to the achievement of a well-functioning internal market. (3) The Commission, in its Communication of 26 April 2007 on European Space Policy, has also established an objective of facilitating the introduction of innovative satellite communications services, in particular by aggregating demand in remote and rural areas, while stressing the need for pan-European licensing of satellite services and spectrum. (4) Directive 2002/21/EC of the European Parliament and of the Council of 7 March 2002 on a common regulatory framework for electronic communications networks and services (Framework Directive) (4) aims at encouraging efficient use and ensuring effective management of radio frequencies and numbering resources, removing the remaining obstacles to the provision of the relevant networks and services, ensuring that there is no discrimination and encouraging the establishment and development of trans-European networks and the interoperability of pan-European services. (5) The introduction of new systems providing mobile satellite services (MSS) would contribute to the development of the internal market and enhance competition by increasing the availability of pan-European services and end-to-end connectivity as well as encouraging efficient investment. MSS constitute an innovative alternative platform for various types of pan-European telecommunications and broadcasting/multicasting services, regardless of the location of end users, such as high-speed Internet/intranet access, mobile multimedia and public protection and disaster relief. MSS could, in particular, improve coverage of rural areas in the Community, thus bridging the digital divide in terms of geography, strengthening cultural diversity and media pluralism and simultaneously contributing to the competitiveness of European information and communication technology industries in line with the objectives of the renewed Lisbon strategy. Directive 89/552/EEC of 3 October 1989 of the European Parliament and of the Council on the coordination of certain provisions laid down by law, regulation or administrative action in Member States concerning the provision of audiovisual media services (Audiovisual Media Services Directive) (5) should apply, as appropriate, to audiovisual media services transmitted using MSS systems. (6) Satellite communications, by their very nature, cross national borders and, as such, are susceptible to international or regional in addition to national regulation. Pan-European satellite services are an important element of the internal market and could make a substantial contribution to achieving European Union objectives, such as expansion of geographical coverage of broadband in line with the i2010 initiative (6). New applications of mobile satellite systems will emerge in the coming years. (7) Commission Decision 2007/98/EC of 14 February 2007 on the harmonised use of radio spectrum in the 2 GHz frequency bands for the implementation of systems providing mobile satellite services (7) provides that Member States shall make these frequency bands available to systems providing MSS in the Community as of 1 July 2007. (8) Radio spectrum technical management, as organised by Decision No 676/2002/EC of the European Parliament and of the Council of 7 March 2002 on a regulatory framework for radio spectrum policy in the European Community (Radio Spectrum Decision) (8) in general and Decision 2007/98/EC in particular, does not cover procedures for assignment of spectrum and granting rights of use for radio frequencies. (9) With the exception of Article 8 of Directive 2002/20/EC of the European Parliament and of the Council of 7 March 2002 on the authorisation of electronic communications networks and services (Authorisation Directive) (9), operators of mobile satellite systems are selected and authorised at national level under the existing Community regulatory framework for electronic communications. (10) Regulations of the International Telecommunications Union (ITU) provide for procedures for satellite radio frequency coordination as a tool for management of harmful interference, but do not extend to selection or authorisation. (11) In order to prevent Member States from taking decisions that might lead to fragmentation of the internal market and undermine the objectives identified in Article 8 of Directive 2002/21/EC, selection criteria for mobile satellite systems should exceptionally be harmonised so that the selection process results in availability of MSS across the European Union. High up-front investment required for the development of mobile satellite systems and the associated high technological and financial risks necessitate an economy of scale for such systems in the form of wide pan-European geographic coverage, so that they remain economically viable. (12) Moreover, the successful launch of MSS requires coordination of regulatory action by Member States. Differences in national selection procedures could still create fragmentation of the internal market due to the divergent implementation of selection criteria, including the weighting of the criteria, or different timescales of the selection procedures. This would result in a patchwork of successful applicants selected in contradiction to the pan-European nature of those MSS. Selection of different operators of mobile satellite systems by different Member States could imply complex harmful interference situations or could even mean that a selected operator is prevented from providing a pan-European satellite service, for instance where different radio frequencies are assigned to the operator in different Member States. Therefore, harmonisation of the selection criteria should be supplemented by the establishment of a common selection mechanism that would provide a coordinated selection outcome for all Member States. (13) Since authorisation of the selected operators of mobile satellite systems involves attachment of conditions to such authorisations and a broad range of national provisions applicable in the field of electronic communications must thus be taken into account, the authorisation issues should be dealt with by the competent authorities of the Member States. However, in order to ensure consistency of authorisation approaches between different Member States, provisions relating to the synchronised assignment of spectrum and harmonised authorisation conditions should be established at the Community level, without prejudice to specific national conditions compatible with Community law. (14) MSS can generally reach geographic areas not well covered by other electronic communications services, in particular rural areas. The coordinated selection and authorisation of new systems providing MSS could therefore play an important role in bridging the digital divide by improving the accessibility, speed, and quality of electronic communications services in these areas, thus contributing to social cohesion. Therefore, the proposed coverage area of MSS (service area), as well as the time frame for providing MSS within all Member States, are important characteristics which should be taken into account in an appropriate manner during the selection procedure. (15) Taking into account a comparatively long period of time and complex technical development steps required for the launch of MSS, progress in the technical and commercial development of mobile satellite systems should be assessed as part of the selection procedure. (16) Satellite radio frequency coordination is critical for the effective provision of MSS in the Member States and should therefore be considered when the credibility of applicants and the viability of the proposed mobile satellite systems are assessed during the selection procedure. (17) The comparative selection procedure should aim to bring mobile satellite systems in the 2 GHz frequency band into use without undue delay, while taking into account the right of applicants to fair and non-discriminatory participation. (18) Complementary ground components are an integral part of a mobile satellite system and are used, typically, to enhance the services offered via the satellite in areas where it may not be possible to retain a continuous line of sight with the satellite due to obstructions in the skyline caused by buildings and terrain. In accordance with Decision 2007/98/EC, complementary ground components use the same frequency bands as MSS (1 980 to 2 010 MHz and 2 170 to 2 200 MHz). The authorisation of such complementary ground components will therefore mainly rely on conditions related to local circumstances. They should therefore be selected and authorised at national level, subject to conditions established by Community law. This should be without prejudice to specific requests made by competent national authorities to the selected applicants to provide technical information indicating how particular complementary ground components would improve the availability of the proposed MSS in geographical areas where communications with one or more space stations cannot be ensured with the required quality, provided that such technical information has not already been provided in accordance with Title II. (19) The limited amount of radio spectrum available implies that the number of undertakings that may be selected and authorised is also necessarily limited. However, if the selection process leads to a finding that there is no radio spectrum scarcity, all eligible candidates should be selected. The limited amount of radio spectrum available may mean that any merger or takeover of any operator providing MSS with or by another could significantly reduce competition and would therefore be subject to scrutiny under competition law. (20) The right to use the specific radio frequencies should be granted to the selected applicants as soon as possible after their selection, in accordance with Article 5(3) of Directive 2002/20/EC. (21) Decisions on the withdrawal of authorisations granted in relation to MSS or complementary ground components due to the non-fulfilment of obligations should be enforced at national level. (22) While monitoring of the use of radio spectrum by the selected and authorised operators of mobile satellite systems and any required enforcement action is undertaken at national level, it should remain possible for the Commission to define the modalities of a coordinated monitoring and/or enforcement procedure. Wherever necessary, the Commission should have the right to raise enforcement issues relating to the fulfilment by operators of common authorisation conditions, in particular coverage requirements. (23) The measures necessary for the implementation of this Decision should be adopted in accordance with Council Decision 1999/468/EC of 28 June 1999 laying down the procedures for the exercise of implementing powers conferred on the Commission (10). Decisions on selection of applicants should be adopted in accordance with the regulatory procedure in view of the importance of the Community procedure for any further national authorisation procedures. (24) In particular, the Commission should be empowered to define the modalities for coordinated application of the rules on enforcement. Since those measures are of general scope and are designed to amend non-essential elements of this Decision by supplementing it with new non-essential elements, they must be adopted in accordance with the regulatory procedure with scrutiny provided for in Article 5a of Decision 1999/468/EC. (25) Since the objective of this Decision, namely to establish a common framework for the selection and authorisation of operators of mobile satellite systems, cannot be sufficiently achieved by Member States and can therefore, by reason of the scale and effects of the action, be better achieved at Community level, the Community may adopt measures, in accordance with the principle of subsidiarity as set out in Article 5 of the Treaty. In accordance with the principle of proportionality as set out in that Article, this Decision does not go beyond what is necessary in order to achieve that objective, HAVE ADOPTED THIS DECISION: TITLE I OBJECTIVE, SCOPE AND DEFINITIONS Article 1 Objective and scope 1. The purpose of this Decision is to facilitate the development of a competitive internal market for mobile satellite services (MSS) across the Community and to ensure gradual coverage in all Member States. This Decision creates a Community procedure for the common selection of operators of mobile satellite systems that use the 2 GHz frequency band in accordance with Decision 2007/98/EC, comprising radio spectrum from 1 980 to 2 010 MHz for earth to space communications, and from 2 170 to 2 200 MHz for space to Earth communications. It also lays down provisions for the coordinated authorisation by Member States of the selected operators to use the assigned radio spectrum within this band for the operation of mobile satellite systems. 2. Operators of mobile satellite systems shall be selected through a Community procedure, in accordance with Title II. 3. The selected operators of mobile satellite systems shall be authorised by Member States in accordance with Title III. 4. Operators of complementary ground components of mobile satellite systems shall be authorised by Member States in accordance with Title III. Article 2 Definitions 1. The definitions laid down in Directive 2002/21/EC and Directive 2002/20/EC shall apply for the purposes of this Decision. 2. The following definitions shall also apply: (a) ‘mobile satellite systems’ shall mean electronic communications networks and associated facilities capable of providing radio-communications services between a mobile earth station and one or more space stations, or between mobile earth stations by means of one or more space stations, or between a mobile earth station and one or more complementary ground components used at fixed locations. Such a system shall include at least one space station; (b) ‘complementary ground components’ of mobile satellite systems shall mean ground-based stations used at fixed locations, in order to improve the availability of MSS in geographical areas within the footprint of the system’s satellite(s), where communications with one or more space stations cannot be ensured with the required quality. TITLE II SELECTION PROCEDURE Article 3 Comparative selection procedure 1. A comparative selection procedure shall be organised by the Commission for the selection of operators of mobile satellite systems. The Commission shall be assisted by the Communications Committee referred to in Article 10(1). 2. Applicants shall be given a fair and non-discriminatory opportunity to participate in the comparative selection procedure, which shall be transparent. The call for applications shall be published in the Official Journal of the European Union. 3. Access to documents relating to the comparative selection procedure, including applications, shall be granted in accordance with Regulation (EC) No 1049/2001 of the European Parliament and of the Council of 30 May 2001 regarding public access to European Parliament, Council and Commission documents (11). 4. The Commission may seek advice and assistance from external experts for the analysis and/or evaluation of applications. Such external experts shall be selected on the basis of their expertise and high level of independence and impartiality. Article 4 Admissibility of applications 1. The following admissibility requirements shall apply: (a) applicants shall be established in the Community; (b) applications shall identify the amount of radio spectrum requested, which shall be no more than 15 MHz for earth to space and 15 MHz for space to earth in relation to any single applicant and shall include statements and evidence concerning the radio spectrum requested, the required milestones and the selection criteria; (c) applications shall include a commitment on the part of the applicant that: (i) the mobile satellite system proposed shall cover a service area of at least 60 % of the aggregate land area of the Member States, from the time the provision of MSS commences; (ii) MSS shall be available in all Member States and to at least 50 % of the population and over at least 60 % of the aggregate land area of each Member State by the time stipulated by the applicant but in any event no later than seven years from the date of publication of the Commission’s decision adopted pursuant to Articles 5(2) or 6(3). 2. Applications shall be submitted to the Commission. The Commission may request applicants to supply additional information regarding the fulfilment of admissibility requirements within a specific time frame of between five and 20 working days. The application shall be deemed inadmissible if such information is not supplied within the specified time frame. 3. The Commission shall decide on the admissibility of applications. Any decision of the Commission on non-admissibility of applications shall be reasoned and adopted in accordance with the advisory procedure referred to in Article 10(2). 4. The Commission shall forthwith inform the applicants whether their applications have been considered as admissible and publish the list of admissible applicants. Article 5 First selection phase 1. Within 40 working days following publication of the list of admissible applicants, the Commission shall assess whether applicants have demonstrated the required level of technical and commercial development of their respective mobile satellite systems. Such assessment shall rely on the satisfactory completion of milestones one to five as set out in the Annex. The credibility of applicants and the viability of the proposed mobile satellite systems shall be taken into account throughout the first selection phase. 2. If the combined demand for radio spectrum requested by eligible applicants retained according to paragraph 1 of this Article does not exceed the amount of radio spectrum available identified in Article 1(1), the Commission shall, by means of a reasoned decision, determine, in accordance with the regulatory procedure referred to in Article 10(3), that all eligible applicants shall be selected and identify the respective frequencies which each selected applicant shall be authorised to use, in each Member State, in accordance with Title III. 3. The Commission shall forthwith inform the applicants whether their applications have been considered as eligible for the second selection phase or have been selected according to paragraph 2. The Commission shall publish the list of eligible or selected applicants. Within 30 working days of such publication, eligible applicants that intend to proceed no further in the selection procedure, and selected applicants that intend not to use the radio frequencies, shall inform the Commission thereof in writing. Article 6 Second selection phase 1. If the combined demand for radio spectrum requested by eligible applicants identified in the first selection phase exceeds the amount of radio spectrum available identified in Article 1(1), the Commission shall select eligible applicants by assessing to what extent the proposed mobile satellite systems of the eligible applicants fulfil the following weighted selection criteria: (a) consumer and competitive benefits provided (20 % weighting) comprising the following two sub-criteria: (i) the number of end-users and the range of MSS to be provided by the date of commencement of the continuous provision of commercial MSS; (ii) the date of commencement of the continuous provision of commercial MSS; (b) spectrum efficiency (20 % weighting) comprising the following two sub-criteria: (i) the total amount of spectrum required; (ii) the aggregated data stream capacity; (c) pan-EU geographic coverage (40 % weighting) comprising the following three sub-criteria: (i) the number of Member States in which at least 50 % of the population is within the service area by the date of commencement of the continuous provision of commercial MSS; (ii) the degree of geographical coverage, based on the service area of the aggregate land area of the Member States by the date of commencement of the continuous provision of commercial MSS; (iii) the time stipulated by the applicant when MSS will be available in all Member States and to at least 50 % of the population and in at least 60 % of the aggregate land area of each Member State; (d) the extent to which public policy objectives, not dealt with by the criteria referred to in points (a), (b) and (c), are achieved (20 % weighting) in accordance with the following three equally weighted sub-criteria: (i) the provision of public interest services contributing to the protection of health or safety and security of citizens in general or specific groups of citizens; (ii) the integrity and security of services; (iii) the range of services provided to consumers in rural or remote areas. 2. Any rules for implementing this Article shall be adopted by the Commission in accordance with the regulatory procedure referred to in Article 10(3). The credibility of the applicants and the viability of the proposed mobile satellite systems shall be taken into account throughout the second selection phase. 3. Within 80 working days following publication of the list of eligible applicants identified in the first selection phase, the Commission shall, on the basis of the report of the external expert panel, if applicable, and in accordance with the regulatory procedure referred to in Article 10(3), adopt a decision on the selection of applicants. The decision shall identify the selected applicants ranked on the basis of the extent to which they meet the selection criteria, the reasons on which the decision is based, as well as the frequencies which each selected applicant is to be authorised to use, in each Member State, in accordance with Title III. 4. The Commission shall publish the decisions adopted pursuant to Articles 5(2) or 6(3) in the Official Journal of the European Union within one month of their adoption. TITLE III AUTHORISATION Article 7 Authorisation of the selected applicants 1. Member States shall ensure that the selected applicants, in accordance with the time frame and the service area to which the selected applicants have committed themselves, in accordance with Article 4(1)(c), and in accordance with national and Community law, have the right to use the specific radio frequency identified in the Commission decision adopted pursuant to Articles 5(2) or 6(3) and the right to operate a mobile satellite system. They shall inform selected applicants of those rights accordingly. 2. The rights covered by paragraph 1 shall be subject to the following common conditions: (a) selected applicants shall use the assigned radio spectrum for the provision of MSS; (b) selected applicants shall meet milestones six to nine set out in the Annex within 24 months of the selection decision adopted pursuant to Articles 5(2) or 6(3); (c) selected applicants shall honour any commitments they give in their applications or during the comparative selection procedure, irrespective of whether the combined demand for radio spectrum exceeds the amount available; (d) selected applicants shall provide to the competent authorities of all Member States an annual report detailing the status of development of their proposed mobile satellite system; (e) any necessary rights of use and authorisations shall be granted for a duration of eighteen years from the date of the selection decision adopted pursuant to Articles 5(2) or 6(3). 3. Member States may grant rights of use of spectrum identified in Article 1(1) for such time and to the extent that they remain outside the service area to which the selected applicants have committed themselves pursuant to this Decision, in accordance with Decision 2007/98/EC. 4. Member States may impose objectively justified, non-discriminatory, proportionate and transparent obligations to ensure communications between emergency services and authorities during major disasters, in accordance with Community law, including Directive 2002/20/EC. Article 8 Complementary ground components 1. Member States shall, in accordance with national and Community law, ensure that their competent authorities grant to the applicants selected in accordance with Title II and authorised to use the spectrum pursuant to Article 7 the authorisations necessary for the provision of complementary ground components of mobile satellite systems on their territories. 2. Member States shall not select or authorise operators of complementary ground components of mobile satellite systems before the selection procedure provided for in Title II is completed by a Commission decision adopted pursuant to Articles 5(2) or 6(3). This is without prejudice to the use of the 2 GHz frequency band by systems other than those providing MSS in accordance with Decision 2007/98/EC. 3. Any national authorisations issued for the operation of complementary ground components of mobile satellite systems in the 2 GHz frequency band shall be subject to the following common conditions: (a) operators shall use the assigned radio spectrum for the provision of complementary ground components of mobile satellite systems; (b) complementary ground components shall constitute an integral part of a mobile satellite system and shall be controlled by the satellite resource and network management mechanism; they shall use the same direction of transmission and the same portions of frequency bands as the associated satellite components and shall not increase the spectrum requirement of the associated mobile satellite system; (c) independent operation of complementary ground components in case of failure of the satellite component of the associated mobile satellite system shall not exceed 18 months; (d) rights of use and authorisations shall be granted for a period of time ending no later than the expiry of the authorisation of the associated mobile satellite system. Article 9 Monitoring and enforcement 1. Selected operators shall be responsible for compliance with any conditions attached to their authorisations and for payment of any applicable authorisation and/or usage fees and charges as required by laws of Member States. 2. Member States shall ensure that rules on enforcement, including rules on penalties applicable in the event of breaches of the common conditions provided for in Article 7(2), are in accordance with Community law, in particular Article 10 of Directive 2002/20/EC. Penalties must be effective, proportionate and dissuasive. Member States shall ensure monitoring of compliance with these common conditions and take appropriate measures to address non-compliance. Member States shall inform the Commission of the results of such monitoring on an annual basis, in the event that any common conditions have not been complied with and in the event that any enforcement measures have been taken. The Commission may, with the assistance of the Communications Committee referred to in Article 10(1), examine any alleged specific breach of the common conditions. Where a Member State informs the Commission of a particular breach, the Commission shall examine the alleged breach with the assistance of the Communications Committee. 3. The measures defining any appropriate modalities for coordinated application of the rules on enforcement referred to in paragraph 2, including rules for the coordinated suspension or withdrawal of authorisations for breaches of the common conditions provided for in Article 7(2), designed to amend non-essential elements of this Decision by supplementing it shall be adopted in accordance with the regulatory procedure with scrutiny referred to in Article 10(4). TITLE IV GENERAL AND FINAL PROVISIONS Article 10 Committee 1. The Commission shall be assisted by the Communications Committee set up by Article 22 of Directive 2002/21/EC. 2. Where reference is made to this paragraph, Articles 3 and 7 of Decision 1999/468/EC shall apply, having regard to the provisions of Article 8 thereof. 3. Where reference is made to this paragraph, Articles 5 and 7 of Decision 1999/468/EC shall apply, having regard to the provisions of Article 8 thereof. The period laid down in Article 5(6) of Decision 1999/468/EC shall be set at one month. 4. Where reference is made to this paragraph, Article 5a(1) to (4) and (5)(b), and Article 7 of Decision 1999/468/EC shall apply, having regard to the provisions of Article 8 thereof. The time limits laid down in Article 5a(3)(c), (4)(b) and (4)(e) of Decision 1999/468/EC shall be set at one month. Article 11 Entry into force This Decision shall enter into force on the third day following its publication in the Official Journal of the European Union. Article 12 Addressees This Decision is addressed to the Member States. Done at Brussels, 30 June 2008. For the European Parliament The President H.-G. PÖTTERING For the Council The President M. KUCLER DOLINAR (1) OJ C 44, 16.2.2008, p. 50. (2) Opinion of the European Parliament of 21 May 2008 (not yet published in the Official Journal) and Council Decision of 23 June 2008. (3) OJ C 287 E, 29.11.2007, p. 364. (4) OJ L 108, 24.4.2002, p. 33. Directive as amended by Regulation (EC) No 717/2007 (OJ L 171, 29.6.2007, p. 32). (5) OJ L 298, 17.10.1989, p. 23. Directive as last amended by Directive 2007/65/EC (OJ L 332, 18.12.2007, p. 27). (6) Commission Communication of 1 June 2005 entitled ‘i2010 — A European Information Society for growth and employment’. (7) OJ L 43, 15.2.2007, p. 32. (8) OJ L 108, 24.4.2002, p. 1. (9) OJ L 108, 24.4.2002, p. 21. (10) OJ L 184, 17.7.1999, p. 23. Decision as amended by Decision 2006/512/EC (OJ L 200, 22.7.2006, p. 11). (11) OJ L 145, 31.5.2001, p. 43. ANNEX MILESTONES 1. Submission of International Telecommunications Union (ITU) request for coordination The applicant shall provide clear evidence that the administration responsible for the ITU filing of a mobile satellite system to be used for the provision of commercial MSS within the territories of the Member States has submitted the relevant ITU Radio Regulations Appendix 4 information. 2. Satellite manufacturing The applicant shall provide clear evidence of a binding agreement for the manufacture of the satellites required for the provision of commercial MSS within the territories of the Member States. The document shall identify the construction milestones leading to the completion of manufacture of satellites required for the provision of commercial MSS. The document shall be signed by the applicant and the satellite manufacturing company. 3. Satellite launch agreement The applicant shall provide clear evidence of a binding agreement to launch the minimum number of satellites required for the continuous provision of commercial MSS within the territories of the Member States. The document shall identify the launch dates and launch services and the contractual terms and conditions concerning indemnity. The document shall be signed by the mobile satellite system operator and the satellite launching company. 4. Gateway Earth Stations The applicant shall provide clear evidence of a binding agreement for the construction and installation of Gateway Earth Stations that would be used for the provision of commercial MSS within the territories of the Member States. 5. Completion of the Critical Design Review The Critical Design Review is the stage in the spacecraft implementation process at which the design and development phase ends and the manufacturing phase starts. The applicant shall provide clear evidence of the completion, no later than 80 working days after the submission of the application, of the Critical Design Review in accordance with the construction milestones indicated in the satellite manufacturing agreement. The relevant document shall be signed by the satellite manufacturing company and shall indicate the date of the completion of the Critical Design Review. 6. Satellite mating The mating is the stage in the spacecraft implementation process at which the Communication Module (CM) is integrated with the Service Module (SM). The applicant shall provide clear evidence that the Test Readiness Review for SM/CM mating has taken place in accordance with the construction milestones indicated in the satellite manufacturing agreement. The relevant document shall be signed by the satellite manufacturing company and shall indicate the date of the completion of the satellite mating. 7. Launch of satellites The applicant shall provide clear evidence of the successful launch and in-orbit deployment of the number of satellites required for the continuous provision of commercial MSS within the territories of the Member States. 8. Frequency coordination The applicant shall provide clear evidence of the successful frequency coordination of the system in accordance with the relevant provisions of the ITU Radio Regulations. However, a system which demonstrates compliance with milestones one to seven inclusive is not obliged to demonstrate at this stage completion of successful frequency coordination with those mobile satellite systems which fail to comply adequately and reasonably with milestones one to seven inclusive. 9. Provision of MSS within the territories of Member States The applicant shall provide clear evidence that it is effectively providing the continuous commercial MSS within the territories of the Member States using the number of satellites it has previously identified under milestone three to cover the geographical area the applicant has committed to in its application by the date of the commencement of the provision of MSS.

Summary: Selection and authorisation of mobile satellite services (MSS) Selection and authorisation of mobile satellite services (MSS) SUMMARY OF: Decision No 626/2008/EC on the selection and authorisation of systems providing mobile satellite services (MSS) Decision 2009/449/EC on the selection of operators of pan-European systems providing MSS Decision 2007/98/EC on the harmonised use of radio spectrum in the 2 GHz frequency bands for the implementation of systems providing MSS Decision 2011/667/EU on modalities for coordinated application of the rules on enforcement with regard to MSS WHAT IS THE AIM OF THE DECISIONS? They aim to facilitate a competitive internal market for mobile satellite services (MSS) and ensure gradual coverage everywhere in the EU. They establish an MSSoperator selection procedure at EU level and common authorisation rules for MSS operators to be applied by EU countries, with the overall aim of making effective use of radio spectrum. KEY POINTS Mobile satellite systems are defined as electronic communications networks and their associated facilities which are capable of providing radio-communications services: between a mobile earth station and satellite space stations; or between mobile earth stations, using communication via satellite space stations; or between a mobile earth station and fixed location complementary ground components* (using communication with at least one satellite space station). Decision No 626/2008/EC sets out selection and authorisation procedures. Selection procedure The selection procedure for MSS operators is organised by the European Commission, assisted by the Communications Committee. The calls for tenders are published in the Official Journal of the European Union. The decision establishes an MSS-operator selection procedure at EU level and common authorisation rules to be applied by EU countries for use of the 2 GHz frequency band, which comprises radiospectrum : from 1980 to 2010 MHz for ground to satellite communication, and 2170 to 2200 MHz for satellite to ground communication, in accordance with Decision 2007/98/EC. Operators submitting an application must be established in the EU, and identify the radio spectrum requested, which should be no more than 15 MHz for each direction of communication. Applicants must also commit to: covering a service area of at least 60% of the aggregate land area of the EU countries, from the time the provision of MSS commences;making MSS available in all EU countries and to at least 50% of the population and over at least 60% of the aggregate land area of each EU country by no later than 7 years from selection. The selection procedure comprises the assessment of both the technical and commercial capacities of applicants as well as the technical and commercial quality of the MSS offered. The Commission publishes the list of selected operators who must then obtain authorisation at national level. Authorisation EU countries guarantee the selected operators the right to use radio frequencies for MSS, subject to conditions including: following milestones regarding the satellites’ mating (integration of the communication and service modules) and launch, frequency coordination and the provision of MSS within EU country territories in the 2 years following their selection;selected operators must honour the commitments made during the selection procedure and provide an annual report to national authorities;the rights of use and authorisations are granted for 18 years from the selection date. EU countries also issue authorisations for the use of complementary ground components. Decision 2009/449/EC determines the following: ICO Satellite Limited and TerreStar Europe Limited are not eligible for radio spectrum allocation (because they did not demonstrate the required level of technical and commercial development of their respective mobile satellite systems and should not be eligible applicants); Inmarsat Ventures Limited are selected for radio spectrum from 1980 to 1995 MHz for earth to space communications and from 2170 to 2185 MHz for space to earth communications; Solaris Mobile Limited are selected for radio spectrum from 1995 to 2010 MHz for earth to space communications and from 2185 to 2200 MHz for space to earth communications. Decision 2007/98/EC determines the following: EU countries must designate frequency bands 1980 to 2010 MHz and 2170 to 2200 MHz for MSS; any other use of these bands must not cause harmful interference and no claim for harmful interference caused by MSS can be made; any complementary ground-based station is an integral part of the MSS and must be controlled by the same system. It must use the same direction of transmission and the same portions of frequency bands as the associated satellite components. Decision 2011/667/EU sets out how EU countries coordinate enforcement response in the event of an alleged breach of the common conditions of the MSS operator authorisation. FROM WHEN DO THE DECISIONS APPLY? Decision No 626/2008/EC has applied since 2 July 2008. Amendments, including revised committee rules and provisions for adopting implementing acts to strengthen enforcement rules, have applied since 26 July 2019. Decision 2009/449/EC has applied since 12 June 2009. Decision 2007/98/EC has applied since 14 February 2007. Decision 2011/667/EU has applied since 11 October 2011. BACKGROUND Directive 2002/21/EC (see summary) was introduced to create an internal market for MSS open to competition and to reduce digital inequalities by progressively improving coverage in less-developed areas of the EU. The European Electronic Communications Code (Directive (EU) 2018/1972) repeals it from 21 December 2020. The decisions follow the guidelines in the 2007 European Parliament Resolution Towards a European Policy on the Radio Spectrum Policy which emphasises the importance of the diffusion of broadband, mobile communications and new wireless technologies in achieving universal coverage in the EU. Pan-European satellite services also enable the expansion of geographical coverage of broadband in line with the i2010 initiative. For more information, see: Going mobile with satellite services (European Commission)Spectrum in the European Union — factsheet (European Commission). KEY TERMS Complementary ground components of MSS: fixed ground-based stations, designed to improve the availability of MSS in geographical areas within the footprint of the system’s satellite(s), where communications with the satellite space stations may not have the required quality. MAIN DOCUMENTS Decision No 626/2008/EC of the European Parliament and of the Council of 30 June 2008 on the selection and authorisation of systems providing mobile satellite services (MSS) (OJ L 172, 2.7.2008, pp. 15-24) Successive amendments to Decision No 626/2008/EC have been incorporated into the original text. This consolidated version is of documentary value only. Commission Decision 2009/449/EC of 13 May 2009 on the selection of operators of pan-European systems providing mobile satellite services (MSS) (OJ L 149, 12.6.2009, pp. 65-68) Commission Decision 2007/98/EC of 14 February 2007 on the harmonised use of radio spectrum in the 2 GHz frequency bands for the implementation of systems providing mobile satellite services (OJ L 43, 15.2.2007, pp. 32-34) Commission Decision 2011/667/EU of 10 October 2011 on modalities for coordinated application of the rules on enforcement with regard to mobile satellite services (MSS) pursuant to Article 9(3) of Decision No 626/2008/EC of the European Parliament and of the Council (OJ L 265, 11.10.2011, pp. 25-27) RELATED DOCUMENTS Directive (EU) 2018/1972 of the European Parliament and of the Council of 11 December 2018 establishing the European Electronic Communications Code (Recast) (OJ L 321, 17.12.2018, pp. 36-214) See consolidated version. Decision No 676/2002/EC of the European Parliament and of the Council of 7 March 2002 on a regulatory framework for radio spectrum policy in the European Community (Radio Spectrum Decision) (OJ L 108, 24.4.2002, pp. 1-6) Directive 2002/21/EC of the European Parliament and of the Council of 7 March 2002 on a common regulatory framework for electronic communications networks and services (Framework Directive) (OJ L 108, 24.4.2002, pp. 33-50) See consolidated version. last update 28.02.2020


17.11.2006 EN Official Journal of the European Union L 318/17 COMMISSION DIRECTIVE 2006/111/EC of 16 November 2006 on the transparency of financial relations between Member States and public undertakings as well as on financial transparency within certain undertakings (Text with EEA relevance) (Codified version) THE COMMISSION OF THE EUROPEAN COMMUNITIES, Having regard to the Treaty establishing the European Community, and in particular Article 86(3) thereof, Whereas: (1) Commission Directive 80/723/EEC of 25 June 1980 on the transparency of financial relations between Member States and public undertakings as well as on financial transparency within certain undertakings (1) has been substantially amended several times (2). In the interests of clarity and rationality the said Directive should be codified. (2) Public undertakings play a substantial role in the national economy of the Member States. (3) Member States sometimes grant special or exclusive rights to particular undertakings, or make payments or give some other kind of compensation to particular undertakings entrusted with the operation of services of general economic interest. These undertakings are often also in competition with other undertakings. (4) Article 295 of the Treaty provides that the Treaty is in no way to prejudice the rules in Member States governing the system of property ownership. There should be no unjustified discrimination between public and private undertakings in the application of the rules on competition. This Directive should apply to both public and private undertakings. (5) The Treaty requires the Commission to ensure that Member States do not grant undertakings, public or private, aids incompatible with the common market. (6) However, the complexity of the financial relations between national public authorities and public undertakings tends to hinder the performance of this duty. (7) A fair and effective application of the aid rules in the Treaty to both public and private undertakings will be possible only if these financial relations are made transparent. (8) Such transparency applied to public undertakings should enable a clear distinction to be made between the role of the State as public authority and its role as proprietor. (9) Article 86(1) of the Treaty imposes obligations on Member States in the case of public undertakings and undertakings to which Member States grant special or exclusive rights. Article 86(2) of the Treaty applies to undertakings entrusted with the operation of services of general economic interest. Article 86(3) of the Treaty requires the Commission to ensure the application of the provisions of that Article and provides it with the requisite means to this end. In order to ensure the application of the provisions of Article 86 of the Treaty the Commission must have the necessary information. This entails defining the conditions for ensuring such transparency. (10) It should be made clear what is to be understood by the terms ‘public authorities’ and ‘public undertakings’. (11) The Member States have differing administrative territorial structures. This Directive should cover public authorities at all levels in each Member State. (12) Public authorities may exercise a dominant influence on the behaviour of public undertakings not only where they are the proprietor or have a majority participation but also by virtue of powers they hold in management or supervisory bodies as a result either of the rules governing the undertaking or of the manner in which the shareholdings are distributed. (13) The provision of public funds to public undertakings may take place either directly or indirectly. Transparency must be achieved irrespective of the manner in which such provision of public funds is made. It may also be necessary to ensure that adequate information is made available as regards the reasons for such provision of public funds and their actual use. (14) Complex situations linked to the diverse forms of public and private undertakings granted special or exclusive rights or entrusted with the operation of services of general economic interest as well as the range of activities that might be carried on by a single undertaking and the different degrees of market liberalisation in the various Member States could complicate application of the competition rules, and particularly Article 86 of the Treaty. It is therefore necessary for Member States and the Commission to have detailed data about the internal and financial and organisational structure of such undertakings, in particular separate and reliable accounts relating to different activities carried on by the same undertaking. (15) The accounts should show the distinction between different activities, the costs and revenues associated with each activity and the methods of cost and revenue assignment and allocation. Such separate accounts should be available in relation to, on the one hand, products and services in respect of which the Member State has granted a special or exclusive right or entrusted the undertaking with the operation of a service of general economic interest, as well as, on the other hand, for each other product or service in respect of which the undertaking is active. The obligation of separation of accounts should not apply to undertakings whose activities are limited to the provision of services of general economic interest and which do not operate activities outside the scope of these services of general economic interest. It does not seem necessary to require separation of accounts within the area of services of general economic interest or within the area of the special or exclusive rights, as far as this is not necessary for the cost and revenue allocation between these services and products and those outside the services of general economic interest or the special or exclusive rights. (16) Requiring Member States to ensure that the relevant undertakings maintain such separate accounts is the most efficient means by which fair and effective application of the rules of competition to such undertakings can be assured. In 1996 the Commission adopted a Communication on services of general interest in Europe (3), which was supplemented by another Communication in 2001 (4), in which it emphasised the importance of such services. It is necessary to take account of the importance of the sectors concerned, which may involve services of general interest, the strong market position that the relevant undertakings may have and the vulnerability of emerging competition in the sectors being liberalised. In accordance with the principle of proportionality it is necessary and appropriate for the achievement of the basic objective of transparency to lay down rules on such separate accounts. This Directive does not go beyond what is necessary in order to achieve the objectives pursued, in accordance with the provisions of the third paragraph of Article 5 of the Treaty. (17) In certain sectors provisions adopted by the Community require Member States and certain undertakings to maintain separate accounts. It is necessary to ensure an equal treatment for all economic activities throughout the Community and to extend the requirement to maintain separate accounts to all comparable situations. This Directive should not amend specific rules established for the same purpose in other Community provisions and should not apply to activities of undertakings covered by those provisions. (18) Certain undertakings should be excluded from the application of this Directive by virtue of the size of their turnover. This applies to those public undertakings whose business is not conducted on such a scale as to justify the administrative burden of ensuring transparency. In view of the limited potential for an effect on trade between Member States, it is not necessary, at this time, to require separate accounts in relation to the supply of certain categories of services. (19) This Directive is without prejudice to other provisions of the Treaty, notably Articles 86(2), 88 and 296, and to any other rules concerning the provision of information by Member States to the Commission. (20) In cases where the compensation for the fulfilment of services of general economic interest has been fixed for an appropriate period following an open, transparent and non-discriminatory procedure it does not seem necessary to require such undertakings to maintain separate accounts. (21) The undertakings in question being in competition with other undertakings, information acquired should be covered by the obligation of professional secrecy. (22) A reporting system based on ex post facto checks of the financial flows between public authorities and public undertakings operating in the manufacturing sector will enable the Commission to fulfil its obligations. That system of control must cover specific financial information. (23) In order to limit the administrative burden on Member States, the reporting system should make use of both publicly available data and information available to majority shareholders. The presentation of consolidated reports is to be permitted. Incompatible aid to major undertakings operating in the manufacturing sector will have the greatest distortive effect on competition in the common market. Therefore, such a reporting system may at present be limited to undertakings with a yearly turnover of more than EUR 250 million. (24) This Directive should be without prejudice to the obligations of the Member States relating to the time-limits for transposition into national law of the Directives set out in Annex I, Part B, HAS ADOPTED THIS DIRECTIVE: Article 1 1. The Member States shall ensure that financial relations between public authorities and public undertakings are transparent as provided in this Directive, so that the following emerge clearly: (a) public funds made available directly by public authorities to the public undertakings concerned; (b) public funds made available by public authorities through the intermediary of public undertakings or financial institutions; (c) the use to which these public funds are actually put. 2. Without prejudice to specific provisions laid down by the Community the Member States shall ensure that the financial and organisational structure of any undertaking required to maintain separate accounts is correctly reflected in the separate accounts, so that the following emerge clearly: (a) the costs and revenues associated with different activities; (b) full details of the methods by which costs and revenues are assigned or allocated to different activities. Article 2 For the purpose of this Directive: (a) ‘public authorities’ means all public authorities, including the State and regional, local and all other territorial authorities; (b) ‘public undertakings’ means any undertaking over which the public authorities may exercise directly or indirectly a dominant influence by virtue of their ownership of it, their financial participation therein, or the rules which govern it. A dominant influence on the part of the public authorities shall be presumed when these authorities, directly or indirectly in relation to an undertaking: (i) hold the major part of the undertaking’s subscribed capital; or (ii) control the majority of the votes attaching to shares issued by the undertakings; or (iii) can appoint more than half of the members of the undertaking's administrative, managerial or supervisory body; (c) ‘public undertakings operating in the manufacturing sector’ means all undertakings whose principal area of activity, defined as being at least 50 % of total annual turnover, is in manufacturing. These undertakings are those whose operations fall under Section D — Manufacturing being subsection DA up to and including subsection DN of the NACE (Rev.1) classification (5); (d) ‘undertaking required to maintain separate accounts’ means any undertaking that enjoys a special or exclusive right granted by a Member State pursuant to Article 86(1) of the Treaty or is entrusted with the operation of a service of general economic interest pursuant to Article 86(2) of the Treaty, that receives public service compensation in any form whatsoever in relation to such service and that carries on other activities; (e) ‘different activities’ means, on the one hand, all products or services in respect of which a special or exclusive right is granted to an undertaking or all services of general economic interest with which an undertaking is entrusted and, on the other hand, each other separate product or service in respect of which the undertaking is active; (f) ‘exclusive rights’ means rights that are granted by a Member State to one undertaking through any legislative, regulatory or administrative instrument, reserving it the right to provide a service or undertake an activity within a given geographical area; (g) ‘special rights’ means rights that are granted by a Member State to a limited number of undertakings, through any legislative, regulatory or administrative instrument, which, within a given geographical area: (i) limits to two or more the number of such undertakings, authorised to provide a service or undertake an activity, otherwise than according to objective, proportional and non-discriminatory criteria; or (ii) designates, otherwise than according to such criteria, several competing undertakings, as being authorised to provide a service or undertake an activity; or (iii) confers on any undertaking or undertakings, otherwise than according to such criteria, any legal or regulatory advantages which substantially affect the ability of any other undertaking to provide the same service or to operate the same activity in the same geographical area under substantially equivalent conditions. Article 3 The transparency referred to in Article 1(1) shall apply in particular to the following aspects of financial relations between public authorities and public undertakings: (a) the setting-off of operating losses; (b) the provision of capital; (c) non-refundable grants, or loans on privileged terms; (d) the granting of financial advantages by forgoing profits or the recovery of sums due; (e) the forgoing of a normal return on public funds used; (f) compensation for financial burdens imposed by the public authorities. Article 4 1. To ensure the transparency referred to in Article 1(2), the Member States shall take the measures necessary to ensure that for any undertaking required to maintain separate accounts: (a) the internal accounts corresponding to different activities are separate; (b) all costs and revenues are correctly assigned or allocated on the basis of consistently applied and objectively justifiable cost accounting principles; (c) the cost accounting principles according to which separate accounts are maintained are clearly established. 2. Paragraph 1 shall only apply to activities which are not covered by specific provisions laid down by the Community and shall not affect any obligations of Member States or undertakings arising from the Treaty or from such specific provisions. Article 5 1. As far as the transparency referred to in Article 1(1) is concerned, this Directive shall not apply to financial relations between the public authorities and: (a) public undertakings, as regards services the supply of which is not liable to affect trade between Member States to an appreciable extent; (b) central banks; (c) public credit institutions, as regards deposits of public funds placed with them by public authorities on normal commercial terms; (d) public undertakings whose total annual net turnover over the period of the two financial years preceding that in which the funds referred to in Article 1(1) are made available or used has been less than EUR 40 million. However, for public credit institutions the corresponding threshold shall be a balance sheet total of EUR 800 million. 2. As far as the transparency referred to in Article 1(2) is concerned, this Directive shall not apply: (a) to undertakings, as regards services the supply of which is not liable to affect trade between Member States to an appreciable extent; (b) to undertakings whose total annual net turnover over the period of the two financial years preceding any given year in which it enjoys a special or exclusive right granted by a Member State pursuant to Article 86(1) of the Treaty, or in which it is entrusted with the operation of a service of general economic interest pursuant to Article 86(2) of the Treaty is less than EUR 40 million; however, for public credit institutions the corresponding threshold shall be a balance sheet total of EUR 800 million; (c) to undertakings which have been entrusted with the operation of services of general economic interest pursuant to Article 86(2) of the Treaty if the compensation they receive, in any form whatsoever, was fixed for an appropriate period following an open, transparent and non-discriminating procedure. Article 6 1. Member States shall ensure that information concerning the financial relations referred to in Article 1(1) be kept at the disposal of the Commission for five years from the end of the financial year in which the public funds were made available to the public undertakings concerned. However, where the same funds are used during a later financial year, the five-year time limit shall run from the end of that financial year. 2. Member States shall ensure that information concerning the financial and organisational structure of undertakings referred to in Article 1(2) be kept at the disposal of the Commission for five years from the end of the financial year to which the information refers. 3. Member States shall, where the Commission considers it necessary so to request, supply to it the information referred to in paragraphs 1 and 2, together with any necessary background information, notably the objectives pursued. Article 7 The Commission shall not disclose such information supplied to it pursuant to Article 6(3) as is of a kind covered by the obligation of professional secrecy. The first paragraph shall not prevent publication of general information or surveys which do not contain information relating to particular public undertakings to which this Directive applies. Article 8 1. Member States whose public undertakings operate in the manufacturing sector shall supply the financial information as set out in paragraphs 2 and 3 to the Commission on an annual basis within the timetable contained in paragraph 5. 2. The financial information required for each public undertaking operating in the manufacturing sector and in accordance with paragraph 4 shall be the annual report and annual accounts, in accordance with the definition of Council Directive 78/660/EEC (6). The annual accounts and annual report include the balance sheet and profit/loss account, explanatory notes, together with accounting policies, statements by directors, segmental and activity reports. Moreover, notices of shareholders' meetings and any other pertinent information shall be provided. The reports required shall be provided for each individual public undertaking separately, as well as for the holding or subholding company which consolidates several public undertakings in so far as the consolidated sales of the holding or subholding company lead to its being classified as ‘manufacturing’. 3. The following details, in so far as not disclosed in the annual report and annual accounts of each public undertaking, shall be provided in addition to the information referred to in paragraph 2: (a) the provision of any share capital or quasi-capital funds similar in nature to equity, specifying the terms of its or their provision (whether ordinary, preference, deferred or convertible shares and interest rates; the dividend or conversion rights attaching thereto); (b) non-refundable grants, or grants which are only refundable in certain circumstances; (c) the award to the enterprise of any loans, including overdrafts and advances on capital injections, with a specification of interest rates and the terms of the loan and its security, if any, given to the lender by the enterprise receiving the loan; (d) guarantees given to the enterprise by public authorities in respect of loan finance (specifying terms and any charges paid by enterprises for these guarantees); (e) dividends paid out and profits retained; (f) any other forms of State intervention, in particular, the forgoing of sums due to the State by a public undertaking, including inter alia the repayment of loans, grants, payment of corporate or social taxes or any similar charges. The share capital referred to in (a) shall include share capital contributed by the State directly and any share capital received contributed by a public holding company or other public undertaking, including financial institutions, whether inside or outside the same group, to a given public undertaking. The relationship between the provider of the finance and the recipient shall always be specified. 4. The information required by paragraphs 2 and 3 shall be provided for all public undertakings whose turnover for the most recent financial year was more than EUR 250 million. The information required above shall be supplied separately for each public undertaking including those located in other Member States, and shall include, where appropriate, details of all intra- and inter-group transactions between different public undertakings, as well as transactions conducted directly between public undertakings and the State. Certain public enterprises split their activities into several legally distinct undertakings. For such enterprises the Commission is willing to accept one consolidated report. The consolidation should reflect the economic reality of a group of enterprises operating in the same or closely related sectors. Consolidated reports from diverse, and purely financial, holdings shall not be sufficient. 5. The information required under paragraphs 2 and 3 shall be supplied to the Commission on an annual basis. The information shall be provided within 15 working days of the date of publication of the annual report of the public undertaking concerned. In any case, and specifically for undertakings which do not publish an annual report, the required information shall be submitted not later than nine months following the end of the undertaking's financial year. 6. In order to assess the number of companies covered by this reporting system, Member States shall supply to the Commission a list of the companies covered by this Article and their turnover. The list is to be updated by 31 March of each year. 7. Member States will furnish the Commission with any additional information that it deems necessary in order to complete a thorough appraisal of the data submitted. Article 9 The Commission shall regularly inform the Member States of the results of the operation of this Directive. Article 10 Directive 80/723/EEC, as amended by the Directives listed in Annex I, Part A, is repealed, without prejudice to the obligations of the Member States relating to the time-limits for transposition into national law of the Directives set out in Annex I, Part B. References to the repealed Directive shall be construed as references to this Directive and shall be read in accordance with the correlation table in Annex II. Article 11 This Directive shall enter into force on 20 December 2006. Article 12 This Directive is addressed to the Member States. Done at Brussels, 16 November 2006. For the Commission Neelie KROES Member of the Commission (1) OJ L 195, 29.7.1980, p. 35. Directive as last amended by Directive 2005/81/EC (OJ L 312, 29.11.2005, p. 47). (2) See Annex I, Part A. (3) OJ C 281, 26.9.1996, p. 3. (4) OJ C 17, 19.1.2001, p. 4. (5) OJ L 83, 3.4.1993, p. 1. (6) OJ L 222, 14.8.1978, p. 11. ANNEX I PART A REPEALED DIRECTIVE WITH ITS SUCCESSIVE AMENDMENTS (referred to in Article 10) Commission Directive 80/723/EEC (OJ L 195, 29.7.1980, p. 35) Commission Directive 85/413/EEC (OJ L 229, 28.8.1985, p. 20) Commission Directive 93/84/EEC (OJ L 254, 12.10.1993, p. 16) Commission Directive 2000/52/EC (OJ L 193, 29.7.2000, p. 75) Commission Directive 2005/81/EC (OJ L 312, 29.11.2005, p. 47) PART B LIST OF TIME LIMITS FOR TRANSPOSITION INTO NATIONAL LAW (referred to in Article 10) Directive Time limit for transposition 80/723/EEC 31 December 1981 85/413/EEC 1 January 1986 93/84/EEC 1 November 1993 2000/52/EC 31 July 2001 2005/81/EC 19 December 2006 ANNEX II CORRELATION TABLE Directive 80/723/EEC This Directive Article 1 Article 1 Article 2(1), introductory sentence Article 2, introductory sentence Article 2(1), point (a) Article 2, point (a) Article 2(1), point (b) Article 2, point (b), first subparagraph Article 2(1), points (c) to (f) Article 2, points (c) to (f) Article 2(1), point (g), introductory words Article 2, point (g), introductory words Article 2(1), point (g), first indent Article 2, point (g)(i) Article 2(1), point (g), second indent Article 2, point (g)(ii) Article 2(1), point (g), third indent Article 2, point (g)(iii) Article 2(2), introductory sentence Article 2, point (b), second subparagraph, introductory sentence Article 2(2), point (a) Article 2, point (b), second subparagraph, point (i) Article 2(2), point (b) Article 2, point (b), second subparagraph, point (ii) Article 2(2), point (c) Article 2, point (b), second subparagraph, point (iii) Article 3 Article 3 Article 3a Article 4 Article 4 Article 5 Article 5 Article 6 Article 5a(1) Article 8(1) Article 5a(2), first subparagraph, introductory sentence Article 8(2), first subparagraph Article 5a(2), first subparagraph, point (i) Article 8(2), first subparagraph Article 5a(2), second subparagraph, introductory sentence Article 8(3), first subparagraph, introductory sentence Article 5a(2), second subparagraph, point (ii) Article 8(3), first subparagraph, point (a) Article 5a(2), second subparagraph, point (iii) Article 8(3), first subparagraph, point (b) Article 5a(2), second subparagraph, point (iv) Article 8(3), first subparagraph, point (c) Article 5a(2), second subparagraph, point (v) Article 8(3), first subparagraph, point (d) Article 5a(2), second subparagraph, point (vi) Article 8(3), first subparagraph, point (e) Article 5a(2), second subparagraph, point (vii) Article 8(3), first subparagraph, point (f) Article 5a(3), first subparagraph Article 8(4), first subparagraph Article 5a(3), second subparagraph, first sentence Article 8(4), second subparagraph Article 5a(3), second subparagraph, second sentence Article 8(3), second subparagraph, first sentence Article 5a(3), second subparagraph, third sentence Article 8(3), second subparagraph, second sentence Article 5a(3), second subparagraph, last sentence Article 8(2), second subparagraph Article 5a(3), third subparagraph Article 8(4), third subparagraph Article 5a(4), first subparagraph Article 8(5), first subparagraph Article 5a(4), second subparagraph Article 8(5), second subparagraph Article 5a(4), third subparagraph Article 8(6) Article 5a(5) — Article 5a(6) Article 8(7) Article 6(1) Article 7, first paragraph Article 6(2) Article 7, second paragraph Article 7 Article 9 Article 8 — — Article 10 — Article 11 Article 9 Article 12 — Annex I — Annex II

Summary: Transparency of financial relations between public authorities and public undertakings Transparency of financial relations between public authorities and public undertakings SUMMARY OF: Directive 2006/111/EC — clear accounting for state-owned companies WHAT IS THE AIM OF THIS DIRECTIVE? It aims to ensure transparency in financial relations between European Union (EU) countries and state-owned companies so as to ensure there is fair competition with, and no discrimination against, private companies. KEY POINTS Specifically, EU countries are required to ensure the transparency of any public funds which are made available to state-owned companies, how they are used and ensure that the costs and income of such companies are clearly set out in separate accounts. The kinds of financial relations covered by the directive include the provision of capital, grants or loans on privileged terms and the setting-off of operating losses*. EU countries must ensure that the internal accounts of the companies concerned are kept separate in relation to their different activities, and that all costs and income are correctly set out according to proper cost accounting principles. Certain kinds of financial relations are excluded from the directive, e.g. between EU countries and central banks, or with state-owned companies involving the supply of services which are unlikely to have a significant impact on trade between EU countries. EU countries must ensure that the relevant financial information is made available to the European Commission for up to 5 years after the public funds were provided to the company. The Commission, however, must not disclose any information covered by the obligation of professional secrecy. Regarding the manufacturing sector, this information has to be provided to the Commission on an annual basis and should include the annual report and annual accounts. FROM WHEN DOES THE DIRECTIVE APPLY? It has applied since 20 December 2006. Directive 2006/111/EC codifies and replaces Directive 80/723/EEC and its subsequent amendments. The original Directive 80/723/EEC had to become law in the EU countries by 1981. BACKGROUND For more information, see: Legislation — Transparency of public undertakings on the European Commission's website. KEY TERMS Setting off of losses: accounting term whereby if a loss is recorded, it is set against a profitable item in order to cancel out its effect. MAIN DOCUMENT Commission Directive 2006/111/EC of 16 November 2006 on the transparency of financial relations between Member States and public undertakings as well as on financial transparency within certain undertakings (Codified version) (OJ L 318, 17.11.2006, pp. 17-25) last update 24.05.2019