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European Commission - Press release

Commission opens in-depth investigation into public contracts between Brussels authorities and French advertising company JC Decaux

Brussels, 24 March 2015

Following a complaint, the European Commission has opened an in-depth investigation to assess whether two measures granted by the Brussels authorities in favour of the French outdoor advertising company JC Decaux were in line with EU state aid rules. The Commission has concerns that certain tax and rent exemptions may have given the company a selective advantage over its competitors. The opening of an in-depth investigation gives interested parties the opportunity to submit comments on the measures under assessment. It does not prejudge the outcome of the investigation.

The Commission started its investigation into alleged state aid measures granted by Belgium in favour of JC Decaux following a complaint from its competitor Clear Channel Belgium.

The first measure concerns the exploitation of a number of advertising panels in the centre of Brussels. JC Decaux had been exploiting, on the basis of a commercial contract with the City of Brussels, advertising panels in exchange for providing the City with public furniture (litters, maps, public WCs) between 1984 and 1999. In 1999, JC Decaux signed a subsequent contract under which new panels would be installed and monthly rent would be paid to the City. The old panels had to be removed progressively before the end of 2010. However, JC Decaux continued to commercially exploit a number of these old panels after they should have been removed, without paying any rent or tax. The Commission has concerns that this may have given the company an unfair advantage over its competitors.

The second part of the investigation concerns the Villo bike rental system in the region of Brussels. The region has defined Villo as a Service of General Economic Interest (SGEI) and has granted JC Decaux an exclusive concession for performing this service in 2008, following a tender procedure. The bike rental system is funded by payments from users and the exploitation of the advertising panels linked to the bike stops. In addition to that, the region of Brussels granted JC Decaux certain rent and tax exemptions.

EU state aid rules on public service compensation, adopted in 2011, allow under certain conditions the compensation of companies through state aid for the extra cost of providing a public service. The state aid rules allow Member States to grant aid for the provision of public services whilst at the same time making sure that companies entrusted with such services do not get overcompensated, which minimises distortions of competition and guarantees an efficient use of public resources.

The Commission does not question the definition of Villo as a public service nor the fact that JC Decaux receives a compensation for performing this public service in line with the requirements of the concession. However, the Commission has concerns that the additional rent and tax advantages granted to JC Decaux after the tender was closed, could result in overcompensating the company, in breach of common rules on the provision of SGEI (see IP/11/1571 and MEMO/11/929).


Background

The non-confidential version of the decision will be published in the State aid register on the competition website under the case number SA.33078 once eventual confidentiality issues have been resolved. The State Aid Weekly e-News lists new publications of state aid decisions on the internet and in the EU Official Journal.

IP/15/4661

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