In October 2014, the Commission opened an in-depth investigation concerning public compensation granted to five public hospitals in Brussels, the CHU Brugmann, the CHU Saint-Pierre, the Queen Fabiola Children's University Hospital, the Iris South Hospitals, and the Institut Bordet, together known as the IRIS hospitals. The Commission was obliged to look into the matter initially as a result of complaints received from two associations of Brussels private hospitals, alleging that unlawful state aid had been granted to the five public IRIS hospitals. The complaints relate to the fact that, since 1996, these hospitals have received payments from six Brussels municipalities to compensate the deficits they incurred in providing health and social services of general economic interest. Private hospitals in Brussels do not receive such deficit compensation.
On the basis of its in-depth assessment, the Commission has found that the public IRIS hospitals have been entrusted with a number of additional obligations on top of the minimum requirements that apply to all hospitals in Belgium. These additional obligations include for example the duty to treat all patients in all circumstances (including non-emergency situations), regardless of patients' ability to pay. They ensure that also the poorest members of the Brussels population have access to the hospital services they need and guarantee the accessibility to high quality hospital care for all. Since the financing sources common to both public and private hospitals are insufficient to cover the costs of these additional obligations, the public IRIS hospitals incur deficits. By compensating these deficits, the Brussels municipalities ensure that the IRIS hospitals can continue to fulfil their public service obligations.
In its investigation, the Commission also verified that, in line with EU state aid rules on services of general economic interest, the IRIS hospitals received no overcompensation as the payments by the municipalities never exceeded the actual deficits the IRIS hospitals incurred due to their public service obligations. On this basis, the Commission concluded that the deficit financing awarded by the Brussels municipalities to the IRIS hospitals since 1996 is in line with EU state aid rules.
The five public general hospitals existing in the Brussels Capital Region were grouped into the IRIS network in 1996. These hospitals are the CHU Brugmann, the CHU Saint-Pierre, the Queen Fabiola Children's University Hospital, the Iris South Hospitals, and the Institut Bordet. Together, they currently operate around 2425 of the 7260 hospital bedsthat are provided by general and university hospitals in the Brussels Capital Region. The five IRIS hospitals employ nearly 10 000 staff, provide over 1 million consultations per year, and constitute Belgium's largest emergency service.
In September 2005, the Commission received a complaint from two associations of Brussels private hospitals alleging that unlawful State aid had been granted to the five Brussels public IRIS hospitals. In its decision of 28 October 2009, the Commission concluded that the compensation of the deficits incurred by the IRIS hospitals since 1996 was compatible with the internal market. Following an appeal by one of the complainants, the General Court annulled that decision on 7 November 2012, ruling that the Commission should have opened an in-depth investigation to gather additional information because the complainants' arguments raised doubts as to the compatibility of the deficit financing of the additional obligations fulfilled by the IRIS hospitals. In light of this judgment, the Commission opened an in-depth investigation on 1 October 2014.
EU state aid rules on services of general economic interest allow Member States to grant compensation for the fulfilment of clearly defined public service obligations under certain conditions. These rules take account of the sensitive nature of services of a social nature. For this reason, state aid to hospitals can normally be implemented without prior Commission scrutiny provided certain conditions are met. This is the first time the Commission adopts a final decision following an in-depth investigation in the hospital sector.
Compensation for services of general economic interest can be found compatible with the internal market when it meets certain criteria of the EU state aid rules for the assessment of public compensation for services of general economic interest (see alsoMEMO). State aid to hospitals is exempt from notification to the Commission and compatible with the internal market if the conditions laid down in the Commission Decision of 20 December 2011 on the application of Article 106 (2) of the Treaty on the functioning of the European Union to state aid in the form of public service compensation granted to certain undertakings entrusted with the operation of services of general economic interest are fulfilled.
The non-confidential version of today's decision will be made available under the case number SA.19864 in the State Aid Registeron the competition website once any confidentiality issues have been resolved. New publications of state aid decisions on the internet and in the Official Journal are listed in the State Aid Weekly e-News.