Dáil Éireann Debate, Tuesday - 16 May 2017
223. Deputy Barry Cowen asked the Minister for Housing, Planning, Community and Local Government if his Department has sought a legal opinion as to whether Part V obligations on developers could amount to state aid for the purposes of EU law or could amount to a public works contract for the purposes of EU law as was considered by the European Court of Justice in the Flemish decree case; and if he will make a statement on the matter. [22888/17]
View answerMy Department has not sought legal advice in relation to the Court of Justice of the European Union (CJEU) judgment referred to by the Deputy.
In relation to the question of state aid, it should be noted that, unlike the position under the Flemish Decree considered in the case, a Part V agreement does not provide for tax incentives and subsidy mechanisms for the developer, some of which were designed to compensate for the social obligation to which subdividers and developers are subject. It should be noted also that the CJEU held in this case that while the tax incentives and subsidy mechanisms provided for in the Flemish Decree were liable to be classified as State aid within the meaning of Article 107(1) TFEU, it was for the referring Belgian court to determine whether the specific requirements for classification as State aid were met. The CJEU also held that it was a matter for the referring court to decide, having regard to Case C-280/00 and Commission Decision 2005/842/EC, whether the measures would in any case fall outside of Article 107(1) TFEU by virtue of being regarded as compensation for the services provided by the recipient undertakings in order to discharge public service obligations.
I do not consider that a Part V agreement is covered by the concept of a ‘public works contract’ contained in Article 1(2)(b) of Directive 2004/18, as it is not a written contract which “has as its object either the execution, or both the design and execution, of works related to one of the activities within the meaning of Annex I to that directive or a work, or the realisation, by whatever means, of a work corresponding to the requirements specified by the contracting authority”. As the Deputy will be aware, Part V agreements provide for the purchase by a housing authority of either land at existing use value or units at a discount (the discount being that the land is paid for at existing use value).
