Health Insurance (Amendment) Act 2012

[1] Judgments in Case C-280/00 Altmark Trans GmbH and Regierungsprsidium Magdeburgv Nahverkehrsgesellschaft Altmark GmbH (“Altmark”) [2003] ECR I-7747 and Joined Cases C-34/01 to C-38/01 Enirisorse SpA v Ministero delle Finanze [2003] ECR I-14243.

[2] In its judgment in Altmark, the Court of Justice held that public service compensation does not constitute State aid if four cumulative criteria are met. First, the recipient undertaking must actually have public service obligations to discharge, and the obligations must be clearly defined. Second, the parameters on the basis of which the compensation is calculated must be established in advance in an objective and transparent manner. Third, the compensation cannot exceed what is necessary to cover all or part of the costs incurred in the discharge of the public service obligations, taking into account the relevant receipts and a reasonable profit. Finally, where the undertaking which is to discharge public service obligations, in a specific case, is not chosen pursuant to a public procurement procedure which would allow for the selection of the tenderer capable of providing those services at the least cost to the community, the level of compensation needed must be determined on the basis of an analysis of the costs which a typical undertaking, well run and adequately provided with the relevant means, would have incurred.

[3] See page 23 of this Official Journal.

[4] See page 4 of this Official Journal.

[5] OJ L 7, 11.1.2012, p. 3.

[6] OJ L 7, 11.1.2012.

[7] OJ C 297, 29.11.2005, p. 4.

[8] OJ C 257, 27.10.2009, p. 1.

[9] OJ C 244, 1.10.2004, p. 2.

[10] OJ L 318, 17.11.2006, p. 17.

[11] Directive 2006/111/EC on the transparency of financial relations between Member States and public undertakings as well as on financial transparency within certain undertakings.

[12] In this context, net cost means net cost as determined in paragraph 25 or costs minus revenues where the net avoided cost methodology cannot be applied.

[13] Public sources of information, cost levels incurred by the SGEI provider in the past, cost levels of competitors, business plans, industry reports, etc.

[14] OJ L 108, 24.4.2002, p. 51.

[15] OJ L 15, 21.1.1998, p. 14.

[16] In Chronopost (Joined Cases C-83/01 P, C-93/01 P and C-94/01 P Chronopost SA [2003] ECR I-6993), the European Court of Justice referred to “normal market conditions”: “In the absence of any possibility of comparing the situation of La Poste with that of a private group of undertakings not operating in a reserved sector, “normal market conditions”, which are necessarily hypothetical, must be assessed by reference to the objective and verifiable elements which are available”.

[17] The reasonable profit will be assessed from an ex ante perspective (based on expected profits rather than on realised profits) in order not to remove the incentives for the undertaking to make efficiency gains when operating activities outside the SGEI.

[18] The rate of return on capital is defined here as the Internal Rate of Return (IRR) that the company makes on its invested capital over the lifetime of the project, that is to say the IRR on the cash flows of the contract.

[19] In any given year the accounting measure return on equity (ROE) is defined as the ratio between earnings before interests and taxes (EBIT) and equity capital in that year. The average annual return should be computed over the lifetime of the entrustment by applying as discount factor either the company’s cost of capital or the rate set by the Commission Reference rate Communication, whatever more appropriate.

[20] The swap rate is the longer maturity equivalent to the Inter-Bank Offered Rate (IBOR rate). It is used in the financial markets as a benchmark rate for establishing the funding rate.

[21] The premium of 100 basis points serves, inter alia, to compensate for liquidity risk related to the fact that an SGEI provider that invests capital in an SGEI contract commits that capital for the duration of the entrustment act and will be unable to sell its stake as rapidly and at as low a cost as is the case with a widely held and liquid risk-free asset.

[22] For instance, by comparing the return with the weighted average cost of capital (WACC) of the company in relation to the activity in question, or with the average return on capital for the sector in recent years, taking into account whether historical data can be appropriate for forward-looking purposes.

[23] Similarly, a deficit which results from efficiency gains lower than expected should be partially borne by the undertaking when stipulated in the entrustment act.

[24] Such as aid granted in relation to in-house contracts, concessions with no competitive allocation, public procurement procedures with no prior publication.

[25] OJ L 83, 27.3.1999, p. 1.

[26] OJ L 140, 30.4.2004, p. 1.

Section 6A.

SCHEDULE 3

€75.00

Section 11C.

SCHEDULE 4

TABLE 1

AMOUNT APPLICABLE FOR PERIOD FROM AND INCLUDING 1 JANUARY 2013 TO AND INCLUDING 30 MARCH 2013

TABLE 2

AMOUNT APPLICABLE ON AND AFTER 31 MARCH 2013

”.

22. Short title, collective citation and construction.

22.— (1) This Act may be cited as the Health Insurance (Amendment) Act 2012.

(2) The Health Insurance Acts 1994 to 2011 and this Act may be cited together as the Health Insurance Acts 1994 to 2012 and shall be construed together as one.