The internal market and competition rules only apply to economic undertakings.
According to the settled case-law of the Court of Justice, an “undertaking” is to be defined as an entity engaged in an economic activity. The classification of an entity as an undertaking thus depends entirely on the nature of its activities and not on its legal status.
To clarify the distinction between economic and non-economic activities, the Court of Justice has consistently held that any activity consisting in offering goods and services on a market is an economic activity. The qualification as an “undertaking” does not depend on whether the entity is set up to generate profits. The fact that the offer of goods or services is made without a profit motive does not prevent the entity which carries on those operations on the market from being considered an undertaking, since that offer exists in competition with that of other operators which do seek to make a profit.
In its judgment of 5 February 2018 in Dôvera zdravotná poistʼovňa v Commission (T-216/15), the Court of Justice found that, in view of the profit pursued by health insurance companies and the existence of intense competition as to quality and the services offered, the activity of providing compulsory health insurance in Slovakia is economic in nature:
“However, it is apparent from the case-law cited in paragraph 48 above that the fact that the offer of goods or services is made without seeking to make a profit does not prevent the entity which carries out those operations on the market from being regarded as an undertaking, provided that the offer exists in competition with that of other operators that are seeking to make a profit. It follows that it is not the mere fact of being in a position of competition on a given market which determines the economic nature of an activity, but rather the presence on that market of operators seeking to make a profit. That is the situation in the present case, since it is common ground between the parties that the other operators on the market in question are seeking to make a profit, so that [the State-owned insurance companies], ‘by contagion’, would have to be considered to be undertakings”.
Accordingly, it is impossible for economic and non-economic operators to be active on the same market. The presence on the market of an economic operator seeking to make a profit implies that other operators on that market should also be qualified as undertakings.
For further information on this case and/or for general legal advice relating to the internal market rules and/or competition rules, please contact Pierre de Bandt or Jeroen Dewispelaere.