Company of mixed economy

In France, a company of mixed economy or SEM is a Public limit company whose capital is mainly held by the State or local government agencies such as the common , the department, the area, which it is directly or via public corporations and to some extent by economic and financial partners private.

The recourse to the SEM guarantees to the community shareholder and contracting the effective taking into account of the General interest in the objectives of the Entreprise and the flexibility of the company of private law.

Statute of the SEM

The statute of the SEM is registered in the general Code of the territorial collectivities starting from the L1521-1 article and in the Code of the trade for the relative tendencies at the public limit companies. It derives mainly from the law of the July 7th 1983 relating to the companies of mixed economy, of the law of the January 2nd 2002 which modernizes the local SEM and of the law of the July 24th 1966 on the business firms which subjects them to the rules Private law.

A SEM can ensure installation, the construction or the exploitation of public services related to commercial industrial or or of any other activity of general interest. It cannot distort the normal play of the Concurrence. Whereas the new Code des Marches Publics had initially excluded from its field of application the contracts of mandate, by which a community entrusts to a SEM the execution of a public service mission, the Council of State reinstated in 2003 these contracts in the field of competition.

It is a Public limit company, whose community must have between 51 and 85% of the capital. The community has at least a representative and half of the voices with the Board of directors.

Some particular companies of mixed economy are distinguished:

the public limit company of mixed economy or SAEM.
the public limit company of local mixed economy or SAEML.
the real public limit company of mixed economy or SAIEM.

History

Since the middle of the years 1980, the number of active SEM in France developed considerably, accompanying the general movement by Décentralisation of the public services which took place.

For a few years, the regrouping of common by the means of the Intercommunalité has been at the origin of a compressing of the number of active SEM in the country.

The Companies of mixed economy were initially created to meet the needs for the public people. Indeed, the purpose of these companies are management of an activity reserved per principle for the administration, namely a public line of business or an activity presenting a character of general interest. The form member of these entities allows the administration a more flexible management of its activities while preserving a certain control on these companies since their capital is mainly made up, i.e. from 50 to 85%, of capital public; control that the administration had more evil to make effective at the time of a delegation of their activities to entirely private structures. The companies of mixed economy were thus created with an aim of meeting a definite need for the administration and the unquestionable capital intensive bond between these two actors a long time made it possible to make escape these companies the application from the right of the competition. The making of conventions with these entities escaped the application a long time from the general principles from the public order, principles guaranteeing, since the stop of the Court of justice of the European Communities Telaustria Verlags of the December 7th 2000, of an equality in the accession with the public contracts between companies. The influence of the Community legislation had as a consequence a progressive abandonment of the exceptions to the application of the economic principles of the right which profited at the companies from mixed economy and these companies were gradually subjected to the right of the public order.

The Court of justice of the European Communities endeavoured to stabilize on an equal footing the public and deprived entities. Accordingly, the Court developed the concept of contract in house (Court of justice of the European Communities, November 18th 1999, Tekall ). This theory makes it possible to draw aside the application of the rules of the economic right for certain specific contracts. Tekall jurisprudence fixed like condition at the existence of such contracts makes it, initially, that the entity at the origin of the known as contract is seen imposing by a public person a control similar to that which this public person would exert on her own services. In the second place, the entity in question was to carry out the essence of its activity with the public person who held it. France thus inserted in this category the companies of mixed economy since the statute of these entities provides that the companies of mixed economy are held mainly by public people, exerting of this fact a very important control on these entities; in the same way the companies of mixed economy are mainly created with an aim of satisfying a particular need for the community, which answered the second condition posed by this jurisprudence. Thus, these particular entities escaped the economic application of the legal provisions as regards contract, knowing that the contracts are the angular stone of the economic relations between companies.

In reaction, the Court added a condition to the application of this theory, in one stop of the January 11th 2005 Stadt Halle , by excluding the benefit from the theory of the contracts in house with the entities which were not entirely held by the public person. The companies of mixed economy thus could not any more, so to profit from the application of this theory since the law imposes on these entities a mixed capital i.e. a capital having to be held at least 15% by entities of private law. This position of the Court, clearly aiming at excluding the companies from mixed economy of the application of the theory of the contract in house , consequently, was confirmed in the stop of the May 11th 2006 Carmotermo .

Until in the Years 1990, the contracts signed by the companies of mixed economy with public people were free from any procedure of publicity or competition; the public people were however to proceed to a competition for the contracting with private operators.

This application of the right common of the public service delegations to the companies of mixed economy concretized the introduction of the rules of competition into the contractual relations of the public people with the companies of mixed economy under the influence of the Community legislation. Article 38 of the law of the January 29th 1993, known as “Fir tree” relating to the public service delegations initially excluded from her field of application the companies whose capital was directly or indirectly held by the public person délégante. However, the Constitutional council censured this exemption for rupture of equality because it was justified neither by the nature of the activity of the companies of mixed economy nor by their statutory character.

The tender of the companies of mixed economy to the right of the government contracts east, however, more recent. It results from an effort of the administrative judge who considered, as of beginning of the year 2000 that the companies of mixed economy were to be regarded as any potential supplier when they offer performances of service to the public people (Council of State, December 30th, 2002, Préfet of the Coasts of Armor ).

The European commission called into question the contracts of mandate signed between the public people and the companies of mixed economy by criticizing the law “Controls public works” of the July 12th 1985 and by declaring contrary with the Community directives some of its provisions. According to the Commission, these contracts of mandate were to observe a procedure preliminary of publicity and competition since comparable to performances of service of common right. In its stop of 2003 UNSPIC , the Council of State took into account these criticisms by imposing the obligation of respect of the general principles of the public order on the contracts of mandate.

Economic impact

At the end of 2006, the Federation of the companies of mixed economy (Fedsem) counts 1.117 active SEM in France and 200 in project.

42% of the companies of mixed economy (Sem) already created manages Public services,
11% have as an aim local economic development,
25% builds or manages Immobilier, in particular social,
22% have a vocation of developer.

In 2006, Sem carried out a Turnover cumulated of 14,5 billion euros and post a capitalization of 2,4 billion euros, held to 65% by local government agencies.

More than 54.000 people work in of Sem. 47% of Sem count twenty paid or more.

Sem are very present in Overseas: in 2006, the 82 overseas Sem (45 in the DOM) carried out a turnover of 919 million euros and employ 5760 people.

Examples of SEM

Sematra, principal shareholder of the Airline company réunionnaise Southern Air.
Semitan, the Company of mixed economy of public transport of the Nantes agglomeration.
Parisian SEM: see the article on the Sociétés of mixed economy of Paris.
SEM 92 of the General advice of the Hauts-de-Seine
SEM Encourages Town of Bordeaux

Old SEM

Semvat, the Company of mixed economy of the travellers of the Toulouse agglomeration, replaced by Connex in 2004.
the SEMCA (concessionary Companies of mixed economy of highways) recoveries since the reform of 2002 by Eiffage (SAPRR and AREA), Vinci (ASF and Escota) and Abertis (Sanef and SAPN).

Random links: