EU rules will make public sector more accountable

20 Jul 00
Municipal contractors and companies which have public service as well as private contracts will have to keep separate financial accounts under new European Union rules.

21 July 2000

Rules on separate accounts already exist for areas such as railways, telecommunications and postal services, but the new regulations – due to come into effect at the start of 2002 – will deal with allegations that some firms are subsidising their commercial tenders via public sector profits.

'Separation of internal accounts will make the actual cost of the public service obligations more apparent,' said EU competition commissioner Mario Monti. Complaints about cross-subsidisation have risen substantially in recent years, the Commission says.

Public broadcasters which have expanded into new media markets, such as the BBC will, in particular, be affected.

PFjul2000

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