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State Aid

State aid: New rules concerning the financing of municipal waste collectors approved



This week the EFTA Surveillance Authority closed its case concerning the financing of municipal waste collectors. The closure comes after Norway agreed to change the financing of the municipal waste collectors so as to comply with the the state aid rules of the EEA Agreement. 

The Authority found that the current system of financing of the municipal waste collectors in Norway may lead to cross-subsidisation of economic activities. This is because some municipal waste collectors that are funded by the state also engage in economic activities. The waste collectors in question are bidding for household waste contracts in public tenders or providing other services on the market, as well as collecting household waste in its own municipality. In addition, some municipal waste collectors are exempted from income tax. 

The Authority proposed that the Norwegian authorities implement the following changes to ensure that the financing of waste collection services in Norway comply with the state aid rules in the EEA Agreement: 

  • Municipal waste collectors should be required to keep separate accounts for the collection of household waste in its own municipality and its other activities.
  • Norwegian authorites should ensure that no cross subsidisation between the non-economic and economic activities of the municipal waste collectors occurs. In particular, they need to ensure that a fair portion of the fixed common costs are allocated to the economic activities.
  •  All municipal waste collectors that offer services on the market should be required to pay income tax.  

The Norwegian authorities agreed to the Authority's suggestions and assured the Authority of their full implementation. They also submitted draft amendments to the Waste Regulation as well as draft tax amendments. The Norwegian authorities confirmed that the measures would be fully implemented before 1 January 2014. 

In light of the Norwegian authorities' acceptance of the measures proposed by the Authority and the proposed introduction of the above mentioned regulatory changes, the Authority has decided to close this case.

For further information, please contact:

Per Andreas Bjørgan
Director, Competition and State Aid Directorate
(+32) 2 286 18 36

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