Government-owned corporation

Public companies (also called state-owned enterprises ) are public or private law organized a company owned by the state. In the Anglo -Saxon world is the State -Owned Enterprise, the speech, the State or its subdivisions include a majority stake in a privately organized companies.

General

The attribute "public" aims either the ownership by legal persons of public law, which are a majority stake in a privately organized company, or to the operation purpose. Considering a functional concept of undertaking are used, they are all to be considered economically operable forms of organization as a company. Anti-trust law, a business is when and to the extent it is economically active; thereafter are also public bodies business. Combining the two terms, the final result of the economic activity related majority public ownership OU. The reference provision of § 63 BHO assumes that federal investments are established or acquired only in the performance of federal tasks. In § 65 BHO is a requirement that involved the federal government to privately organized company only for important interest and then may exercise reasonable control, respecting the subsidiarity principle. This majority public participation is about even with the membership of a public company in the Pension Institution of the Federal Government and the Länder ( VBL ) for expression. Main requirement for membership in the VBL is an overriding public interest or significant public influence ( Implementing provisions to § 19 Section 2 Sentence 1 letter e VBL Statute ).

Term scope

In a broader sense all federal and state institutions and immediate public bodies as well as the majority held by a public carrier privately organized companies belong to the public sector companies. The public companies are classified according to § 2 paragraph 3 Financial Statistics Act, all companies in the nominal capital the public sector (federal, state, local ) is involved with more than 50 %. In the strict sense of the concept of a public company is limited to privately organized company with predominantly public-sector participation.

Prescribe GemO that the public purpose, the appropriate relationship to the performance of the municipality and the subsidiarity principle to be observed in public companies. The concept of a public company can be found in German law no. Thus, under § 130 sub-section 2 that " business or company is also a public undertaking within the meaning of paragraph 1. " An initial European law legal definition held ready Article 2, Paragraph 1 b ) Transparency Directive. After that every company on the " may exercise directly or indirectly, the public authorities may exercise, financial participation, statutes or other rules which govern the business as a dominant influence " to be classified as a public company. " It is believed that a dominant influence exists if the public sector directly or indirectly owns the majority of the subscribed capital of the company or has the majority of attaching to shares issued by the undertaking or more than half of the members of the administrative can be ordered or supervisory bodies of the undertaking. " This definition has been taken over almost verbatim 2 EU Utilities Directive in Article 1 no. The new EU Transparency Directive has adopted the text of the current Transparency Directive. It follows that the controlling influence of the public sector is regarded as the most important criterion for a public company, as well as public property, provided that the influence of the power to fill the senior positions in the company or control over business decisions on the basis of special rights of the representatives of includes state violence. It is an irrefutable presumption that in a direct or indirect majority shareholding exists a dominant influence.

Finally, in the GemO (about § 107 paragraph 1 sentence 3 GemO NRW) is considered the economic activity than the operation of companies that are active in the market, if the service could be provided by a private individual with the intention of making a profit.

Confines

" Clean working economically -fiscal businesses are not the communities," if there is no link to their public duties. With the " public purpose " is also a company does not comply, whose sole or primary purpose is profit. After that public companies must also fulfill the purpose of general interest and should not be geared primarily for profit. The profit must be subordinated to the public purpose; it is expressly permitted to supply the local budget revenues. To § 109 para 2 GemO NRW expects that the annual income of a municipal company provides at least a normal market return on capital. The involvement of a carrier body at a privately organized company can only take place in legal forms in which a limitation of liability is possible ( § 108 Section 1 No. 3 GemO NRW, so GmbH or AG). In Article 86, paragraph 1, TFEU also a ban on State aid for public companies is statuiert, without being defined in more detail here. They will aid law equated by such provision their legal entities. After that public companies may not have the contract or against particular its Article 12 TFEU and Article 81, to Article 89 TFEU enacted nor maintained any measure contrary.

Dependencies

Public company is a generic term for public companies. This can be associated economic, human and organizational interactions or dependencies between public companies and their public support. Therefore, Article 3 of the Transparency Directive will ensure that the disclosure of financial relations between public authorities and public undertakings is assured. In particular, this concerns

• The compensation of operating losses;
• Provision of capital equipment,
• Non-refundable grants or loans on privileged terms;
• The granting of financial advantages by forgoing profits or the recovery of sums due;
• The forgoing of a normal return on public funds used;
• The equalization of burdens imposed by the public authorities.

Since the economic activity of the entities which must be governed by a common good purpose, the task of responsibility has to remain with the carrier authority. This must regardless of what legal form was chosen to ensure a reasonable influence on the activity of the company. This so-called Ingerenz duty also arises from the principle of democracy, after all, public companies work with public money, demand accountability for its use of taxpayers through its democratically elected decision-makers and can exert influence must. This is not rare to see problem areas, if a private law GmbH / AG was chosen as the right to form and also private shareholders are involved. The aligned to the public purpose corporate purpose must be defined in the articles anyway. The purpose of the municipal investment management.

Purpose

The concept of a public company can capture the essence of the field of management. It was organizationally, legally and economically separate from its legal entities in order to perceive a well-defined area of ​​responsibility. Public companies are of general interest, business development or regional development on behalf of their legal entities. Public is a company if it will work for the general public, so the public is and is pursuing a public purpose. Federal or provincial immediate ipc and KöR among the public companies and administrations. At the local level, all local companies such as municipal utilities belong to the public enterprises. In the broadest sense this includes the local equity and publicly owned enterprises and all institutions and bodies of public law as they engage in economic activity.

Competition law is based on a functional notion of undertaking. Those who are so economically operated in the trade, is to be regarded as a company. Anti-trust law is a business, if and to the extent it is economically active. Pure institutions and public bodies such as BaFin or German pension insurance are active not economical in the market and act as pure authorities. Public companies are certainly more controlled and monitored as a regulated private companies.

Efficiency of public enterprises

According to § 7 ​​BHO and § 6 para 1 HGrG and the identical provisions of the LHO the principles of efficiency and economy must be observed. This applies initially only apply to legal entities and their ipc / KöR. After appropriate means of feasibility studies for all financial impact measures; this is a nationwide special instruction.

Konrad Mellerowicz had in 1956 recognized that the crucial problem of the contracting operating data lies in " to lead him to biggest economy, because the monopoly property and the lack of compulsion to full cost recovery does not just lie in the direction of the economy ." Although public companies and administrations do not work according to the profit motive, but they would have to act economically. Economical means that the ratio of the result of the activity and the effort required for it to be as cheap as possible. Because economy is not only the selection principle of general business management, but also the public business administration.

However, when considering further efficiency and profitability of public enterprises must be made between two groups of companies. On the one hand, there are public companies that can be profitable (of which, therefore, be expected profitability is ), on the other hand, there are public companies that can not even be out to cover costs. This distinction depends, among other things, depends on the role of public enterprises. In the municipal electric utilities as could be expected, but hardly in cultural enterprise with a certain efficiency. Of the latter is rather expected that they work as far as possible without major losses. The cited, comprehensive study of about 9,000 public companies were the financial statements from the years 1998 to 2006 based on studies demonstrating developed financial ratios and with those of the private companies were compared. Then also peculiarities of public enterprises have been considered as the allocations of public support. They were eliminated from the total income, so that the remaining income were included as " autonomous income" in the analysis. A higher proportion of the autonomous income can be seen as a positive indicator of corporate profitability. In contrast, a high proportion of by the public authorities tends to suggest that the company is reliant on the help of the public sector due to its low profitability. Therefore, one could attract public assignments conclusions about the actual profitability of the company due to the volume. The assignments in a sense, the compensation for the politically -determined prices in the public sector dar.

During the analysis period between 1999 and 2006, the cited study at private companies between 2001 and 2003 was able to observe a period of economic weakness due to decline in operating income and extraordinary gain on earnings, while public companies hardly regularities were observed. As their income were offset from ordinary business activities for the most part by the financial result, it can be concluded on a strong earnings impact of the public sector. In the autonomous income shows that they were tended to decrease and 2006 still only 92 % of all proceeds accounted for; corresponding increase was the proportion of assignments. Comparisons show that the margin between the average revenue and average cost for private companies was greater than in public companies. While the margin between revenue and expenditure in the private sector remained constant, it was also rather smaller public companies from year to year. The interest burden of public enterprises intensity is compared to the private sector at a higher level, which is obviously connected not only with their higher debt, but also with their weakness in sales.

Although the return on sales in public and private companies must be interpreted with caution and different, but a strong profitability gap between the two was observed. While the return on sales amounted to public companies in the period 1999-2006, on average, at 0.81%, it reached 3.16% at private companies in the same period. The operational efficiency of public enterprises - as measured by the return on assets - was significantly lower than that of private companies on average. This result also confirms the idea that the economic efficiency of public enterprises could be as measured by profitability ratios, but must be interpreted cautiously because of the peculiarities of the public sector. Overall, the earnings analysis leads ( both in the structure and amount-based view of the company's results as well as the profitability analysis ) of public enterprises to the conclusion that in general, by virtue of the peculiarity of public enterprises hardly potential is to discover for their efficiency in a business sense. The earnings analysis underscored the close interdependence between public enterprises and public budgets.

Tax and insolvency issues

In public company for tax purposes not their form of organization, but the type of activity is crucial. Then subject to corporation tax and VAT when used as commercial operation ( PCO ) are to be classified.

The legal entities themselves (federal, state and local ) are not insolvent ( § 12 Insolvency Act ). You are not obliged to Insolvenzabkehr terms of their operated under private law firms by federal or state law. From a 100 % stake in a carrier body at a privately organized company alone can not therefore be concluded that the ( bankruptcy incompetent ) carrier body will preserve at all costs the company from insolvency. Since only haftungsbegrenzende legal forms may be selected by the carrier body, the risk of insolvency is additionally increased.

Examples in Germany

• Company wholly owned by the Federal Republic of Germany Companies in the form of a public sector institution: Agricultural Bank pension

• German railway

• Federal printing
• Federal Republic of Germany - Finance Agency
• BwFuhrparkService ( directly and indirectly through the German railway )
• BVVG soil recovery and management company
• German air traffic control
• German Society for International Cooperation
• Energy Nord
• Germany Trade and Invest
• Society for development, procurement and operation
• Heeresinstandsetzungslogistik
• Lusatian and Central German Mining Administration Company
• Gästehaus Petersberg (indirectly through BImA )
• VEBEG
• Bismuth

• Companies in the form of a public sector institution: Bank for Reconstruction ( property: 80% federal, 20% of countries, but is liable to the federal government alone for all liabilities )

• German Post ( indirectly through KfW )
• German Telekom ( directly and indirectly through KfW )
• Port of Duisburg
• Airport Frankfurt am Main

• LH Bundeswehr clothing company
• BWI Information Technology
• Juris
• Forschungszentrum Jülich
• Berlin Brandenburg Airport
• Munich Airport

The communities in Germany have organized the tasks of primary care in public or in private law:

List of city and municipal works

Examples in Switzerland

• Companies in the form of a public sector institution: SBB; Swiss Post; SUVA; cantonal building insurance;
• Companies in the form of AG with state majority share: Swisscom; RUAG; NOK

Examples in France

In France there is traditionally a large public sector ( secteur publique ) with many public enterprises ( entreprise publique ). One can distinguish

• établissements publics à caractère industriel et commercial ( EPIC) ( subject to public law )
• Sociétés national in private law (for example, joint-stock company " SA " = Société anonyme) whose capital belongs exclusively to the State. Well-known examples: Société nationale des chemins de fer français ( SNCF)
• Société national industrial aérospatiale (1970-1978, then renamed Aérospatiale )

State -Owned Enterprises

State -Owned Enterprise, also known as Government -Owned Corporation ( GOC) (State-owned corporation ), is a legal entity, which is usually established by a government with the aim to come to market conditions in competition with private companies and profits generate. Although such companies do business commercially, they are subject to government targets and can be used accordingly as a political tool. The features and rules under which they operate State -Owned Enterprises, which vary from country to country. State -Owned Enterprises should not be confused with companies in which the state is indeed involved and also can exert influence, but only has minority interests.

Worldwide most are export credit insurance companies owned by the state. This is the case with the Swiss Export Risk Insurance SERV, the U.S. Eximbank or the Italian Istituto per i Servizi assicurativi del Credito all'Esportazione ( SACE ) SpA The German Euler Hermes and Coface SA, the French, however, are part of private sector corporations and wrap the export credit insurance as a mandate for the state your from.

In the U.S., spreads the organizational form of the "component units" very much at the level of states and the municipalities ( " municipalities "). Are in it - as in Germany - some parts of the municipal tasks organisationally. These include in particular drinking water, sewage or electricity supply. For them, the carrier body is by law financially liable ( " financially accountable " ), shall be consolidated in the financial statements of their wearers body.