Regulation and competition on local public utilities

This paper outlines the evolution of the regulatory framework for the supply of local public utilities, social and health services since the early nineties. That framework is rendered complex by frequent legislative reforms, the overlap of general rules and specific rules for some services, and the division of legislative powers among the European Community, the central government and regional governments. The various reform acts, both horizontal and sector-specific, have not always pursued homogenous goals, seeking in some cases to foster and in others to restrain competition. The rules for local public utilities have recently changed again: competitive tendering is now the standard mechanism for awarding contracts to supply services, but local authorities may still supply services through in-house providers or use other contract award procedures where they deem it impossible to introduce competitive mechanisms.