'State' and 'Market' in the Competition and Free Movement Case Law of the EU Courts

The Treaty rules on free movement and competition are predicated on a distinction between state measures and measures of private undertakings that can be problematic in practice, as this distinction is often not clear cut. The first part of this paper examines the manner in which the European Courts of Justice attribute measures either to the public or the private sphere in their free movement and competition case law. The second part looks at those areas of EU law that deal with the interface of the public and the private sphere such as effet utile, public undertakings, special and exclusive rights and services of general economic interest, as well as state aids, public authority and public interest exceptions.The examination of the case law of the Court starts out from two competing theoretical frameworks, i.e. the Ordoliberal school of law and economics, and the service public approach to public services. It is found not to be determined or explained by either of these. Instead, the variables of proportionality and preemption, and Community law doctrines such as functionalism, teleology and subsidiarity play an overriding role. The November Revolution of 1993 (broadly, before and after the Keck judgment and similar case law in other areas) is found to have given rise to a complex realignment of rules, where horizontal broadening of the scope of EU law is often accompanied by a vertical withdrawal deferring to the Member States