Question by Sahra Wagenknecht, 26 March 2007

In the context of the current tender procedure for the Landesbank Berlin, which also incorporates the Berliner Sparkasse, the European Commission and the Berlin Senate have been quoted as making statements which in some cases differ very substantially in their substance and contradict earlier Commission statements.

For example, the Commission recently opposed the imposition of any requirements on the future purchaser (such as job guarantees or a commitment to maintaining the location of the company headquarters) and urged that the sale price should be the only criterion used in selecting the purchaser, since any other approach would be at odds with the principle of non-discrimination. However, in August 2006 the Commission stated that 'there are grounds for protecting the name "Sparkasse", given the public interest aspect to the work these banks perform and the need for consumers to be able to distinguish them from other banks. However, a ban on using the name "Sparkasse" following privatisation is not a measure proportionate to the need to guarantee protection of that public interest. Germany could enact measures which would be proportionate, for example by making the use of the name by private banks contingent on the fulfilment of certain public interest tasks which are demanded of savings institutes set up under public law or by specifying the name which may be used' (Land Press Service, 1 August 2006).

Has this approach to the issue of the sale of the bank been abandoned, or, to put it another way, are the current developments compatible with the statement issued in August 2006?

In addition, in June 2006 the Commission emphasised that 'pursuant to Article 295 of the EC Treaty (…) Germany is completely free to take decisions on the privatisation or non-privatisation of a savings bank' (Commission press release of 28 June 2006, IP/06/870). In contrast, in its public statements the Berlin Senate is clearly working on the assumption that the requirement imposed by the EU covers not just the sale of the Bankgesellschaft Berlin, but explicitly also the privatisation of the Sparkasse.

Does the requirement imposed by the Commission cover the privatisation of the Berliner Sparkasse, or is it correct to say that any decision on the privatisation of the Berliner Sparkasse will be taken in Berlin? If the requirement covers the privatisation of the Berliner Sparkasse, how can this be reconciled with Article 295 of the EC Treaty?

Answer given by Mrs Kroes on behalf of the Commission, 1 June 2007

The Commission would like to clarify that the press communication cited in the Honourable Member's question concerns the then pending infringment proceedings based on restrictions to the freedom of establishment and the free movement of capital that were brought against Germany in response to the continued ban on the use of the 'Sparkasse' designation following privatisation.

In parallel, but separate to the infringement proceedings, Germany had, in the context of the Commission's approval of restructing aid for the Bankgesellschaft Berlin (BGB) [renamed the Landesbank Berlin Holding AG (LBH)] in its Decision 2005/345/EC of 18 February 2004(1), 'undertaken […] to ensure that the Land of Berlin sells its holding in BGB.' According to the Commission's decision of 18 February 2004, the Land of Berlin is obliged to conduct 'an open, transparent and non-discriminatory tendering procedure' for the sale of LBH including Berliner Sparkasse which 'will be open to any potential domestic and foreign buyer' and in which the buyer 'will be selected on the basis of economic criteria.'

As concerns the Commission's statements on job guarantees and the maintenance of the LBH seat in Berlin in the context of the ongoing tendering procedure for LBH, it must be noted that these statements are not in contradiction to earlier statements given by the Comission in the context of the infringement proceedings. The Commission's decision of 18 February 2004 contains an obligation on the Land of Berlin to select the buyer on the basis of economic criteria. Furthermore, in the press release of 6 December 2006 concerning the closure of the infringement case, it was stated that 'in the case of a privatisation, Member States can require the Sparkassen to continue to meet certain public service obligations. Section 40 of the German Banking Act (Kreditwesengesetz) will be applied in a manner that does not infringe the provisions of the EC Treaty on the right of establishment (Articles 43 et seq.) and the movement of payments and capital (Articles 56 et seq.).'

In accordance with Article 295 of the Treaty, the transfer of a firm from the public to the private sector is an economic policy choice which, in itself, falls within the exclusive competence of Member States.

By accepting to sell LBH, including Berliner Sparkasse, on the basis of an open, transparent and non-discriminatory tendering procedure, Germany has itself made such an economy policy choice.

(1) 2005/345/EC: Commission decision of 18 February 2004 on restructuring aid implemented by Germany for Bankgesellschaft Berlin AG (notified under document number C(2004)327) (text with EEA relevance), OJ L 116, 4.5.2005.