TUPE

December 11th, 2017

Case C-472/16, Siguenza v Ayuntamiento de Valledolid, in which Advocate General Tanchev delivered his Opinion on 6 December 2017, concerns a music teacher previously employed by a company that had been running a municipal music school, following the school having been run by the municipality directly.  The case raised yet again the question under what such circumstances the loss of a service contract to a competitor following a tendering exercise is to be regarded as the transfer of an economic entity so as to require the new contractor to take over staff of the previous contractor.  The specific features of the particular case were (1) a concession that expired before the competitor took over, (2) a delay of 5 months before the competitor resumed the activity and (3) the fact that none of the 26 persons employed by the previous employer were taken over, albeit the tangible assets were taken over. The Advocate General concluded that there was no transfer.

There was no economic entity: at the time the school resumed it had ceased to exist as an entity.  If there was an economic entity, it did not retain its identity: most of the factors which indicate whether the old and the new entity are identical militated against there being a transfer.

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