Related parties
Municipalities perform a variety of tasks to serve the public interest. Performing those duties can be done in a variety of ways:
- by performing the tasks themselves;
- by outsourcing tasks to another organization and
- by participating in a related party.
When municipalities perform tasks themselves within a municipal department, the municipality bears all financial and all operational risks. Outsourcing tasks can be done through the provision of subsidies or by concluding contracts. These are normally preceded by a tender. Municipalities can also perform tasks through "related parties.
What do we mean by a related party?
The Besluit begroting en verantwoording provincies en gemeenten (Bbv) (Decree on budgeting and accounting for provinces and municipalities) indicates in article 1 under b that a "related party" should be understood to mean: an organization under private or public law in which the municipality has an administrative and a financial interest.
Een financieel belang houdt in: als de gemeente aansprakelijk is bij niet-nakoming van verplichtingen of een aan de verbonden partij ter beschikking gesteld bedrag dat (door de gemeente) niet opgeëist kan worden indien de verbonden partij failliet gaat.
Een bestuurlijk belang houdt in: als de gemeente zeggenschap heeft in de betreffende organisatie, bijvoorbeeld als een wethouder, raadslid of ambtenaar zitting heeft in het bestuur of namens de gemeente stemt.
Different types of related parties can be distinguished within Kerkrade: Joint Arrangements (GR), Public Limited Companies (NV) and Private Limited Companies (BV). The choice of a specific legal form depends in part on the objective to be achieved.
Reasons for participation in related parties
Possible reasons for participating in a related party include: risk spreading (sharing financial risks with others), efficiency benefits, knowledge benefits and the so-called catalyst function (initiating activities that would not be possible without the municipality's role as initiator).
Possible dangers lie mainly in the loss of control and the dual role of the municipality. Think of financial risks, directors' liability, lack of information and therefore reduced possibilities for influence.
Information common arrangements
Joint Arrangements (GRs) are related parties based on public law. A joint arrangement is basically "extended local government"; several municipalities join forces and place the execution of municipal tasks in a joint arrangement. Below you will find information about joint arrangements (related parties) of which the municipality is part.