It is well known that the financial needs of the State and other public entities are met through the tax system, in accordance with the provisions of Article 103(1) of the Constitution of the Portuguese Republic (CRP).
Local Authorities are not exempt from this phenomenon, resorting to the creation of administrative fees to satisfy this need.
Fees are based on a consideration, which justifies the existence of a synallagmatic relationship, as a sine qua non condition for their validity.
It should be noted, however, that the consideration supporting the imposition of a given fee does not have to be mathematically identical to the cost of the service provided, as jurisprudence is unanimous on this matter.
Under the terms of Article 4(2) of the General Tax Law (LGT), the consideration for a given fee may be based on (i) the provision of a public service, (ii) the use of a public domain asset, or (iii) the removal of a legal obstacle.
In the specific case of the Subsoil Occupation Fee (TOS), the consideration corresponds to the use of the subsoil for the installation of pipes and conduits. Thus, this fee aims to compensate municipalities for the deprivation of public domain use and grants the right to such space for private use.
The TOS is, as a rule, created and regulated by Municipal Regulations, which must include, in accordance with Article 8(2)(c) of the General Regime of Local Authority Fees (RGTAL), the economic and financial justification for the fee amounts, under penalty of nullity.
Regarding the fee amount, Article 4(1) of the RGTAL states that the value of the fee must comply with the principle of proportionality and should not exceed the cost of the public activity or the benefit derived by the private entity.
The equivalence provided for in Article 4 of the RGTAL translates into a synallagmatic equivalence, which essentially requires a reasonable and proportionate correlation between the fee amount and the consideration received by the private entity, without requiring a mathematical correspondence between the two.
This fee is particularly relevant for concessionary entities engaged in the distribution of natural gas, which, in order to carry out their activity, are subject to the payment of the TOS. On several occasions, however, this fee has been manifestly disproportionate and lacks any economic-financial study to justify it.
Reference must be made to Resolution of the Council of Ministers No. 98/2008, of April 8, which approved the drafts of the Public Service Concession Contracts for Regional Natural Gas Distribution, and Ordinance No. 1213/2010, of December 2, in its current wording, which approved the Model License for the operation of the local natural gas distribution network. It was determined that the value of the TOS may be fully passed on to the entities using the infrastructure or to final consumers.
Accordingly, concessionary entities have been passing on the amounts paid for the TOS to final consumers by including these costs in their invoices.
Under the heading “Rights-of-way and subsoil occupation fees,” Article 85(3) of the State Budget Law for 2017, approved by Law No. 42/2016, of December 28, stipulates that the TOS cannot be reflected in consumer invoices, thereby prohibiting the passing on of this fee.
This provision, as widely confirmed by the courts, has been valid and fully effective since January 1, 2017, with rulings declaring illegal any acts of passing on the fee that were included in gas consumption invoices and borne by final consumers.
Despite the above, concessionary entities have continued the practice of passing on the TOS to final consumers, relying on contracts signed with the State and thus charging undue amounts.
This situation is explicitly confirmed on the website of the Energy Services Regulatory Authority (ERSE), which, despite the jurisprudentially confirmed illegality of passing on the TOS, provides a fee simulation tool, allowing final consumers to determine the amount that will (illegally) be charged to them.
Thus, final consumers of natural gas must carefully review their invoices to check whether the TOS amount is being passed on to them and, if so, challenge such charges.
