APPLICATIONOF ADMINISTRATIVELAW TOPRIVATZATIONS efficiency ethical Democratic legitimisation holds two items: democratic steering and democratic accountability. To accomplish his accountability towards parliament, a minister should have the power to give directions to the privatised company: without power no accountability (and vv ) The necessary power can be contributed in various ways Aside from the various methods in the public domain, other foms of founding democratic legitimatisation are feasible. In a more traditional vision an immedate link between responsibility for the public interest and public domain, might be deemed as the only possible way. Though democratic legit im isation for the public interest is essental, accountability within the public doma in is not the only way to achieve it. Other methods are feasible. It might be made obligatory for the com panies to publish annual reports, to respond to special representative or independent councils and to operate with an objective supervisory board. with certain creativ ity democratic legitim isation might be provided in a different, but effective way. It can be seen as a challenge in privatisation to make privatised companies more responsible towards society Guarantees should however not develop into a deta iled network ofrules, which will make the privatisation void The strains of the principle of equity before bw might comer the options of a company too sharply and restrict it too much to operate effectively onan open market And moreover, from the other hand, competition might lead companies nto infringement of the principle. A commercal insurance company is to be expected exclude risk groups, though behaviour like that is not socially correct. Of course an attitude like that could be prohibited by aw, but making deta iled rules on how to run a company might affect the company s position on the open market, or have more effects on the functioning of the open market as such. For these reasons the vermment might refra in from conversion of state activ ities into an open market system, if the principle of equity before the la w is at stake egal certa inty is partly connected with predictability of actions of the adm inistration. The adm inistration is tied to public law rules and citizens know what to expect by reading the rules. To draw the conclusion that public law has a monopoly in legal certa inty, would be incorrect however, Two remarks could be made. Private law companies are bound to produce certainty towards the public a well. And the public legal certainty is lim ited in itself. It cannot be denied, that rules leave room for interpretation and civil servants are partly free to act in compliance with their own common sense. This is a phenomenon known as the discretion of lic authorities. The freedom of private companies is guided by law that can set minimum standards for quality and maximum levels for prices With respect to the rinciple of legal certa inty it might be possible in many cases to find a balance between the need for legal certa inty and reasonable freedom for market options. If too many rules are needed however, the govemment should refra in from transformation of state a ctiv ities into open market competition With regard to the ast two checkpoints might be remarked: a new mix between government and market as coordination mechanisms (Bovenberg, 1999) should be created. Whether a public or a private organisation of a service is effective or efficient depends ma inly on the character of the serv ice. Electricity was due to beAPPLICATION OF ADMINISTRATIVE LAW TO PRIVATIZATIONS 5 - efficiency, - efficacy. Democratic legitimisation holds two items: democratic steering and democratic accountability. To accomplish his accountability towards parliament, a minister should have the power to give directions to the privatised company: without power no accountability (and v.v.). The necessary power can be contributed in various ways. Aside from the various methods in the public domain, other forms of founding democratic legitimatisation are feasible. In a more traditional vision an immediate link between responsibility for the public interest and public domain, might be deemed as the only possible way. Though democratic legitimisation for the public interest is essential, accountability within the public domain is not the only way to achieve it. Other methods are feasible. It might be made obligatory for the companies to publish annual reports, to respond to special representative or independent councils and to operate with an objective supervisory board. With certain creativity democratic legitimisation might be provided in a different, but effective way. It can be seen as a challenge in privatisation to make privatised companies more responsible towards society. Guarantees should however not develop into a detailed network of rules, which will make the privatisation void. The strains of the principle of equity before law might corner the options of a company too sharply and restrict it too much to operate effectively on an open market. And moreover, from the other hand, competition might lead companies into infringement of the principle. A commercial insurance company is to be expected to exclude risk groups, though behaviour like that is not socially correct. Of course an attitude like that could be prohibited by law, but making detailed rules on how to run a company might affect the company s position on the open market, or have more effects on the functioning of the open market as such. For these reasons the government might refrain from conversion of state activities into an open market system, if the principle of equity before the law is at stake. Legal certainty is partly connected with predictability of actions of the administration. The administration is tied to public law rules and citizens know what to expect by reading the rules. To draw the conclusion that public law has a monopoly in legal certainty, would be incorrect however. Two remarks could be made. Private law companies are bound to produce certainty towards the public as well. And the public legal certainty is limited in itself. It cannot be denied, that rules leave room for interpretation and civil servants are partly free to act in compliance with their own common sense. This is a phenomenon known as the discretion of public authorities. The freedom of private companies is guided by law that can set minimum standards for quality and maximum levels for prices. With respect to the principle of legal certainty it might be possible in many cases to find a balance between the need for legal certainty and reasonable freedom for market options. If too many rules are needed however, the government should refrain from transformation of state activities into open market competition. With regard to the last two checkpoints might be remarked: a new mix between government and market as coordination mechanisms (Bovenberg, 1999) should be created. Whether a public or a private organisation of a service is effective or efficient depends mainly on the character of the service. Electricity was due to be