1. For the purposes of this Directive 'Contracting authorities' are State, regional or local authorities, bodies governed by public law, associations formed by one or more such authorities or one or more such bodies governed by public law, other than those awarding a concession for the purpose of pursuing an activity as refrred to in Annex III..
2. 'Regional authorities' include all authorities of the administrative units falling under NUTS 1 and 2, as referred to by Regulation No. (EC) 1059/2003 of the European Parliament and of the Council16.
3. 'Local authorities' include all authorities of the administrative units falling under NUTS 3 and smaller administrative units, as referred to by Regulation No. 1059/2003.
4. 'Bodies governed by public law' means bodies that have all of the following characteristics:
(a) they are established for or have the specific purpose of meeting needs in the general interest, not having an industrial or commercial character;
(b) they have legal personality;
(c) they are financed, for the most part, by the State, regional or local authorities, or other bodies governed by public law; or subject to management supervision by those bodies; or have an administrative, managerial or supervisory board, more than half of whose members are appointed by the State, regional or local authorities, or by other bodies governed by public law.
For the purpose of point (a) of the first subparagraph, a body which operates in normal market conditions, aims to make a profit, and bears the losses resulting from the exercise of its activity, it does not have the purpose of meeting needs in the general interest, not having an industrial or commercial character.
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16 OJ L 154, 21.6.2003, p. 1