Category Archives: Public services contracts

Public service contracts – Supply of Greek translation services for the Parliament

Judgment

T-667/11

14.01.2015

Parties

Jurisdiction

Formation

Judge Rapporteur

Advocate General

Subject-matter

Action for annulment

Verloss International SA, Attimedia SAVEuropean Parliament

General Court

3rd Ch.

E. Bieliunas

 /

Public services contracts

Keywords

 Public service contracts – Supply of Greek translation services for the Parliament – Rejection of a tenderer`s bid – Obligation to state reasons – Non-contractual liability

Significant points

  1. The decision of the European Parliament of 18 October 2011 implied the rejection of Verloss International and Attimedia tender for the main contract and the fact that it had been decided to award the contract to another tenderer for the provision of Greek translation services. The Parliament has a broad discretion with regard to the factors to be taken into account for the purpose of deciding to award a contract following an invitation tender.
  2. The Parliament did not provide Verloss International SA and Attimedia SA with either the name of the successful tender or any information about the characteristics and relative advantages of the successful tender, even though it was required to do so under the Financial Regulation (Article 100(2)) and the Implementing Rules.
  3. Even if the Parliament did not give adequate statement of reasons for the contested decision, that does not mean that the award of the contract to the successful tenderer constitutes wrongful conduct or that there is a causal link between that fact and the loss alleged by Verloss International SA and Attimedia SA.

Noteworthy

Public service contracts – Directive 92/50/EEC

Judgment

C-568/13

18.12.2014

Parties

Jurisdiction

Formation

Judge Rapporteur

Advocate General

Subject-matter

Reference for a preliminary ruling

Azienda Ospedaliero-Universitaria di Careggo-Firenze

V

Data Medical Service Srl

CJEU

 5th Chamber

 E. Juhász

 J. Kokott

Public service contracts — Directive 92/50/EEC

Keywords

 Public service contracts — Directive 92/50/EEC — Articles 1(c) and 37 — Directive 2004/18/EC — First subparagraph of Article 1(8) and Article 55 — Concepts of ‘service provider’ and ‘economic operator’ — Public university hospital — Entity with legal personality and business and organisational autonomy — Principally non-profit-making activity — Institutional purpose of offering health services — Possibility of offering similar services on the market — Admission to participate in a tendering procedure for the award of a public contract

Significant points

  1. It should be noted that the possibility for public entities to participate in tendering procedures for public contracts, in parallel to the participation of private economic entities, is already evident from the wording of Article 1(c) of Directive 92/50, according to which ‘service provider’ is to mean any natural or legal person, including a public body, which offers services. Furthermore, such a possibility to participate was recognised by the Court in the judgment in Teckal, C‑107/98, EU:C:1999:562, paragraph 51, and was repeated in the subsequent judgments in ARGE, EU:C:2000:677, paragraph 40; CoNISMa, EU:C:2009:807, paragraph 38; and Ordine degli Ingegneri della Provincia di Lecce and Others, EU:C:2012:817, paragraph 26.
  2. One of the objectives of the EU rules on public procurement is to attain the widest possible opening-up to competition (see, to that effect, the judgment in Bayerischer Rundfunk and Others, C‑337/06, EU:C:2007:786, paragraph 39), an opening-up which is also in the interest of the contracting authority concerned itself, which will thus have greater choice as to the tender which is most advantageous and most suited to the needs of the public authority in question.
  3. The Court has therefore held that it follows from both the EU rules and the case-law that any person or entity which, in the light of the conditions laid down in a contract notice, believes that it is capable of carrying out the contract is eligible to submit a tender or to put itself forward as a candidate, regardless of whether it is governed by public law or private law, whether it is active as a matter of course on the market or only on an occasional basis (see, to that effect, the judgment in CoNISMa, EU:C:2009:807, paragraph 42).
  4. The provisions of Directive 92/50, and in particular the general principles of freedom of competition, non-discrimination and proportionality which underlie that directive, must be interpreted as not precluding national legislation which allows a public hospital, such as that at issue in the main proceedings, participating in a tendering procedure to submit a tender which cannot be matched by any competitors as a result of the public funding which it receives.
  5. In that regard, even if the referring court considers that it is desirable to identify corrective mechanisms designed to even out the disparities existing between the various economic operators at the outset and which should go further than procedures to check the potentially abnormal character of the tenders, it must be noted that the EU legislature, while being aware of the differences between competitors participating in a public contract, did not make provision for mechanisms other than those designed to check and possibly reject abnormally low tenders.
  6. However, the provisions of Directive 92/50 and the Court’s case-law do not allow, a priori and without further consideration, a tenderer to be excluded from participation in a procedure for the award of a public contract on the sole ground that, as a result of public subsidies which it receives, it is able to submit tenders at prices which are significantly lower than those of unsubsidised tenderers (see, to that effect, the judgments in ARGE, EU:C:2000:677, paragraphs 25 to 27, and CoNISMa, EU:C:2009:807, paragraphs 34 and 40).
  7. In addition, in the course of the examination of the abnormally low character of a tender on the basis of Article 37 of that directive, the contracting authority may take into consideration the existence of public funding which such an entity receives in the light of the option to reject that tender. It should be noted that Article 37 of Directive 92/50 does not contain a definition of the concept of an ‘abnormally low tender’. It is thus for the Member States and, in particular, the contracting authorities to determine the method of calculating an anomaly threshold constituting an ‘abnormally low tender’ within the meaning of that article (see, to that effect, the judgment in Lombardini and Mantovani, C‑285/99 and C‑286/99, EU:C:2001:640, paragraph 67).
  8. That being the case, the EU legislature made clear in that provision that the abnormally low character of a tender must be assessed ‘in relation to the service to be provided’. Thus, the contracting authority may, in the course of its examination of the abnormally low character of a tender, take into consideration, for the purpose of ensuring healthy competition, not only the situations set out in the second paragraph of Article 37 of Directive 92/50 but also all the factors that are relevant in the light of the service at issue (see, to that effect, the judgment in SAG ELV Slovensko and Others, EU:C:2012:191, paragraphs 29 and 30).

Noteworthy

The Court of Justice has reaffirmed that public entities may participate in public procurement tenders and cannot be precluded from doing so under national legislation. Even if these entities receiving public funding may find themselves at a competitive advantage compared to market operators offering services without market funding, no corrective measures are permitted under EU law allowing for the automatic exclusion of abnormally low tenders. The contracting authority, however, may take into consideration the existence of public funding when deciding to reject the tender.

Public procurement – Contracts falling below the threshold laid down in Directive 2004/18/EC

Judgment

C-470/13

18.12.2014

Parties

Jurisdiction

Formation

Judge Rapporteur

Advocate General

Subject-matter

Reference for a preliminary ruling

Generali-Providencia Biztosító Zrt

V

Közbeszerzési Hatóság Közbeszerzési Döntőbizottság

CJEU

10th Chamber

C. Vajda

M. Szpunar

Public procurement

Keywords

 Public procurement — Contracts falling below the threshold laid down in Directive 2004/18/EC — Articles 49 TFEU and 56 TFEU — Applicability — Certain cross-border interest — Grounds for exclusion from a tendering procedure — Exclusion of an economic operator having committed an infringement of national competition rules, established by a judgment given not more than five years ago — Lawfulness — Proportionality

Summary

  1. In so far as the provisions of the TFEU relied on by the referring court are concerned, it must be observed that, where a public contract does not come within the scope of Directive 2004/18, because it falls short of the relevant threshold laid down in Article 7 of that directive, that contract is subject to the fundamental rules and general principles of that treaty, provided that it is of certain cross-border interest in the light, inter alia, of its value and the place where it is carried out (see, to that effect, judgments in Ordine degli Ingegneri della Provincia di Lecce and Others, C‑159/11, EU:C:2012:817, paragraph 23, and Consorzio Stabile Libor Lavori Pubblici, C‑358/12, EU:C:2014:2063, paragraph 24).
  2. In relation to the exclusion of economic operators from a public contract in the context of freedom of establishment and the freedom to provide services under Articles 49 TFEU and 56 TFEU, it must be observed that Article 45(2)(d) of Directive 2004/18 makes it possible to exclude any operator who ‘has been guilty of grave professional misconduct proven by any means which the contracting authorities can demonstrate’.
  3. It must be observed that the concept of ‘professional misconduct’, for the purposes of that provision, covers all wrongful conduct which has an impact on the professional credibility of the operator at issue and not only the infringements of ethical standards in the strict sense of the profession to which that operator belongs (see, to that effect, judgment in Forposta and ABC Direct Contact, C-465/11, EU:C:2012:801, paragraph 27). In those circumstances, the commission of an infringement of the competition rules, in particular where that infringement was penalised by a fine, constitutes a cause for exclusion under Article 45(2)(d) of Directive 2004/18.
  4. If such a cause for exclusion is possible under Directive 2004/18, it must a fortiori be regarded as justified in relation to public contracts which fall short of the threshold defined in Article 7 of that directive and which are consequently not subject to the strict special procedures laid down in that directive (see, to that effect, judgment in Consorzio Stabile Libor Lavori Pubblici, C-385/12, EU:C:2014:2063, paragraph 37).
  5. The answer to the questions referred is that Articles 49 TFEU and 56 TFEU do not preclude the application of national legislation excluding the participation in a tendering procedure of an economic operator which has committed an infringement of competition law, established by a judicial decision having the force of res judicata, for which a fine was imposed.

Noteworthy

 In this preliminary ruling, the Court of Justice has confirmed that even if a public contract does not come within the scope of an EU directive and national legislation did not make the directive concerned directly and unconditionally applicable to such a contract, the contract may still be subject to the fundamental rights and principles of the TFEU provided it is of certain cross-border interest.