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European Commission requests Belgium to apply fair and transparent procedure

Wednesday November 24th, 2010

The European Commission has requested Belgium to ensure that EU rules on public procurement – the purchase of goods or services by public authorities – are applied properly, notably in the case of a public works contract for the design, refurbishment, new construction, financing and maintenance of educational institutions located in Eupen.

The Commission considers that Belgium has breached EU public procurement rules by awarding this contract through the unjustified use of a negotiated procedure (permissible only in exceptional circumstances). EU rules are designed to ensure fair and transparent competition for public contracts in Europe, thereby creating opportunities for European companies while ensuring the best value for public money. If the rules are not respected there is a risk of a closed market and wasted public money. The Commission’s request to Belgium takes the form of a reasoned opinion. If Belgium does not reply satisfactorily within two months, the Commission may refer this matter to the Court of Justice.

What is the aim of the EU rule in question?

Public procurement is about how public authorities spend public money for the acquisition of goods or services. It covers purchases of everything from computer systems to waste water plants, ship building, and consulting services. Total public procurement in the EU is estimated at about 17% of the Union’s GDP. The open and transparent tendering procedures required under EU public procurement rules mean more competition, stronger safeguards against corruption, and better service and value for money for taxpayers.

How is Belgium not respecting EU rules and how are businesses and citizens suffering as a result?

The German-speaking Community of Belgium published a contract notice for the award of a public works contract for the design, refurbishment, new construction, financing and maintenance of educational institutions located in Eupen.

The value of this contract is more than 100 million euros. The procedure used is a negotiated procedure with publication of a contract notice. Although such a procedure is in principle open to all interested companies, the fact that negotiations take place between the public authorities and the individual bidders entails significant more risks for the equal treatment of bidders than the open or restricted procedure – the standard procedures under EU law. Furthermore, the negotiated procedure is much less transparent.

For these reasons EU public procurement rules allow contracting authorities to use the negotiated procedure only in exceptional cases. However, the use of this procedure in the present case is, according to the Commission, not in line with these rules.

The latest information on infringement proceedings concerning all Member States can be found at: http://ec.europa.eu/community_law/index_en.htm

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