Public procurement: Commission requests Spain to comply with Court judgment on review period between contract award and conclusion

13 October 2009

The European Commission has decided, under Article 228 of the EC Treaty, to formally request Spain to comply with a 2008 judgment of the European Court of Justice. In that judgment (case C-444/06), the Court ruled that Spain had failed to fulfil its obligations under the EC Public Procurement Remedies Directive (Directive 89/665/EC), by failing to provide for a mandatory waiting period between the award of the contract and its conclusion. The Commission considers that the Spanish authorities have not taken the necessary measures to fully comply with the judgment of the Court.

Spain not complying with previous Court judgement

On 3 April 2008 the European Court of Justice ruled on case C-444/06 Commission v. Spain. The judgement stated that Spain had failed to fulfil its obligations under Article 2(1) (a) and (b) of Council Directive 89/665/EEC, by failing to lay down a mandatory period for the contracting authority to notify the decision on the award of the contract to all the tenderers and by failing to provide for a mandatory waiting period between the award of the contract and its conclusion.

According to the Spanish authorities, the new Spanish system of remedies in the field of public procurement, as governed by the Law on Contracts of the Public Sector (Law 30/2007) since 1 May 2008, fully complies with the requirements of Directive 89/665/EEC as interpreted by the ECJ in C-444/06.

The European Commission does not share this view. Conversely, the Commission considers that this new system of remedies does not actually guarantee the existence of a period between award and conclusion of the contract, which would provide all rejected bidders with the necessary elements allowing them to effectively institute review proceedings before an independent body at a stage where infringements can still be remedied.

Background

Total public procurement in the EU – i.e. the purchases of goods, services and public works by governments and public utilities – is estimated at about 16% of the Union’s GDP. The open and transparent tendering procedures required under EU public procurement law mean more competition, stronger safeguards against corruption, and better service and value for money for taxpayers.

Under the EC Treaty, the European Commission has powers to take legal action – known as infringement procedures – against a Member State that is not respecting its obligations under EU rules. These procedures consist of three steps. The first is that the Member State receives a letter of formal notice and has two months to respond. In case further compliance with EU legislation is needed, the Commission sends a reasoned opinion. Again the Member State has two months to reply. If there is no satisfactory reply, the Commission can refer the matter to the European Court of Justice in Luxembourg. It can also request that the Court impose a fine on the country concerned if it does not comply with the Court's ruling.

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