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Sub-dimensional PUBLIC PROCUREMENT: between EU principles and gold plating

Sub-dimensional PUBLIC PROCUREMENT: between EU principles and gold plating. Dacian C. Dragos Center for Good Governance Studies Babes Bolyai University, Cluj Napoca , Romania. Contracts outside the EU directives: what relevance?.

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Sub-dimensional PUBLIC PROCUREMENT: between EU principles and gold plating

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  1. Sub-dimensional PUBLIC PROCUREMENT: between EU principles and gold plating Dacian C. Dragos Center for Good Governance Studies Babes Bolyai University, ClujNapoca, Romania

  2. Contracts outside the EU directives: what relevance? • 80% of the procurement market – contracts not covered by the directives • 10% of procedures are covered by the EU Directives • 90% of procedures recorded nationally – below the EU thresholds • Values: 20% of the public expenditures covered by the EU Directives

  3. Thresholds • THE WTO Government Procurement Agreement (SDR) • 2014 Directives (EUR) • (a) EUR 5 186 000 for public works contracts; • (b) EUR 134 000 public supply and service, central authorities • (c) EUR 207 000 public supply and service contracts, sub-central authorities • (d) EUR 750 000 public service contracts Annex XIV • Up until 2004 – full application of the Directive - lowering the thresholds • 2014 onward – increasing the thresholds

  4. Reasoning • Sub-dimensional - not enough cross border interest • Contracts above thresholds – majority of PP in the MS • GPA • Critique: • The size of PP • MS become the main actors in the integration of public markets, not the EU

  5. Case law of the CJUE • Unitron Scandinavia • Telaustria • Commission v. France • Germany v. Commission • Commission v. Italy • Coname • Bent MoustenVestergaard • Parking Brixen

  6. Case law (cont) • Succhi di frutta • EvropaïkiDynamiki • Strong Segurança • Medipac-Kazantzidis • SECAP • Commission v. Ireland • Belgacom • Comune di Ancona

  7. Soft law: the 2006 Communication • Synthesis of the jurisprudence • Cross border interest test: • subject matter of the contract, • its estimated value, • the size and structure of the particular market, • commercial practices • the geographic location of the place of performance

  8. EU principles • Recital 1: • free movement of goods, • freedom of establishment • freedom to provide services • equal treatment, • non-discrimination, • mutual recognition, • proportionality • transparency

  9. Equal treatment • the obligation of transparency • the principle of freedom to provide services • the principle of free competition • No new obligations (Germany v. Commission)

  10. Non-discrimination • Non-discriminatory description of the subject-matter of the contract (Bent MoustenVestergaard) • Mutual recognition • Non discrimination = equal treatment? • EU institutions • National courts

  11. Proportionality • 2006 Communication • Time limits Transparency • Rules known in advance • Applied equally • Sufficient time • Individual quotations? No • Coname: some degree of transparency, unless very modest economic interest

  12. Member States experiences • National jurisdictions - playground for the principles of EU law. • Options: • extension of the rules of the Directives to sub-dimensional procurement (either fully or partially), • the application of general public or private law rules

  13. OECD 2010 • Majority of MS – sub-dimensional procurement in same legislative act • Sub-dimensional PP – transparency, competitive, fair procedures

  14. Selected MS data 2012 • Gold plating • new EU entrants (2004 and 2007) (fear of corruption) • France, Italy and Spain • Germany, Denmark, UK – separate regimes

  15. National procedures for sub-dimensional procurement - simplified. • shorter time limits for submission of applications or tenders (further shortened in case of electronic submissions) • less demanding rules for publication and selection of tenderers.

  16. Direct procurement • very modest economic interest • national thresholds – between EUR 5000 and EUR 50 000 • Spain - 50 000 works 18 000 services and supplies, France and Poland EUR 15 000, Italy EUR 40 000, Romania EUR 100 000 works and EUR 30 000 services and supplies, Denmark EUR 67 000. • UK and Germany -no national threshold, but devolved local authorities may establish similar thresholds

  17. Remedies • OECD study – majority - same remedies • Denmark, UK, Germany, Spain - different remedies regimes • Direct procurement - national rules of redress

  18. Final remarks • European Commission: direct cross-border procurement has not increased as much as was anticipated • Even more true for sub-dimensional procurement • 2014 Directive: joint awarding of public contracts by contracting authorities from different Member States (Recital 73)

  19. Sub dimensional regime • Case law CJUE • National practices – mainly gold plating. • Cross border interest test - rarely performed, • Remedies are either extended as a result of gold plating, or provided by national law. • The scope of sub-dimensional procurement bound to widen

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