Tag Archives: PU

Public passenger transport service by rail and road

Public passenger transport service by rail and road

Outline of the Community (European Union) legislation about Public passenger transport service by rail and road

Topics

These categories group together and put in context the legislative and non-legislative initiatives which deal with the same topic.

Competition > Rules applicable to specific sectors > Competition in transport

Public passenger transport service by rail and road

Document or Iniciative

Regulation (EC) No 1370/2007 of the European Parliament and of the Council of 23 October 2007 on public passenger transport services by rail and by road, and repealing Council Regulations (EEC) No 1191/69 and (EEC) No 1107/70

Summary

Public service compensation may be necessary to ensure the provision of services of general economic interest (SGEI) and guarantee safe, efficient, attractive and high quality passenger transport.

This Regulation applies to regular and non-limited access, national and international public passenger transport services by rail and other track-based modes and by road.

Public service contracts and general rules

The competent authority * is obliged to conclude a public service contract with the operator to which it grants an exclusive right and/or compensation in exchange for discharging public service obligations * (PSO). Obligations which aim to establish maximum tariffs for all or certain categories of passengers may be subject to general rules.

To define the framework for the competent authority, the latter grants compensation for the net positive or negative financial impact on costs and revenue occasioned by compliance with the pricing obligations established in the general rules.

The public service contracts * and general rules define:

  • the PSO to be fulfilled by the operator and the areas concerned;
  • the parameters based on which compensation must be calculated and the nature and scope of all exclusive rights granted to avoid any overcompensation;
  • the means of distributing the costs linked to service supply (staff costs, energy, infrastructure, maintenance, etc.);
  • the means of distributing income from the sale of transport tickets between the operator and the competent authority.

The duration of public service contracts is limited and must not exceed ten years for bus and coach services, and fifteen years for passenger transport services by rail or other track-based modes. This period may be extended by up to 50 % under certain conditions.

Awarding of public service contracts

Public service contracts are awarded according to the rules laid down in this Regulation. However, for awarding certain passenger transport services by bus or tram, the procedures of Directives 2004/17/EC and 2004/18/EC apply.

Subject to certain reservations detailed in Article 5 of the Regulation, local authorities may provide public transport services themselves or assign them to an internal operator over which they have control comparable to that over their own services.

Any competent authority who uses a third party other than an internal operator must award public service contracts by means of transparent and non-discriminatory competitive procedures which may be subject to negotiation.

The obligation to instigate competitive procedures does not apply to:

  • low level contracts, the average annual value of which is estimated at less than EUR 1 000 000 or which supply less than 300 000 kilometres of public passenger transport services;
  • where emergency measures are taken or contracts are imposed in response to actual or potential service interruptions;
  • regional or long distance rail transport.

Terms and conditions

The Member States have three months to provide the Commission with all the information necessary to determine whether the compensation allocated is compatible with this Regulation.

Each competent authority must publish a global annual report on the public service obligations incumbent on them and the resultant compensation received by them.

One year prior to any competitive procedure, the competent authority must ensure that the following information is published in the Official Journal of the European Union: name and contact details of the competent authority, type of allocation proposed and services and territories likely to be affected.

The Member States must gradually come into line with the Regulation, with the end of the transition period fixed at 3 December 2019.

Background

This Regulation forms part of the objectives in the Commission’s white paper of 12 September 2001 entitled “European transport policy for 2010: time to decide” and repeals Regulations (EEC) No 1191/61 and (EEC) No 1107/70.

Key terms used in the act
  • Competent authority: any public authority or group of public authorities in one or more Member States which can intervene in public passenger transport in a given geographical area, or any body invested with such power;
  • Public service obligation: requirement defined or determined by a competent authority to guarantee general interest services in terms of passenger transport which an operator, in considering its own commercial interest, would not assume or would not ensure in the same measure or under the same conditions, without compensation;
  • Public service contract: all arrangements made between one or more transport operators with one or more responsible authorities for all the rights and obligations of the service in question, including any unilateral public acts.

Reference

Act Entry into force Deadline for transposition in the Member States Official Journal
Regulation (EC) No 1370/2007 3.12.2009 OJ L 315 of 3.12.2007

Pure air for Europe

Pure air for Europe

Outline of the Community (European Union) legislation about Pure air for Europe

Topics

These categories group together and put in context the legislative and non-legislative initiatives which deal with the same topic.

Environment > Air pollution

Pure air for Europe

Document or Iniciative

Directive 2008/50/EC of the European Parliament and of the Council of 21 May 2008 on ambient air quality and cleaner air for Europe.

Summary

This Directive lays down measures aimed at the following:

  • defining and establishing objectives for ambient air quality * designed to reduce harmful effects on health and the environment;
  • assessing the ambient air quality in Member States on the basis of common methods and criteria;
  • collating information on ambient air quality in order to monitor long-term trends, in particular;
  • ensuring that such information on ambient air quality is made available to the public;
  • maintaining air quality where it is good and improving it in other cases;
  • promoting increased cooperation between the Member States in reducing air pollution.

Member States shall designate the competent authorities and bodies responsible for evaluating the quality of ambient air, approving measurement systems, ensuring the accuracy of measurements, analysing assessment methods and cooperating with other Member States and the Commission.

Air quality assessment

This Directive establishes a system for the assessment of ambient air quality in relation to sulphur dioxide, nitrogen dioxide and oxides of nitrogen, particulate matter (PM10 and PM2,5), lead, benzene and carbon monoxide as well as ozone.

Member States shall establish areas or zones (urban, suburban, rural, rural background) throughout their territory, and assess and manage the air quality.

This Directive sets thresholds for assessment for each pollutant, criteria for the assessment method (in particular the siting of sampling points), reference methods for measurement, limit values * for the protection of human health and the environment, the target and the obligation of reducing exposure for the population to PM2,5, information thresholds * and alert thresholds *, critical levels * for the protection of vegetation and the list of information to be included in action plans for improvement in air quality.

Each Member State shall set up at least one measuring station and may, by agreement with adjoining Member States, set up one or several common measuring stations.

Air quality management and action plans

Where the levels of pollutants in ambient air are below the limit values specified in this Directive, Member States shall maintain the levels of those pollutants below the limit values and shall endeavour to preserve the best ambient air quality, compatible with sustainable development.

Where, in given zones or agglomerations, the levels of pollutants in ambient air exceed any limit value or target value *, plus any relevant margin of tolerance in each case, Member States shall ensure that air quality plans are established for those zones and agglomerations in order to achieve the predefined limit value or target value.

In the event of exceedances of those limit values for which the attainment deadline is already expired, the air quality plans shall set out appropriate measures, so that the exceedance period can be kept as short as possible and can include additional specific measures to protect sensitive population groups. Measures similar to those laid down in short-term action plans may be considered.

Where there is a risk that the levels of pollutants will exceed the alert thresholds, Member States shall draw up action plans indicating the measures to be taken in the short term in order to reduce the risk or its duration. These actions plans can in particular suspend activities which contribute to the risk of exceedance (motor-vehicle traffic, construction works, the use of industrial plants etc.). In addition, these action plans may include specific measures aimed at the protection of sensitive population groups, in particular children.

Where thresholds are exceeded due to transboundary transport of air pollutants, the Member States concerned shall cooperate and coordinate their work in order to remove the exceedance.

Public information

Member States shall ensure that up-to-date information on ambient concentrations of the pollutants covered by this Directive is routinely made available to the public and the bodies concerned. Where alert thresholds and information thresholds are exceeded, Member States shall publish:

  1. information on the exceedance or exceedances observed (place, type of threshold, time and duration of the exceedance, highest concentration observed);
  2. forecasts for the following hours and days;
  3. information on the type of population concerned, possible health effects and recommended behaviour;
  4. information on preventative measures and measures to reduce the emissions.

Member States shall also make available to the public annual reports for all pollutants covered by this Directive.

Penalties

Member States shall lay down the rules on penalties applicable to infringements of the national provisions adopted pursuant to this Directive and shall take all measures necessary to ensure that they are implemented. The penalties must be effective, proportionate and dissuasive.

Context

This Directive repeals and replaces Directive 96/62/EC on ambient air quality assessment and management, Directive 1999/30/EC relating to limit values for sulphur dioxide, nitrogen dioxide and oxides of nitrogen, particulate matter and lead in ambient air, Directive 2000/69/EC relating to limit values for benzene and carbon monoxide in ambient air, Directive 2002/3/EC relating to ozone in ambient air and Decision 97/101/EC establishing a reciprocal exchange of information and data on air pollution within the Member States.

Key Terms of the Act
  • Ambient air: outdoor air in the troposphere, excluding workplaces as defined by Directive 89/645/EEC.
  • Limit value: a level fixed on the basis of scientific knowledge, with the aim of avoiding, preventing or reducing harmful effects on human health and/or the environment as a whole, to be attained within a given period and not to be exceeded once attained.
  • Target value: a level fixed with the aim of avoiding, preventing or reducing harmful effects on human health and/or the environment as a whole, to be attained where possible over a given period.
  • Information threshold: a level beyond which there is a risk to human health from brief exposure for particularly sensitive sections of the population and for which immediate and appropriate information is necessary.
  • Alert threshold: a level beyond which there is a risk to human health from brief exposure for the population as a whole and at which immediate steps are to be taken by the Member States.
  • Critical level: a level fixed on the basis of scientific knowledge, above which direct adverse effects may occur on some receptors, such as trees, other plants or natural ecosystems but not on humans.

References

Act Entry into force Deadline for transposition in the Member States Official Journal

Directive 2008/50/EC [adoption COD/2005/0183]

11.6.2008

10.6.2010

OJ L 152 of 11.6.2008

Public finances in Member States in 2004

Public finances in Member States in 2004

Outline of the Community (European Union) legislation about Public finances in Member States in 2004

Topics

These categories group together and put in context the legislative and non-legislative initiatives which deal with the same topic.

Economic and monetary affairs > Stability and growth pact and economic policy coordination

Public finances in Member States in 2004

Document or Iniciative

Communication from the Commission to the Council and the European Parliament: Public finances in EMU – 2004 [COM(2004)425 final – Not published in the Official Journal].

Summary

The Commission analyses public finances in European and Monetary Union (EMU) in 2004 and emphasises the need to strengthen the economic governance framework in the Union. It notes more frequent use of the excessive deficit procedure and refers to the strains that are a source of uncertainty in implementing the budgetary surveillance framework, notably because of the divergent interpretation of the provisions of the Treaty and the stability and growth pact by the Community institutions. It proposes an improved analysis of budgetary developments. It also stresses that budgetary discipline and economic growth are mutually compatible objectives. It analyses the link between long-term fiscal and growth policies with a view to improving the quality of public finances.

Review of the current situation

Slower growth is contributing to budget deficits throughout the European Union (EU). Enlargement of the Union in 2004 led to growing disparities in the budgetary performances of Member States. The most significant deficits are those of Germany and France. Given their size, both countries affect the overall outcome for the euro area. The Commission is concerned about the public finance situation in Italy given its high debt-to-GDP ratio but also about the deterioration in actual balances in several countries outside the euro area, including Poland and the United Kingdom. However, it notes the soundness of public finances in Belgium, Spain, Finland, Ireland and Luxembourg. Outside the euro area, Denmark, Estonia and Sweden maintained surpluses throughout the cyclical slowdown.

The last two years have seen frequent use of the excessive deficit procedure. In 2003 Germany, France and Portugal were in an excessive deficit position. In the case of Germany and France, the probability of bringing the deficits below 3 % of GDP in 2004 was very low in the light of the draft budgets submitted for 2003. The Commission therefore moved forward with the excessive deficit procedure with the aim of urging these two countries to correct their deficits at least by 2005. In 2004 the Commission also started the excessive deficit procedure for Greece, the Netherlands and the United Kingdom, which registered deficits above 3 % of GDP in 2003. On the basis of its forecasts, the Commission recommended that an “early warning” be sent to Italy given the risk that it would breach the 3 % reference value in 2004. The procedure was also started for several new Member States following their accession to the EU. Recommendations were addressed to them with a view to helping them pursue a credible mulitiannual adjustment path.

In the immediate future, in spite of an improving growth outlook, the Commission considers that budgetary prospects for 2004 and 2005 are not very promising and that achieving sound public finances will take time. The deficit in Germany and France is projected by the Commission to remain above 3 % of GDP in 2004. The two Member States are committed to bringing down the deficit to below 3 % of GDP in 2005. Greece, Italy, the Netherlands and Portugal could also see their deficits breach the 3 % threshold if no corrective measures are taken. The budgetary situation in most of the new Member States is expected to improve over the next two years.
Unfortunately, a close-to-balance position will not be reached by most Member States, including Germany, France, Portugal and the United Kingdom, by 2007 (0.7 % of GDP for the euro area). These countries do not have an adequate safety margin to prevent a breach of the 3 %- of-GDP reference value in the event of adverse economic conditions. The Commission considers that the medium-term objectives of some Member States are based on overly optimistic growth assumptions.

The poor implementation record for the stability and convergence programmes is hampering achievement of the Lisbon objectives for making the EU the most competitive and most dynamic economy in the world. It is vital that Member States reach budgetary positions which ensure that the automatic stabilisers work freely and mitigate the impact of population ageing on the sustainability of public finances. As economic conditions improve, efforts will be needed to improve the underlying budgetary positions: the difficulties experienced by certain Member States in complying with the Treaty requirements in 2002 and 2003 reflect the fact that they did not carry out enough fiscal adjustment during the good economic times in 1999 and 2000.

Overcoming current difficulties

The Commission notes tensions in the implementation of the procedures laid down in the Treaty and the stability and growth pact (SGP) as regards budgetary surveillance, notably on account of the divergent application of the SGP by the Community institutions. In February 2002, for instance, the Commission recommended that the Council address an “early warning” to Germany and Portugal. The Council did not follow the Commission’s proposals on account of the commitments made by those countries. Similarly, the Council did not follow in 2003 the Commission’s recommendations regarding Germany and France which extended by one year the deadline for correcting the excessive deficit situation and which entailed triggering the following stages in the procedure.

The Commission has announced a strategy aimed at seeking legal clarity on the provisions of the Treaty and the SGP, pursuing budgetary surveillance and strengthening economic governance. Accordingly, at the end of January 2004 it asked the European Court of Justice to annul the decisions taken by the Council and the conclusions adopted at its November meeting. The Commission is pursuing budgetary surveillance in accordance with the provisions of the Treaty and the SGP. This involves assessing the 2003 updates of the stability and convergence programmes and preparing draft opinions for the Council. It is updating the broad economic policy guidelines (BEPGs), including the country-specific recommendations for certain Member States.

The Commission considers that the temporary slippages affecting budgetary positions must be identified more quickly. The Report on Public Finances in EMU – 2004 highlights four areas where progress has been made in analysing budgetary developments:

  • the role of one-off measures. “One-off” measures taken by governments are becoming a frequent and sizeable feature of budgetary policies in the EU. In the Commission’s view, it is important to take account of such measures and the reasons behind them in the budgetary surveillance process. It would like to see greater transparency of budget measures and better reporting of them by Member States, including in the stability and growth programmes;
  • the use of cyclically adjusted budget balances. At present, a common methodology which provides figures for cyclically adjusted budget balances (CABs) is used to disentangle changes in the budget which reflect the economic cycle from those which do not, the latter reflecting measures decided by policymakers. The Commission proposes excluding the component of the change attributable to unexpected changes in potential growth in order to correct the fiscal adjustment measures made at the level of Member States;
  • the assessment of the long-term sustainability of public finances. Budgetary surveillance includes an assessment of the long-term sustainability of public finances on the basis of the updated stability and convergence programmes. The Commission is stepping up the quantitative analysis of the results obtained, thereby giving the assessment a higher information value. It notes that the risks to long-term sustainability are most serious in five countries (Germany, Belgium, France, Greece and Italy) and that two countries (Netherlands and United Kingdom) face medium-term difficulties. Spain and Portugal envisage difficulties over the long-term projections for pension expenditures. Six countries (Austria, Denmark, Finland, Italy, Luxembourg and Sweden) seem to be well placed to meet the costs of an ageing society on the basis of current policies;
  • the consideration of contingent liabilities. To obtain a comprehensive picture of the sustainability of public finances, liabilities other than those included in the Maastricht definition of gross debt should be considered. “Contingent liabilities” correspond to government obligations that materialise only when particular events occur, and the stock of such liabilities is relatively high in the new Member States. Given the differing national situations and trends in the EU, the Commission considers that improved disclosure and monitoring of contingent liabilities would help to strengthen budgetary discipline in the Union.

There have been criticisms that the EU budgetary surveillance framework focuses too much on disciplinary aspects and so is not growth-friendly. The Commission concludes that budgetary discipline does not rule out economic growth. Budgetary discipline and sound public finances contribute to a macroeconomic environment that fosters growth, and the fiscal framework prevents protracted deficits that may have an impact on future income. The Commission’s analysis suggests that the budgetary adjustment in the 1990s induced by the EU fiscal framework resulted in growth of limited duration and magnitude but laid the foundations for better growth prospects. In the absence of the framework, the budget deficits would have crowded out private investment and further reduced potential growth compared with current figures.

The Commission highlights the need to strengthen economic governance in the EU. The framework which applies to the conduct of national fiscal policies and the processes underlying the coordination of economic policies in the EU need to be reassessed. For instance, the Treaty rules on public finances contribute to growth and allow room for proper implementation of the Lisbon strategy. However, the BEPGs could assume a more prominent role in economic policy coordination by providing better fiscal guidance to Member States. The Commission again stresses the importance of improving the interpretation of the fiscal rules in order to take debt developments in Member States into account. Lastly, the Commission recalls the advantages of clarifying the respective roles of the Council and the Commission in implementing the Treaty instruments. It also emphasises the importance of an improved dialogue between all the actors concerned at both national and Community level.

Since 2000 the Commission has produced an annual report on public finances in the European Union. It also adopts communications on the subject.

Related Acts

Commission Communication to the Council and the European Parliament – Public finances in EMU – 2003 [COM(2003)283 final – Not published in the Official Journal]
The European Commission recommends establishing a coherent medium-term strategy to tackle the problem of growing budget imbalances and stimulate growth.

Commission Communication to the Council and the European Parliament – Public finances in EMU – 2002 [COM(2002)209 final – Not published in the Official Journal]
The Commission takes stock of the trend in budgetary policies. There are economic situations to be faced up to while the budgetary framework for the Economic and Monetary Union has to be improved. The Commission underscores the importance of the early warning procedure. To ensure that the stability and growth pact is credible, the Commission believes that its objectives must be attained, while the long-term viability of public finances must be secured. In addition, the quality of public expenditure must be guaranteed and enlargement must be prepared.

Commission Communication to the Council and the European Parliament – Public finances in EMU – 2001 [COM(2001)355 final – Not published in the Official Journal]
This communication analyses the budgetary results of the Member States in 2000 and considers the short- and medium-term prospects. The budgetary policy debate is influenced by a variety of factors, in particular the stability and growth pact objective of attaining a budget position close to balance or in surplus, The importance of a budgetary policy that ensures an appropriate mix of macro-economic policies, the enlargement of the debate to embrace the quality and viability of the public finances, and the need for coordination on budget issues. Lastly the Commission sets out in detail the path to be followed, that is to say closer coordination on budgetary matters.

Public finances in Member States in 2005

Public finances in Member States in 2005

Outline of the Community (European Union) legislation about Public finances in Member States in 2005

Topics

These categories group together and put in context the legislative and non-legislative initiatives which deal with the same topic.

Economic and monetary affairs > Stability and growth pact and economic policy coordination

Public finances in Member States in 2005

Document or Iniciative

Communication from the Commission to the Council and the European Parliament of 1 June 2005: “Public finances in EMU – 2005” [COM(2005) 231 final – Not published in the Official Journal].

Summary

The communication summarises the main policy messages of the report entitled ” Public finances in EMU – 2005 “, the latest of the reports the Commission has drawn up each year since 2000. The Commission notes that there are still budgetary imbalances in some countries (Germany, Cyprus, France, Greece, Hungary, Italy, Malta, Poland, Slovakia and United Kingdom), although the general government deficit in the euro area has improved marginally. According to forecasts, the euro-area and EU deficits should remain roughly stable in 2005 and 2006.

Ten Member States face excessive deficit procedures

The communication takes account of the reform of the stability and growth pact (SGP). Since the summer of 2004, ten EU countries have been subject to the excessive deficit procedure (EDP):

  • France and Germany. Following the Court of Justice ruling *, both countries have taken measures that could result in the excessive deficit being corrected in 2005. At this stage no further action under the EDP is necessary.
  • Netherlands. The Netherlands reduced their excessive deficit to 2.5 % of gross domestic product (GDP) in 2004. The Commission therefore proposed in May 2005 to abrogate the decision on the existence of an excessive deficit.
  • Cyprus, Hungary, Malta, Poland, Czech Republic and Slovakia. The Council decided that an excessive deficit existed in each of these countries outside the euro area. In order to remedy the situation, it issued recommendations to these countries. All of them, apart from Hungary, have taken effective measures in response to the recommendation.
  • Greece. The Council has issued a notice to Greece, the last step before sanctions. Greece has until 2006 to correct the excessive deficit, which is of an unprecedented magnitude (5.2 % and 6.1 % of GDP in 2003 and 2004 respectively).

The Commission is placing emphasis on improving statistical governance in the budgetary field following the revision in the Greek government accounts in 2004. In a communication on a European governance strategy for fiscal statistics [COM(2004) 832 final], the Commission put forward three lines of action:

  • building up the legislative framework;
  • developing the Commission’s operational capacity;
  • defining European standards on the independence of statistical institutes.

Reform of the stability and growth pact: analysing budgetary data

The communication describes the main stages of the reform of the stability and growth pact. The debate has led to changes in the basic regulations on the surveillance of budgetary positions and the implementation of the excessive deficit procedure.

The Commission notes that the report aims to improve the understanding of public finance issues in the EU and to upgrade budgetary surveillance. For 2005, the report presents an analysis of the discrepancy between budgetary plans presented in stability and convergence programmes and the actual results achieved, an analysis of the determinants of debt dynamics and an analysis of the long-term sustainability of public finances.

These analyses enable the Commission to:

  • achieve effective budgetary planning. The Commission has collected data enabling it to compare actual budgetary developments in the Member States with initial objectives. In this way it has been able to see how its assessment of stability and convergence programmes has evolved over the years. It highlights the importance of finding ways to avoid spending slippages and more effectively plan expenditure patterns in a manner that increases their quality – also to better match the new Lisbon priorities.
  • understand the determinants of debt dynamics. The Commission focuses on “stock-flow adjustment”, which captures the residual discrepancy between the change in the outstanding debt stock and the general government deficit, as defined in the Protocol to the Maastricht Treaty. The usual analysis focuses on deficits and nominal growth, while much less attention has been given to the stock-flow adjustment. However, this component conveys relevant information about the evolution of government assets and liabilities and about the discrepancy between deficits. The report shows that the stock-flow adjustment in past years has, on average, been positive (consequently adding to the build-up of debt) and that in some countries it is partly associated with cash deficits being systematically higher than “Maastricht deficits”.
  • increase focus on the long-term sustainability of public finances. Public finances must be sustainable, despite ageing populations and the costs involved in the European social model. The 2005 report shows that the Member States must consolidate their budgets in order to achieve a sustainable position. The reform of the stability and growth pact is helping to ensure the long-term sustainability of public finances. The exchange of information among Member States and with the Commission on national expenditure will increase transparency and lead to a better assessment of the long-term sustainability of public finances.

Structural reforms and budgetary objectives

The Commission gives high priority to economic reforms that increase growth and employment. The report reviews and discusses the link between the implementation of structural reforms and budgets in implementing the EU framework for fiscal policy. This important issue has been under-researched.

Reforms can contain the growth of certain types of government expenditure, such as reforms of pension or health care systems. Reforms aimed at improving potential output and growth may also have indirect positive effects. However, numerical rules to limit excessive deficits may discourage reforms. The trade-off between reforms and budgetary objectives can be explained by the short-term costs of reforms and by the fact that reforms can be costly to particular groups in society, so that tax cuts or other government transfers may be needed.

The report looks at labour and product market reforms and pension reforms. The analysis focuses on two issues: the short-term impact of reforms on budgets, and the possibility that fiscal consolidation measures prevent reforms. According to the data, there is no strong evidence to show that reforms are less frequent in times of budgetary consolidation. However, in the aftermath of reforms there is, in general, a slight deterioration in budget balances. The Commission believes that reforms should be considered with caution in the implementation of the stability and growth pact (SGP). The 2005 SGP reform package includes provisions aimed at ensuring that the budgetary objectives of the EU fiscal framework do not clash with structural reforms that may contribute to sound public finances and increased growth.

New Member States: fiscal challenges

The ten Member States that joined the EU in 2004 are continuing their economic integration by catching up in terms of their income levels and by looking forward to adopting the euro. Fiscal policy can make a key contribution in this process via efficient and sustainable tax and expenditure policies and by supporting stable development of the economy. In the short term, some of the new Member States may need to make difficult choices, for example on higher spending in certain areas such as infrastructure, training or R&D, which may make it even harder to contain budget deficits. The report discusses the main challenges facing the new Member States in conducting their fiscal policy, such as the problem of an ageing population.

The new Member States are in a position to finance some of their needs thanks to their high potential growth and, in some cases, their low public debt. However, the stock of contingent liabilities is relatively high in many of these countries, and this creates the risk of sudden upswings in debt levels if government payments related to guarantees materialise. The Commission highlights the importance of taking advantage of periods of strong growth to achieve budgetary improvements. In this way, Member States can ensure adequate headroom to stabilise the economy during a downturn.

The Commission believes that there is scope for policy-makers in the new Member States to pursue their growth and stability objectives while ensuring proper management of public finances. Efforts must be made to:

  • restructure existing expenditure programmes;
  • enhance tax bases in order to strengthen public finances and foster conditions conducive to growth;
  • enhance the transparency of budgetary procedures;
  • improve risk management in the private sector via well-designed surveillance.

Although the framework for economic and budgetary surveillance in EMU has provided positive results, analyses show that Member States need to do more if they are to deliver the expected results. The reform of the SGP and the Lisbon strategy have responded to the need to match procedural rules with the economic reality and needs of the Member States. They will be tested in the years to come. The way the new SGP framework will be implemented from the start will be crucial for its future credibility. The Commission encourages the Member States to pursue this ambitious strategy by enhancing the quality and ensuring the sustainability of their public finances.

Key terms used in the act
  • Case C-27/04: The debate surrounding the stability and growth pact gathered momentum following a ruling on 13 July 2004 by the Court of Justice of the European Communities (CJEC) concerning the excessive deficit procedures initiated against Germany and France. In November 2003 the Commission sent the Council recommendations for speeding up the excessive deficit procedure in both cases. However, the Council did not act on those recommendations and suspended the excessive deficit procedures. It argued that its conclusions were of a political nature. The Court ruled that the Commission’s complaint, namely that the Council had not adopted the formal instruments contained in the Commission recommendations, was inadmissible and that the Council conclusions of 25 November 2003 adopted in respect of France and Germany were annulled as regards suspension of the excessive deficit procedure.

Purchasing property in another Member State

Purchasing property in another Member State

Outline of the Community (European Union) legislation about Purchasing property in another Member State

Topics

These categories group together and put in context the legislative and non-legislative initiatives which deal with the same topic.

Internal market > Single market for capital

Purchasing property in another Member State

Acts

Treaty of Accession of the Czech Republic, Estonia, Cyprus, Latvia, Lithuania, Hungary, Malta, Poland, Slovenia and Slovakia signed in Athens on 16 April 2003 – Annexes V to XIV [Official Journal L 236 of 23.9.2003]

Act concerning the conditions of accession of the Czech Republic, the Republic of Estonia, the Republic of Cyprus, the Republic of Latvia, the Republic of Lithuania, the Republic of Hungary, the Republic of Malta, the Republic of Poland, the Republic of Slovenia and the Slovak Republic and the adjustments to the Treaties on which the European Union is founded – Protocol No 6

on the acquisition of secondary residences in Malta [Official Journal L 236 of 23.9.2003]

Treaty between the Kingdom of Belgium, the Czech Republic, the Kingdom of Denmark, the Federal Republic of Germany, the Republic of Estonia, the Hellenic Republic, the Kingdom of Spain, the French Republic, Ireland, the Italian Republic, the Republic of Cyprus, the Republic of Latvia, the Republic of Lithuania, the Grand Duchy of Luxembourg, the Republic of Hungary, the Republic of Malta, the Kingdom of the Netherlands, the Republic of Austria, the Republic of Poland, the Portuguese Republic, the Republic of Slovenia, the Slovak Republic, the Republic of Finland, the Kingdom of Sweden, the United Kingdom of Great Britain and Northern Ireland (Member States of the European Union) and the Republic of Bulgaria and Romania, concerning the accession of the Republic of Bulgaria and Romania to the European Union [Official Journal L 157 of 21.6.2005]

Act concerning the conditions of accession of the Kingdom of Norway, the Republic of Austria, the Republic of Finland and the Kingdom of Sweden and the adjustments to the Treaties on which the European Union is founded – protocol No 2 on the Åland islands [Official Journal No C 241 of 29.8.1994]

Treaty on European Union – Protocol No 1 on the acquisition of property in Denmark [Official Journal No C 191 of 29.7.1992]

Summary

Article 56 of the Treaty establishing the European Community enshrines the free movement of capital as a fundamental freedom. It is intended to remove all restrictions on the movement of capital so that European citizens may take full advantage of the single market. However, with the successive accessions of new Member States to the Community, transitional periods of varying lengths governing the possibility of purchasing property and/or cultivated land and forest areas in another Member State were negotiated. This was notably the case for the new Member States that joined the Union on 1 May 2004 (Cyprus, Estonia, Hungary, Latvia, Lithuania, Poland, the Czech Republic, Slovakia, Slovenia and Malta) and on 1 January 2007 (Bulgaria and Romania), but is also true of Denmark and Finland.

Accession criteria and negotiations

The conditions under which a candidate country is to become a member of the Union are the result of negotiations. Candidate countries must first of all satisfy the Copenhagen criteria by meeting the following political, economic and legal conditions. They must:

  • be a democratic state based on the rule of law: they must be democracies with stable institutions guaranteeing the rule of law and human rights, and respect for and protection of minorities.
  • have a market economy: states wishing to join the Union must have a functioning market economy as well as the capacity to cope with competitive pressure and market forces within the Union.
  • be able to take on the obligations of membership: candidate countries must in particular transpose the acquis into their national legislation and be able to put it into practice. The acquis is the body of EU legislation, made up of all the rules, legislation and common policies.

The Union’s capacity to absorb new Members while maintaining the momentum of European integration is another important consideration with each accession.

Negotiations clarify the conditions under which each country’s accession is to take place. Transitional periods may be agreed. Negotiations are conducted in Intergovernmental Conferences involving Member States and the candidate country in question. The Council adopts the EU’s common positions on a proposal from the Commission. The candidate States nominate a chief negotiator, backed up by a team of experts, who directs negotiations according to the positions that have been set out. Parliament receives reports about the progress of the negotiations, and gives its assent to the accession that results. For the treaty to come into force, Member States and the candidate country in question must ratify the accession treaty according to their respective internal procedures.

States that have been Members since 1 May 2004

The ten Member States that joined the Union on 1 May 2004 all negotiated transitional periods. These are recorded under the heading “free movement of capital” in the Annexes to the Treaty of Accession:

  • Cyprus obtained a transitional period of five years (starting from the date of accession) for legislation in force on 31 December 2000 on the acquisition by aliens of residences for secondary use;
  • Estonia, Latvia, Lithuania and Slovakia negotiated a transitional period of seven years regarding the acquisition of agricultural land and forests. Self-employed farmers from other Member States who have been legally resident and active in farming in Estonia for at least three years are not subject to this restriction. The transitional period may be extended for a maximum of three years if these countries demonstrate the need for a safeguard clause;
  • Hungary enjoys a five-year transitional period regarding the acquisition of secondary residences. Nationals of the Member States and States party to the European Economic Area (EEA) Agreement who have been legally resident in Hungary for at least four years continuously are not subject to the restrictions. Hungary also enjoys a seven-year transitional period for the acquisition of agricultural land and forests. Self-employed farmers who have been resident and active in farming in Hungary for at least three years are not subject to the restriction. The transitional period may be extended by a maximum of three years if Hungary demonstrates the need for a safeguard clause;
  • Poland negotiated a transitional period of five years regarding the acquisition of secondary residences. This does not apply to EU nationals and nationals of States party to the EEA Agreement who have been legally resident in Poland for at least four years continuously. There is also a twelve-year transitional period for the acquisition of agricultural land and forests. Self-employed farmers from the EU and EEA who have been legally resident and leasing land in Poland for at least three years or seven years continuously (depending on the region) are not affected by these measures;
  • The Czech Republic negotiated a transitional period of five years for the acquisition of secondary residences by EU and EEA nationals who do not reside in the Czech Republic. Regarding the acquisition of agricultural land and forests, the country applies provisions similar to those in force in Estonia, Latvia, Lithuania and Slovakia;
  • Slovenia: as regards the real estate market, Slovenia may resort to the general safeguard clause provided for in Article 37 of the Treaty of Accession for a period of up to seven years after the date of accession. This general economic safeguard clause (normally valid for a period of up to three years only after accession) is intended to mitigate the effects of any serious deterioration in the economic or competitive situation resulting from accession in certain sectors or regions;
  • Malta negotiated a specific protocol which is part of the Treaty of Accession: Protocol 6 on the acquisition of secondary residences in Malta. The country may maintain in force the restrictions contained in its national legislation on the acquisition of secondary residences by nationals of Member States who have not legally resided in Malta for at least five years.

States that have been Members since 1 January 2007

Bulgaria and Romania have been Member States of the European Union since 1 January 2007. The Treaty of Accession of these two countries was signed by the Heads of State and Government in Luxembourg on 25 April 2005. It provides for transitional periods for the acquisition of secondary residences and agricultural land and forests:

  • a five-year transitional period for the acquisition of secondary residences by Community citizens not resident in Bulgaria/Romania;
  • a transitional period of no more than seven years for the acquisition of agricultural land and forests. This period will not apply to self-employed farmers residing in Bulgaria or Romania.

The European Commission has drawn up a report on the results of the negotiations with Bulgaria and Romania[pdf].

Scandinavian countries: Denmark and Finland (the Åland Islands)

Protocol 1 on the acquisition of secondary residences in Denmark is part of the Treaty on European Union. It stipulates that, notwithstanding the provisions of the Treaty on the free movement of capital, Denmark may maintain the existing legislation on the acquisition of second homes. However, it should be underlined that any discrimination on grounds of nationality is strictly forbidden under Article 12 of the Treaty establishing the European Community. A European national residing in Denmark may therefore acquire a secondary residence under the same conditions as a Danish national. A Danish national not residing in Denmark, by contrast, is subject to the same conditions as any other European national residing outside the country. In short, nationals should not enjoy any privileged treatment in their Member State.

Finland has sovereignty over the Åland Islands, which enjoy special status under international law, with relative autonomy as negotiated in the League of Nations in 1921. Protocol No 2, which is part of the Finnish Accession Treaty, stipulates that the provisions of the EC Treaty apply with certain derogations. The Åland Islands may therefore maintain the national provisions in force on 1 January 1994 regarding, inter alia, restrictions on the right of natural and legal persons to acquire and hold real property without permission by the competent authorities of the islands. There should be no discrimination concerning such acquisition of property. Finland must ensure that the same treatment applies to all natural and legal persons of the Member States in the Åland Islands.

Public procurement in the fields of defence and security

Public procurement in the fields of defence and security

Outline of the Community (European Union) legislation about Public procurement in the fields of defence and security

Topics

These categories group together and put in context the legislative and non-legislative initiatives which deal with the same topic.

Internal market > Businesses in the internal market > Public procurement

Public procurement in the fields of defence and security

Document or Iniciative

Directive 2009/81/EC of the European Parliament and of the Council of 13 July 2009 on the coordination of procedures for the award of certain works contracts, supply contracts and service contracts by contracting authorities or entities in the fields of defence and security, and amending Directives 2004/17/EC and 2004/18/EC (Text with EEA relevance). [See amending act(s)].

Summary

This Directive applies to public contracts in the fields of defence and security for:

  • the supply of military equipment;
  • the supply of sensitive equipment;
  • works, supplies and services directly related to military or sensitive equipment;
  • works and services for specifically military purposes or sensitive works and sensitive services.

Public procurement

Economic operators, whether they are natural or legal persons, can participate in invitations to tender in these fields. Groups of economic operators may also participate. If a contract is awarded to them, they may be required to assume a specific legal form.

Market thresholds and exclusions

This Directive shall apply to contracts which have a value excluding value-added tax (VAT) estimated to be no less than the following thresholds:

  • EUR 400,000 for supply and service contracts;
  • EUR 5,000,000 in the case of works contracts.

Exclusions

Certain specific contracts are excluded from the scope of this Directive, including:

  • contracts governed by specific procedural rules pursuant to an international agreement or arrangement between Member States and third countries and markets governed by the specific procedural rules of an international organisation purchasing for its purposes;
  • contracts for which the application of the rules of this Directive would oblige a Member State to supply certain information the disclosure of which it considers contrary to the essential interests of its security;
  • contracts awarded in the framework of a cooperation programme aimed at developing a new system;
  • contracts for the purposes of intelligence activities;
  • contracts awarded in a third country when forces are deployed outside the territory of the Union and transactions take place in the area of operations;
  • contracts relating to immovable property;
  • contracts awarded between governments.

Procedures

Contracting authorities/entities shall apply national procedures for the award of public contracts adjusted for the purposes of this Directive, by using the restricted procedure or the negotiated procedure with publication of a contract notice. An open procedure cannot be chosen.

Member States may use a competitive dialogue in the case of particularly complex contracts. In this case, contracting authorities/entities open a dialogue with the candidates selected in order to identify and define the means best suited to satisfying their needs.

There are also exceptional cases in which it is possible to use the negotiated procedure without publication of a contract notice.

The procedures are adjusted for the specific purposes of this Directive, in particular by proposing specific rules for the security of information, the security of supply and subcontracting.

The contracting authorities/entities may also conclude framework agreements, the duration of which may not exceed seven years. They must not, however, restrict competition.

Rules on advertising and transparency

Contracting authorities/entities may publish a prior information notice on their buyer profiles or on Tenders Electronic Daily (TED). They are obliged to publish a contract notice on TED with the sole exception of an exceptional negotiated procedure without publication of a contract notice.

In the case of restricted or negotiated procedures, contracting authorities/entities shall invite the selected candidates to submit their tenders and to negotiate. They shall also be invited to negotiate under the negotiated procedure. This invitation shall include contract documents, the deadline for receipt of tenders and an indication of any documents to be annexed.

For every contract or framework agreement, the contracting authorities/entities must draw up a written report describing the selection procedure chosen as well as information concerning the candidates.

Contract award criteria

Contracting authorities/entities shall award contracts on the basis of:

  • the most economically advantageous tender. Award shall then be based on various criteria linked to the subject-matter of the contract in question, such as quality, price or technical merit); or
  • the lowest price.

Subcontracting

Contracting authorities/entities may oblige the successful tenderer to organise a transparent and non-discriminatory competition when awarding subcontracts to third parties.

In addition, Member States may allow or require their contracting authorities/entities to ask that subcontracts representing at least a certain share of the value of the contract (a maximum of 30 %) be awarded to third parties following a transparent and non-discriminatory competition.

Review

A review of a decision taken by contracting authorities/entities may be sought in the event of an infringement of Community law. Member States must ensure that any operator that has suffered harm has access to effective and rapid rights to review. They may require that operators who wish to seek review either inform the contracting authority or first seek review from it.

During a review procedure, interim or final measures may be taken. In both cases, damages shall be granted to the persons concerned.

Context

The 2005 Green Paper on defence procurement highlighted the fact that it was essential to create a European market for defence equipment. This Directive should prove to be an appropriate legislative framework since it meets the specific requirements relating to goods and services in the fields of defence and security.

Reference

Act Entry into force Deadline for transposition in the Member States Official Journal

Directive 2009/81/EC

21.8.2009

21.8.2011

OJ L216, 20.8.2009

Amending act(s) Entry into force Deadline for transposition in the Member States Official Journal

Regulation (EC) No 1177/2009

1.1.2010

OJ L 314, 1.12.2009

Regulation (EU) No 1251/2011

2.12.2011

OJ L 319, 2.12.2011

Successive amendments and corrections to Directive 2009/81/EC have been incorporated into the original text. This consolidated version is for reference only.

Public procurement

Public procurement

Outline of the Community (European Union) legislation about Public procurement

Topics

These categories group together and put in context the legislative and non-legislative initiatives which deal with the same topic.

Internal market > Businesses in the internal market > Public procurement

Public procurement

The purchase of goods and services and the ordering of works by a public authority such as a national government, a local authority or their dependent bodies, are public contracts. Opening up these contracts, which account for a large proportion of the GDP of the EU, has allowed an increase in competition between the enterprises of the European Union, reducing prices and guaranteeing better quality of services for citizens. Over the years, the EU has introduced legislative provisions which modernise and facilitate the award of contract process. It has increased transparency, fairness and interoperability in this respect through tools such as the TED (Tenders Electronic Daily) database, the single classification system (evidenced by the common vocabulary for the public contracts) and the System of Information on Public Procurement (SIMAP). It has also signed the multilateral Agreement on Government Procurement (AGP) and negotiated an international award procedure within the World Trade Organisation (WTO).

Areas of public procurement

  • Common procurement vocabulary
  • Public works contracts, public supply contracts and public service contracts
  • Public procurement in the water, energy, transport and postal services sectors
  • Green public procurement

Defence procurement

  • Public procurement in the fields of defence and security
  • Defence procurement
  • Defence procurement exemptions

Reviews in the area of public procurement

  • Review procedures: supply, works and service contracts
  • Remedies mechanisms: water, energy, transport and postal services sectors

Dematerialisation of public procurement markets

  • A strategy for e-procurement
  • Development of e-Procurement in the European Union (Green Paper)
  • eGovernment

Public private partnerships

  • Rules applicable to Institutionalised Public-Private Partnerships (IPPP)
  • Green Paper on public-private partnerships
  • Developing Public Private Partnerships
  • Concessions under Community law

Public works contracts, public supply contracts and public service contracts

Public works contracts, public supply contracts and public service contracts

Outline of the Community (European Union) legislation about Public works contracts, public supply contracts and public service contracts

Topics

These categories group together and put in context the legislative and non-legislative initiatives which deal with the same topic.

Internal market > Businesses in the internal market > Public procurement

Public works contracts, public supply contracts and public service contracts

Document or Iniciative

Directive 2004/18/EC of the European Parliament and of the Council of 31 March 2004 on the coordination of procedures for the award of public works contracts, public supply contracts and public service contracts [See amending acts].

Summary

This Directive (called the “Classic Directive”) applies to public contracts * concluded by a contracting authority in sectors other than the water, energy, transport and postal services sectors for:

  • supplies;
  • services;
  • works,

which are not exceptionally excluded by this Directive, nor are works concessions *.

Scope

Thresholds

The “traditional” directive applies to public works contracts, public supply contracts and public service contracts which have a value excluding VAT estimated to be no less than the pre-established thresholds.

The thresholds are recalculated by the Commission every two years. The calculation of the value of these thresholds shall be based on the average daily value of the euro, expressed in Special Drawing Rights (SDRs). This average is calculated over the 24 months terminating on 31 August for the revision with effect from 1 January.

The value of the thresholds is the following:

  • EUR 130 000 for public supply and service contracts awarded by central government authorities (ministries, national public establishments);
  • EUR 200 000 for public supply and service contracts: awarded by contracting authorities * which are not central government authorities; covering certain products in the field of defence awarded by the central government authorities; concerning certain services in the fields of research and development (RTD), telecommunications, hotels and catering, transport by rail and waterway, provision of personnel, vocational training, investigation and security, certain legal, social and sanitary, recreational, cultural and sporting services;
  • EUR 5 000 000 in the case of works contracts.

For those Member States which have not adopted the single currency, the value of these thresholds is calculated and published by the European Commission in the Official Journal once the re-calculated thresholds in Euros are published.

Certain contracts are excluded or reserved

The following public contracts are excluded from the scope of the directive:

  • contracts covered by the “special sectors” directive and contracts awarded with the purpose of providing or exploiting public telecommunications networks;
  • contracts which are declared to be secret or affect the essential interests of a Member State;
  • contracts concluded pursuant to international agreements;
  • contracts concerning the following services: the acquisition or rental of existing buildings; the acquisition, development, (co)production of broadcasting programmes; arbitration and conciliation services; the purchase, sale or transfer of financial instruments; central bank services; employment contracts; RTD services which do not belong exclusively to the contracting authority or which are not wholly financed by it;
  • service contracts awarded on the basis of an exclusive right;
  • service concessions;
  • certain public contracts awarded in the field of defence and security covered by Directive 2009/81/EC.

Member States my reserve participation in certain public contracts to sheltered workshops or provide for such contracts to be performed in the context of sheltered employment programmes where most of the employees concerned are handicapped persons.

Rules applicable to all public contracts

Contract award criteria

The criteria used by the contracting authorities in awarding their public contracts are:

  • either the lowest price only;
  • or, where the contract is awarded to the most economically advantageous tender, various criteria linked to the subject-matter of the contract in question (quality, price, technical merit, aesthetic and functional characteristics, environmental characteristics, etc.). The contracting authority should specify the relative weighting it gives to each of the criteria.

Rules on publication and transparency

Throughout the procedure, public contracts whose value exceeds the thresholds in the Directive are subject to obligations regarding information and transparency. This takes the form of publishing information notices drawn up in accordance with standard Commission forms. There are several types:

  • the prior information notice (not compulsory);
  • after having sent the notice of the publication of a prior information notice, the contracting authority publishes this notice on its buyer profile itself or sends it to the Office for Official Publications of the European Communities (Publications Office).
    This publication is compulsory when the contracting authority wishes to reduce the time limits for the receipt of tenders;
  • the notice of the publication of a prior information notice (not compulsory), if the prior information notice is only published on the website (‘buyer profile’) of the contracting authority;
  • the contract notice or notice of a design contest (compulsory);
  • the contracting authority may publish this notice itself nationally and should send it to the Publications Office. Publication by the Publications Office is free. The notice is published in full in an official language of the Community, and a summary is translated into the other languages;
  • the contract award notice and notice of the results of a design contest (compulsory).

The notices sent by the contracting authorities to the Commission can be transmitted by traditional or electronic means. Standard forms and details on transmission procedures are accessible on the information system for public procurement (SIMAP).

Each contracting authority shall provide information, as soon as possible, on the decisions reached concerning the award of a contract, including grounds for not awarding it. It shall draw up a written report for all contracts. It shall, as soon as possible, inform:

  • the decisions taken, including decisions not to award a contract.

On the request of the economic operator concerned:

  • any unsuccessful candidate of the reasons for rejecting them;
  • any tenderer who has made an admissible tender of the relative advantages of the tender selected, as well as the name of the economic operator * chosen.

The exchange and storage of information involving the various parties to the contract ensure the integrity of the data and confidentiality. The contracting authority only examines the content of the tenders after the time limit set for submitting them has expired. Use of electronic means is non-discriminatory and helps to speed up the procedures. Devices for the electronic receipt of tenders permit the use of electronic signatures, guarantee the authenticity, integrity and confidentiality of the data and are capable of detecting possible fraud.

Technical specifications

The technical specifications define the characteristics required of a material, supply or service such that they fulfil the use for which they are intended. They are out in the contract documentation (contract notices, contract documents or additional documents) without creating unjustified obstacles to competition. These characteristics may include environmental performance, design, conformity assessment, performance, safety, dimensions, quality assurance, and production methods, on the condition that they relate to the subject of the contract. For public works contracts, they also cover test, inspection and acceptance conditions, as well as construction techniques.

When drawing up its technical specifications, a contracting entity refers to national standards transposing European standards, European technical approvals, and international standards. It can also determine performance and functional requirements, particularly in the environmental domain (e.g. European eco-labels). The tenderer’s tender is valid if he/she manages to prove that it meets the requirements defined by the technical specifications in an equivalent fashion. An appropriate means may be constituted by the submission of a technical dossier or a test report from a recognised body (laboratory, certification and inspection body).

In principle, technical specifications do not mention a specific make or process nor do they refer to trade marks, patents or a specific production.

Economic operators’ capabilities and combating fraud and corruption

European public procurement legislation provides conditions which may be required for the purposes of participation in public procurement. These conditions aim to check the suitability of economic operators tendering for contracts on the basis of criteria relating to their economic and financial capacity, and their technical and professional knowledge or abilities.

The conditions for participation also aim to effectively combat fraud and corruption.

Exclusion from public procurement contracts of any economic operators who have been found guilty of participating in a criminal organisation or of corruption, fraud or money laundering is obligatory. A contracting authority may ask tenderers for any document testifying to their professional conduct and/or economic situation. To obtain this information, it may turn to the competent national authorities or those of another Member State.

Any economic operator may be excluded from participation in a public contract where that economic operator:

  • is bankrupt (or the subject of proceedings for a declaration of bankruptcy), is being wound up, has suspended business activities or his/her affairs are being administered by the court;
  • has been convicted of any offence concerning his/her professional conduct;
  • has been guilty of grave professional misconduct;
  • has not paid social security contributions or taxes;
  • has made a false declaration to the contracting authority.

Traditional and electronic means of communication are on equal footing

With regard to the exchange of information, the new directive places traditional and electronic means of communication on equal footing. It leaves market operators free to choose which means of communication to use for the procedures. If electronic means are used, the contracting authority is able to reduce the time limits as follows:

  • the electronic publication of a prior information notice makes it possible to reduce by seven days the time limit for the receipt of tenders in open and restricted procedures. The same applies for the receipt of requests to participate in negotiated procedures and the competitive dialogue;
  • on top of the previous reduction, time limits in open and restricted procedures may be further reduced by five days where the contract documents are available on the Internet.

A new purchasing technique has entered the scene: the dynamic purchasing system. It is exclusively based on electronic means of communication.

Electronic auctions

A contracting entity may hold an electronic auction to award a contract, except for certain works and service contracts such as the design of works which relate to intellectual performances. The electronic auction shall be based:

  • either on prices when the contract is awarded to the lowest price,
  • or on prices and/or the values of the features of the tenders, when the contract is awarded to the most economically advantageous tender.

The specifications shall contain the following details:

  • the quantifiable features (figures or percentages) whose values are the subject of the electronic auction and the minimum differences when bidding;
  • the electronic auction process and the technical specifications for connection.

Before proceeding with the electronic auction, the contracting authority shall make a full initial evaluation of the tenders. All tenderers who have submitted admissible tenders shall be invited to take part simultaneously by electronic means. The invitation shall state the date and time of the start of the auction and, if appropriate, the number of phases. It shall also state the mathematical formula to be used to determine automatic re-rankings, incorporating the weighting of all the award criteria. Throughout each phase, the participants shall know their relative rankings compared to the other participants, but without knowing their identity.

The electronic auction shall close: at a date and time fixed in advance, when a certain amount of time has elapsed after receipt of the last submission, or when the number of phases in the auction has been completed.

Public procurement procedures

There are different public procurement procedures: the open procedure, the restricted procedure, the negotiated procedure, and the competitive dialogue.

The open procedure

In an open procedure, any interested economic operator may submit a tender. The minimum time limit for the receipt of tenders is 52 days from the date on which the contract notice was published. If a prior information notice has been published, this time limit can be cut to 36 days. In no case may the time limit for the receipt of tenders be less than 22 days.

The restricted procedure

In the case of restricted procedures, any economic operator may request to participate and only candidates invited to do so may submit a tender.

The time limit for the receipt of requests to participate is 37 days from the date of the contract notice. The contracting authority then, simultaneously and in writing, invites the selected candidates to submit their tenders. There should be a minimum of five candidates, except if there are not enough with the required capabilities. The minimum time limit for the receipt of tenders shall be 40 days from the date on which the invitation is sent. If a prior information notice has been published, this may be shortened to 36 days. The minimum time limit for the receipt of tenders may not be less than 22 days. Exceptionally and when urgency requires, the contracting authority may set a minimum time limit of 15 days (10 days if the notice is sent electronically) for requests to participate and of 10 days for the receipt of tenders.

The negotiated procedure

In a negotiated procedure, the contracting authority consults the economic operators of its choice and negotiates the terms of the contract with them.

The following cases justify the use of the negotiated procedure with prior publication of a contract notice:

  • following another procedure which revealed the presence of irregular tenders, insofar as this new procedure does not substantially alter the original terms of the contract;
  • in exceptional cases, when the nature of the contracts or the risks attaching thereto prevent prior pricing;
  • in the field of services, for intellectual services which do not permit the use of an open or restricted procedure;
  • for works which are performed solely for purposes of research or testing.

The following cases justify the use of the negotiated procedure without prior publication of a contract notice:

  • for all types of contract: when no tenders have been submitted in response to an open procedure or a restricted procedure;
  • when, for technical or artistic reasons, or for reasons connected with the protection of exclusive rights, the contract may be executed only by a particular economic operator; in cases of extreme urgency brought about by unforeseeable events;
  • for supply contracts: when the products involved are manufactured purely for the purposes of RTD;
  • for additional deliveries over a maximum period of three years where a change of supplier would oblige the contracting authority to acquire material having different technical characteristics; for supplies quoted and purchased on a commodity market;
  • for purchases of supplies under particularly advantageous conditions from an economic operator definitively winding up his business activities or in receivership;
  • for public service contracts, when the contract should, according to the rules of the contest, be awarded to the successful candidate in the design contest;
  • for works and service contracts: up to 50 % of the amount of the original contract, for additional works or services which are not included in the initial project and have become necessary through unforeseen circumstances;
  • for new works or services consisting in the repetition of similar works or services entrusted to the initial economic operator for a maximum of three years.

In negotiated procedures with prior publication of a contract notice, the minimum time limit for receipt of requests to participate is 37 days from the date of the contract notice. In cases of extreme urgency, the contracting authority may set a minimum time limit of 15 days (10 days if the notice is sent electronically). The contracting authority, simultaneously and in writing, invites the selected candidates (a minimum of three) to negotiate. The invitation comprises all the contract documents, the deadline for the receipt of the tenders, the address to which the tenders must be sent and the language or languages in which the tenders must be drawn up. The relative weighting of criteria for the award of the contract is also included.

The competitive dialogue

30 A contracting authority may make use of the competitive dialogue for complex contracts if it is not able to define by itself the technical solutions to satisfy its needs or is not able to specify the legal and/or financial make-up of a project. Large infrastructure projects would seem to lend themselves to this type of dialogue.

The contracting authority publishes a contract notice that includes the award criteria. The minimum time limit for receipt of requests to participate is 37 days. The contracting authority then, simultaneously and in writing, invites the selected candidates (a minimum of three) to conduct a dialogue. The discussion commences, may take place in stages and continues until the (technical and/or economic and legal) solutions have been defined. The contracting authority ensures equal treatment of all tenderers and protects the confidentiality of the information. At the end of the dialogue, the candidates submit their final tenders. These tenders may be specified, but without changing the basic features of the contract. The contracting authority awards the contract in accordance with the award criteria set and on the basis of the most economically advantageous tender.

Public works concessions

Public works concessions of a value in excess of EUR 5 000 000 are subject to specific rules. These rules do not apply to:

  • public works contracts concerning the provision or exploitation of public telecommunications networks;
  • public contracts which are secret or are awarded pursuant to international rules;
  • public works contracts covered by the “special sectors” directive.

The contracting authority publishes an information notice. The time limit for the presentation of applications is 52 days from the date of the notice, minus seven days if it is transmitted by electronic means.

The concessionaire must apply the advertising rules for contracts awarded to third parties, except in the case of a negotiated procedure without prior publication of an information notice. If the concessionaire is a contracting authority, all the rules provided for public works contracts apply.

Groups of enterprises that have been formed to obtain the concession and enterprises related to them are not considered third parties. An enterprise is related to a concessionaire when the relationship between the two is, directly or indirectly, that of a dominant influence. Ownership, financial participation, and operating rules determine this dominant influence.

Service design contests

Admission to design contests may not be limited to the territory (or part of the territory) of a Member State or by the legal nature of the participants. Design contests in the field of services and design contests with prizes for participants may be organised by:

  • central government authorities starting from a threshold of EUR 130 000;
  • other contracting authorities starting from a threshold of EUR 200 000;
  • all contracting authorities starting from a threshold of EUR 200 000 where the contests concern certain services in the fields of RTD, telecommunications, hotels and catering, transport by rail and waterway, provision of personnel, vocational training, investigation and security, certain legal, social and sanitary, recreational, cultural and sporting services.

The contracting authority publishes a contest notice drawn up in accordance with the rules for public procurement procedures. The exchange and storage of information ensures the integrity and the confidentiality of data. The contracting authority examines the projects only after the time limit set for submitting them has expired.

The assessment criteria are clear and non-discriminatory, ensuring genuine competition. The jury shall be composed exclusively of independent natural persons. Where a professional qualification is required of participants in a contest, at least a third of the jury members shall have this qualification. The jury is autonomous in its decisions and examines the plans on the basis of the selection criteria. Anonymity must be observed until the jury has reached its final decision.

Context

The awarding of contracts concluded in the Member States must comply with the principles of the free movement of goods, the right of establishment and the freedom to provide services. However, when public contracts exceed a certain amount, Community coordination of the national procedures for awarding these contracts is necessary in order to ensure maximum competition and full benefit to be made of the internal market.

Key terms used in the act
  • Public contract: contract for pecuniary interest concluded in writing between a contracting body and an economic operator, which has as its object the execution of works, the supply of products or the provision of services.
  • (Works or service) concession: a contract which differs from a public contract in that the source of revenue for the economic operator consists either solely in the right of exploitation or in this right together with payment.
  • Contracting authority: the State, a regional or local authority, a body governed by public law (and their associations) with the ability to engage in public procurement.
  • Economic operator: a contractor, supplier or service provider who responds to an invitation to tender

References

Act Entry into force Deadline for transposition in the Member States Official Journal
Directive 2004/18/EC

30.4.2004

31.1.2006

OJ L 134 of 30.4.2004

Amending act(s) Entry into force Deadline for transposition in the Member States Official Journal

Directive 2005/75/EC

9.12.2005

31.1.2006

OJ L 323 of 9.12.2005

Regulation (EC) No 2083/2005

1.1.2006

OJ L 333 of 20.12.2005

Directive 2006/97/EC

1.1.2007

1.1.2007

OJ L 363 of 20.12.2006

Regulation (EC) No 1422/2007

1.1.2008

OJ L 317 of 5.12.2007

Directive 2009/81/EC

21.8.2009

21.8.2011

OJ L 216 of 20.8.2009

Regulation (EC) No 1177/2009

1.1.2010

OJ L 314 of 1.12.2009

Regulation (EU) No 1251/2011

1.1.2012

OJ L 319 of 2.12.2011

Successive amendments and corrections to Directive2004/18/EC have been incorporated in the basic text. This consolidated version  is for reference purpose only.

Public procurement in the water, energy, transport and postal services sectors

Public procurement in the water, energy, transport and postal services sectors

Outline of the Community (European Union) legislation about Public procurement in the water, energy, transport and postal services sectors

Topics

These categories group together and put in context the legislative and non-legislative initiatives which deal with the same topic.

Internal market > Businesses in the internal market > Public procurement

Public procurement in the water, energy, transport and postal services sectors

Document or Iniciative

Directive 2004/17/EC of the European Parliament and of the Council of 31 March 2004 coordinating the procurement procedures of entities operating in the water, energy, transport and postal services sectors [See amending acts].

Summary

Directive 2004/17/EC on the “special sectors” of water, energy, transport and postal services applies to public procurement contracts concluded by a contracting authority in the sectors in question for:

  • supplies;
  • services;
  • works,

which are not exceptionally excluded by this Directive. However, in contrast to the “classic” Directive, this Directive does not apply to works concessions.

Scope

Contracting entities

The “special sectors” directive applies to:

  • all contracting authorities * or public undertakings * which pursue activities in one of the following fields: gas, electricity, water, transport services, postal services *, the extraction of fuels, or the provision of ports or airports;
  • all contracting entities which, when they are neither contracting authorities nor public undertakings, pursue one (or more) of the above activities and enjoy special or exclusive rights * granted by a competent authority of a Member State, as defined by the Directive.

Non-exhaustive lists of contracting entities are given in the Annexes. Member States must notify the Commission of any changes.

Activities concerned

The directive applies to the following activities:

  • the provision or operation of fixed networks intended to provide a service to the public in connection with the production, transport or distribution of gas, heat or electricity, or the supply of gas, heat or electricity to such networks;
  • the provision or operation of fixed networks intended to provide a service to the public in connection with the production, transport or distribution of water, or the supply of water to such networks;
  • where the contracting entity is active in the drinking water sector, contracts or design contests connected with irrigation, land drainage or hydraulic engineering projects, or contracts connected with the disposal or treatment of sewage;
  • the provision or operation of networks providing a service to the public in the field of transport by railway, automated systems, tramway, trolley bus, bus or cable.
    Bus transport services are excluded from the scope of the directive where other entities are free to provide those services, either in general or in a particular geographical area, under the same condition as the contracting entities;
  • the provision of postal services *. These services cover: postal services which are reserved under the terms of Directive 97/67/EC, as well as those which may not be reserved under Directive 97/67/EC; all of the following services are also covered, on condition that such services are provided by an entity which also provides postal services and that the market is not yet open to competition: mail management services (e.g. mailroom management services), added-value services linked to and provided entirely by electronic means (e.g. the secure transmission of coded documents, address management services), direct mail bearing no address, financial services (e.g. postal money orders and postal giro transfers), philatelic services and logistics services;
  • the exploitation of a geographical area for the purpose of exploring for or extracting oil, gas, coal or other solid fuels, or the provision of airports and maritime or inland ports or other terminal facilities to carriers by air, sea or inland waterway.

Contracts awarded in the sectors in question are no longer subject to the Directive if effective competition exists. Member States have had the possibility of asking the Commission to adopt a decision testifying to the existence of effective competition in a Member State for a given sector in accordance with a specific procedure. This procedure is based on the characteristics of the goods and services under consideration, the existence of alternatives, prices and the presence of several competitors. On its own initiative or at the request of the national contracting entities, when the national transposition of the directive allows them to do so, the Commission may adopt a decision testifying to the existence of effective competition in a Member State and for a given sector. If no decision is made within the deadline set, the exclusion becomes applicable.

Revised thresholds

The directive applies to contracts that have a value excluding VAT estimated to be no less than the following thresholds:

  • EUR 400 000 in the case of supply and service contracts;
  • EUR 5 000 000 in the case of works contracts.

These thresholds are re-calculated by the Commission every two years. The calculation of their value is based on the average daily value of the euro, expressed in special drawing rights (SDR), over the 24 months ending on 31 August for the revision with effect from 1 January.

For those Member States that have not adopted the single currency, the value of these thresholds calculated and published by the European Commission in the Official Journal when the recalculated thresholds in Euros are published.

Certain contracts are excluded or reserved

The scope of the directive excludes:

  • works and service concessions in the sectors of activity concerned;
  • contracts awarded for purposes of resale, lease to third parties, for purposes other than the pursuit of an activity in the sectors concerned or for the pursuit of such an activity in a third country.
    The Commission may publish in the Official Journal the list of the categories of products and activities excluded;
  • contracts which are secret and require special security measures or are awarded pursuant to international rules;
  • certain contracts awarded by a contracting entity to an affiliated undertaking or awarded by a joint venture formed exclusively by a number of contracting entities for the purpose of carrying out the activities concerned.
  • By definition, contracts attributed to an undertaking whose annual accounts are consolidated with those of the contracting entity or is subject to a dominant influence by virtue of ownership, financial participation, or the rules which govern it.
    Contracting entities must notify the Commission of the names of the undertakings or (joint) ventures concerned and the nature and volume of the contracts involved;
  • service contracts awarded on the basis of an exclusive right;
  • service contracts for the acquisition or rental of land, existing buildings or other immovable property or concerning rights thereon (excluding financial service contracts concluded at the same time as, before or after the contract of acquisition or rental); arbitration and conciliation services; financial services in connection with the issue, sale, purchase or transfer of financial instruments (such as transactions to raise money or capital); employment contracts; and research and development (RTD) services wholly remunerated by the contracting entity;
  • contracts awarded by certain contracting entities for the purchase of water and for the supply of energy or of fuels for the production of energy;
  • certain contracts subject to special arrangements in Germany, Austria, the Netherlands and the United Kingdom and in the field of the exploration or extraction of oil, gas, coal and other solid fuels.
  • certain contracts awarded in the fields of defence and security covered by Directive 2009/81/EC.

Member States may reserve participation in certain public contracts to sheltered workshops or provide for such contracts to be performed in the context of sheltered employment programmes where most of the employees concerned are handicapped persons.

Rules applicable to contracts

Contract award criteria

The criteria used by the contracting entities are:

  • either the lowest price only;
  • or, where the contract is awarded to the most economically advantageous tender, various criteria linked to the subject-matter of the contract in question (quality, price, technical merit, aesthetic and functional characteristics, environmental characteristics, etc.). As a general rule, the contracting entity should specify the relative weighting it gives to each of the criteria.

Rules on publication and transparency

Throughout the procedure, public contracts whose value exceeds the thresholds in the Directive are subject to obligations regarding information and transparency. This takes the form of publishing information notices drawn up in accordance with standard Commission forms. There are several types:

  • the notice of the publication of a periodic indicative notice (not compulsory);
  • the periodic indicative notice for supplies and services contracts in excess of EUR 750 000 and for works contracts of more than EUR 5 000 000. The contracting entity publishes this notice on its buyer profile itself (after having sent the notice of the publication of a periodic indicative notice) or sends it to the Office for Official Publications of the European Communities (Publications Office).
  • This publication is compulsory when the contracting entity wishes to reduce the time limits for the receipt of tenders or when the notice is used as a means of calling for competition;
  • the contract notice or notice of a design contest (compulsory).
  • The contracting entity may publish this notice itself nationally and should send it to the Publications Office. Publication by the Publications Office is free. The notice is published in full in an official language of the Community, and a summary is translated into the other languages;
  • the contract award notice and notice of the results of a design contest (compulsory).
  • the notice on the existence of a qualification system.

The notices sent by the contracting entities to the Commission can be transmitted by traditional or electronic means. Standard forms and details on transmission procedures are accessible on the information system for public procurement (SIMAP).

The contracting entity shall provide information on the decisions reached concerning the award of a contract, including grounds for not awarding it. For all contracts, it must be able to justify its decisions and should keep all the appropriate information for at least four years. It shall, as soon as possible, inform:

  • any unsuccessful candidate of the reasons for rejecting his/her application;
  • any tenderer who has made an admissible tender of the relative advantages of the tender selected, as well as the name of the economic operator chosen.

The exchange and storage of information involving the various parties to the contract ensure the integrity of the data and confidentiality. The contracting entity only examines the content of the tenders after the time limit set for submitting them has expired. Use of electronic means is non-discriminatory and helps to speed up the procedures. Devices for the electronic receipt of tenders permit the use of electronic signatures, guarantee the authenticity, integrity and confidentiality of the data and are capable of detecting possible fraud.

Technical specifications

The technical specifications define the characteristics required of a material, supply or service such that they fulfil the use for which they are intended. They are out in the contract documentation (contract notices, contract documents or additional documents) without creating unjustified obstacles to competition. These characteristics include environmental performance, design, conformity assessment, performance, safety, dimensions, quality assurance, and production methods. For public works contracts, they also cover test, inspection and acceptance conditions, as well as construction techniques. In any case, they must be related to the subject of the contract.

When drawing up its technical specifications, a contracting entity refers to national standards transposing European standards, European technical approvals, and international standards. It can also determine performance and functional requirements, particularly in the environmental domain (e.g. European Eco-label). The tender is valid if it manages to prove that it meets the requirements defined by the technical specifications in an equivalent fashion. An appropriate means may be constituted by the submission of a technical dossier or a test report from a recognised body (laboratory, certification and inspection body).

In principle, technical specifications do not mention a specific make or process nor do they refer to trade marks, patents or a specific production.

Economic operators’ capabilities, combating fraud and corruption

European public procurement legislation provides conditions, which may be required for the purposes of participation in public procurement. These conditions aim to check the suitability of economic operators tendering for contracts on the basis of criteria relating to their economic and financial capacity, and their technical and professional knowledge or abilities.

The conditions for participation also aim to effectively combat fraud and corruption, systematically excluding from public procurement contracts any economic operators who have been found guilty of participating in a criminal organisation or of corruption, fraud or money laundering. A contracting authority may ask tenderers for any document testifying to their professional conduct and/or economic situation. To obtain this information, it may turn to the competent national authorities or those of another Member State. It should be noted that the application of these exclusion clauses is only compulsory for contracting authorities. For other contracting entities (public enterprises and private enterprises with a special or exclusive right), these clauses are optional.

Any economic operator may be excluded from participation in a public contract where that economic operator:

  • is bankrupt (or the subject of proceedings for a declaration of bankruptcy), is being wound up, has suspended business activities or his/her affairs are being administered by the court;
  • has been convicted of any offence concerning his/her professional conduct;
  • has been guilty of grave professional misconduct (e.g. misrepresentation);
  • has not paid social security contributions or taxes.

Traditional and electronic means of communication are on equal footing

With regard to the exchange of information, the new directive places traditional and electronic means of communication on equal footing. It leaves market operators free to choose which means of communication to use for the procedures. If electronic means are used, the contracting entity is able to reduce the time limits (but within irreducible margins):

  • the electronic transmission of notices used as a means of calling for competition (depending on the individual case, a contract notice, periodic indicative notice or notice on the existence of a qualification system) makes it possible to reduce by seven days the time limit for the receipt of tenders in open procedures. The same applies for the receipt of requests to participate in restricted and negotiated procedures;
  • on top of the previous reduction, time limits for the receipt of tenders in open, restricted and negotiated procedures may be further reduced by five days where the contract documents are available on the Internet.

A new purchasing technique has entered the scene: the dynamic purchasing system. It is exclusively based on electronic means of communication.

Electronic auctions

A contracting entity may hold an electronic auction to award a contract. This is valid for all types of contract, with the exception of certain works and service contracts having as their subject-matter intellectual performances (e.g. the design of works). The electronic auction shall be based:

  • either on prices when the contract is awarded to the lowest price,
  • or on prices and/or the values of the features of the tenders, when the contract is awarded to the most economically advantageous tender.

The specifications shall contain the following details:

  • the quantifiable features (figures or percentages) whose values are the subject of the electronic auction and the minimum differences when bidding;
  • the electronic auction process and the technical specifications for connection.

Before proceeding with the electronic auction, the contracting entity shall make a full initial evaluation of the tenders. All tenderers who have submitted admissible tenders shall be invited to take part simultaneously by electronic means. The invitation shall state the date and time of the start of the auction and, if appropriate, the number of phases. It shall also state the mathematical formula to be used to determine automatic rerankings, incorporating the weighting of all the award criteria. Throughout each phase, the participants shall know their relative rankings compared to the other participants, but without knowing their identity.

The electronic auction shall close either at a date and time fixed in advance, or when a certain amount of time has elapsed after receipt of the last submission, or when the number of phases in the auction has been completed.

Rejection of tenders that are abnormally low or contain products originating in third countries

A contracting entity may reject a tender if it:

  • is abnormally low, particularly because the tenderer has obtained State aid which was granted illegally; it should, however, give the economic operator the opportunity to justify the constituent elements of its tender.
  • contains products amounting to over 50 % of its value which originate in third countries with which the Community has not concluded multilateral or bilateral market access agreements for Community enterprises.

Member States shall inform the Commission of any general difficulties encountered by their enterprises in securing the award of service contracts in third countries. They may, for example, report the non-observance of international labour law provisions. The Commission shall, at the same time, draw up an annual report to the Council on negotiations with third countries regarding access for Community enterprises to the markets covered by this Directive in these countries. It may propose that the Council restrict (or suspend) access to service contracts in the European Union covered by this Directive to enterprises with links to these third countries.

Public procurement procedures

There are different public procurement procedures: the open procedure, the restricted procedure, and the negotiated procedure with or without the publication of a public contract notice. However, the competitive dialogue introduced in 2004 for the Classic Directive is not available for the special sectors.

Contracting entities may award a contract without a prior call for competition under the following conditions:

  • when no suitable tenders or applications have been submitted in response to a prior call for competition; where a contract is awarded purely for the purposes of RTD; when, for technical or artistic reasons, or for reasons connected with the protection of exclusive rights, the contract may be executed only by a particular economic operator; in cases of extreme urgency brought about by unforeseeable events; for contracts based on a framework agreement, when this has been concluded in accordance with the Directive;
  • supply contracts: for additional deliveries where a change of supplier would oblige the contracting entity to acquire material having different technical characteristics; for supplies quoted and purchased on a commodity market; for bargain purchases or purchases of supplies under particularly advantageous conditions from an economic operator definitively winding up his business activities or in receivership;
  • for additional works or services which were not included in the initial project and have become necessary through unforeseen circumstances;
  • for new works consisting in the repetition of similar works;
  • for public service contracts, when the contract should, according to the rules of the contest, be awarded to the successful candidate in the design contest.

The open procedure

In an open procedure, any interested economic operator may submit a tender.

The minimum time limit for the receipt of tenders is 52 days from the date on which the contract notice was published. If a periodic indicative notice has been published, this time limit can be cut, as a general rule, to 36 days. In no case may the time limit for the receipt of tenders be less than 22 days.

The restricted procedure

In the case of restricted procedures, any economic operator may request to participate and only candidates invited to do so may submit a tender.

The time limit for the receipt of requests to participate is, as a general rule, 37 days from the date of the notice (or the invitation to confirm interest, when the call for competition is made by means of a periodic notice). In no case may it be less than 22 days (or 15 days if the notice is transmitted electronically). The contracting entity then, simultaneously and in writing, invites the selected candidates to submit their tenders. The time limit for the receipt of tenders, which is the same for all applicants, can be set by mutual agreement between the contracting entity and the selected candidates. If no agreement is reached, the contracting entity fixes a time limit that is, as a general rule, at least 24 days – and never less than 10 days – from the date of the invitation to tender.

The negotiated procedure

In a negotiated procedure, the contracting entity consults the economic operators of its choice and negotiates the terms of the contract with them.

In negotiated procedures with the publication of a contract notice, the procedure and the minimum time limits for the receipt of requests to participate and for the receipt of tenders are identical to those for the restricted procedure.

Service design contests

The directive applies to design contests for service procurement procedures worth over EUR 400 000 or where the contest prizes and payments are in excess of this value.

A design contest may not be held for:

  • contracts awarded for purposes other than the pursuit of an activity in the sectors concerned or for the pursuit of such an activity in a third country;
  • contracts which are secret, require special security measures or are awarded pursuant to international rules;
  • any activity which is exposed to competition.

The contracting entity publishes a contest notice drawn up in accordance with the rules for public procurement procedures. The exchange and storage of information ensures the integrity and the confidentiality of data. The contracting entity examines the projects only after the time limit set for submitting them has expired.

Admission to design contests may not be limited to the territory (or part of the territory) of a Member State or by the legal nature of the participants. The selection criteria are clear and non-discriminatory, ensuring genuine competition. The jury shall be composed exclusively of independent natural persons. Where a professional qualification is required of participants in a contest, at least a third of the jury members shall have this qualification. The jury is autonomous in its decisions and examines the plans on the basis of the selection criteria. Anonymity must be observed until the jury has reached its final decision.

Context

This Directive responds to the need to guarantee the opening up of contracts and a fair balance in applying the rules for granting contracts in the water, energy, transport and postal services sectors. It aims to preserve equal treatment between public sector and private sector contracting bodies.

Key terms used in the act
  • public contract: contract for pecuniary interest concluded in writing between a contracting body and an economic operator, which has as its object the execution of works, the supply of products or the provision of services.
  • (works or service) concession: a contract which differs from a public contract in that the source of revenue for the economic operator consists either solely in the right of exploitation or in this right together with payment.
  • contracting authority: the State, a regional or local authority, a body governed by public law (and their associations) with the ability to engage in public procurement.
  • public undertaking: any undertaking over which a contracting authority may exercise a dominant influence by virtue of their ownership of it, their financial participation therein, or the rules which govern it.
  • economic operator: a contractor, supplier or service provider who responds to an invitation to tender.
  • special or exclusive rights: rights granted by a Member State which limits the exercise of a given activity to one or more entities, and affects the ability of other entities to carry out such activity.
  • postal services: services consisting of the clearance, sorting, routing and delivery of postal items.

References

Act Entry into force Deadline for transposition in the Member States Official Journal

Directive 2004/17/CE

30.4.2004

31.1.2006

OJ L 134 of 30.4.2004

Amending act(s) Entry into force Deadline for transposition in the Member States Official Journal

Directive 2005/51/CE

21.10.2005

31.01.2006

OJ L 257 of 1.10.2005

Regulation (EC) No 2083/2005

1.1.2006

OJ L 333 of 20.12.2005

Regulation (EC) No 1422/2007

1.1.2008

OJ L 317 of 5.12.2007

Directive 2009/81/EC

21.8.2009

21.8.2011

OJ L 216 of 20.8.2009

Regulation (EC) No 1177/2009

1.1.2010

OJ L 314 of 1.12.2009

Regulation (EU) No 1251/2011

1.1.2012

OJ L 319 of 2.12.2011

Successive amendments and corrections to Directive 2004/17/CE have been incorporated in the basic text. This consolidated version  is for reference purpose only.

 

Public access to documents held by the Institutions

Public access to documents held by the Institutions

Outline of the Community (European Union) legislation about Public access to documents held by the Institutions

Topics

These categories group together and put in context the legislative and non-legislative initiatives which deal with the same topic.

Institutional affairs > The decision-making process and the work of the institutions

Public access to documents held by the Institutions

This Green Paper launches a public consultation on access to documents held by the Institutions. The Commission takes stock of the implementation of the legislation on this subject. It proposes that the current rules should be revised to include a more active dissemination policy for documents. They should incorporate developments in the area of the environment into the regime for obtaining access to documents and strike a fair balance between the rights of the public and the protection of public and private interests.

Document or Iniciative

Commission Green Paper of 18 April 2007, “Public Access to Documents held by Institutions of the European Community – A review”, [COM(2007) 185 final – Not published in the Official Journal]

Summary

This Green Paper is intended to amend the Regulation on public access to European Parliament, Council and Commission documents (Regulation (EC) No 1049/2001). This Regulation has made available to the public a considerable number of previously unpublished documents. However, judgments from the Court of First Instance, complaints settled by the European Ombudsman, and other legal developments have made it necessary to review this Regulation.

The Commission launched a broad consultation on this subject which ran from mid-April to mid-July 2007. It will publish a report on the results of the consultation in September 2007 and submit its proposals for amending the Regulation on access to documents held by the Institutions in October of the same year.

In this Green Paper, the Commission first takes stock of the rules on access to the documents. It then suggests improvements to these rules and asks participants in the consultation to evaluate its proposals.

Taking stock of the rules on public access to documents

Experience confirms that the Regulation’s functioning has been more than satisfactory, as demonstrated by the fact that the Commission grants two out of three requests for access. There has been a steady increase in the number of initial access requests submitted to it, while the number of confirmatory requests (i.e. applications asking the Commission to reconsider a refusal to grant access) remains stable. Appeals have been submitted to the Court of Justice, as have complaints to the European Ombudsman, but these account for only a very small proportion of the total number of requests handled.

Although the implementation is satisfactory, it is nonetheless necessary to re-examine the Regulation in order to clarify certain provisions, to incorporate the case-law of the Court of First Instance in this area, and lastly, to take account of the latest developments regarding access and transparency.

Firstly, certain points need to be clarified. For example, the right of access to documents is sometimes in opposition to the right to protection of personal data. For this reason, the relationship between public access and a privileged right of access to relevant documents which cannot be disclosed to the public must be clarified. Secondly, improvements could be made to the dissemination of information that can be made accessible to the public, for example, with regard to the scope of the registers, the number of documents directly accessible to the public and the user-friendliness of the electronic information systems.

Furthermore, the Commission would like to point out that the Court of First Instance has already clarified many of the Regulation’s provisions, concerning its general characteristics, procedural issues or exceptions to access to documents. It would be wise for the Commission to include this case-law in new Community legislation.

Finally, other developments make it necessary to re-examine the regulation, such as:

  • The application of the Århus Convention to Community Institutions and bodies (Regulation (EC) No 1367/2006): this agreement applies to environmental information. It guarantees the public the right of access to environmental information held by the Community Institutions and bodies. These must also make environmental information available to the public in easily accessible electronic databases. The Commission points out that certain provisions of Regulation (EC) No 1049/2001 and Regulation (EC) No 1367/2006 partly overlap, such as their scope and their beneficiaries. Regulation (EC) No 1049/2001 lays down a general regime for access to documents while Regulation (EC) No 1367/2006 concerns only access to environmental information . Similarly, Regulation (EC) No 1049/2001 applies only to the Parliament, the Council, the Commission and the Community agencies, while Regulation (EC) No 1367/2006 applies to all of the Institutions and Community bodies. Lastly, certain exceptions to the right of access laid down in the two Regulations do not completely correspond. Although the two regimes are largely convergent, some differences could lead to differing interpretations and make it necessary to re-examine the Regulation;
  • The transparency of Council meetings: the Council recently amended its rules of procedure in order to make its decisions more transparent. Its public deliberations and debates are now published on the Internet in all the official EU languages, which goes beyond the scope of Regulation (EC) No 1049/2001.

Proposed improvements to rules on access to documents

In light of this, the Commission has concluded that the current rules need to be amended to:

  • improve direct access to documents;
  • better inform the public on the activities of the European Institutions;
  • clarify the legal framework;
  • strike the right balance between the public’s right to know and the protection of legitimate public and private interests.

In order to fulfil these objectives, the Commission is launching a consultation on various proposed measures. It suggests, for example, improving the rules on access to documents by adopting a more active dissemination policy, by integrating the rules on access to environmental information into the general system of access to documents, and, lastly, by clarifying the provisions of the Regulation which are likely to create conflicts of interest.

The Commission proposes making the legislative process of the EU Institutions more transparent and more easily accessible to the general public. To achieve this, it suggests clarifying the concept of “legislative documents”, which should in principle be directly accessible in full to the public. The stage of the procedure at which they should be published should also be specified and they should be made easier to access.

Subsequently, it asks participants in the consultation to evaluate several proposals, including:

  • More systematic dissemination to the public of documents held by the Institutions. The Institutions already publish large amounts of information on their web sites such as EUR-Lex, Prelex, the European Parliament ‘s Legislative Observatory, and the Parliament’s, Commission’s and Council’s document registers, and the Register on comitology. However, the Commission queries whether the information provided through document registers and on the websites of the Institutions are sufficiently comprehensive and easy to access. It also wonders whether active dissemination of information should perhaps focus on certain specific fields.
  • Integrating the rules on access to environmental information into the general system of access to documents. As mentioned above, Regulation (EC) No 1049/2001 and the rules on access to environmental information diverge on several points and may give rise to different interpretations. The Commission therefore proposes to amend Regulation (EC) No 1049/2001 to incorporate the rules on access to environmental information. Such an amendment would maintain a single regime for access to documents held by the Parliament, the Council and the Commission, providing greater consistency and legal clarity for citizens. In order to put into place a single regime, the system of exceptions to the right of access would then have to be revised, for example, by adding exceptions intended to protect the environment.

And lastly, the Commission presents concrete solutions intended to strike the right balance between certain interests which sometimes come into conflict, such as:

  • Public access and the protection of personal data: In order to balance these two sometimes contradictory rights, the Commission proposes that, in the new Regulation, the Institutions define a series of criteria for the disclosure of personal data. These criteria would be based on two principles. Firstly, the disclosure of the data must be justified in the public interest. Secondly, it must not affect the person’s privacy or integrity;
  • Public access and commercial or economic interests: There are specific rules on access to information obtained in the framework of investigations on state aid, anti-trust, merger, trade defence or anti-fraud cases, as well as in public procurement and grant award procedures. The Commission is of the opinion that the specific rules and the Regulation need to be made consistent. It therefore proposes that the new Regulation provide that no access can be granted to documents containing information known to a limited number of persons, the disclosure of which is liable to cause serious harm to legitimate interests of the person who has provided it or to third parties.
  • Public access and good administration: Certain requests for documents entail a heavy workload. In order to reconcile transparency with the principle of good administration, the Commission proposes that three parameters be taken into account: the amount of documentation requested, the definition of documents held by the Institutions, and lastly, the effect of the passing of time on the application of the exceptions on access to documents. The Commission therefore suggests that specific provisions should be laid down for handling requests which are clearly excessive or improper, in particular with regard to time frames. In the case of particularly voluminous or complex requests, the Institutions may only extend the time limit for a reply by 15 working days. Nor, on this basis, can they reject requests which are clearly intended to block a service’s normal operations. The Commission also suggests that the concept of a “document held by the Institutions” be clarified and should cover information held in electronic databases that can be extracted using the existing search tools. Lastly, the Commission proposes that the events before and after which exceptions would or would not apply be specified.

This fact sheet is not legally binding on the European Commission, it does not claim to be exhaustive and does not represent an official interpretation of the text of the Treaty.