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# 52001AE0515

**Opinion of the Economic and Social Committee on the "Proposal for a Directive of the European Parliament and of the Council on the coordination of procedures for the award of public supply contracts, public service contracts and public works contracts" **

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Official Journal C 193 , 10/07/2001 P. 0007 - 0015 *

Opinion of the Economic and Social Committee on the "Proposal for a Directive of the European Parliament and of the Council on the coordination of procedures for the award of public supply contracts, public service contracts and public works contracts"

(2001/C 193/02)

On 8 September 2000 the Council decided to consult the Economic and Social Committee, under Articles 47(2), 55 and 95 of the Treaty establishing the European Community, on the above-mentioned proposal.

The Section for the Single Market, Production and Consumption, which was responsible for preparing the Committee's work on the subject, adopted its opinion on 7 February 2001. The rapporteur was Mr Green.

At its 381st plenary session on 25 and 26 April 2001 (meeting of 26 April 2001), the Economic and Social Committee adopted the following opinion by 92 votes to 21, with eight abstentions.

1. Introduction

1.1. Following the Commission Green Paper on "Public Procurement in the European Union: Exploring the Way Forward" published in November 1996(1), the ESC unanimously adopted an opinion on 28 May 1997(2).

After analysing the contributions received, the Commission mapped out the perspectives for future action in its Communication entitled "Public Procurement in the European Union" of March 1998(3). The response from the parties concerned by the Green Paper made it clear that there was a need to simplify the relevant legal framework within EU legislation and to adapt it to the new electronic age, while nevertheless maintaining the stability of its basic structure. The Commission has therefore decided to merge the existing directives, in keeping with the conclusions of the Lisbon European Council, which call for economic reforms to complete the internal market and to make it fully operational.

1.2. The present Commission proposal to combine the directives into a single legal text involves the following four aspects:

- simplifying the existing legal framework;

- clarifying unclear or complicated provisions;

- mendments to the content, and

- consolidation of the three "classic directives" so as to merge them into a single text, which is the object of the present proposal.

The ESC welcomes the work done by the Commission with regard to these four aspects, but nevertheless wishes to propose a number of modifications.

1.3. After some general comments on the proposed simplifications, which mainly concern the merger of the three old directives, and on the legislative changes involved, the Committee presents its proposals.

2. Comments on the merger of the three old directives into a single legal text and the resultant simplification

2.1. The directives on public procurement have had very little effect in encouraging liberalisation in this area and so the Commission has decided to remove some of the inconsistencies between the three public sector directives, namely Directive 92/50/EEC relating to the coordination of procedures on the award of public service contracts(4), Directive 93/36/EEC coordinating procedures for the award of public supply contracts(5) and Directive 93/37/EEC concerning the coordination of procedures for the award of public works contracts(6). However, the attempt at clarification has not been entirely successful in that EU legislation on concessions and public-private partnerships (PPPs) is still particularly unclear. The Commission's interpretative Communication on Concessions in Community law(7) of April 2000 should have been incorporated into the proposed merger of texts given its crucial importance. Even though the Commission states that the Communication does not preclude the possibility of a legislative proposal specifically on concessions, it would have been a good idea to include a more concrete definition of concessions contracts and public-private partnerships in the proposed directive so as to avoid continually having to modify EU legislation. The Commission should make a clear-cut decision in favour of one of two options: either it provides a better definition of public works concessions, public-private partnerships and service concessions, since this draft directive covers all these areas, or it points out that such contracts are excluded from the present directive and will be dealt with in a future directive as the Committee has proposed.

2.2. The current directives have been restructured without radically altering the legal obligations which they impose: a single text will henceforth be applicable to supply, works and service contracts. This simplification has advantages for users, but one cannot help feeling that making too many changes to legislation in this field will be detrimental to the legislation itself and the smooth implementation of the rules it is intended to impose. It should also be said that according a high level of protection to public interests causes problems in an area where businesses are often in a more vulnerable position than public purchasers, particularly with regard to time limits for payment.

2.3. It is legitimate for contracting authorities to take social and environmental aspects into account when assessing the quality of tenders, provided that the principle of equal treatment is respected and the current national and European social and environmental legislation is complied with. The Directive should state that ILO Convention 94 (Labour Clauses - Public Contracts) must be complied with.

2.4. The ESC also notes that several factors justify adopting a regulation:

- the importance and complexity of the proposals;

- the range of different national regulations currently in force, which constitute a major obstacle to harmonisation of the European market;

- the number of countries set to joint the EU which may each have their own regulations - some of these countries have never had any regulations on public procurement;

- the range of different local regulations;

- the directives will have to be transposed into national legislation on the grounds that they contain legal innovations.

This raises the question whether it makes sense to adopt a new directive in an area where economic operators and contracting authorities often refer to the wording of the directives when called upon to interpret their own national legal texts. The ESC feels that a regulation would be more appropriate as it would prevent discrepancies between individual countries' formulations in an area where it is extremely difficult to implement the single market, inter alia because of differing national regulations which hinder the opening up of the market. A common text is necessary if European regulations are to be effective.

2.5. The ESC would also take issue with the lack of references in the proposal to environmental considerations which are crucial to Europe's future. Reasonably compatible environmental criteria which are directly related to the products or services to be provided could be incorporated in more specific terms in Article 53. These should only be taken into account when they have a decisive influence on the environmental impact depending on how the tenderers intend to carry out the works.

2.6. Equally remarkable is the absence of any social aspects among the criteria for awarding a contract. Social criteria could also be developed in a specific manner in Article 53. The Committee realises that it is difficult to cover these points in detail and recommends that the future Commission interpretative Communications dealing with environmental and social aspects are transformed into guidelines for Member States, containing the details on how these aspects could be implemented. In addition, the Commission is now working on a Green Public Procurement Handbook in order to guide public authorities on taking into account environmental characteristics when awarding a contract. The ESC recommends the drafting of a Social Procurement Handbook with a view to guiding public authorities in this field also.

2.7. The ESC is in favour of simplifying the directives by merging them into a single text with the effect of replacing three separate legal texts which largely deal with the same questions and comprise, respectively, 35 (supplies), 37 (works) and 45 articles (services), and combining them into a single legal text consisting of 82 articles. The ESC points out, however, that merging the three directives into one obliges the Member States to transpose the new directive, contrary to what is stated in the introduction to the new directive, as it includes amendments and the addition of new provisions.

2.8. The ESC points out that equal competition should be introduced in all Member States and that no Member State should maintain a system of over-regulation, which hampers liberalisation. This does not apply to labour law.

2.9. The ESC has serious doubts as to whether the confidentiality of tenders can at present be guaranteed in practice when contracts are awarded using electronic methods, given that computer piracy seems to be a common phenomenon even within the best protected networks.

3. General comments on the modifications to the legislation

3.1. The ESC welcomes the clarification provided by this new draft directive. It is divided into six titles, namely definitions and general principles, rules on public contracts, granting of special or exclusive rights, rules governing service design contests, rules on concessions, and final provisions. The articles are arranged in such a way as to follow logically the course of a contract award procedure. The ESC is not satisfied with the definition of bodies governed by public law (Article 1(5)) which should be elaborated and clarified. The Commission's draft interpretative Communication on in-house activities should be incorporated into the present draft directive because it should be clearly and precisely spelt out when the rules laid down in European law on the awarding of contracts are to be applied between contracting authorities and operators who are dependent on them. The interpretative Communication on concessions contains some crucial elements in this respect, and these should be included in the present draft, especially the obligation to make the award of contracts subject to competition and the rule on transparency.

3.2. The ESC points out that bodies governed by public law which function as economic operators should not exploit the advantages associated with their status to disregard the rules of competition. It is clear in the EU that administrative bodies or companies with special status enjoy competitive advantages. Supplementary rules are essential to oblige contracting authorities to look into whether public-law bodies are subject to the same burdens in terms of fiscal, social and financial costs as private operators. The obligation to make the award of contracts or commissions equivalent to contracts in the private sector subject to competition should also be imposed on contracting authorities in their dealings with public, semi-public or private bodies which are dependent on them or other commissioning bodies.

3.3. It is also undesirable for private companies to benefit from monopolistic conditions in certain markets. It is therefore essential to ensure that neither public nor private operators are the object of discriminatory treatment in the awarding of public contracts and that the competitive conditions remain uniform for all participants and conform to EU law.

3.4. The ESC can endorse the three principles which the Commission has applied in drawing up the new provisions: modernisation, simplification and flexibility, based on a desire to take account of the advent of the information society, the gradual withdrawal of the State from certain economic activities and increased budgetary austerity. However, the ESC would point out that, in the interests of liberalisation, there is a need for a clearer definition of public contracts and that some clarification is required inter alia of what is meant by "contracts ... which have as their object ... the realisation, by whatever means, of a work corresponding to the requirements specified by the contracting authority." In general it is not satisfactory to retain definitions from the earlier directives as they are unclear, inter alia with regard to concessions, which are mentioned in the next point.

3.5. The Commission proposes seven substantive amendments concerning the introduction of electronic purchasing mechanisms; the introduction of a new negotiated procedure which for particularly complex contracts permits a "competitive dialogue" between the contracting authority and the different candidates; the possibility for public purchasers of concluding so-called "framework agreements"; clarification of provisions relating to technical specifications; a strengthening of the provisions relating to award and selection criteria and a simplification of thresholds. The ESC is pleased to note all these modifications which both public and private operators wish to see, but regrets that the Commission does not make use of the opportunity to come up with a new definition of concessions contracts and contracts concerning public-private partnerships as the Committee has suggested in a number of opinions, most recently in that entitled "Strengthening of the law governing concessions and public/private partnership (PPP) contracts"(8): "A public works concession is an act (whether by contract or unilateral) whereby a public authority delegates to a private organisation the task of designing, constructing, financing, maintaining and operating an infrastructure and/or service for a predetermined extended period."

3.6. The amendments the Commission has proposed to the "utilities directive" 93/38/EEC coordinating the procurement procedures of entities operating in the water, energy, transport and telecommunications sectors(9) in the light of the gradual liberalisation of certain sectors, make it necessary to amend some provisions in the "classic" directives. A general procedure should be adopted for carrying out these amendments.

4. Specific comments on the proposed modifications

4.1. Recognition of the principle of confidentiality (Article 5) with regard to information provided by economic operators is based on the desire to support innovation within enterprises by protecting their intellectual and technical input. However, in a text of this importance, the scope of this principle should have been defined rather more clearly, inter alia regarding what kind of confidential information it covers and how long such information shall be regarded as confidential. The ESC feels that the principle of confidentiality should apply not only to tenders received, but to all proposals submitted to the contracting authority(10), including variant tenders and information on all tenderers, as well as all commercial information and any other information relating to the operation or businesses. This could be implemented with reference to Article XIV of the Government Procurement Agreement.

4.2. The introduction of electronic purchasing mechanisms is necessary because of developments in current methods. The conclusions of the European Council meeting of 23 and 24 March 2000 call upon the Commission, Council and Member States "to take the necessary steps to ensure that it is possible by 2003 for Community and government procurement to take place on-line"(11). The ESC would endorse this, with the above-mentioned proviso that the security of electronic communications and data storage should be considerably improved. The Member States cannot afford to run the risk of sensitive information being intercepted by outsiders or published illegally; it is a crucial condition that electronic submission and acceptance of tenders be made secure. Electronic signature and encryption systems must be reinforced.

4.3. The procedures laid down in current legislation make no provision for the exclusive use of electronic means, and this is not permitted(12). Electronic transmission would make it possible to reduce the time-limit of 12 days which are necessary at the moment for transmission to the Publication Office and publication in the Official Journal. It would thus be possible to reduce the time-limit for publication from 12 days to five. These reductions seem to be excessive in two cases: 1) when the minimum time-limit for submission of tenders is reduced to five days from the time the notice is sent out on the assumption that the contract documents are made available electronically as soon as the notice is sent out. Companies will be unaware that they are available before the notice is published; 2) when the time-limit which companies have to submit their tenders is reduced to a minimum of 10 days in the case of restricted or negotiated procedures deemed to be urgent. In any event it is important that the time saving inherent in electronic procedures should also benefit businesses/tenderers.

4.4. "Competitive dialogue" between contracting authorities and tenderers is an excellent innovation in that contracting authorities should have the opportunity to consider innovative solutions when they are unfamiliar with or objectively unable to assess what the market has on offer in terms of technical or financial solutions. In the light of the case law of the Court of Justice, such a dialogue is not allowed under the current open and restricted procedures, and the current provisions on the use of a negotiated procedure with prior publication are limited to exceptional situations. The ESC endorses this proposal, but would reiterate that the principle of confidential treatment of the information provided by operators should be elaborated and clarified.

4.4.1. It is therefore right that the Commission should wish to introduce provisions enabling dialogue to take place in a single award procedure which will result in the contract being carried out. However, it is desirable for the procedure to incorporate a phase during which the specifications would be established on the basis of negotiations with the selected participants, followed by the submission of tenders by the participants in the negotiations and then by the award of the contract to the best tender. This is the only way to really take account of the interests of the businesses participating in the dialogue. However, this is not the procedure set out here. Instead, the Commission is proposing that at the end of the negotiations with selected participants to determine how its needs can best be satisfied, the contracting authority will define the final technical specifications either by retaining one of the solutions presented by one of the participants or by combining more than one of the solutions presented (cherry picking).

4.4.2. The ESC notes that this is tantamount to the Commission giving the contracting authority the opportunity to appropriate the results of participants' inventiveness and innovation and to create competition between them. It is reasonable to expect that under these circumstances applicants will be reluctant to submit highly detailed proposals if these are going to be in competition with their commercial competitors. If each candidate were invited to submit their best and final tender after the negotiation stage based on the proposals they submitted earlier, the draft directive would be consistent with standard legislation on the procurement of goods, construction and services drawn up by the United Nations Commission on International Trade Law which refers to a procedure involving a "request for proposals" (Article 48). The ESC therefore feels that the provisions on complex procurement should be amended and clarified in line with the above comments in order to strike a better balance between the interests of the contracting authority and economic operators. This is a clear move away from so-called "cherry picking". The ESC also feels that these procedures will enable SMEs to take part in large-scale projects.

4.5. The Commission considers it necessary to introduce more flexible purchasing techniques using framework agreements as a means of revamping the directive with a view to permitting the use of flexible purchasing techniques enabling purchasers to benefit from product developments and price changes. Framework agreements are not contracts to the extent that they do not lay down specific terms and thus cannot give rise to performance as a contract does. The ESC has its doubts about this measure, and feels it should not be part of the directive. It constitutes nothing more than a pre-selection, in that "framework agreements" are to be used in the case of repetitive purchases to choose certain economic operators who, when the time comes, will be able to meet the purchasers' needs, enabling purchases to be made under better conditions in keeping with the constant development of the market for certain products and services. Exempting contracting authorities from the obligation to publish details of contracts awarded once a framework agreement is in place is questionable in the light of the overall objective of transparency in the conditions governing the awarding of public contracts. There is also a risk that the envisaged procedure will encourage certain contracting authorities to haggle over prices.

4.6. The current provisions on technical specifications(13) are designed to require public purchasers to define technical specifications by reference to an exhaustively listed set of instruments so as to avoid conferring any advantage on a given economic operator or giving preference to national production. The most important of these instruments is the standard - preferably European, international or failing that, national; European Technical Approval for e.g. building products (cf. Directive 89/106/EEC) may also be used as a reference.

4.6.1. Application of the provisions of the directives has led in certain cases to a situation where standards have been treated as de facto requirements, thereby limiting the buyer's choice to only those products which comply with the standard and introducing hidden constraints.

4.6.2. This obstructs the introduction of technological innovations. The proposed changes apply to all purchases of goods, works and services under the so-called "classic" directives as well as purchases under the Utilities Directive.

4.6.3. The ESC feels that the new wording (Article 24) is to be welcomed in that it adds performance and functional requirements to the list of permitted references (Article 24(5) ff.)

4.7. Article 25 allowing recourse to variants, including the provision that these should be subject to the same provisions as for technical specifications, is also to be welcomed. The use of standards in individual countries must not lead to a situation where an experimental standard is recognised on an equal footing with a fully valid European standard.

4.8. The existing directives provide for publication of invitations to tender in the Official Journal ("S" supplement) and in the TED database. The proposed directive merely states that the EU Publications Office must publish notices of calls to tender through the official channels. It is therefore no longer a requirement that calls to tender be accessible on a particular database, but simply that they be made public on the Internet and in a non-indexed form. Some 3000 to 4000 invitations to tender are published every week, making it difficult, especially for SMEs, to determine which of these are relevant to their field of activity. The ESC has misgivings about calls to tender not being published on the TED or similar indexed database, which can be searched quickly and accurately. The Committee therefore feels that invitations to tender should at the very least continue to be published in this database.

4.9. Strengthening the provisions relating to award and selection criteria is an excellent innovation in that the current provisions concerning award criteria (Article 36(2) of Directive 92/50/EEC, Article 26(2) of Directive 93/36/EEC and Article 30(2) of Directive 93/37/EEC) stipulate that these criteria must be listed in the contract notice or in the contract documents, "where possible" in descending order of the importance attached to them by the contracting authority. This provision is far from binding as regards the mention of a descending order of importance, and contracting authorities still enjoy a considerable margin of discretion when awarding contracts. It makes sense to establish a general rule making it compulsory to state the relative weighting of the criteria from the start of each procedure. The aim of the new directive is to make it compulsory to state the relative weighting of each criterion at the contract notice stage or in the contract documents(14). The ESC fully endorses the weighting of criteria for awarding the contract to the most economically advantageous tender under Article 53 of the directive as this will increase transparency in the procedures for awarding contracts and ensure equal treatment of tenderers. The obligation to apply objective criteria announced in advance so as not to limit the number of candidates invited to tender in the case of restricted and negotiated procedures is also an excellent provision. A guarantee of remuneration according to the legal and administrative provisions in force in individual states cannot be required for services by self-employed persons, e.g. architects and lawyers, alone. There must also be some binding provision in the directive giving analogous material protection for the established rights of workers in the EU. The following should therefore be inserted in the first sentence of Article 53(1) after "... of certain services": "... and existing remuneration obligations deriving from collective agreements and laws in force in the place where the contract is to be carried out, ...".

4.9.1. If the contracting authority can justify the provisions on complex contracts (Article 29) the proposed arrangements may be deemed satisfactory. The ESC would stress that it is not desirable to give too narrow and complex a definition of the term "public contract" as both economic and technical developments make an exact specification difficult. Nevertheless, the ESC welcomes the fact that the contracting authority is required to state the criteria and weighting in the invitation to tender (for restricted and negotiated procedures) or in the invitation to participate in the dialogue (for negotiated procedures in the case of complex contracts). In other cases - open procedures - failure to state the relative weighting right at the start of the procedure may render the procedure void.

4.9.2. The directive leaves it up to the contracting authority to set the specific level of economic operators' capacity and experience required for a given contract; this makes it possible to select applicants on the basis of their ability to carry out the contract under optimum conditions. In the case of restricted procedures and negotiated procedures with publication of a contract notice, imposing the obligation to justify any limitation of the number of applicants on the basis of specific levels of capacity and experience increases the transparency of these procedures.

4.9.3. Similarly, the Committee proposes that the text of the Directive specifies that a tenderer could also be excluded if a serious infringement of social or environmental laws has been established. This is already possible under the current Directives but it will be reinforced and clarified by a specific mention in the text of the future Directive.

4.9.3.1. In particular, the Committee believes that consideration should be given to the personal record of the tenderer, excluding from participation in a contract any economic actor who has breached employment laws, including equal treatment provisions, of the Member States. In this way procurement agencies could exclude tenderers who do not respect national and regional regulations which aim to achieve certain social objectives.

4.9.3.2. It is also important to evaluate the technical and professional abilities of tenderers through establishing certain criteria which allow verification of compliance with compulsory legislation regarding the promotion of employment, integration of persons excluded from the labour market and equal treatment, such criteria to be duly published in the notice for tender.

4.9.4. As regards Article 49, the ESC would point out that some Community countries use a system of service certification and this type of certification should be included among the criteria referred to in this article, but without allowing it to become a hidden obstacle to competition.

4.10. In the case of abnormally low tenders (Article 54) it should be stipulated that contracting authorities are to examine tenders which seem to be abnormally low compared to the others submitted in line with the Government Procurement Agreement (Article XIII(4)(a)). It should be clearly stated that the tenders in question are to be rejected if adequate justification is not forthcoming. The ESC proposes that the directive should incorporate a method of providing contract (or performance) bonds and would provide an option for the contracting authority to require such a bond for large contracts, i.e. those which exceed the thresholds provided for in Article 8c of the Directive. The objective should be to guarantee transparency and equality of treatment with regard to fiscal and economic conditions. The contracting authorities must follow a specific procedure for identifying, examining and eliminating such tenders regardless of whether the tenderers are public or private bodies.

4.11. The current directives lay down a wide range of thresholds. Often, it is not easy to establish which threshold is applicable to a specific public contract. There is an urgent need to reduce the number of different thresholds and to remove all references to "the equivalent in euro of SDR", stating all thresholds in euros up to the full extent compatible with the Community's international obligations under the Government Procurement Agreement (GPA), concluded in the Uruguay Round multilateral negotiations(15). The thresholds will henceforth be stated in euros and rounded up. The ESC regards the proposed thresholds as satisfactory(16).

4.12. Use of a Common Procurement Vocabulary (CPV) was the subject of a Commission Recommendation in 1996(17). This nomenclature represents a further development of and an improvement to the CPC and NACE nomenclatures in that it is better suited to the specific characteristics of the public procurement sector. Since the CPV will be the subject of a proposal by the Council and the Parliament for it to be formally adopted as the Community nomenclature applicable to public contracts, and this proposal will lay down arrangements for its revision, the ESC is not in favour of it being retained in the present directive.

4.13. The ESC wholeheartedly endorses the repetition of Article 55 on exclusive rights as this is extremely important. Unfortunately, simply repeating it does not solve the question of prior awarding of exclusive rights which is a particular problem in the awarding of service concessions. This goes back to the comments made above on concessions contracts and public-private partnerships, and the ESC would reiterate that the interpretative communication is extremely important in this respect in that it states quite clearly that the award of exclusive rights is to be subject to the rules of the Treaty and the guiding principles of Court of Justice case law.

Brussels, 26 April 2001.

The President

of the Economic and Social Committee

Göke Frerichs

(1) Green Paper on Public Procurement in the European Union - Exploring the Way Forward, COM(96) 583 final.

(2) ESC Opinion on the Green Paper, rapporteur Mr Malosse, OJ C 287, 22.9.1997, p. 92.

(3) COM(98) 143 final of 11.3.1998.

(4) OJ L 209, 24.7.1992, as amended by Directive 97/52/EC of 13.10.1997 (OJ L 328, 28.11.1997).

(5) OJ L 199, 9.8.1993, as amended by Directive 97/52/EC of 13.10.1997 (OJ L 328, 28.11.1997).

(6) OJ L 199, 9.8.1993, as amended by Directive 97/52/EC of 13.10.1997 (OJ L 328, 28.11.1997).

(7) Commission interpretative Communication on Concessions in Community law, OJ C 121, 29.4.2000, p. 2.

(8) ESC Opinion, OJ C 14, 16.1.2001, rapporteur Mr Levaux, point 4.1.3.

(9) OJ L 199, 9.8.1993, as amended by Directive 94/22/EC of 30.5.1994 (OJ L 164, 30.6.1994) and Directive 98/4/EC of 16.2.1998 (OJ L 101, 1.4.1998).

(10) For example, outline solutions, authorised variants, proposals submitted during negotiations and anything concerning communications between the contracting authority and businesses.

(11) See Conclusions, point 17, fourth indent.

(12) According to the Commission, it would therefore not appear necessary to provide a transitional period during which the parallel use of traditional means would be compulsory, especially as businesses will benefit de facto from a transitional period by virtue of the time-limits for adoption and transposition put forward in the present proposal.

(13) The Supply (93/36/EEC), Works (93/37/EEC) and Services (92/50/EEC) Directives contain the same provisions regarding common technical rules. The Utilities Directive (93/38/EEC) contains broadly equivalent provisions.

(14) This weighting may take different forms (in particular, it may be expressed as a percentage or in terms of relative share compared with another criterion) and to ensure a certain flexibility, may be expressed as a range within which the value attributed to each criterion shall be stated.

(15) Council Decision 94/800/EC of 22.12.1994 concerning the conclusion on behalf of the European Community, as regards matters within its competence, of the Agreements reached in the Uruguay Round multilateral negotiations (1986 to 1994) (OJ L 336, 23.12.1994, p. 1).

(16) Directive 93/37/EEC: a single threshold of EUR 5300000 applicable to all contracts and concessions falling under the scope of the directive. Directives 93/36/EEC and 92/50/EEC: two thresholds, of EUR 130000 or EUR 200000, depending on whether the contracting authority has the status of a central or of a non-central authority; applicable to all contracts and to design contests falling under the respective scope of the directives.

(17) Commission Recommendation 96/527/EC of 30.7.1996 on the use of the Common Procurement Vocabulary (CPV) for describing the subject-matter of public contracts (OJ L 222, 3.9.1996).

APPENDIX

to the Opinion of the Economic and Social Committee

The following amendments were rejected during the debate, but received more than a quarter of the votes cast:

Point 2.3

Amend as follows:

"When assessing the quality of the tenders, the contracting authorities must in principle work within the objective criteria related to the tender in questionwhich are directly related to the product or service and which are designed to select the best, most favorable tender, in order to avoid discrimination between the tendering parties.

Nevertheless it is legitimate for the contracting authorities to take social and environmental aspects into account, provided that they are designed to ensure that current national and European social and economic legislation is complied with."

Reason

Assessment of tenders for the award of public contracts must be carried out on the basis of criteria directly related to the object of the contract, which further the aim of selecting the best and most advantageous tender, in the interests of transparency, competition, non-discrimination and the most appropriate award of public contracts.

Although environmental assessment criteria may be accepted provided they comply with the principle set out in the paragraph above, we believe that the introduction of social considerations - where not relating exclusively to compliance with a legal requirement - do not have the purpose of assessing tenders objectively in terms of the planned project, but may reflect political issues or the demands of particular social organisations, and these should not encroach upon the award of public contracts. The possibility of public authorities arbitrarily introducing such clauses, which go beyond the requirements of law, inevitably leads to distortions of competition and is damaging to the principle of equality of opportunity and transparency - in contradiction with the aim of the draft directive, which is to harmonise procedures and enhance the functioning of the internal market.

Result of the vote

For: 46, against: 59, abstention: 0.

Point 2.6

Change the second sentence to read:

"Social criteria could also be developed in a specific manner in Article 53, as long as they have no direct or indirect discriminatory effect and are compatible with the main purpose of the contract."

Reason

The further requirement that there should be no discriminatory effect is important in order to prevent protectionist practices. This amendment also corresponds to the text of the parallel opinion INT/074. We must ensure that the two opinions are consistent with each other.

Result of the vote

For: 50, against: 61, abstention: 1.

Point 4.9

Delete the last three sentences (from "A guarantee of remuneration ...").

Reason

The guarantee of remuneration provided for in Article 53 in accordance with legal and administrative provisions in force in individual states is already very problematic. The call to extend this to "collective agreements and laws in force in the place where the contract is carried out" would in practice seriously hamper, if not prevent, cross-border competition. Taking local laws into account would create a high barrier for external competitors. Furthermore, collective agreements are not legal provisions but agreements between the parties. Requiring that they be observed would discriminate against any company not covered by a collective agreement.

Result of the vote

For: 51, against: 61, abstention: 1.

Point 4.9.3

Amend the end of the first sentence to read:

"... if a serious infringement ... has been established by a court".

Reason

Exclusion can only be permitted if a tenderer has been legally convicted.

Result of the vote

For: 40, against: 73, abstentions: 4.

Points 4.9.3.1 and 4.9.3.2

Delete.

Reason

The requirement that tenderers who have breached member state employment laws should be excluded indefinitely and that tenderers should be evaluated on the basis of "certain criteria which allow verification of compliance with compulsory (i.e. national) legislation" would in practice lead to completely unmanageable and possibly even arbitrary discrimination, especially against external competitors. Even minor breaches of national provisions could lead to exclusion of tenderers or prolonged checks and legal disputes. The process of monitoring these criteria alone would cause huge problems for public authorities.

The amended version of point 4.9.3 is sufficient to prevent serious violations. The other requirements go against the principle of proportionality and should not be included.

Result of the vote

For: 53, against: 71, abstention: 1.

The following point in the section opinion was rejected during the discussion in favour of an amendment, but received more than a quarter of the votes cast:

"2.5. The ESC would also take issue with the lack of references in the proposal to environmental considerations which are crucial to Europe's future. Reasonably compatible environmental criteria which do not distort the contract could be incorporated in more specific terms in Article 53. These should only be taken into account when they have a decisive influence on the environmental impact depending on how the tenderers intend to carry out the works."

Result of the vote

For: 48, against: 30, abstentions: 4.