# CE2004084EN.01047201.xml

| 3.4.2004 | EN | Official Journal of the European Union | CE 84/472 |
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3.4.2004

EN

Official Journal of the European Union

CE 84/472

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(2004/C 84 E/0546)

WRITTEN QUESTION E-1571/03

by Erik Meijer (GUE/NGL) to the Commission

(8 May 2003)

Subject:   Solutions for environmental problems in Flanders without increasing dependence on private firms

Subject:

| 1. | Does the Commission's criticism of the significant involvement of the Flemish government since 1990 in tackling environmental problems relate exclusively to the advantages secured by firms operating in free market, including private firms employed by the Flemish government, because of the absence of competition? Are fines to be imposed? What will happen if the firms are declared bankrupt in the meantime? |
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1.

Does the Commission's criticism of the significant involvement of the Flemish government since 1990 in tackling environmental problems relate exclusively to the advantages secured by firms operating in free market, including private firms employed by the Flemish government, because of the absence of competition? Are fines to be imposed? What will happen if the firms are declared bankrupt in the meantime?

| 2. | How can governments, who are responsible for dealing with environmental problems, guard themselves against the efforts of private firms to take over some of their tasks under worse conditions, such as road transport instead of transport by water or restricting their activities to those which are profitable? |
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2.

How can governments, who are responsible for dealing with environmental problems, guard themselves against the efforts of private firms to take over some of their tasks under worse conditions, such as road transport instead of transport by water or restricting their activities to those which are profitable?

| 3. | How can governments keep down the cost of carrying out environmental improvements by avoiding dependence on private companies who see environmental rehabilitation as a valuable market but not as an essential objective? |
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3.

How can governments keep down the cost of carrying out environmental improvements by avoiding dependence on private companies who see environmental rehabilitation as a valuable market but not as an essential objective?

| 4. | Could the problem raised by the Commission be solved if the legal status of the Flemish firms concerned were to be changed from companies with some private shareholders into government services for which the Flemish government, including the Flemish provinces and Flemish intercommunal associations, bear full liability? |
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4.

Could the problem raised by the Commission be solved if the legal status of the Flemish firms concerned were to be changed from companies with some private shareholders into government services for which the Flemish government, including the Flemish provinces and Flemish intercommunal associations, bear full liability?

Sources: De Standard, 9 April and 10 April 2003, De Morgen, 10 April 2003, De Financiëel Economische Tijd, 10 April 2003.

Answer given by Mr Bolkestein on behalf of the Commission

(25 June 2003)

(25 June 2003)

| 1. | As indicated in the answer to Written Question E-l570/03 from Mr Meijer (1), the Commission raised objections, under the public procurement rules, to a number of agreements/measures awarded without prior invitation to tender by the local and regional authorities in the Flemish region relating to certain actions in the field of environmental policy. A dialogue is being conducted with the Belgian authorities in order to reach an out-of-court settlement. It is only if the Belgian authorities should refuse to comply with Community law throughout the entire infringement procedure that the matter would be referred to the Court of Justice under the strict conditions laid down in Article 228(2) and the Court could impose a lump sum or penalty payment on the Belgian authorities. In the meantime, the possible bankruptcy of certain firms involved in this dossier does not seem to be a relevant factor in the analysis conducted by the Commission, which seeks to ensure compliance with Community law and thus require of the Belgian authorities that, when they decide to entrust the conduct of certain economic activities to a third party, the choice of this third party is made after a competitive tendering process. |
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1.

As indicated in the answer to Written Question E-l570/03 from Mr Meijer (1), the Commission raised objections, under the public procurement rules, to a number of agreements/measures awarded without prior invitation to tender by the local and regional authorities in the Flemish region relating to certain actions in the field of environmental policy. A dialogue is being conducted with the Belgian authorities in order to reach an out-of-court settlement. It is only if the Belgian authorities should refuse to comply with Community law throughout the entire infringement procedure that the matter would be referred to the Court of Justice under the strict conditions laid down in Article 228(2) and the Court could impose a lump sum or penalty payment on the Belgian authorities. In the meantime, the possible bankruptcy of certain firms involved in this dossier does not seem to be a relevant factor in the analysis conducted by the Commission, which seeks to ensure compliance with Community law and thus require of the Belgian authorities that, when they decide to entrust the conduct of certain economic activities to a third party, the choice of this third party is made after a competitive tendering process.

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| 2. | In his second question, the Honourable Member asks how governments can guard themselves against poorer environmental conditions which might be applied by private enterprises. In response, it should be noted that the contracting authorities may, within the context of the public contracts which they award and subject to certain conditions, take ecological criteria into consideration, provided that these are linked to the subject-matter of the contract. |
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2.

In his second question, the Honourable Member asks how governments can guard themselves against poorer environmental conditions which might be applied by private enterprises. In response, it should be noted that the contracting authorities may, within the context of the public contracts which they award and subject to certain conditions, take ecological criteria into consideration, provided that these are linked to the subject-matter of the contract.

| 3. | Through his third question, the Honourable Member wishes to find out how governments can keep down the costs of applying environmental measures whilst avoiding dependence on private companies. On this topic, it should be pointed out that the correct application of public procurement legislation should allow proper competitive tendering and thus find the tender offering the best value for money, whilst enabling environmental considerations to be taken into account under the conditions mentioned above. |
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3.

Through his third question, the Honourable Member wishes to find out how governments can keep down the costs of applying environmental measures whilst avoiding dependence on private companies. On this topic, it should be pointed out that the correct application of public procurement legislation should allow proper competitive tendering and thus find the tender offering the best value for money, whilst enabling environmental considerations to be taken into account under the conditions mentioned above.

| 4. | In his fourth question, the Honourable Member wishes to know whether the problem raised by the Commission could be solved by transforming the companies responsible for carrying out environmental work into government services. This question seems to refer to the problem of ‘in house’ relations, which would fall outside the scope of public procurement rules. The Court of Justice has, however, explained with regard to this matter that the rules on public procurement always apply when the State or public authority (acting as the contracting authority) assigns the provision of a service to a third party, except in exceptional situations in which the contracting authority exercises over the body concerned a control which is similar to that which it exercises over its own departments and that body carries out the essential part of its activities with the contracting authority. The obligation to issue a prior invitation to tender could not therefore be evaded simply by taking a 100 % holding in a company (‘Teckal’ judgment of 18 November 1999 in Case C-107/98). |
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4.

In his fourth question, the Honourable Member wishes to know whether the problem raised by the Commission could be solved by transforming the companies responsible for carrying out environmental work into government services. This question seems to refer to the problem of ‘in house’ relations, which would fall outside the scope of public procurement rules. The Court of Justice has, however, explained with regard to this matter that the rules on public procurement always apply when the State or public authority (acting as the contracting authority) assigns the provision of a service to a third party, except in exceptional situations in which the contracting authority exercises over the body concerned a control which is similar to that which it exercises over its own departments and that body carries out the essential part of its activities with the contracting authority. The obligation to issue a prior invitation to tender could not therefore be evaded simply by taking a 100 % holding in a company (‘Teckal’ judgment of 18 November 1999 in Case C-107/98).

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(1)  See page 471.

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