Judgment — ECLI:EU:C:2003:544
Date: 2003-10-16
Language of the case: Spanish
Court formation: Sixth Chamber
Based on: Treaty establishing the European Economic Community (1957)
Subject matter: Right of establishment;Approximation of laws;Freedom to provide services
Concepts: Concept of contracting authority
Procedure: Action for failure to fulfil obligations - successful
Origin: Spain

Summary of the Judgment 
Approximation of laws — Procedures for the award of public works contracts — 
Directive 93/37 — Contracting authorities — Body governed by public law — Defini-
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SUMMARY — CASE C-283/00 
tion — Needs in the general interest, not having an industrial or commercial character — 
Criteria for assessment — Entity carrying on the construction, management and sale of a 
Member State's prison assets — Included 
(Council Directive 93/37, Art. 1(b), second subpara.) 
In order to be defined as a body governed 
by public law within the meaning of the 
second paragraph of Article 1(b) of Direc­
tive 93/37 concerning the coordination of 
procedures for the award of public works 
contracts, an entity must satisfy the three 
cumulative conditions set out therein, 
requiring it to be a body established for 
the specific purpose of meeting needs in the 
general interest not having an industrial or 
commercial character, to possess legal 
personality and to be closely dependent 
on the State, regional or local authorities or 
other bodies governed by public law. 
In this respect, the concept of 'needs in the 
general interest, not having an industrial or 
commercial character', is one of Commu­
nity law and must be given an autonomous 
and uniform interpretation throughout the 
Community, the search for which must 
take account of the background to the 
provision in which it appears and of the 
purpose of the rules in question. That 
concept includes needs which are satisfied 
otherwise than by the supply of goods and 
services in the marketplace and which, for 
reasons associated with the general interest, 
the State chooses to provide itself or over 
which it wishes to retain a decisive 
influence. 
In determining whether or not there exists a 
need in the general interest not having an 
industrial or commercial character account 
must be taken of relevant legal and factual 
circumstances, such as those prevailing 
when the body concerned was formed and 
the conditions in which it carries on its 
activity, including, inter alia, lack of com­
petition on the market, the fact that its 
primary aim is not the making of profits, 
the fact that it does not bear the risks 
associated with the activity, and any public 
financing of the activity in question. 
Accordingly, if the body operates in normal 
market conditions, aims at making a profit 
and bears the losses associated with the 
exercise of its activity, it is unlikely that the 
needs it aims at meeting are not of an 
industrial or commercial nature. 
It follows that a State commercial company 
established for the specific purpose of 
carrying on all activities which prove 
necessary in order to construct, manage or 
sell a Member State's prison assets, must be 
treated as a body governed by public law 
for the purposes of the second paragraph of 
Article 1(b) of the Directive and, therefore, 
as a contracting authority for the purposes 
of the f irs t p a r a g r a p h the reof . 
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COMMISSION v SPAIN 
Consequently, the Directive is applicable to 
the procedures for the award of public 
works contracts conducted by that com­
pany. The needs in the general interest 
which such a company is responsible for 
meeting being, therefore, a necessary con­
dition of the exercise of the State's penal 
powers, they are intrinsically linked to 
public order. 
(see paras 69, 79-82, 84-85, 93-95) 
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