Order — ECLI:EU:C:2019:526
Date: 2019-06-20
Language of the case: Italian
Court formation: Tenth Chamber
Subject matter: Transport
Procedure: Reference for a preliminary ruling
Origin: Italy

Translation C-475/18 — 1 
Case C-475/18 
Request for a preliminary ruling 
Date lodged: 
20 July 2018 
Referring court: 
Consiglio di Stato (Italy) 
Date of the decision to refer:  
24 May 2018 
Appellant: 
SATI — Società Autocooperative Trasporti Italiani SpA 
Respondent: 
Azienda di Trasporti Molisana — A.T.M. SpA 
  
[...] 
The Consiglio di Stato (Council of State, Italy) 
sitting in its judicial capacity (Fifth Chamber) 
makes the following 
ORDER 
in the proceedings [...] brought by  
SATI — Società Autocooperative Trasporti Italiani s.p.a, [...] 
v 
Azienda di Trasporti Molisana — A.T.M. s.p.a. [...] 
intervening party: 
Regione Molise, [...] 
EN 
REQUEST FOR A PRELIMINARY RULING OF 24. 5. 2018 — CASE C-475/18. 
 
2  
[Or. 2] 
seeking variation 
of Judgment No 278/2017 of the Tribunale Amministrativo Regionale per il 
Molise (Regional Administrative Court, Molise, Italy), First Chamber, delivered 
inter partes. 
[...] 
[...] [procedure] 
I. FACTS 
1. The Molise Region, by decision of the Regional Executive Committee of 
30 June 2015, amended the network of minimum regional services of local public 
transport (‘LPT’), providing for an extension of 149 939.750 km on an annual 
basis with a corresponding increase in costs of EUR 330 000.00, plus VAT. 
1.1. In the inquiry document attached to the decision it was stipulated that the 
extension of the network of regional services of LPT would occur as a matter of 
urgency and be temporary in nature pending a review and partial reorganisation of 
the entire service programme of regional LPT. This was rendered necessary by the 
numerous requests received for the timetables of some routes to be amended, for 
lines to be integrated and for new connections to be established [...]. 
1.2. The extension agreed to was directly awarded to the companies with which 
there were already ongoing service contracts for the same routes or different 
routes; specifically, a large part of the new services were, thus, awarded to 
SATI — Società Autocooperative Trasporti Italiani s.p.a. 
II. THE COURT OF FIRST INSTANCE 
[Or. 3] 
2. A.T.M. — Azienda di Trasporti Molisana s.p.a. brought an action before the 
Tribunale amministrativo regionale per il Molise (Regional Administrative Court, 
Molise) challenging that regional decision on the basis of three pleas in law. 
2.1. By its first plea in law it alleged infringement, by the Region, of Article 18 of 
decreto legislativo (Legislative Decree) No 422 of 19 November 1997 and of 
Article 15 of legge regionale (Regional Law) of Molise No 19 of 24 March 2000 
by reason of awarding the newly-established services directly without initiating a 
public tendering procedure for the undertakings interested in operating the 
services; the appellant stated that it would have been interested in participating in 
such a procedure, it being an operator in the sector and having been a LPT service 
provider on behalf of the Region until 2013. 
SATI 
 
3 
2.2. By its second and third pleas in law it alleged infringement, by the Region, of 
Article 16 of Legislative Decree No 422 of 19 November 1997, of Article 11 of 
Regional Law No 19 of Molise of 24 March 2000 and of Article 34 of decreto 
legislativo (Legislative Decree) No 267 of 18 August 2000 by reason of having 
provided for the amendments to the LPT network without carrying out an 
investigation aimed at verifying the existence of grounds in the public interest and 
without reaching prior agreement with the relevant local authorities, as expressly 
required by Article 16, referred to above. 
3. The Molise Region and SATI s.p.a. lodged a defence before the court, 
contending that the action should be dismissed.  
3.1. The proceedings concluded with judgment No 278 of 3 August 2017, by 
which the action was upheld and, consequently, the contested regional decision 
was annulled and the Region was ordered to pay damages to A.T.M. s.p.a. as well 
as the costs of the proceedings. 
3.2. The Tribunale upheld the action for annulment on the following grounds: 
- Article 5 of the EU Regulation on public passenger transport services by rail and 
by road [Regulation (EC) No 1370/2007 of the European Parliament and of the 
Council of 23 October 2007] stipulates that the award of a service contract to a 
third party must take place by means of a tendering procedure; 
- that same provision provides, however, for a derogation from an open 
competition under certain conditions precisely identified therein, making it clear, 
however, that [Or. 4] direct award is permitted ‘unless prohibited by national 
law’; 
- in the present case, despite the service in question being among those which may 
be awarded directly, that option is precluded by Article 18 of Legislative Decree 
No 422 of 19 November 1997, which lays down a general rule for LPT service 
concessions to be awarded by means of an open tender procedure; 
- the open tender procedure rule is reiterated by regional legislation (Regional 
Law No 19 of 2000 and Regional Law No 9 of 2015) and is in line with the 
principles of the EU Treaty as expressed by the case-law of the Court of Justice of 
the European Union and by the European Commission interpretive 
communication of 12 April 2000 on concessions under Community law. 
3.3. The Tribunale also considered the second and third pleas in law to be well 
founded: in establishing the additional LPT services the Region could not evade 
the procedure provided for by Article 16 of Legislative Decree No 422, which 
comprises carrying out a complete investigation that takes into account all the 
parameters set out therein (such as the integration of the transport networks, 
commutes to school and work, the usability of the services and the need to reduce 
congestion and pollution), and involving the local authorities in establishing the 
minimum services. 
REQUEST FOR A PRELIMINARY RULING OF 24. 5. 2018 — CASE C-475/18. 
 
4  
III. GROUNDS OF APPEAL 
4. An appeal has been brought by SATI S.p.A., seeking alteration of that judgment 
on the basis of five grounds. A.T.M. Molise and the Molise Region lodged a 
defence before the court. 
5. The grounds of appeal take issue with the findings in the judgment delivered at 
first instance. 
5.1. In particular, so far as is relevant for present purposes, the grounds of appeal 
focus on the finding that it was not possible to make a direct award even though it 
is accepted by all parties that the service to be awarded features among those 
which, under Article 5 of the EU regulation, the public body has the power to 
award directly. 
[Or. 5] 
5.2. The appellant company claims, more specifically, that the court of first 
instance erred in its interpretation of the national legislation, which in no way 
establishes such an absolute prohibition on directly awarding LPT services where 
EU law requires, in any case, an open tendering procedure to be launched. 
5.3. By its other grounds of appeal, the appellant also contests the part of the 
judgment in which the conduct of the local authority is condemned for having 
disregarded the procedure set out in national and regional legislation for 
establishing the minimum regional LPT services. 
6. The present court takes the view that the grounds of appeal are capable of 
leading to the judgment at first instance being wholly overturned, since they make 
reasonable criticisms which call into question all the considerations that led to the 
action at first instance being upheld. It finds, for that reason, that above all the first 
ground of appeal concerning the question of the possibility of directly awarding 
the newly established services is relevant to the decision of the court. 
IV. NATIONAL AND EU LAW  
7. Article 5 of 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) Nos 1191/69 and 1107/70 
provides in its paragraph 4 that: ‘Unless prohibited by national law, the competent 
authorities may decide to award public service contracts directly: 
(a) where their average annual value is estimated at less than EUR 1 000 000 
or, in the case of a public service contract including public passenger transport 
services by rail, less than EUR 7 500 000; or 
(b) where they concern the annual provision of less than 300 000 kilometres of 
public passenger transport services or, in the case of a public service contract 
SATI 
 
5 
including public passenger transport services by rail, less than 500 000 
kilometres. 
In the case of a public service contract directly awarded to a small or [Or. 6] 
medium-sized enterprise operating not more than 23 road vehicles, those 
thresholds may be increased to either an average annual value estimated at less 
than EUR 2 000 000 or to an annual provision of less than 600 000 kilometres of 
public passenger transport services.’ 
8. Article 18 (Organisation of regional and local public transport services) of 
Legislative Decree No 422 of 19 November 1997 [Transfer of functions and tasks 
in the area of public transport at local level to the regions and local bodies, under 
the terms of Article 4(4) of Legge (Law) No 59 of 15 March 1997] provides, in 
paragraph 2, that: ‘In order to encourage the move away from monopolistic 
structures and to introduce rules of competition into the management of regional 
and local transport services, when awarding service contracts the regions and 
local authorities shall respect the principles of Article 2 of Legge (Law) No 481 of 
14 November 1995, guaranteeing in particular: (a) recourse to competitive 
procedures for the selection of a service operator on the basis of the elements of a 
service contract provided for in Article 19 and in accordance with EU and 
national law on public service contracts. The entities that may participate in 
tendering procedures are those which meet the moral, financial and professional 
eligibility criteria, in accordance with the legislation in force, for the attainment 
of the prescribed licence for the transportation of passengers by road. Companies, 
as well as their parent, associate and subsidiary companies, which hold contracts, 
in Italy or abroad, that do not comply with Article 5, in conjunction with 
Article 8(3), of Regulation (EC) No 1370/2007 of the European Parliament and of 
the Council of 23 October 2007 and that run until after 3 December 2019, may 
not participate in any current or future tendering procedures for the award of 
service contracts. This exclusion does not apply to companies that have been 
awarded a service contract following a tendering procedure. The contract shall be 
awarded on the basis of the best economic conditions and conditions for the 
provision of the service, as well as plans for development and enhancement of the 
networks and systems and the fixing of a minimum utilisation rate for the 
establishment [Or. 7] or maintenance of the individual lines managed. The call 
for tenders must guarantee that the availability, in any capacity, of the networks, 
installations and other facilities essential for the operation of the service does not 
constitute a relevant condition for the evaluation of the bids submitted by the 
tenderers. The call for tenders must also ensure that the goods referred to in the 
previous sentence are, irrespective of who may have them available to them, in 
whatever capacity, made available to the operator awarded the contract following 
a public tendering procedure.’ 
V. THE QUESTION REFERRED TO THE COURT OF JUSTICE OF THE 
EUROPEAN UNION FOR A PRELIMINARY RULING 
REQUEST FOR A PRELIMINARY RULING OF 24. 5. 2018 — CASE C-475/18. 
 
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9. Even in the light of the pleadings of the parties to the proceedings, the present 
court notes that there is uncertainty as to interpretation, which justifies the 
reference to the Court of Justice of the European Union under Article 267 TFEU. 
10. The uncertainty concerns the correct interpretation of EU law (Article 5(4) of 
Regulation No 1370/2007, set out above) in so far as it excludes the possibility of 
directly awarding public service contracts for LPT, even in marginal cases (so-
called de minimis cases), where this ‘is prohibited by national law’. 
10.1 The court asks whether, in order to retain the operation of the 
abovementioned prohibition, it is sufficient that the legislature merely lays down a 
general rule for LPT service contracts to be awarded by means of a public call for 
tenders (as provided for by Article 18(2) Legislative Decree No 422, cited above), 
or whether, rather, it is necessary for there to be a specific prohibition which refers 
precisely to the circumstances in relation to which the EU legislation allows a 
direct award to be made. 
10.2. The answer to the question concerning interpretation is decisive for 
resolving the dispute before the Consiglio di Stato (Council of State): if a specific 
prohibition is required, also referring to the circumstances in which a direct award 
of the contract is permitted under the EU legislation, then, in the absence of such 
express prohibition in Italian law, the Region’s conduct cannot be condemned. 
[Or. 8] 
10.3. There is, moreover, no specific prohibition on directly awarding such 
contracts in the Regional legislation cited in the judgment at first instance. 
VI. THE QUESTION 
11. In the light of the foregoing considerations, the following question is referred 
for a preliminary ruling: 
‘Must Article 5(4) of Regulation (EC) No 1370/2007 of 23 October 2007 be 
interpreted as meaning that national legislation contains a prohibition on directly 
awarding local public transport services, precluding such direct award even in 
circumstances in which it would be permitted by EU legislation, where it 
establishes a general rule that the abovementioned services must be awarded by 
means of a public call for tenders, or is that the case only if there is a specific 
prohibition on directly awarding such contracts that also refers to the 
circumstances in which it is permitted by EU law?’ 
[...] 
[...] Rome, [...] 24 May 2018 […] 
[...] [stay of proceedings and instructions to the Registry] 
SATI 
 
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[Or. 9] 
[...]