Opinion of the Advocate General — ECLI:EU:C:2013:219
Date: 2013-04-11
Language of the case: Dutch
Subject matter: Right of establishment;Approximation of laws;Freedom to provide services
Procedure: Action for failure to fulfil obligations - unfounded
Origin: Netherlands

Summary of the facts 1. By the present action for failure to fulfil obligations, the European Commission alleges that the Kingdom of the Netherlands infringed EU public procurement law since, in connection with the award of a purported public works concession by the municipality of Eindhoven, it failed to fulfil its obligations under Article 2 and Title III of 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. (2) 2. The dispute stems from the decision taken by the municipality of Eindhoven (‘the municipality’) on 7 August 2001 to carry out, within its territory, a construction project in an area located between the existing district of Doornakkers and the new residential district of Tongelresche Akkers. (3) The municipality’s aim was to redevelop that area (‘the Doornakkers centre’), which it owned, by, among other things, giving residents of the two districts access to certain social and cultural services (a healthcare centre, a play, integration and learning centre (‘the SPILcentrum’) and a commercial centre with apartments and housing). 3. On 12 September 2001, the municipal council approved the urban development plans drawn up by the municipality’s staff for the Doornakkers centre project (Annex 2 to the defence). Those plans contain the planning guidelines for the district in the form of a plan and provide for infrastructure and facilities with a view to joining the existing district of Doornakkers and the new residential district of Tongelresche Akkers. The former would have a healthcare centre, commercial premises and apartments. The latter would be home to accommodation and leisure infrastructure, including sports facilities. 4. On 11 April 2002, the municipality’s staff drafted an opinion entitled ‘Selection of a promoter for the Doornakkers district centre’. (4) That opinion informed the municipal council of the criteria to be applied in selecting the purchaser of the land on which the Doornakkers centre project would be carried out. In that opinion it was also stated that the contract for the sale of the plots offered to the contractual partner approached should comply with ‘the framework conditions and guidelines set by the municipality, namely the specifications’, and should ‘meet the … wishes of the purchasers/end users’. (5) 5. These framework conditions and guidelines set out, inter alia, the functions and the heights of the buildings in accordance with the urban development plan. They envisage the construction of apartments and housing, the extension of the existing healthcare centre, a connecting area between the two main sites, good accessibility, an underground car park in accordance with municipal parking regulations, conservation of valuable green spaces, and the creation of a square and a new district park. 6. According to the opinion entitled ‘Selection of a promoter for the Doornakkers district centre’, it was proposed to invite the promoters approached for the project, Hurks and Haagdijk BV, to a discussion. By decision of 23 April 2002, the municipal council decided to follow that opinion. 7. Thus, in mid-May 2002, the municipality invited Hurks and Haagdijk BV by telephone to a meeting scheduled for 11 June 2002. 8. The main topics of that discussion were the abovementioned framework conditions and guidelines and a document entitled ‘Information for prospective promoters participating in a selection process’. 9. On 15 July 2003, the municipality finally selected Hurks as the contractual partner approached for the conclusion of a contract for the sale of the plots concerned. (6) 10. From July 2003 to October 2005, Hurks fleshed out its construction plans into a master plan produced with the assistance of an architects practice. That master plan included numerous drawings specifying the dimensions, locations and spreads of the buildings to be constructed in accordance with the municipality’s framework conditions and guidelines. It was completed on 26 October 2005 and approved by the municipality on 14 February 2006. 11. With a view to implementing the plan, the municipality and Hurks concluded a ‘cooperation contract’ signed by Hurks on 12 June 2007 and by the municipality on 16 July 2007. 12. Alongside these negotiations, on 13 February 2007, the municipality chose Woonbedrijf as the owner of the SPILcentrum. A cooperation contract was signed by the municipality and Woonbedrijf on 15 April 2008. B – Pre-litigation procedure 13. Following a complaint relating to an infringement of EU public procurement law allegedly committed by the municipality in connection with the Doornakkers centre project, on 2 July 2008 the Commission sent the Netherlands Government a letter in which it requested from it information on that centre. The Netherlands Government replied by letter of 19 December 2008. 14. Since the Commission considered these responses to be insufficient, on 24 February 2009 it sent the Netherlands Government a letter of formal notice based on an infringement of EU public procurement law, and specifically Directive 2004/18. The Netherlands Government replied by letter of 30 June 2009. As the Commission was not satisfied by the responses provided by the Netherlands Government, it issued a reasoned opinion on 9 October 2009. 15. Because the Netherlands Government had not changed its position upon the expiry of the time-limit laid down in the reasoned opinion, the Commission instituted the present proceedings. II – Legislative framework 16. Article 1(2) and (3) of Directive 2004/18 stipulates: ‘2.(a) “Public contracts” are contracts for pecuniary interest concluded in writing between one or more economic operators and one or more contracting authorities and having as their object the execution of works, the supply of products or the provision of services within the meaning of this Directive. (b) “Public works contracts” are public contracts having as their object either the execution, or both the design and execution, of works related to one of the activities within the meaning of Annex I or a work, or the realisation, by whatever means, of a work corresponding to the requirements specified by the contracting authority. A “work” means the outcome of building or civil engineering works taken as a whole which is sufficient of itself to fulfil an economic or technical function. … 3. “Public works concession” is a contract of the same type as a public works contract except for the fact that the consideration for the works to be carried out consists either solely in the right to exploit the work or in this right together with payment.’ 17. Article 2 sets out the principles of awarding contracts, according to which ‘[c]ontracting authorities shall treat economic operators equally and non‑discriminatorily and shall act in a transparent way’. 18. Article 16 provides that Directive 2004/18 ‘shall not apply to public service contracts for: (a) the acquisition or rental, by whatever financial means, of land, existing buildings or other immovable property or concerning rights thereon’. 19. Lastly, Title III of Directive 2004/18 contains the rules specifically applicable to public works concessions. III – Analysis A – The legal problems to be examined 20. Before examining the substance of the case, the Court will have to consider three arguments raised by the Netherlands Government in connection with the admissibility of the action: – the Commission’s use of documents which it received or discovered after the reasoned opinion had been issued; – an extension, in the Commission’s application, of the subject-matter of the dispute; – the application ratione temporis of Directive 2004/18. 21. According to the Commission, whose view I share, this latter argument concerns the substance and not the admissibility of the action. I will therefore examine, first of all, the two issues which relate to the admissibility of the action and then consider the temporal application of Directive 2004/18 and the other substantive issues. 22. As far as the substance is concerned, the parties essentially disagree on the notion of ‘public works concession’ within the meaning of Directive 2004/18. According to the Netherlands Government, the Commission does not demonstrate the existence of a public works contract or, a fortiori, the existence of a public works concession. B – Admissibility 23. In accordance with settled case-law, the proper conduct of the pre-litigation procedure constitutes an essential guarantee required by the TFEU not only in order to protect the rights of the Member State concerned, but also to ensure that any contentious procedure will have a clearly defined dispute as its subject-matter. (7) 24. It should be borne in mind in this regard that ‘in accordance with settled case-law, the letter of formal notice sent by the Commission to the Member State and then the reasoned opinion issued by the Commission delimit the subject-matter of the dispute, so that it cannot thereafter be extended. The opportunity for the Member State concerned to submit its observations, even if it chooses not to avail itself thereof, constitutes an essential guarantee intended by the Treaty, adherence to which is an essential formal requirement of the procedure for finding that a Member State has failed to fulfil its obligations. Consequently, the reasoned opinion and the proceedings brought by the Commission must be based on the same complaints as those set out in the letter of formal notice initiating the pre-litigation procedure’. (8) 1. The contested documents 25. According to the Netherlands Government, the Commission is seeking to prove the alleged failure to fulfil obligations on the basis of documents which it communicated to the Commission or which the Commission produced after the reasoned opinion had been issued. Since the Netherlands Government did not have the opportunity to comment on those documents during the pre-litigation stage, the Commission violated its rights of defence. (a) What are these contested documents? 26. As was stated above, the letter of formal notice dates from 24 February 2009. The Netherlands Government replied to it on 30 June 2009. The Commission notified its reasoned opinion on 9 October 2009. 27. However, by letter of 12 May 2010, the Commission sent a fresh request for information to the Kingdom of the Netherlands. The Netherlands Government replied to that request by communicating a number of documents on 11 June 2010. In his reply, the Minister for Foreign Affairs stated that the Commission could not use this information in the present proceedings. 28. One of those documents was nevertheless used by the Commission, together with three other documents which it obtained in the course of its own research after the reasoned opinion had been sent and which it claims are available ‘to the general public’. The four contested documents are therefore, respectively: – the cooperation contract between Woonbedrijf – which will be the owner of the SPILcentrum – and the municipality dated 15 April 2008 (Annex 5 to the application); – an information letter from the municipal council dated 18 March 2008 (Annex 18 to the application); – a regulation adopted by the Minister for Housing, Communities and Integration on 6 October 2009, entitled ‘Temporary incentive scheme for housing construction projects for 2009’ and published in Staatscourant on 12 October 2009 (Annex 19 to the application); – a statement taken from the website of the Ministry of Housing, Spatial Planning and the Environment, dated 14 December 2009 (Annex 20 to the application). (b) The effect of the Commission’s use of these documents on the proper conduct of the procedure? 29. As I stated in point 24 of this Opinion, the reasoned opinion and the proceedings brought by the Commission must be based on the same complaints as those set out in the letter of formal notice initiating the pre-litigation procedure. 30. Thus, ‘the Commission cannot seek a declaration of a specific failure … regarding a particular factual situation that was not referred to in the course of the pre-litigation procedure’. (9) Any specific ground of complaint of that kind must necessarily have been relied on at the pre-litigation stage, in order that the Member State concerned has the opportunity to remedy the particular situation complained of or to avail itself of its right to defend itself in that regard; such defence may in particular prompt the Commission to withdraw the ground of complaint and/or help to delimit the subject-matter of the dispute that the Court will subsequently have before it. (10) 31. However, it should be pointed out that, in the present case, the documents produced by the Commission, whose use is being challenged by the Netherlands Government, regard exclusively the single factual situation which was the subject-matter of the pre-litigation procedure. They do not seek to support a new complaint, but only to illustrate the complaint made in the pre-litigation procedure. 32. More specifically, I note that the first two documents date from March and April 2008 and therefore predate the formal notice. They have a clear link with the factual situation described in that notice and, by their nature, were not unknown to the Netherlands authorities. 33. The first is the cooperation contract signed between Woonbedrijf and the municipality on 15 April 2008. Woonbedrijf had been chosen by the municipality as the owner of the SPILcentrum on 13 February 2007. Furthermore, when the municipality decided, on 14 February 2006, to approve the master plan proposed by Hurks, it stated in its decision that the plan had been prepared by a project unit which included representatives of the municipality and Woonbedrijf. The Netherlands Government could not therefore have been unaware that the relations established between Woonbedrijf and the municipality were part of the dispute. 34. The second is an information letter from the municipal authorities concerning housing developments initiated by the municipality for the period 2005 to 2010. The project relating to the Tongelresche Akkers district and the Doornakkers centre is expressly mentioned several times. As with the cooperation contract between Woonbedrijf and the municipality, the Netherlands Government could not have been unaware of the possible effect of that document on the proceedings in so far as, for the municipality, the development of housing was directly linked to securing government subsidies and the Doornakkers centre was part of that dynamic. 35. The other two documents are public documents, one of which is an administrative regulation published in Staatscourant and the other an information notice published on the website of a public authority. The first regulates the conditions for obtaining aid for the housing development programme and the second is a related general information notice. 36. The documents therefore simply make it possible to understand the factual situation and do not develop a new complaint. On the contrary, they merely illustrate the complaint made in the formal notice and the reasoned opinion. 37. Lastly, it should be borne in mind that, whilst the Commission must, of course, respect the rights of defence of the Netherlands Government, it must, in accordance with its duty of sincere cooperation under Article 4(3) of the EU Treaty, facilitate the achievement of the Commission’s tasks. ‘Where it is a question of checking that the national provisions intended to ensure effective implementation of the directive are applied correctly in practice, the Commission … does not have investigative powers of its own in the matter, [it] is [therefore] largely reliant on the information provided by any complainants and by the Member State concerned … In such circumstances, it is indeed primarily for the national authorities to conduct the necessary on-the-spot investigations, in a spirit of genuine cooperation and mindful of each Member State’s duty, recalled in paragraph 42 of the present judgment, to facilitate the general task of the Commission …’. (11) 38. Consequently, the Commission’s action cannot, in my view, be declared inadmissible by reason of the Commission’s use of the abovementioned documents. 2. New complaint and extension of the subject-matter of the dispute 39. The Netherlands Government also alleges that the Commission claimed for the first time in the application that the municipality received a ‘service’ in order to show that there was a contract for pecuniary interest whereas, in the course of the pre-litigation stage, the Commission focused exclusively on the existence of a ‘consideration’ provided by the municipality to Hurks. This constitutes a new complaint concerning the existence of a service allegedly received by the municipality, which extends the subject-matter of the dispute. 40. In this connection, the Court stated in Commission v Portugal (12) that the fact that, ‘in its application, the Commission set out in detail the arguments supporting its conclusion as to the alleged failure to fulfil obligations, arguments which had already been put forward in more general terms in the letter of formal notice and the reasoned opinion, and merely explained further why it takes the view that that scheme is incompatible with the freedom to provide services, did not alter the subject of that infringement and has thus had no effect on the scope of the proceedings’. 41. I do not concur with the Netherlands Government’s opinion that this dictum is not applicable in the present case. Both in the letter of formal notice and in the reasoned opinion, the Commission alleges that the Kingdom of the Netherlands infringed EU public procurement rules and, more specifically, Directive 2004/18. From the outset, the Commission has taken the view that the contract between the municipality and Hurks was a public works concession within the meaning of Article 1(3) of Directive 2004/18 which requires a contract for pecuniary interest. That condition was expressly analysed by the Commission in its reasoned opinion (pp. 7 to 9). 42. In its application, (13) the Commission does not introduce a new complaint. It updates its arguments so as to take account of recent developments in the Court’s case-law on the subject of the notion of ‘contract for pecuniary interest’, which requires a service to be provided by the contractor which is of ‘immediate economic benefit’ to the contracting authority. (14) In my view, in doing so, the Commission merely sets out in detail the arguments in support of its claim relating to the alleged failure to fulfil obligations which had already been put forward in more general terms in the letter of formal notice and in the reasoned opinion. (15) 43. The Commission’s action thus seems to be admissible. C – Applicability ratione temporis of Directive 2004/18 44. As a preliminary point, as I have already explained, I consider this question to relate not to the admissibility of the action, but to the substance of the dispute. (16) 45. Under Article 80 of Directive 2004/18, the directive had to be transposed no later than 31 January 2006. 46. According to the Commission, negotiations did not really begin until after the adoption of the master plan on 14 February 2006, i.e. after the entry into force of Directive 2004/18. The Netherlands Government, on the other hand, considers that it is the municipality’s decision of 23 April 2002 that determines the applicable directive, as that was when the municipality decided not to follow the European tender procedure, but to choose just two candidates. The choice to proceed with Hurks was made on 15 July 2003. 47. The key dates are therefore as follows: – 7 August 2001: decision taken by the municipality of Eindhoven to carry out, within its territory, a construction project in an area located between the existing district of Doornakkers and the new residential district of Tongelresche Akkers; (17) – 12 September 2001: approval by the municipal council of the urban development plans for the Doornakkers centre project drawn up by the municipality. (18) Those plans contain the planning guidelines for the district in the form of a plan. They also provide for infrastructure and facilities with a view to joining the existing district of Doornakkers and the new residential district of Tongelresche Akkers. The former would have a healthcare centre, commercial premises and apartments. The latter would be home to accommodation and leisure infrastructure, including sports facilities; – 11 April 2002: opinion entitled ‘Selection of a promoter for the Doornakkers district centre’. (19) That opinion, drafted by the municipality’s internal services, informs the municipal council of the criteria to be applied in selecting the purchaser of the land on which the Doornakkers centre project will be carried out. The opinion also states that the contract for the sale of plots offered to the contractual partner approached should comply with ‘the framework conditions and guidelines set by the municipality, namely the specifications’, and should ‘meet the … wishes of the purchasers/end users’. (20) These framework conditions and guidelines set out, inter alia, the functions and the heights of the buildings in accordance with the urban development plan. They envisage the construction of apartments and housing, the extension of the existing healthcare centre, a connecting area between the two main sites, good accessibility, an underground car park in accordance with municipal parking regulations, conservation of valuable green spaces, and the creation of a square and a new district park. It proposes the selection of two companies, Hurks and Haagdijk; – 23 April 2002: adoption by the municipal council of the opinion of 11 April 2002; – 11 June 2002: meeting between the municipality and the two promoters approached to carry out the project. The topics of that discussion are the abovementioned framework conditions and guidelines and a document entitled ‘Information for prospective promoters participating in a selection process’; (21) – 15 July 2003: selection by the municipality of Hurks as the contractual partner for carrying out the project; (22) – July 2003 to October 2005, production by Hurks (with the assistance of an architects’ practice) of a master plan in which it fleshes out its construction plans. That master plan includes numerous drawings specifying the dimensions, locations and spreads of the buildings to be constructed in accordance with the municipality’s framework conditions and guidelines; – 31 January 2006: time-limit for the transposition of Directive 2004/18; – 14 February 2006: approval by the municipality of the master plan drawn up by Hurks; – 12 June and 16 July 2007: signature of the ‘cooperation contract’. 1. Principle and exception 48. Each of the parties relies upon the judgments delivered by the Court in Commission v France (23) and pressetext Nachrichtenagentur. (24) 49. In Commission v France, the Court clarified the question of the application ratione temporis of Council Directive 93/38/EEC of 14 June 1993 coordinating the procurement procedures of entities operating in the water, energy, transport and telecommunications sectors (OJ 1993 L 199, p. 84) by identifying a principle and an exception. 50. As regards the principle, ‘the decision by a contracting entity concerning the type of procedure to be followed and whether it is necessary for a prior call for competition to be issued for the award of a public contract constitutes a distinct stage in the procedure, a stage during which the essential characteristics of the execution of the procedure are defined and which may, as a rule, take place only at the point when that procedure is initiated. Accordingly, in determining whether [the directive] … is applicable to such a decision …, account must be taken, as a rule, of the point in time at which that decision was adopted’. (25) This is because ‘it would be contrary to the principle of legal certainty to determine the applicable law by reference to the date of the award of the contract since that date marks the end of the procedure, while the decision of the contracting entity to proceed with or without a prior call for competition is normally taken at the initial stage of that procedure’. (26) 51. Nevertheless – and herein lies the exception – if negotiations opened subsequently ‘were substantially different in character from those already conducted and were, therefore, such as to demonstrate the intention of the parties to renegotiate the essential terms of the contract, … the application [of the provisions of a subsequent directive] might be justified’. (27) 52. The notions of ‘materially different in character’ and ‘essential terms of the contract’ were developed in pressetext Nachrichtenagentur. The amendment necessary in order to be covered by the exception must affect a material aspect of the contract, such as: – conditions which, had they been part of the initial award procedure, would have allowed for the admission of tenderers other than those initially admitted or would have allowed for the acceptance of a tender other than the one initially accepted; (28) – the extension of the scope of the contract considerably to encompass services not initially covered; (29) – an amendment which gives rise to a change in the economic balance of the contract in favour of the contractor in a manner which was not provided for initially; (30) – the substitution, not provided for in the initial contract, of a new contractual partner for the one to which the contracting authority had initially awarded the contract; (31) – the price. 2. Application in the present case 53. The exception identified by the Court in Commission v France, does not seem, prima facie, to be applicable as such in the present case. The exception covers situations in which a contract has been materially amended. However, it seems that the only contract signed between the municipality and Hurks dates from summer 2007. 54. It is nevertheless clear from the documents before the Court that the parties had already agreed on the essential points before the cooperation contract was signed. Moreover, the Commission does not, strictly speaking, claim the existence of fresh negotiations between the parties. It does, however, consider that certain essential aspects of the contract were determined only after the time-limit for the transposition of Directive 2004/18 had expired. According to the Commission, the dictum of Commission v France, should therefore be applied by analogy. (32) 55. I do not agree with that conclusion. (a) The principle 56. In the view of the Court, the applicable directive is the one in force when the contracting authority chooses the type of procedure to be followed and decides definitively whether it is necessary for a prior call for competition to be issued for the award of a public contract. This rule is founded on the principle of legal certainty which does not permit the applicable law to be determined by reference to the date of the award of the contract since that date marks the end of the procedure, while the decision of the contracting entity to proceed with or without a prior call for competition is normally taken at the initial stage of that procedure. (33) 57. I do not therefore think that it is a question of the existence of a contract in the formal sense of the term, but of identifying, in the development of the matter over time, the time when the public authority takes ‘the decision … concerning the type of procedure to be followed and whether it is necessary for a prior call for competition to be issued for the award of a public contract’. (34) 58. This interpretation is confirmed in Hochtief and Linde‑Kca‑Dresden. In that judgment, the Court reaffirmed that where ‘the contracting authority’s decision to exclude the bid from the consortium set up by the applicants in the main proceedings and to continue the procedure with the two candidates who were considered to be suitable was taken before the date on which the period for transposition of Directive 2004/18 expired …, it would … be contrary to the principle of legal certainty to determine the law applicable … by reference to the date of the award of the contract, when the decision which in the present case is alleged to have infringed Community law was taken before the date [of expiry of the time-limit for transposition]’. (35) 59. In the present case, the decision within the meaning of the cited case-law was unquestionably taken by the municipality on 23 April 2002. 60. The urban development plan for the Doornakkers centre project had already been approved by the municipality on 12 September 2001. On that date, the project guidelines were known (infrastructure and facilities necessary for joining the existing district and the new district, types of buildings to be constructed, etc.). 61. On 23 April 2002, it is the method of selecting the promoter to carry out the project that is defined. On that date the municipality approved the opinion drafted by its services entitled ‘Selection of a promoter for the Doornakkers district centre’. In that document, the role of the promoter and the selection method are expressly defined (see Articles 1.3 and 2). The two shortlisted candidates were already presented and the application of the public procurement rules was expressly rejected: ‘at the end of the selection process, the municipality shall designate a prospective promoter to which it can award the promotion agreement. This will be, for the municipality, the contractual partner sought for a contract for the sale of land subject to conditions. These conditions must ensure that the planned district centre is constructed in accordance with the requirements and the wishes of the municipality and with the specifications and meets the wishes of the purchasers/end users. The fact that the municipality opts for a sale subject to conditions means that there will be no tender procedure and that the public procurement rules are not applicable’. (36) 62. This is certainly ‘the decision by [the] contracting entity concerning the type of procedure to be followed and whether it is necessary for a prior call for competition to be issued for the award of a public contract’. (37) (b) The exception 63. The question still remaining is therefore whether the abovementioned exception applies. In this respect, it is for the Commission, in the context of its action for failure to fulfil obligations, to show that essential aspects were amended after 31 January 2006, the date on which the time-limit for the transposition of Directive 2004/18 expired and which is considered to be the ‘key’ date by the parties. 64. The Commission relies on two aspects: the allocation of the financial risks for certain parts of the SPILcentrum project and responsibility for the development of public spaces. (i) The SPILcentrum 65. In the project as a whole, the SPILcentrum was the infrastructure whose profitability was most uncertain. For that reason, Hurks did not wish to bear the financial risk alone. However, the municipality systematically refused to share the risk. Consequently, Hurks eventually agreed to proceed with the construction of the centre for its own account and at its own risk. In exchange, the municipality chose a housing corporation – Woonbedrijf – as the future owner of the SPILcentrum. In return Woonbedrijf received a one-off subsidy of EUR 2.41 million. 66. According to the Commission, this is an essential aspect of the collaboration between Hurks and the municipality. However, it could not be finalised until Woonbedrijf had been designated as owner on 13 February 2007. (ii) Development of public spaces 67. In the opinion of the municipality adopted on 23 April 2002, it is stated, in Article 4.2, that ‘the promoter shall also be responsible for the development of public spaces’. However, under the cooperation contract signed by the parties, public spaces remain in the ownership of the municipality, which is responsible, for its own account and at its own risk, for making the planning area (with the exception of the plot earmarked for the commercial centre) suitable for construction and habitation (Articles 8.1 and 8.2 of the cooperation contract). 68. Under Article 1.1 of the cooperation contract, the notion of ‘making suitable for habitation’ means ‘inter alia the improvement of roads and their foundations, squares, pavements, green spaces and public spaces, including green compensation, urban furniture and urban facilities’. 69. According to the Commission, this is also an essential aspect of the collaboration which was agreed between the parties after the time-limit for the transposition of Directive 2004/18 had expired. (c) Assessment 70. I do not think that the fact that the allocation of the financial risks for certain parts of the SPILcentrum project and responsibility for the development of public spaces could have been finally decided after the decision taken on 23 April 2002 is crucial. 71. Taking, for example, the aspects highlighted by the Court in pressetext Nachrichtenagentur, it would appear that neither of the two points identified by the Commission would have justified a new tender procedure: – in the project as a whole, these two points would not have been sufficient to result in ‘the admission of tenderers other than those [who could have been] initially admitted’; (38) – the scope of the contract is, in any case, not extended considerably to encompass services not initially covered; (39) – the amendment relating to the development of public spaces does not give rise to a notable change in the economic balance of the contract in favour of the contractor in a manner which was not provided for initially; (40) – there is no substitution of a new contractual partner for the one to which the contracting authority had initially awarded the contract; (41) – the price had already been fixed, as the Commission itself acknowledges. (42) 72. On the other hand, as the Commission itself pleads in order to prove the existence of a public works contract (which is paradoxical), ‘a comparison between Article 1.1 of the cooperation contract and the information document communicated by the municipality to the prospective promoters in June 2002 shows that, for the most part, the assignment of the buildings to be constructed had been defined by the municipality as early as 2002’. (43) 73. In paragraph 43 of its application, it goes as far as to describe as ‘details’ the aspects which will be determined in the course of the negotiations subsequent to the decision of 23 April 2002. In paragraph 67 of its application, it also disputes that the object of the cooperation contract is merely the sale of land in view of the obligations imposed on the promoters during the ‘informal’ selection process. According to the Commission, ‘the promoters were required to devise their plans on the basis of a specific concept, stipulated by the municipality, namely the “dumbbell” model, each of the two extremities forming a hub with facilities. If this represented merely the sale of land, no such obligation would have been provided for’. 74. At this point in my analysis, I therefore consider that the Commission has not provided the necessary and sufficient evidence to establish the application of Directive 2004/18, which is invoked in support of its action. In proceedings based on Article 258 TFEU, it is for the Commission to prove the existence of the failure. (44) 75. Furthermore, to take the Commission’s view would lead to an absurd situation which is contrary to the objective pursued by the legislature. Following the Commission’s reasoning, the date which should be used to determine the applicable directive would be the date on which the municipality adopted the master plan, i.e. 14 February 2006. However, that plan, produced by Hurks, is presented as a fully-fledged construction plan. Article 2 of the cooperation contract, which defines the object of the contract, expressly provides that it seeks to govern ‘the terms and conditions for exclusive cooperation between the parties in order to carry out the project in accordance with the master plan and the other planning documents’. (45) 76. If the adoption of the master plan were the decision which determines the applicable directive, this would mean that the possible call for candidates would be based on the plans of a contractual partner selected outside a tender procedure which might not be successful at the end of the selection process. What promoter would agree to produce such a master plan without the guarantee of carrying out the project? What promoter would permit a competitor to use its plans? 77. It is certain that, just as the principle of legal certainty prevents the applicable law being determined by reference to the date of the award of the contract, (46) it prevents it being determined by reference to the date on which the plans of the pre-selected promoter are adopted by the public authority. 78. In addition, the rule identified by the Court in Commission v France, also safeguards the interests of competitors. To determine the applicable directive by reference to the decision whether to open a call for tenders makes it possible to give practical effect to possible recourse by competitors which have been rejected, de facto, by the decision of the public authority not to put the contract out to competitive tender. 79. By rejecting the view that the applicable law is determined by the contracting authority’s decision to award the contract, the rule has the fortunate consequence of preserving an appropriate date for challenges by injured parties of decisions taken by the contracting authorities. 80. Consequently, since the Commission has not provided evidence to prove that Directive 2004/18, which is invoked in support of its action, was applicable and it confirmed at the hearing that it was restricting the basis of its action to that directive alone (even though the applicable definitions and principles were, in its view, identical in Council Directive 93/37/EEC of 14 June 1993 concerning the coordination of procedures for the award of public works contracts (47)), I consider that the action must be dismissed. 81. Nevertheless, in case the Court does not concur with my reasoning and considers Directive 2004/18 to be applicable, I will also examine below the substantive questions raised by the present case. D – Substance 82. In order to find that the Kingdom of the Netherlands has failed to fulfil its obligations, it is necessary to determine the nature of the contract concluded between the municipality, on the one hand, and Hurks, on the other, with a view to the redevelopment of the Doornakkers centre: does it represent merely the sale of land or a public works concession within the meaning of Directive 2004/18? (48) 1. Assessment 83. The three conditions required for the existence of a public works concession follow from the definitions of ‘public works contracts’ and ‘public works concession’ in Article 1(2)(a) and (b) and in Article 1(3) of Directive 2004/18 respectively. There must be: – a written contract between a contracting authority and an economic operator [Article 1(2)(a)]; – a contract whose object is either the execution, or both the design and execution, of works related to one of the activities within the meaning of Annex I to Directive 2004/18 or a work, or the realisation, by whatever means, of a work corresponding to the requirements specified by the contracting authority [Article 1(2)(b)]; – a contract concluded for pecuniary interest, where the consideration must consist either solely in the right to exploit the work or in this right together with payment (Article 1(3)). 84. As the existence of a written contract between the municipality and Hurks has not been called into question, only the second and third conditions will be examined. (a) A public works contract 85. The existence of a public works concession necessarily implies, first and foremost, the existence of a public works contract. Three scenarios are provided for in Article 1(2)(b) of Directive 2004/18. The contract must have as its object: – either the execution of works related to one of the activities within the meaning of Annex I of Directive 2004/18 or of a work (a work meaning the outcome of building or civil engineering works taken as a whole which is sufficient of itself to fulfil an economic or technical function); – or both the design and execution of works related to one of the activities within the meaning of Annex I of Directive 2004/18 or a work; – or the realisation, by whatever means, of a work corresponding to the requirements specified by the contracting authority. 86. According to the Netherlands Government, the contract concluded between the municipality and Hurks does not come in any of these three categories in so far as it covers merely the sale of land. Article 16 of Directive 2004/18 expressly excludes this kind of transaction from its scope. 87. It is true that the agreements between the municipality and Hurks relate to the sale of several plots of land owned by the municipality. However, it is clear from reading the ‘cooperation contract’ and from all the legal and economic relations established between Hurks and the municipality that this can be only an accessory element of the contract. Furthermore, the Court has held that it was prudent not to exclude the application of Directive 2004/18 where an award procedure provided for the sale of land which would subsequently form the subject of a works contract. (49) This reasoning may be applied, a fortiori, where the two transactions are provided for in the same agreement, as in the present case. 88. According to the recitals in the preamble to the cooperation contract signed by the municipality and Hurks: – ‘[t]he parties wish to develop and construct a new centre for the new residential district of Tongelresche Akkers and the existing district of Doornakkers …’ (recital B); – ‘[t]he municipality and Hurks have reached an agreement on the development and the implementation of the functions set out in recital B of the present …’ – i.e. a healthcare centre, a play, integration and learning centre with apartments, an extension of an existing healthcare centre with an underground car park, a commercial centre with housing, and an underground car park, housing (recital F). 89. The object of the contract is itself defined without any reference to the sale of land. Under Article 2 of the cooperation contract, it seeks to govern ‘the terms and conditions for exclusive cooperation between the parties in order to carry out the project in accordance with the master plan and the other planning documents’. The project in question is itself defined by the contract as the ‘redevelopment of the planning area’, which includes making that area ‘suitable for construction and habitation’ under the conditions laid down in the contract (Article 1.1 of the cooperation contract). 90. That contract also provides for the creation of a ‘project team’ composed of a ‘project group’ and several ‘working groups’, whose role is to devise the planning documents – that is to say the final draft of the urban development plan, the local area development plan, the specifications, the relevant demolition documents, the development plan for public spaces, etc. (Article 5 of the cooperation contract) – and to prepare the decisions taken by the parties, it being understood that the project group is chaired by the municipality’s project manager (Article 3 of the cooperation contract). 91. Lastly, Article 7.5 of that contract, which concerns the sale of land, expressly makes the supply of the land subject to an undertaking given by Hurks to ‘construct buildings on the plots in accordance with the planning documents and the schedule’, which is the subject of Article 6. 92. In addition, according to the procedural documents, the price of the land is EUR 5 616 024, (50) whilst the construction of the project is evaluated at EUR 28 186 000 (Annex 7 to the application). 93. It can therefore be inferred from the cooperation contract that its object was not primarily the sale of land, but above all the execution of works related to one of the activities within the meaning of Annex I to Directive 2004/18, namely, to mention just one example, general construction of buildings and civil engineering works or a work within the meaning of that directive. (51) 94. I think that the project covered by the cooperation contract in question also comes under the third scenario mentioned in Article 1(2)(b) of Directive 2004/18, namely ‘the realisation, by whatever means, of a work corresponding to the requirements specified by the contracting authority’. 95. If reference is made to the clarifications given in Helmut Müller, cited above, which is relied on by the Commission and the Netherlands Government, ‘in order for it to be possible to establish that a contracting authority has specified its requirements within the meaning of [Article 1(2)(b) of Directive 2004/18], the authority must have taken measures to define the type of the work or, at the very least, have had a decisive influence on its design’. (52) This means that ‘the mere fact that a public authority, in the exercise of its urban-planning powers, examines certain building plans presented to it, or takes a decision applying its powers in that sphere, does not satisfy the obligation that there be “requirements specified by the contracting authority” within the meaning of that provision’. (53) 96. In this regard, I share the Commission’s opinion. It is clear from the cooperation contract signed by the two parties, the other documents referred to in that contract (master plan, planning documents, etc.) and the information document published by the municipality in June 2002 – i.e. at the very beginning of the project – for the two prospective promoters that it was the municipality that decided not only on the relevant land-use planning, but also on the assignment of the buildings to be constructed. 97. It is apparent, inter alia, from the document entitled ‘Doornakkers Centre – Programme’ (54) that the number of buildings to be constructed is specified precisely, but also the number of rooms, the function allocated to each of them, and even their surface area. The number of parking spaces to be provided for each building is also indicated. (55) 98. The Court has already had occasion to point out that specifications ‘relating to a precise description of the buildings to be constructed, their quality and their fixtures and fittings, far exceed the usual requirements of a tenant in relation to newly-constructed premises of a certain size’. (56) According to the Court, a contract containing such specifications therefore has ‘as its main object the construction [of a building] in accordance with the requirements specified by [the contracting authority]’. (57) 99. In those circumstances, which are similar to those in the present case, the Court held that, in so far as those constructions constituted a ‘work’ within the meaning of the applicable directive, they were sufficient of themselves to fulfil an economic function, their value was higher than the threshold laid down under Directive 93/37 concerning the coordination of procedures for the award of public works contracts and the contract had been concluded for pecuniary interest, the contract had to be classified as a ‘public works contract’. The same findings must be made in the present case. 100. Lastly, the composition and the tasks entrusted to the ‘project team’ defined in Article 3 of the cooperation contract also reflect the municipality’s desire to maintain a pro-active role as the project progresses, going beyond simply examining the building plans presented to it or taking a decision in the exercise of its regulatory urban-planning powers. It is this ‘team’, led by the municipality’s project manager, which must devise and draw up the planning documents, which include not only the urban development plan and the local area development plan, but also the provisional and final proposal for the various functions, the specifications and the drawings of the various functions, and the construction and communication schedules (see Articles 5.1 to 5.3 of the cooperation contract). Furthermore, any departures from the master plan identified by the project group must be submitted to the municipality for approval (Article 5.4 of the contract). Interim conclusion 101. I consider that the first condition laid down by Directive 2004/18 for the existence of a public works concession, namely the existence of a public works contract, is satisfied and that the Commission provides sufficient proof thereof. The project in question comes at least under the first and third scenarios referred to in Article 1(2)(b) of Directive 2004/18. It concerns the execution of works related to one of the activities within the meaning of Annex I of Directive 2004/18 and/or of a work within the meaning of that directive, and the realisation, by whatever means, of a work corresponding to the requirements specified by the contracting authority. 102. I wish to point out, in so far as it is relevant, that the Netherlands Government is incorrect in its claim that the three situations covered by Article 1(2)(b) of Directive 2004/18 are mutually exclusive. 103. As the Commission points out, the Court has already had occasion to state that ‘infrastructure works of the kind listed in Article 4 of Law No 847/64 constitute either building or civil engineering works, hence activities of the kind referred to in Annex II to ?Directive 2004/18], or works sufficient in themselves to fulfil an economic and technical function. They thus satisfy, at the very least, the criteria laid down in the first and second indents ?of Article 1(2)(b) of Directive 2004/18]’. (58) 104. The fact that the works planned by the municipality in the present case come under more than one of the cases envisaged by the directive cannot therefore result in the dismissal of its application. (b) A contract concluded for pecuniary interest 105. The third condition that must be met by a contract in order to satisfy the definition of ‘public works concession’ is to be concluded for pecuniary interest. 106. It is settled case-law that the pecuniary nature of the concession contract means that the contracting authority which has concluded a public contract receives a service pursuant to that contract in return for consideration paid by it to the contractor. (59) That service, for the contracting authority, consists in the realisation of works from which it intends to benefit. (60) (i) A service and an immediate economic benefit 107. In the present case, the obligation to execute the works in question is expressly laid down in Article 7.5 of the cooperation contract, under which ‘Hurks gives an undertaking to the municipality to construct buildings on the plots in accordance with the planning documents and the schedule’. 108. However, the Court stated in Helmut Müller, that such a service had to ‘be of direct economic benefit to the contracting authority’. (61) 109. Rather than talking about immediate economic benefit, in his Opinion in Helmut Müller, Advocate General Mengozzi developed the requirement that ‘there be a direct link between the public authority and the work or works to be executed’ so as to ‘reconcile the potential contradiction between the need to prevent abuses on the one hand and the need to avoid extending the scope of [Directive 2004/18] indefinitely on the other’. (62) 110. According to Advocate General Mengozzi, the existence of a direct link can be found: – where the public authority immediately acquires ownership of the property or the works to be produced. This case covered situations in which the authority does not procure the property, but obtains an immediate economic benefit as a result of it, such as the right to make use of the property; (63) – where public funds, or more generally public resources (such as making land available free of charge), are employed for the execution of the work and/or works; (64) – where the work or works to be carried out are the result of an initiative taken by the authority in question. (65) However, this residual category must be distinguished from ‘the mere pursuit of the public interest through recourse to ordinary town planning powers’ for Directive 2004/18 to apply. (66) 111. As I have already stated, in point 108 of this Opinion, the Court did not adopt as such the criterion of a direct link in Helmut Müller. On the contrary, it opted to refer only to the notion of ‘immediate economic benefit’. In doing so, the Court seems to have excluded the abovementioned residual category – that is, the scenario of an initiative taken by the contracting authority – and therefore restricted the scope of Directive 2004/18. 112. This interpretation nevertheless allows the public authorities a certain margin of discretion. In Helmut Müller, the Court only excluded from the concept of immediate economic benefit the mere exercise of urban-planning powers intended to give effect to the public interest. Otherwise, the Court simply illustrated its remarks by giving five non-exhaustive examples. Relevant situations were cases where: – the public authority becomes owner of the works or work which is the subject of the contract; (67) – the contracting authority holds a legal right over the use of the works which are the subject of the contract, in order that they can be made available to the public; (68) – the contracting authority benefits from economic advantages derived from the future use or transfer of the work; (69) – the contracting authority contributed financially to the realisation of the work; (70) – the contracting authority assumes risks were the work to be an economic failure. (71) 113. The Court does not mention the case referred to by Advocate General Mengozzi in which the work or works to be carried out are the result of an initiative taken by the authority in question. (72) On the other hand, like him it excludes the case where that public authority merely exercises urban-planning powers, intended to give effect to the public interest. (73) What does this mean for the present case? 114. In the present case, the municipality has certainly not become the owner of the constructed properties and that was not its intention. 115. However, the relations established by it for the purposes of the Doornakkers centre, whether with Hurks or with other actors such as Woonbedrijf, (74) tend to show an intervention by the municipality which goes beyond coherent planning of the development of part of an urban district. (75) 116. It should not be ignored that the functions to be fulfilled by the project were defined precisely by the municipality and include a healthcare centre, a play, integration and learning centre (SPILcentrum) with apartments, an extension of the existing healthcare centre with an underground car park, a commercial centre with housing and an underground car park and more housing (recital B of the cooperation contract). 117. The contracts relating to the use and the financing of the SPILcentrum also demonstrate that the project is of immediate economic benefit to the municipality. 118. As I have already explained above, (76) Hurks did not wish to bear the financial risk of the SPILcentrum alone on account of its uncertain profitability. It eventually agreed to construct it for its own account and at its own risk, as, in exchange, the municipality had approved the housing corporation Woonbedrijf as the future owner of the SPILcentrum, as early as 13 February 2007. (77) Hurks was therefore certain that the least profitable building would be used. 119. Woonbedrijf received a one-off operating subsidy of EUR 2.41 million from the municipality for the three unprofitable functions of the SPILcentrum: the sports hall, the meeting space and the youth space. (78) 120. The Netherlands Government confirms that the sports hall and the meeting space are used by the Sportbedrijf De Karpen association. It also explains that the association ‘belongs’ to the municipality. (79) 121. With the designation of Woonbedrijf as owner of the SPILcentrum, the agreement signed by that housing corporation and the municipality on 15 April 2008 and the use of the sports hall and the meeting space by the Sportbedrijf De Karpen association, the municipality guaranteed that the SPILcentrum is made available to the public. 122. This is a second illustration of the immediate economic benefit mentioned by the Court in Helmut Müller. Immediate economic benefit ‘may also be held to exist where it is provided that the contracting authority is to hold a legal right over the use of the works which are the subject of the contract, in order that they can be made available to the public’. (80) 123. Admittedly, it is not the municipality itself that is the user of the properties, but an association which ‘belongs’ to it (in the words of the Netherlands Government). However, the Court has already held that the State could take the form of bodies other than its own structures. Thus, for State aid, ‘[w]ith regard to the [condition connected with an intervention by the State or through State resources], it is clear from established case-law that there is no need to draw any distinction according to whether the aid is granted directly by the State or by public or private bodies established or appointed by that State’. (81) The same reasoning may be applied mutatis mutandis in the present case. 124. Second, I consider that the municipality can also be considered to have contributed financially to the project (fourth example given by the Court in Helmut Müller, cited above, point 52) in so far as Hurks did not agreed to build the SPILcentrum at its own risk until the municipality had given it an assurance that Woonbedrijf would be the owner of the centre. In exchange, Woonbedrijf received from the municipality an operating subsidy in excess of EUR 2 million. 125. It can also be seen that the transaction represents financial gain for the municipality in so far as the infrastructure promoter is required to pay for something which, in the absence of the cooperation contract, the municipality itself would have to build and finance. It should be noted that the extension of the healthcare centre is evaluated at EUR 8 400 000 and the construction of the SPILcentrum at EUR 7 386 500, including EUR 3 738 500 for functions likely to be used by the municipality (the school, the sports hall and the youth centre). (82) 126. Lastly, going beyond their contribution to the general interest or good urban planning, several of those functions (in particular the healthcare centre and the commercial centre) relate to economic activities which can bring in revenue for the municipality through taxes and other expenditure. In other words, to paraphrase the Court, the contracting authority, which is the municipality, will enjoy economic advantages derived from the use (or future transfer) of the work (third example given by the Court in paragraph 52 of the judgment in Helmut Müller). 127. I therefore take the view that, in the present case, having regard to the material in the file, the existence of an immediate economic benefit for the municipality is proven to the required legal standard: the municipality has gone well beyond simply achieving the objective of ‘the development or coherent planning of part of an urban district’. (83) (ii) A consideration 128. As I have already stated, the pecuniary nature of a concession contract means that the contracting authority which has concluded a public contract receives a service pursuant to that contract in return for consideration. 129. Whilst, for the contracting authority, the service resides in the execution of the works, for the contractor, the consideration consists either in the right to exploit the work or in this right together with payment (Article 1(3) of Directive 2004/18). 130. In view of the legal relations established between the municipality and Hurks, I have doubts, above all, as to the very existence of the ‘right of exploitation’ conferred on Hurks when it is the owner of the land and the properties to be constructed. As the Netherlands Government explained at the hearing, to exploit means to benefit from the advantages and to tolerate the disadvantages of the work of a third party. That is not the situation in the present case. 131. Nevertheless, if there had to be ‘exploitation’ within the meaning of Directive 2004/18, the present case would raise a further two questions. First, is the grant of a public works concession – and of the right to exploit the work – for an indefinite duration compatible with EU law? Second, does the consideration exist where the concessionaire is or becomes the owner of the land and/or the finished works? – Public works concession and indefinite duration? 132. First of all, I concur with the Commission’s observation that Directive 2004/18 does not give the slightest indication that a concession should have a limited duration. 133. The Court has already had occasion to consider this question. I am referring to the abovementioned judgments in pressetext Nachrichtenagentur and Helmut Müller. According to the Netherlands Government, it is clear from paragraph 79 of the judgment in Helmut Müller that a concession contract of indefinite duration is contrary, per se, to EU law. 134. I must point out, however, that the Court has not given a clear statement in so far as it opted to use the conditional [in the French], explaining that ‘in any event, with regard to the duration of concessions, there are serious grounds, including the need to guarantee competition, for holding the grant of concessions of unlimited duration to be contrary to the European Union legal order’. (84) 135. In addition, the Court refers to paragraph 73 of the judgment in pressetext Nachrichtenagentur, in which it asserted that ‘the practice of concluding a public services contract for an indefinite period is in itself at odds with the scheme and purpose of the Community rules governing public contracts’. However, this paragraph of the judgment cannot be dissociated from the following paragraph, which forms the conclusion of the Court’s reasoning. In that paragraph it ruled that ‘[n]evertheless, Community law, as it currently stands, does not prohibit the conclusion of public service contracts for an indefinite period’. (85) 136. EU law has not changed since that judgment was delivered. Unlike framework agreements, the European legislature has still not set a time-limit for concession contracts. (86) However, such a limit does appear in the Proposal for a Directive of the European Parliament and of the Council on the award of concession contracts (87) which is currently under discussion. If that amendment is adopted, EU law will then impose a time-limit. The text itself will no longer leave any room for doubt as to the interpretation of what the Court has called ‘the scheme and purpose of the Community rules governing public contracts’. (88) 137. Second, it is true that the practice of concluding a public contract for an indefinite period might, over time, impede free competition between potential service providers and hinder the application of the provisions of European Union directives guaranteeing advertising of procedures for the award of public contracts. (89) However, simply to exclude contracts of indefinite duration from the scope of Directive 2004/18 seems to run an even greater risk, as it is more common: the risk of the same rules being circumvented. 138. As the Commission points out in its application, if such concession contracts of indefinite duration fell outside the scope of Directive 2004/18, the parties would need only conclude a written contract for pecuniary interest which is of indefinite duration to avoid the rules on equality, transparency and non-discrimination which form the basis for the public procurement rules. 139. Lastly, it must be ascertained exactly what is covered by the notion of ‘indefinite duration’. In my view, this must be distinguished from ‘infinite duration’ which, alone, is limitless. On the other hand, a contract of indefinite duration is a contract whose duration has not been fixed at the beginning, but which may be terminated for certain reasons provided for in the contract, with or without notice and with or without penalty. 140. For these various reasons, I therefore believe that a concession of indefinite duration as defined in the preceding point may be covered by Directive 2004/18. 141. However, that is not the situation in the present case, as a concession of indefinite duration has not been awarded to Hurks, but ownership of the land and the future works. Consequently, Hurks does not enjoy a right of indefinite duration, but a right of ‘infinite duration’. Conversely, for the municipality, the duration of the contract is clearly identified. Once the buildings provided for in the cooperation contract are constructed, the contract has been performed and the parties’ rights and obligations come to an end. Before then, the only grounds for termination of the cooperation contract relate to the essential conditions for carrying out the project, such as obtaining a valid building permit (90) or the solvency of the contractor. (91) 142. In fact, the only question arising in the present case in analysing the consideration required for the concession contract to be a contract for pecuniary interest is the ownership of the site as a whole. – Public works concession and ownership? 143. According to the Commission, the transfer of ownership of the land to Hurks was accompanied by the concurrent transfer of a right of exploitation of an indefinite duration, since the sale of the land to Hurks alone would not have permitted the works provided for in the cooperation contract to be executed. 144. Under Article 7.2 and 7.3 of the cooperation contract, the existence of a building permit to execute the works constituted a suspensive or resolutive condition for the sale of the land having regard to the relevant aspects. The execution of works was therefore made possible only by the undertaking given by the municipality in Article 6 of the cooperation contract to collaborate fully. 145. According to the Netherlands Government, a distinction should be drawn between exploitation as the owner and exploitation as the concessionaire. In the first case, exploitation is based on the owner’s right of ownership. In the second case, exploitation is based on a concession granted by the owner to the concessionaire. In the present case, since the municipality transferred ownership of the land to Hurks, the Netherlands Government considers that Hurks exploits it as the owner and not by virtue of a concession. In support of its arguments, it again invokes Helmut Müller. 146. In the Opinion in Helmut Müller, Advocate General Mengozzi took the view that, if the words ‘right to exploit’ used by Directive 2004/18 in its definition of public works concessions could be interpreted broadly, one possibility which ‘ought to be excluded, in view of the meaning and the general system of the measure in question, is the possibility of a public works concession in which the concessionaire has a right of ownership in the finished works’. (92) 147. The Court has taken a more nuanced position. It is true that ‘in order for a contracting authority to be able to transfer to the other contracting party the right to exploit a work within the terms of [Article 1(3) of Directive 2004/18], that contracting authority must be in a position to exploit that work’. (93) However, according to the Court, ‘that will normally not be the case where the only basis for the right of exploitation is the right of ownership of the economic operator concerned’, since ‘as long as an economic operator enjoys the right to exploit the land which he owns, it is in principle impossible for a public authority to grant a concession relating to that exploitation’. (94) 148. Accordingly, if the principle is to exclude a concession where the ‘builder’ is the owner of the land, the use of the words ‘normally’ and ‘in principle’ gives rise to the possibility of an exception. 149. The Court has not, however, given any indication as to the conceivable exceptions. The only clue lies in the explanation of the rule: the contracting authority may not exploit the work ‘where the only basis for the right of exploitation is the right of ownership of the economic operator concerned’. (95) 150. It must be acknowledged that, in the light of this wording, opinion in legal literature has also been divided. 151. For some, the answer was clear: if the public authority does not remain or does not become the owner of the work forming the object of the contract, there is no concession in so far as the authority cannot grant a concession for a property to which it has no right. (96) As I have already explained, Directive 2004/18 requires the contracting authority to grant the concessionaire, as a consideration for realising the work, the right to exploit it or this right together with payment (Article 1(3) of Directive 2004/18). The right of ownership includes the right to exploit. Consequently, if the former is transferred, the latter can no longer be. 152. For proponents of this view, which I will describe as strict, the concessionaire must necessarily leave ownership with the contracting authority and retain the management of the property in order, inter alia, to make it available to the public and to receive a payment in exchange for this. (97) 153. Nevertheless, for others, Directive 2004/18 promotes a broader understanding of concessions. (98) According to these writers, exploitation of the work implies the right to derive profit from it even if this does not necessarily happen through the levying of fees paid by users. According to this interpretation, the right to exploit may be passed on by the promoter in the price at which the land, housing or other works are sold. In that case, ownership of the property does not remain with or revert to the contracting authority, but its contractual partner was nevertheless able to exploit the property it built by selling it. 154. This interpretation would be consistent with the definitions laid down in Directive 2004/18, as public works concession is defined by reference to the notion of ‘public works’. It is true that the definition of public works contracts does not require the contracting authority to remain or become the owner of the property. In the view of the writers who support a broad interpretation of concession, a distinction should not therefore be drawn between the two kinds of contract depending on the holder of the right of ownership. (99) 155. For others still, the question has not been resolved and clarification on this point would be welcome. (100) 156. I share the latter opinion. 157. If we wish to adopt the framework outlined by the Court in Helmut Müller – the contracting authority may not exploit the work where ‘the only basis for the right of exploitation is the right of ownership of the economic operator concerned’ (101) – it must be asked what could be the basis for the right of exploitation but not the right of ownership. 158. In the present case, what would be the other basis for the right of exploitation? 159. Aside from the right of ownership exercised over the land and the buildings – whether that right is acquired prior to or concurrently with the transactions and whether the promoter has acquired it from a third party or from a public authority – I can possibly see only the acquisition of the permits required for the execution of works covered by the cooperation contract. 160. It should not be forgotten, however, that in Helmut Müller, the Court rejected the view that the economic risk inherent in concession lies in the uncertainty over obtaining the necessary urban planning authorisations. For the Court, in this case, the risk would not be the risk linked to exploitation, but to the contracting authority’s powers in respect of urban planning. (102) Furthermore, in the present case, the risk does not exist for the promoter since the cooperation contract expressly provides that ‘the contracts for the sale of the plots in question shall mention that the supply [of the land] was subject to the resolutive condition that a valid building permit has been issued on the date of commencement of the construction works as provided for in Article 9.1’ (103) and that ‘the supply of the plot for the commercial centre and for the housing shall take place no later than four weeks after a valid building permit is available for the fulfilment of the function concerned’. (104) 161. By analogy, I therefore consider that it is not possible to infer a basis for the right to exploit the works from the resolutive condition relating to the acquisition of permits. If permits are not obtained, the works will simply not be constructed and the sale of the land possibly cancelled (see Article 7.2 to 7.4 of the cooperation contract). 162. It is true that Hurks needs the municipality to help it to obtain the necessary permits and exemptions for the execution of the works. However, it seems that it is not the municipality that issues the permits. Consequently, it cannot be regarded as the ‘basis’ for the right of exploitation. 163. More generally, I have doubts as to the very existence of cases where the only basis for the right of exploitation is the right of ownership of the contracting authority or of the operator. 164. A priori, the different conventional forms taken by the right which permit the use of an object without having ownership of it always result from breaking up that ownership (whether that be, for example, servitudes, emphyteutic leases or usufruct). If the concessionaire derives its right to exploit from one of these forms (servitude, emphyteutic lease, usufruct), it is not therefore the owner and the question of the impossibility of a concession does not arise. 165. If that right is granted by the contracting authority, the concessionaire is not the owner, but it only benefits from a limited right of exploitation and derives that right from the authorisation to exploit the works granted by the contracting authority. 166. Conversely, if it grants a servitude, a usufruct or an emphyteutic lease, it does so as the owner and any exploitation that it retains stems from its right of ownership. 167. The uncertainty stemming from the wording of Helmut Müller, with regard to the effect of ownership of the work by the operator seems to be very small and restricted to situations which do not appear to arise in the present case. 168. Like Advocates General Mengozzi and Jääskinen, I would be in favour of the Court simply ruling out the possibility of a public works concession where a right of ownership of the finished works is granted to the (purported) concessionaire. (105) 169. Whatever the case, if the Court were to remove, either way, the uncertainty over the effect of ownership of the work by the operator which stems from Helmut Müller, I consider that, in the circumstances of the present case, the Commission does not demonstrate to the required legal standard the actual existence of a consideration – namely the right to exploit or this right together with payment – for Hurks, the owner of the land and the finished works. Consequently, there can be no question of a public works concession contract. 170. In the light of this last observation, I suggest that the Court dismiss the Commission’s action. 171. It is true that my conclusion allows the risk of the circumvention of public procurement rules to persist, through contracts of sale with the transmission of the right of ownership. As a result, the situation is certainly not satisfactory. However, this is a consideration de lege ferenda. 172. In the present case, the Court is required to rule within the strict framework of an action for failure to fulfil obligations having regard to the law as it stands and the evidence provided by the Commission. If the Commission considers the risk described above to be considerable and harmful to the European Union, it is for it to exercise its right of legislative initiative in order to amend Directive 2004/18. 2. Summary 173. The applicable directive is the one in force when the contracting authority chooses the type of procedure to be followed and assesses whether it is necessary for a prior call for competition to be issued for the award of a public contract. 174. In the present case, I consider that the municipality took that decision on 23 April 2002. In my view, Directive 2004/18 was not therefore applicable. However, it is the basis for the Commission’s action. 175. The conditions required for the existence of a public works concession follow from the definitions of ‘public works contracts’ and ‘public works concession’ in Article 1(2)(a) and (b) and in Article 1(3) of Directive 2004/18 respectively. There are three. There must be: – a written contract between a contracting authority and an economic operator; – a contract whose object is either the execution, or both the design and execution, of works related to one of the activities within the meaning of Annex I to Directive 2004/18 or a work, or the realisation, by whatever means, of a work corresponding to the requirements specified by the contracting authority; – a contract concluded for pecuniary interest, where the consideration must consist either solely in the right to exploit the work or in this right together with payment (Article 1(3)). 176. In my view, the pecuniary nature of the contract requires, first, the realisation of a work by the concessionaire which is of immediate economic benefit to the contracting authority and, second, a consideration for the concessionaire, namely the right to exploit the work or this right together with payment to the concessionaire. To satisfy this condition, as the applicable legislation stands at present, the concession may be granted for an indefinite duration, but not infinitely, in particular in the form of a transfer of the contractual partner’s right of ownership. 177. Consequently, since Hurks derives its right of exploitation from ownership of the land purchased from the municipality and has not therefore obtained it through a public works concession contract, I consider the Commission’s action to be unfounded. IV – Costs 178. Under Article 138 of the Rules of Procedure, the unsuccessful party is to be ordered to pay the costs if they have been applied for in the successful party’s pleadings. The Commission must therefore be ordered to pay the costs incurred by the Kingdom of the Netherlands, since it has applied for costs. 179. In accordance with Article 140 of the Rules of Procedure, the Federal Republic of Germany is ordered to bear its own costs. V – Conclusion 180. In the light of the foregoing considerations, I propose that the Court: – dismiss the action brought by the European Commission, since 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 is not applicable ratione temporis; – in the alternative, dismiss the Commission’s action, since Directive 2004/18 is not applicable because the contract at issue is not a public works concession contract; – in any event, order the Commission to pay the costs incurred by the Kingdom of the Netherlands and order the Federal Republic of Germany to bear its own costs. 1 – Original language: French. 2 – OJ 2004 L 134, p. 114. 3 – See the opinion of the municipality’s internal services of 26 July 2001, approved by the municipal council on 7 August 2001 (Annex 1 to the defence). 4 – See Annex 3 to the defence. 5 – See the opinion of the municipality’s internal services of 11 April 2002, approved by the municipal council on 23 April 2002 (Annex 3 to the defence, p. 5). 6 – See Annex 5 to the defence. 7 – See, to that effect, Case C‑365/97 Commission v Italy [1999] ECR I‑7773, paragraph 35; Case C‑392/99 Commission v Portugal [2003] ECR I‑3373, paragraph 133; and Case C‑38/10 Commission v Portugal [2012] ECR, paragraph 16. 8 – Case C‑535/07 Commission v Austria [2010] ECR I‑9483, paragraph 41 (my emphasis). 9 – Case C‑494/01 Commission v Ireland [2005] ECR I‑3331, paragraph 36. 10 – I do not concur with the view taken by the Netherlands Government to the effect that the situation envisaged by the Court in Commission v Ireland, is limited to the case of a ‘failure of a general nature’ merely concerning ‘systemic and consistent tolerance’. On the contrary, in that same case, what the Commission intended to prove through the production of additional evidence was precisely ‘to support the proposition that the failure thus alleged is general and consistent’. See the judgment cited above, paragraph 37. 11 – Commission v Ireland, cited above, paragraphs 42 to 45. 12 – Case C‑458/08 Commission v Portugal [2010] ECR I‑11599, paragraph 47 and cited case-law. 13 – See paragraphs 156 to 160. 14 – Case C‑451/08 Helmut Müller [2010] ECR I‑2673. 15 – With regard to reliance by the Commission, in the application, on case-law not cited in the pre-litigation procedure for an action for failure to fulfil obligations, the Court ruled that ‘[b]y referring to the Open Skies judgments in its originating application the Commission merely intended to set out the most recent case-law relating to the principles governing the exclusive external competence of the Community, without extending, modifying or even limiting the subject-matter of the dispute, as defined in the reasoned opinion’ (Case C‑433/03 Commission v Germany [2005] ECR I‑6985, paragraph 29). 16 – See, to that effect, Case C‑337/98 Commission v France [2000] ECR I‑8377. 17 – See the opinion of the municipality’s internal services of 26 July 2001, approved by the municipal council on 7 August 2001 (Annex 1 to the defence). 18 – See Annex 2 to the defence. 19 – See Annex 4 to the defence. 20 – See the opinion of the municipality’s internal services of 11 April 2002, approved by the municipal council on 23 April 2002 (Annex 4 to the defence, p. 5). 21 – See Annex 4 to the defence. 22 – See Annex 5 to the defence. 23 – Judgment cited above. 24 – Case C‑454/06 [2008] ECR I‑4401. 25 – Commission v France, cited above, paragraphs 36 and 37 (my emphasis). 26 – Ibid., paragraph 40. 27 – Ibid., paragraph 44. 28 – pressetext Nachrichtenagentur, cited above, paragraph 35. 29 – Ibid., paragraph 36. 30 – Ibid., paragraph 37. 31 – Ibid., paragraph 40. 32 – See paragraph 46 of the Commission’s reply: ‘It must be inferred from the Court’s case-law that, on the basis of the principles of equal treatment and transparency of procurement procedures (see Article 2 of Directive 2004/18), public contracts must be re-awarded if one of the essential terms of the contract is amended and thus results in the conclusion of a new contract, but this does not mean that this position cannot be applied by analogy to other situations’ (my emphasis). 33 – Commission v France, cited above, paragraph 40. 34 – Ibid., paragraph 36. 35 – Case C‑138/08 Hochtief and Linde-Kca-Dresden [2009] ECR I‑8991, paragraphs 28 and 29. 36 – Article 2.5 of the opinion entitled ‘Selection of a promoter for the Doornakkers district centre’ (Annex 4 to the application). 37 – Wording used by the Court in paragraph 36 of the judgment in Commission v France. 38 – pressetext Nachrichtenagentur, cited above, paragraph 35. 39 – Ibid., paragraph 36. 40 – Ibid., paragraph 37. 41 – Ibid., paragraph 40. 42 – ‘Even though Hurks and the municipality had agreed on the price and on the sale of the land by the municipality …’ (paragraph 46 of the Commission’s application). 43 – Commission’s application, paragraphs 77 and 78 (my emphasis). 44 – To that effect, see, inter alia, Case C‑306/08 Commission v Spain [2011] ECR I‑4541, paragraph 94. 45 – My emphasis. 46 – Commission v France, cited above, paragraph 40. 47 – OJ 1993 L 199, p. 54. 48 – It could not be a public works contract in the strict sense in so far as there is no financial consideration from the municipality (with regard to this notion, see Opinion of Advocate General Jääskinen in Commission v Spain). 49 – Helmut Müller, cited above, paragraph 82. 50 – At the hearing, the Netherlands Government confirmed that the price of the land had been assessed beforehand by an independent expert and that it did not take into account any increase in value subsequently realised by the promoter. Hurks was not granted any reduction in consideration of the advantages that the municipality would derive from the execution of the project. 51 – With regard to this latter category – a work – reference can usefully be made to Auroux and Others, which also concerned a project to revitalise a district through the creation of a leisure centre consisting of, inter alia, a multiplex cinema and commercial premises. According to the Court, ‘[i]t is clear from Article 1(c) of [Directive 2004/18] that the existence of a work must be determined in relation to the economic or technical function of the result of the works undertaken (see Joined Cases C‑187/04 and C‑188/04 Commission v Italy, … paragraph 26). As is apparent from a number of clauses in the agreement, the construction of the leisure centre is intended to accommodate commercial and service activities, so that the agreement must be regarded as fulfilling an economic function’ (Case C‑220/05 Auroux and Others [2007] ECR I‑385, paragraph 41). In the present case, it cannot be disputed that several buildings are intended to accommodate commercial and service activities (healthcare, SPILcentrum, etc.) and therefore fulfil an economic function. 52 – Helmut Müller, cited above, paragraph 67 (my emphasis). 53 – Helmut Müller, cited above, paragraph 68. 54 – Annex to the information notice for prospective promoters participating in a selection process drafted by the municipality with a view to the meeting of 11 June 2002. 55 – See Annex 4 to the defence. 56 – Case C‑536/07 Commission v Germany [2009] ECR I‑10355, paragraph 58. 57 – Ibid., paragraph 59. 58 – Case C‑399/98 Ordine degli Architetti and Others [2001] ECR I‑5409, paragraph 59. 59 – For the company to which the contract is awarded, the consideration consists either in the right to exploit the work or in this right together with payment (Article 1(3) of Directive 2004/18). This requirement will be examined later. 60 – See Helmut Müller, cited above, paragraph 48. 61 – Ibid., paragraph 49. 62 – Point 54 of the Opinion. 63 – Ibid., point 55. 64 – Ibid., points 56 to 58. 65 – Ibid., point 59. 66 – Ibid., point 61. 67 – Helmut Müller, cited above, paragraph 50. 68 – Ibid., paragraph 51. 69 – Ibid., paragraph 52. 70 – Ibid., paragraph 52. 71 – Ibid., paragraph 52. 72 – Point 59 of the Opinion of Advocate General Mengozzi in Helmut Müller. 73 – Helmut Müller, cited above, paragraph 57. 74 – See below, points 118 to 121. 75 – Helmut Müller, cited above, paragraph 55. 76 – See points 12, 33 and 66 of this Opinion. 77 – See the recitals in the preamble to the cooperation contract of 15 April 2008 between Woonbedrijf and the municipality (p. 2) (Annex 5 to the Commission’s application). 78 – Convention signed between Woonbedrijf and the municipality on 15 April 2008. 79 – Paragraphs 17 to 20 of the rejoinder. 80 – Helmut Müller, cited above, paragraph 51. 81 – Case C‑345/02 Pearle and Others [2004] ECR I‑7139, paragraph 34 and cited case-law. 82 – According to figures communicated by the Netherlands Government in its response to the Commission of 19 December 2008 (Annex 7 to the application). 83 – Helmut Müller, cited above, paragraph 55. 84 – Helmut Müller, cited above, paragraph 79. 85 – pressetext Nachrichtenagentur, cited above, paragraph 74. Whilst that case concerned a service contract, this would not seem to prevent the reasoning being applied to public works contracts. Furthermore, Helmut Müller, concerned a public works contract. 86 – See the fourth subparagraph of Article 32(2) of Directive 2004/18. 87 – See Article 16 of the Proposal for a Directive of the European Parliament and of the Council on the award of concession contracts (COM(2011) 897 final) and the amendment proposed by the Council (18007/12) (2011/0437 (COD)). 88 – pressetext Nachrichtenagentur, cited above, paragraph 73. 89 – To that effect, pressetext Nachrichtenagentur, cited above, paragraph 73. 90 – See Articles 7.2 and 7.3 of the cooperation contract signed by the municipality and Hurks. 91 – See Article 12.2 of the cooperation contract. 92 – Point 90 of the Opinion. 93 – Helmut Müller, cited above, paragraph 72. 94 – Ibid., paragraphs 73 and 74 (my emphasis). 95 – Ibid., paragraph 73 (my emphasis). 96 – ‘Helmut Müller[, cited above,] taught us that there could be a concession only if the contracting authority retained ownership of the works in question, the idea being that it is not possible to grant a concession for something that you do not possess or that you no longer possess’ (Llorens, F., and Soler-Couteaux, P., ‘Marchés, DSP, concession de travaux ou d’aménagement: de quelques problèmes de frontière’, Contrats et marchés publics, Les revues Jurisclasseur, November 2011, indicator 10). The same writers expressed a similar view in an initial commentary on Helmut Müller: ‘One thing is sure: the sale of land cannot be treated in the same way as a works concession if the work to be constructed remains in the (definitive) ownership of the purchaser. … This closes the debate on whether the exploitation by a purchaser of land of the buildings which he expects to construct there as owner cannot be treated in the same way as the right of exploitation, which is a characteristic of concession’. However, the writers are uncertain about the situation – similar to the present case – where the contracting authority contributes to the financing of the buildings or if it took the initiative for them. Nevertheless, in this case, ‘the contract can no longer be treated in the same way as a concession if the exploitation by the purchaser relates solely to the works of which it is the owner’ (Llorens, F., and Soler-Couteaux, P., ‘La vente de terrains, la concession de travaux publics et le marché public de travaux: la vision de la CJUE (à propos de l’arrêt Helmut Müller)’, Contrats et marchés publics, Les revues Jurisclasseur, May 2010, indicator 5). For a criticism of this view, see Durviaux, A.-L., ‘Droit européen des marchés publics et autres contrats publics’, RTD eur., 2011, p. 423 to 447, sp. n° 13. For a strict interpretation, see also Fatôme, E., and Richer, L., ‘Concession de travaux et droit d’exploitation’, AJDA, 2012, p. 682: ‘Therefore, as the right to exploit a property constitutes an attribute of the right of ownership of that property, it seems logical that, for a contract to be regarded as a works concession, that contract must provide that once completed by the contractual partner, the work becomes the property of the contracting authority’. See also Meister, M., ‘Champ d’application de la directive 2004/18 et notion de “travaux”’, Europe, May 2010, p. 29. 97 – See, to that effect, Fatôme, E., and Richer, L., ‘Concession de travaux et droit d’exploitation’, op. cit. These writers refer to the Opinion delivered by Advocate General Jääskinen in Commission v Spain. 98 – Fatôme, E., and Richer, L., ‘Concession de travaux et droit d’exploitation’, op. cit. 99 – To that effect, see Llorens, F., and Soler-Couteaux, P., ‘Marchés, DSP, concession de travaux ou d’aménagement: de quelques problèmes de frontière’, Contrats et marchés publics, Les revues Jurisclasseur, November 2011, indicator 10. 100 – Brown, A., ‘Helmut Müller GmbH v Bundesanstalt fur Immobilienaufgaben (C‑451/08): clarification on the application of the EU procurement rules to land sales and development agreements’ P.P.L.R., 2010, 4, NA 125 to 130. 101 – Paragraph 73 (my emphasis). 102 – Ibid., paragraph 78. 103 – Article 7.2 of the cooperation contract signed between the municipality and Hurks. 104 – Article 7.3 of the cooperation contract. 105 – See Opinion of Mr Mengozzi in Helmut Müller, cited above, point 90. Mr Jääskinen wrote in his Opinion in Commission v Spain, cited above (point 97 of the Opinion): ‘However, even assuming that the ownership of land that the developer receives could be said to amount to a right to exploitation being granted, which is not my view, such a right is granted for an indefinite period and is thus contrary to the definition given to a concession by the Court in Helmut Müller and pressetext Nachrichtenagentur’ (my emphasis). As was explained above, I do not, on the other hand, share the view taken by Mr Jääskinen regarding the effect of the indefinite duration of the contract on the classification of the transaction.