Summary;Judgment — ECLI:EU:C:2022:559
Date: 2022-07-14
Language of the case: Spanish
Court formation: Fourth Chamber
Subject matter: Right of establishment;Internal market - Principles;Freedom to provide services
Procedure: Reference for a preliminary ruling;Reference for a preliminary ruling - inadmissible
Origin: Spain

Summary C-436/20 – 1 
Case C-436/20 
Summary of the request for a preliminary ruling pursuant to Article 98(1) of 
the Rules of Procedure of the Court of Justice 
Date lodged: 
16 September 2020 
Referring court: 
Tribunal Superior de Justicia de la Comunidad Valenciana (High 
Court of Justice of the Community of Valencia, Spain) 
Date of the decision to refer: 
3 September 2020 
Applicant/appellant: 
Asociación Estatal de Entidades de Servicios de Atención a 
Domicilio (ASADE) 
Defendant/respondent: 
Consejería de Igualdad y Políticas Inclusivas 
  
Subject matter of the main proceedings 
The purpose of the main proceedings is to determine the legality of legislation of 
the Community of Valencia which permits contracting authorities to make use of 
agreements with private non-profit organisations to provide social services to the 
person without following the procedures set out in EU public procurement 
legislation. 
Purpose and legal basis of the request for a preliminary ruling 
‘Request for a preliminary ruling on interpretation – Article 267 TFEU – Public 
procurement – Articles 49 and 56 TFEU – Directive 2014/24/EU – Directive 
2006/123/EC – National legislation which permits contracting authorities to make 
use of agreements with private non-profit organisations to provide social services 
to the person without following the procedures laid down in EU public 
procurement legislation’ 
EN 
SUMMARY OF THE REQUEST FOR A PRELIMINARY RULING – CASE C-436/20 
 
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Questions referred 
1) Must Article 49 TFEU and Articles 76 and 77 of Directive 2014/24/EU of 
the European Parliament and of the Council of 26 February 2014 (as read with 
Article 74 and Annex 14 thereof) be interpreted as precluding national legislation 
which permits contracting authorities to make use of agreements with private non-
profit organisations ― not solely voluntary associations ― to provide all manner 
of social services to the person in return for reimbursement of costs without 
following the procedures in the Procurement Directive and irrespective of the 
estimated value, simply by classifying the arrangements in question as non-
contractual? 
2) If the reply is in the negative, meaning that such arrangements are possible, 
must Article 49 TFEU and Articles 76 and 77 of the Procurement Directive (as 
read with Article 74 and Annex 14 thereof) be interpreted as permitting 
contracting authorities to make use of agreements with private non-profit 
organisations (not solely voluntary associations) to provide all manner of social 
services to the person in return for reimbursement of costs without following the 
procedures in the directive and irrespective of the estimated value, simply by 
classifying the arrangements in question as non-contractual, where, moreover, the 
national legislation in question does not expressly include the requirements 
established in Article 77 of the directive, but refers to subsequent implementation 
through regulations without expressly stipulating, among the requirements to be 
satisfied by the implementing regulations, that they must explicitly include the 
conditions laid down in Article 77 of the directive? 
3) If the reply is, again, in the negative, meaning that such a situation is 
possible, must Articles 49 and 56 TFEU, Articles 76 and 77 of the Public 
Procurement Directive (as read with Article 74 and Annex XIV thereof) and 
Article 15(2) of Directive 2006/123/EC of the European Parliament and of the 
Council of 12 December 2006 on services in the internal market be interpreted as 
permitting contracting authorities, when selecting non-profit organisations (not 
solely voluntary associations) with which to enter into agreements to provide all 
manner of social services to the person, to include not only the selection criteria 
set out in Article 2(2)(j) of the said directive but also the criterion that the 
organisation be established in the place where the service is to be provided? 
EU case-law and provisions of EU law cited 
Articles 49 and 56 TFEU. 
Directive 2014/24/EU of the European Parliament and of the Council of 
26 February 2014 on public procurement and repealing Directive 2004/18/EC (OJ 
2014 L 94, p. 65). Articles 76 and 77 (as read with Article 74 and Annex XIV). 
ASADE 
 
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Directive 2006/123/EC of the European Parliament and of the Council of 
12 December 2006 on services in the internal market (OJ 2006 L 376, p. 36). 
Article 15(2). 
Judgment of the Court of Justice of 19 December 2012, Ordine degli Ingegneri 
della Provincia di Lecce and Others (C-159/11, EU:C:2012:817). 
Judgment of the Court of Justice of 13 June 2013, Piepenbrock (C-386/11, 
EU:C:2013:385). 
Judgment of the Court of Justice of 19 June 2014, Centro Hospitalar de Setúbal 
and SUCH (C-574/12, EU:C:2014:2004). 
Judgment of the Court of Justice of 28 January 2016, CASTA and Others 
(C-50/14, EU:C:2016:56). 
National case-law and provisions of national law cited 
Ley 5/1997, de 25 de junio, por la que se regula el Sistema de Servicios Sociales 
en el ámbito de la Comunidad Valenciana (Law 5/1997 of 25 June 1997 
governing the Social Services System within the Community of Valencia) (BOE 
No 192 of 12 August 1997, p. 24405). (Law of the Community of Valencia.) 
Articles 44 bis, 53, 56, 62, 63, 64, 66, 67 and 68. [Amended by the Ley 13/2016, 
de 29 de diciembre, de medidas fiscales, de gestión administrativa y financiera, y 
de organización de la Generalitat (Law 13/2016 of 29 December 2016 on 
measures in respect of tax, administrative and financial management and the 
organisation of the Government of the Community of Valencia) (BOE No 34 of 
9 February 2017, p. 8694).] 
Ley 3/2019, de 18 de febrero, de servicios sociales inclusivos de la Comunitat 
Valenciana (Law 3/2019 of 18 February 2019 on inclusive social services in the 
Community of Valencia) (BOE No 61 of 12 March 2019, p. 23249). (Law of the 
Community of Valencia.) Articles 87, 88 and 92. 
Decreto 181/2017, de 17 de noviembre, del Consell, por el que se desarrolla la 
acción concertada para la prestación de servicios sociales en el ámbito de la 
Comunitat Valenciana por entidades de iniciativa social (Decree 181/2017 of 
17 November 2017 of the Council of the Community of Valencia making 
regulations governing public-private agreements for the provision of social 
services by social enterprises within the Community of Valencia (DOGV No 8197 
of 23 December 2017, p. 48245). 
Brief summary of the facts and the main proceedings 
1 By virtue of the powers conferred on it in respect of social services by the Spanish 
Constitution, the Community of Valencia passed Law 5/1997 of 25 June 1997 
SUMMARY OF THE REQUEST FOR A PRELIMINARY RULING – CASE C-436/20 
 
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governing the Social Services System within the Community of Valencia (‘Law 
5/1997’). Regulations to implement this law were made by Decree 181/2017 of 
17 November 2017 of the Council of the Community of Valencia making 
regulations on public-private agreements for the provision of social services by 
social enterprises within the Community of Valencia (‘Decree 181/2017’). Law 
5/1997 was repealed by Law 3/2019 of 18 February 2019 on inclusive social 
services in the Community of Valencia (‘Law 3/2019’). Under this law, Decree 
181/2017 remains in force. 
2 The Asociación Estatal de Entidades de Servicios de Atención a Domicilio (State 
Association of Domiciliary Care Providers, ‘ASADE’) lodged an administrative-
law action with the referring court against Decree 181/2017. In that action, in 
addition to seeking to have Decree 181/2017 declared void ab initio, it sought a 
ruling that Article 44 bis(c), Article 53, Article 56(2) and Title VI of Law 5/1997 
were inapplicable. 
3 In the action ASADE also relied on Article 267 TFEU, asking the referring court 
to refer the matter to the Court of Justice for an interpretation concerning the 
compatibility of Law 5/1997 with Article 49 TFEU, Article 77 of Directive 
2014/24/EU and Article 15(2) of Directive 2006/123/EC. Having heard ASADE 
and the other party to the proceedings (the Consejería de Igualdad y Políticas 
Inclusivas de la Comunidad Valenciana (Community of Valencia Department for 
Equality and Inclusive Policies)), the referring court referred the three questions in 
the request summarised herein to the Court of Justice for a preliminary ruling. 
Main arguments of the parties to the main proceedings 
4 ASADE argues that Decree 181/2017, which makes regulations on the public-
private agreements provided for in Law 5/1997, excludes for-profit entities from 
providing public services under a public-private agreement and allows non-profit 
organisations (not solely voluntary associations) to provide public services in 
return for payment without having to go through a transparent competitive process 
that ensures equal treatment. In its view, this is contrary to Article 49 TFEU 
(freedom of establishment), to Directive 2014/24/EU, in that it does not respect 
the principle of equal treatment between economic operators, and to Article 15(2) 
of Directive 2006/123/EC. 
5 ASADE states that freedom of establishment is restricted and that the restriction is 
not justified on grounds of public policy, public security or public health, or for 
overriding reasons in the public interest. Moreover, in its view, the exceptions to 
the rule that were established in Centro Hospitalar de Setúbal and SUCH and in 
Casta and Others are not applicable, because the legislation of the Community of 
Valencia is not restricted to the areas of health and social security, but covers all 
types of social services and, moreover, applies to non-profit organisations rather 
than solely to voluntary associations. 
ASADE 
 
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6 Lastly, ASADE notes that the repeal of Law 5/1997 by Law 3/2019 does not in 
any way alter the situation, since the system of public-private agreements is 
reproduced with minor changes, and public-private agreements continue to be 
reserved for non-profit organisations rather than solely for voluntary associations. 
7 The Department for Equality and Inclusive Policies considers that both Law 
5/1997 and Decree 181/2017 comply with Directives 2014/24/EU and 
2006/123/EC. It states that, having regard to the principle of solidarity enshrined 
first in the TEU and now in the TFEU, the Court of Justice has already permitted 
exceptions to be made to the principle of free competition in the case of contracts 
concluded with non-profit organisations in relation to the social security system, 
given that social and health services display a number of characteristics that 
require them to be treated differently as regards public procurement rules. In this 
respect, it refers to recitals 6, 7 and 114 of Directive 2014/24/EU, and also to 
Article 77 of the directive, which even permits contracts in the field of social, 
cultural or health services to be reserved for certain organisations. 
8 The Department for Equality and Inclusive Policies notes that public-private 
agreements offer an alternative form of management to direct or indirect 
management of non-economic public services, which are provided by non-profit 
organisations that receive payment in the form of reimbursement of costs (which 
may not include any business profit), in accordance with the principle of 
budgetary efficiency. It also considers that public-private agreements do not 
infringe Directive 2006/123/EC, since the directive does not apply to non-
economic services of general interest or to social services relating to social 
housing, childcare and support to families and persons permanently or temporarily 
in need which are provided by the State or by charities recognised as such by the 
State. 
9 Lastly, the Department for Equality and Inclusive Policies considers that the 
request for a preliminary ruling is unfounded, since Law 5/1997 has been repealed 
by Law 3/2019. 
Brief summary of the reasons for the request for a preliminary ruling 
10 The referring court notes that, in the light of decisions of the Court of Justice such 
as those in Ordine degli Ingegneri della Provincia di Lecce and in Piepenbrock, 
the concept of a contract for pecuniary interest also includes contracts for which 
the agreed remuneration is limited to reimbursement of the costs of providing the 
agreed service. The referring court therefore doubts that the arrangements for 
public-private agreements contained in Article 4 bis(1)(c), Article 53, 
Article 56(2) and Title VI of Law 5/1997 comply with European Union law and, 
in particular, with Articles 49 and 56 TFEU, Articles 76 and 77 of Directive 
2014/24/EU (as read with Article 74 and Annex XIV thereof) and Article 15(2) of 
Directive 2006/123/EC. 
SUMMARY OF THE REQUEST FOR A PRELIMINARY RULING – CASE C-436/20 
 
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11 The referring court believes that an answer is needed from the Court of Justice to 
its question concerning the compatibility of the arrangements for public-private 
agreements with EU law, since the referring court’s ruling on ASADE’s 
application for a declaration of nullity of Decree 181/2017 is dependent on this 
point. 
12 The referring court notes that the fact that Law 5/1997 has been repealed by Law 
3/2019 does not lessen its interest in obtaining the requested interpretation from 
the Court of Justice, since the new law does not materially alter the arrangements 
for public-private agreements for the provision of social services, and the starting 
point for the examination of the contested administrative provision (Decree 
181/2017) must be the lawfulness or otherwise of the originating law which it 
implements (Law 5/1997).