Judgment;Abstract — ECLI:EU:C:2020:240
Date: 2020-03-26
Language of the case: Hungarian
Court formation: Fourth Chamber
Subject matter: Right of establishment;Approximation of laws;Freedom to provide services
Procedure: Reference for a preliminary ruling
Origin: Hungary

Summary C-496/18 — 1 
Case C-496/18  
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: 
30 July 2018 
Referring court: 
Fővárosi Törvényszék (Budapest High Court, Hungary) 
Date of the decision to refer: 
7 June 2018 
Applicants: 
HUNGEOD Közlekedésfejlesztési, Földmérési, Út- és 
Vasúttervezési Kft. 
SIXENSE Soldata 
Budapesti Közlekedési Zrt. 
Defendant: 
Közbeszerzési Hatóság — Közbeszerzési Döntőbizottság (Public 
Procurement Authority — Public Procurement Arbitration Panel) 
  
Subject matter of the main proceedings 
Administrative review of the decision declaring the amendment of a public 
contract to be illegal and imposing a fine. 
Purpose and legal basis of the request for a preliminary ruling 
Whether the power of the authority responsible for reviewing the legality of public 
contracts to commence proceedings of its own motion and, where applicable, to 
impose a fine, once the period for bringing an action for a review of public 
procurement infringements established in the Member State’s previous legislation 
has expired, but before the expiry of the period for bringing an action established 
in the new legislation, is compatible with the principles on which the public 
EN 
SUMMARY OF THE REQUEST FOR A PRELIMINARY RULING — CASE C-496/18  
 
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procurement directives are based, the principle of legal certainty, the right to good 
administration and the right to an effective remedy and a fair trial. 
Legal basis: Article 267 TFEU. 
Questions referred 
1. Must Article 41(1) and Article 47 of the Charter of Fundamental Rights of 
the European Union, recitals 2, 25, 27 and 36 of Directive 2007/66/EC of the 
European Parliament and of the Council of 11 December 2007 amending 
Council Directives 89/665/EEC and 92/13/EEC with regard to improving 
the effectiveness of review procedures concerning the award of public 
contracts, Article 1(1) and (3) of Council Directive 92/13/EEC of 
25 February 1992 coordinating the laws, regulations and administrative 
provisions relating to the application of Community rules on the 
procurement procedures of entities operating in the water, energy, transport 
and telecommunications sectors, and, in this context, the principle of legal 
certainty, as a general principle of EU law, and the requirement for effective 
and rapid remedies against decisions by contracting authorities in public 
procurement cases, be interpreted as precluding legislation of a Member 
State which, in relation to public procurement contracts entered into before 
that legislation came into force, provides a general authorisation that enables 
the competent (monitoring) authority created by that legislation, after the 
periods established in the Member State’s previous legislation for bringing 
an action for review of public procurement infringements committed prior to 
the entry into force of the new legislation have expired but within the time 
period established in the new legislation, to commence proceedings to 
investigate a specific public procurement infringement and to rule on the 
substance, leading to a ruling that the infringement did take place, the 
imposition of a public procurement penalty, and the application of the 
consequences of the voiding of the contract? 
2. Can the legal rules and principles referred to in question 1 ― and also the 
effective exercise of the (subjective and personal) right of review enjoyed by 
parties with an interest in the award of a public contract ― be applied to the 
right to commence and conduct review proceedings conferred on the 
(monitoring) authorities created by the law of the Member State, which have 
the power to identify and investigate public procurement infringements of 
their own motion, and which are under a duty to defend the public interest? 
3. Does Article 99(1) and (2) of Directive 2014/25/EU of the European 
Parliament and of the Council on procurement by entities operating in the 
water, energy, transport and postal services sectors and repealing Directive 
2004/17/EC mean that in order to defend EU financial interests in the field 
of public procurement, the law of the Member State may, through the 
adoption of new legislation, confer on the (monitoring) authorities which 
HUNGEOD AND OTHERS 
 
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have power under the law of the Member State to identify and investigate 
public procurement infringements of their own motion, and which are under 
a duty to defend the public interest, a general power to investigate public 
procurement infringements committed before the entry into force of the 
legislation in question and to commence and conduct proceedings, even 
where the time periods established under the previous legislation have 
expired? 
4. If ― having regard to the legal rules and principles referred to in question 1 
― the (monitoring) authorities’ power of investigation described in 
questions 1 and 3 is held to be compatible with EU law, is any relevance to 
be ascribed to the legal, regulatory, technical or organisational deficiencies 
or other obstacles that prevented the public procurement infringement from 
being investigated at the time when the infringement took place? 
5. Even if, in the light of the above principles, the (monitoring) authorities 
which are authorised by the law of the Member State to identify and 
investigate public procurement infringements of their own motion, and 
which are under a duty to defend the public interest may be granted the 
power referred to in questions 1 to 4, must Article 41(1) and Article 47 of 
the Charter of Fundamental Rights of the European Union, recitals 2, 25, 27 
and 36 of Directive 2007/66/EC of the European Parliament and of the 
Council of 11 December 2007 amending Council Directives 89/665/EEC 
and 92/13/EEC with regard to improving the effectiveness of review 
procedures concerning the award of public contracts, Article 1(1) and (3) of 
Council Directive 92/13/EEC of 25 February 1992 coordinating the laws, 
regulations and administrative provisions relating to the application of 
Community rules on the procurement procedures of entities operating in the 
water, energy, transport and telecommunications sectors and, in this context, 
the principle of legal certainty, as a general principle of EU law, and the 
requirement for effective and rapid remedies against decisions by 
contracting authorities in public procurement cases, and the proportionality 
principle, be interpreted as meaning that the national courts may assess 
whether the period of time that has elapsed between the occurrence of the 
infringement, the expiry of the period previously established for bringing an 
action for review, and the commencement of the proceedings to investigate 
the infringement, is reasonable and proportionate, and may use this as a 
basis for determining the legal consequences of the nullity of the contested 
decision or other consequences established by the law of the Member State? 
Provisions of EU law cited 
– Articles 41 and 47 of the Charter of Fundamental Rights of the European 
Union. 
SUMMARY OF THE REQUEST FOR A PRELIMINARY RULING — CASE C-496/18  
 
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– Council Directive 89/665/EEC of 21 December 1989 on the coordination of the 
laws, regulations and administrative provisions relating to the application of 
review procedures to the award of public supply and public works contracts. 
– Article 1(1) and (3) of Council Directive 92/13/EEC of 25 February 1992 
coordinating the laws, regulations and administrative provisions relating to the 
application of Community rules on the procurement procedures of entities 
operating in the water, energy, transport and telecommunications sectors. 
– Recitals 2, 25, 27 and 36 of Directive 2007/66/EC of the European Parliament 
and of the Council of 11 December 2007 amending Council Directives 
89/665/EEC and 92/13/EEC with regard to improving the effectiveness of 
review procedures concerning the award of public contracts. 
– Recital 122 of 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. 
– Article 99(1) and (2) of Directive 2014/25/EU of the European Parliament and 
of the Council of 26 February 2014 on procurement by entities operating in the 
water, energy, transport and postal services sectors and repealing Directive 
2004/17/EC. 
– Judgments of the Court of Justice of 30 May 1991, Commission v Germany 
(361/88, EU:C:1991:224); of 7 November 1996, Commission v Luxembourg 
(C-221/94, EU:C:1996:424); of 12 December 2002, Universale Bau and Others 
(C-470/99, EU:C:2002:746); of 11 October 2007, Lämmerzahl (C-241/06, 
EU:C:2007:597); of 28 January 2010, Commission v Ireland (C-456/08, 
EU:C:2010:46); of 21 October 2010, Symvoulio Apochetefseon Lefkosias 
(C-570/08, EU:C:2010:621); of 11 September 2014, Fastweb (C-19/13, 
EU:C:2014:2194); of 12 March 2015, eVigilo (C-538/13, EU:C:2015:166), 
paragraph 40; of 6 October 2015, Orizzonte Salute (C-61/14, EU:C:2015:655); 
of 15 September 2016, Star Storage and Others (C-439/14 and C-488/14, 
EU:C:2016:688); of 5 April 2017, Marina del Mediterráneo and Others (C-
[391]/15, EU:C:2017:268); and of 16 May 2017, Berlioz (C-682/15, 
EU:C:2017:373). 
Provisions of national law cited 
– Articles 303, 306/A, 307, 322, 323, 325, 327, 328 and 379 of the a 
közbeszerzésekről szóló 2003. évi CXXIX. törvény (Law CXXIX of 2003 on 
Public Procurement; ‘the 2003 Law on Public Procurement’). 
– Articles 148, 152, 153, 187 and 197 of the a közbeszerzésekről szóló 2015. évi 
CXLIII. törvény (Law CXLIII of 2015 on Public Procurement; ‘the 2015 Law 
on Public Procurement’). 
HUNGEOD AND OTHERS 
 
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– Articles 1 and 80 of the a 2007–2013 programozási időszakban az Európai 
Regionális Fejlesztési Alapból, az Európai Szociális Alapból és a Kohéziós 
Alapból származó támogatások felhasználásának rendjéről szóló 4/2011. 
(I. 28.) Korm. rendelet (Decree No 4/2011 of 28 January 2011 on the use of aid 
from the European Regional Development Fund, the European Social Fund and 
the Cohesion Fund for the 2007-2013 programming period). 
– Article 200 of the a Polgári Törvénykönyvről szóló 1959. évi IV. törvény (Law 
IV of 1959 on the Civil Code). 
– Article 6:95 of the a Polgári Törvénykönyvről szóló 2013. évi V. törvény (Law 
V of 2013 on the Civil Code). 
Brief summary of the facts and the main proceedings 
1 On 1 March 2006, Budapesti Közlekedési Zrt, as the contracting authority, and 
SIXENSE Soldata and Hungeod 2006, as members of the consortium that had 
been awarded the tender, concluded a public contract that exceeded the threshold 
established by EU law, for the supply of certain equipment for the project for Line 
4 of the Budapest Metro, which was undertaken in part using EU funding. The 
parties amended the contract on 5 October 2009. The contracting authority 
published a notice informing of the amendments in accordance with Article 307 of 
the 2003 Law on Public Procurement. In its decision of 3 August 2017 ― in 
proceedings commenced on 29 May 2017 of his own motion by the Head of the 
Közbeszerzési Hatóság (Public Procurement Authority) ― based on procedural 
rules laid down in the new 2015 Law on Public Procurement, which had come 
into force after the contract had been signed, the Közbeszerzési 
Döntőbizottságnak (Public Procurement Arbitration Panel) ruled that the 
amendment of this contract was contrary to the 2003 Law on Public Procurement 
and imposed a fine on the parties. 
Main arguments of the parties in the main proceedings 
2 In its decision, the Public Procurement Arbitration Panel first examined the 
applicants’ argument over whether the Public Procurement Authority had begun 
the process of reviewing the amendment of the contract within the time period, 
and whether the 2003 or the 2015 Law on Public Procurement applied. 
3 In its opinion, under the transitional provision in the 2015 Law on Public 
Procurement (Article 197(1)), the 2015 Law should apply to the possibility of 
amending contracts entered into before the 2015 Law came into force (on 
1 November 2015), to monitoring the performance and amendment of such 
contracts and to review procedures. With regard to the monitoring of amendments, 
under the 2015 Law on Public Procurement the jurisdiction of the Public 
Procurement Authority is not restricted to contract amendments that take place 
after the entry into force of the 2015 Law. The defendant therefore considers that 
SUMMARY OF THE REQUEST FOR A PRELIMINARY RULING — CASE C-496/18  
 
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the principles of non-retroactivity and legal certainty cited by the applicants do not 
apply. 
4 Based on the above, the defendant considers that the 2015 Law on Public 
Procurement also establishes the periods within which actions for review must be 
brought. Because the project that is the subject of the proceedings is in large part 
being undertaken with EU funding, the peremptory time period laid down in 
Decree 4/2011 of 28 January 2011 applies, which allows the disputed contractual 
amendment to be reviewed until 31 December 2020. 
Brief summary of the grounds for the request for a preliminary ruling 
5 Public procurement law is one of the areas of Hungarian law that changes most 
often ― also as a result of EU law — meaning that legal stability and 
predictability are particularly important in this area, not only as regards the tender 
process and the conclusion of contracts, but also as regards subsequent reviews of 
the legality of the way in which those contracts are performed. The referring court 
wishes to know what requirements arise from EU law with regard to the time 
periods established in the public procurement review procedure for bringing an 
action for review and whether, alongside legal certainty, there is a public interest 
(such as the protection of the European Union’s financial interests) that provides 
justification for allowing public contracts to be examined for almost a decade 
afterwards. 
6 The Court of Justice has already addressed the issue of the compatibility with EU 
law of periods within which actions for review of public procurement cases must 
be brought in several judgments. In particular, it has held that the objective of 
ensuring effective and rapid remedies pursued by Directive 89/665 must be 
achieved in national law in compliance with the requirements of legal certainty 
(judgment of 28 January 2010, Commission v Ireland, C-456/08, EU:C:2010:46, 
paragraph [61]). However, firstly, the Court of Justice has ruled on this matter 
within the context of what is known as the subject’s right to an effective remedy, 
that is, with regard to actions brought by one of the parties with an interest in the 
public contract (the contracting authority or the successful or unsuccessful 
tenderers). By contrast, in the present proceedings the point at issue is the right of 
the monitoring authorities responsible for ensuring judicial oversight of the 
process to bring such an action. 
7 Directive 2014/24 strengthened the role of what are known as the monitoring 
authorities, which are charged with overseeing the legality of public contracts. 
Where these authorities identify specific infringements, whether through their own 
initiatives or as a result of information received, they are empowered to indicate 
those problems, in particular, to the courts or other authorities. That directive was 
implemented by the 2015 Law on Public Procurement, which created the Public 
Procurement Authority, whose role is to promote legal compliance in the field of 
public procurement and openness and transparency in the use of public funds, 
HUNGEOD AND OTHERS 
 
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having regard to the public interest and the interests of the contracting authorities 
and the tenderers. Within this context, amongst other powers, it exercises official 
power to review amendments to contracts and to bring actions of its own motion 
before the Public Procurement Arbitration Panel where it is likely that the 
amendment or the performance of the contract is unlawful. 
8 In this regard, the referring court harbours doubts as to whether, under the rules 
and principles established in Directive 2014/24, there are limits on the powers of a 
Member State’s monitoring authorities ― and, if so, the nature of those limits ― 
and the extent to which the requirements of EU law set out by the Court of Justice 
in relation to the subject’s right to an effective remedy in public procurement 
cases prevail in relation to those limits. 
9 Specifically, questions 1 to 5 seek to clarify whether these rules and principles of 
EU law prevent the legislation of a Member State from ‘reopening’ periods for 
bringing actions for review established under the previous legislation that have 
already expired in respect of a particular infringement and enabling the 
infringement to be investigated. If, however, this is possible for overriding reasons 
of public interest (for example, the European Union’s financial interests), the 
referring court wishes to clarify whether the fact that the infringement was not 
investigated until 8 years later is of any relevance. 
10 The defendant argues that it is not a case of reopening the period, but rather that 
the 2015 Law on Public Procurement made provision for the exercise of a 
completely new power. However, the referring court rejects this argument, 
because the 2003 Law on Public Procurement already contains peremptory 
periods, which are of the utmost importance. 
11 In addition, the facts of the main proceedings show, firstly, that the infringement 
that was examined in the review procedure commenced in 2017 could legally have 
been examined under the provisions of the 2003 Law on Public Procurement and, 
secondly, that in any event the periods laid down in the 2003 Law on Public 
Procurement for commencing an investigation of this infringement had already 
expired at that time. 
12 The need for legal certainty recognised in the case-law of the Court of Justice 
requires the State and the legislature to ensure that both the overall legal 
framework and also each of its individual provisions are clear, unequivocal, 
foreseeable in terms of their effects, and predictable. This leads to the principle of 
non-retroactivity and, in particular, the prohibition on legal regulation ex post 
facto. The referring court awaits a response from the Court of Justice on whether 
EU law, in particular the requirement for effective and rapid remedies in public 
procurement and the principle of legal certainty, mean that there must be 
reasonable and proportionate time limits on the ability of the monitoring 
authorities to bring actions for review of public procurement cases. 
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13 Indeed, if the purpose of the periods laid down in the public procurement 
legislation is precisely to ensure that remedies against infringements committed 
during public procurement procedures are as rapid and effective as possible, and 
to bring the legal relationship arising from that procedure to a definitive 
conclusion within a specific timescale, a new legal provision that enables public 
contracts to be re-examined seems incompatible with that objective. 
14 The referring court notes that the first question referred specifically raises the 
issue of what the precise legal consequences would be, within the field of public 
procurement, of any limits imposed by EU law on the aforesaid legal authorisation 
(whether these apply only to the commencement of an investigation into an 
infringement and an examination of the substance, and thus to a finding that an 
infringement has occurred and the imposition of a fine, or to the application of the 
consequences of declaring the contract void, or to all these matters). Recitals 25 
and 27 of Directive 2007/66 refer explicitly to the requirement for legal certainty 
only with regard to reviews intended to lead to the contract being declared void. 
15 The express aim of question 2 is to clarify whether the Court of Justice considers 
that the general requirements applicable to reviews in the field of public 
procurement referred to above (legal certainty, effectiveness, rapidity, 
predictability, foreseeability and effective safeguarding of the rights of those 
subject to EU law) are also decisive and apply to actions for review (intended to 
penalise an infringement) where the review is intended to ensure judicial oversight 
of the subject matter of the process. 
16 With regard to question 4, the referring court expresses its doubts as to whether 
the nature of the deficiencies or obstacles that prevented the infringement from 
being investigated is relevant. On the one hand, while it is true that the 2003 Law 
on Public Procurement provided a lower level of publicity and official oversight, 
the applicants published a notice concerning the amendment of the contract, and 
the Public Procurement Arbitration Panel even examined the amendment at the 
request of the EUTAF [Directorate General for Audits of EU Funding], which it 
rejected on the ground that it was out of time. In addition, the risks entailed by 
negligence on the part of the monitoring authorities or failure to detect an 
infringement are matters for the Member State, not for those involved in the 
public procurement process. Moreover, it was also possible to examine the 
amendment of the contract under the 2003 Law on Public Procurement, given that 
a specific decision was adopted on this question. In the opinion of the referring 
court, according to the interpretation provided by the Court of Justice, the purpose 
of establishing time limits for bringing actions for review in public procurement 
cases is precisely to impose definitive limits on challenges to decisions by 
contracting authorities or to performance of contracts, and to ensure that those 
limits are objective and apply irrespective of the reason why the public contract 
was not examined. Once a time period has expired it cannot commence to run 
again, nor can it be extended, thus prolonging indefinitely the period of time in 
which to bring an action. 
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17 The referring court also requests an interpretation of EU law in the light of 
Articles 41 and 47 of the Charter on Fundamental Rights because, in its view, 
according to the case-law, Article 1 of Directive 89/665 must necessarily be 
interpreted in the light of the fundamental rights set out in the Charter, in 
particular the right to an effective remedy in Article 47 (judgment of 6 October 
2015, Orizzonte Salute, C-61/14, EU:C:2015:655, paragraph 49). This court 
believes that an examination and interpretation is also needed of Article 41, 
because the Public Procurement Arbitration Panel is an administrative authority. It 
is not clear whether the legislation in question passed by the Member State 
ensures fair treatment where, under that legislation, the applicants have to face the 
fact that, even though the periods established in the 2003 Law on Public 
Procurement have expired, 8 years later, under the provisions of a new law, they 
can face an action for review which also affects their right of defence. 
18 In this context, in question 5 the referring court also asks the Court of Justice to 
interpret EU law in order to clarify whether ― in the event that, in spite of the 
points set out above, it is possible to examine the amendment to the public 
contract in question ― the court of the Member State may take into account the 
length of time that has elapsed when the court comes to determine whether the 
disputed administrative act is void, or the amount of the fines to be imposed and 
other penalties, or in any other way.