62023TJ0126_RES
Case T‑126/23
VC
v
European Agency for Safety and Health at Work
Judgment of the General Court (Fourth Chamber, Extended Composition) of 2 October 2024
(Public supply contracts – Financial regulation – Exclusion from procurement procedures and from the award of grants financed by the general budget of the European Union and by the EDF for a period of two years – Publication of the exclusion – Registration in the early detection and exclusion system database – Serious professional misconduct – Decision of a national competition authority – Suspension by a national court – Obligation to state reasons – Right to effective judicial protection – Remedial measures – Unlimited jurisdiction – Manifest error of assessment – Error of assessment – Proportionality)
European Union public contracts – Tendering procedure – Decision to exclude an operator from tendering procedures and from the award of grants for ‘serious professional misconduct’ – Absence of a final judgment or a final administrative decision – Exclusion on the basis of a preliminary classification in law of the conduct of the tenderer – Preliminary classification on the basis of an administrative decision – Suspension of that decision by a national court – Effects of the suspension decision on the competent EU authority – Absence – Observance of the right to effective judicial protection
(Arts 4(3) and 19(1), second subparagraph, TEU; Art. 325 TFEU; Charter of Fundamental Rights of the European Union, Art. 47; European Parliament and Council Regulation No 966/2012, as amended by Regulation 2015/1929, Art. 106(1), (2) and (7), and 2018/1046, Art. 136(1), (2) and (6)
(see paragraphs 24-28, 37, 38, 42-44)
European Union public contracts – Tendering procedure – Decision to exclude an operator from tendering procedures and from the award of grants for ‘serious professional misconduct’ – Judicial review – Unlimited jurisdiction – Scope – Strict limitation to determining the penalty – Remedial measures taken by the operator – Exclusion
(Arts. 261 and 263 TFEU; European Parliament and Council Regulations No 966/2012, as amended by Regulation 2015/1929, Art. 106(7)(c) and 2018/1046, Arts 136(6)(a) and 143(9))
(see paragraphs 54-56)
Action for annulment – Review of legality – Criteria – Decision to exclude an operator from tendering procedures and from the award of grants for ‘serious professional misconduct’ – Factors to be taken into consideration – Factors that pre-date the contested decision – Evidence not presented during the administrative procedure before the EU authorities – Exclusion
(Arts. 261 and 263 TFEU; European Parliament and Council Regulations No 966/2012, as amended by Regulation 2015/1929, Art. 106(7)(c) and 2018/1046, Arts 136(6)(a) and 143(9))
(see paragraphs 58-60, 62, 64, 65)
EU budget – Financial regulation – Administrative penalties which may be imposed by the Commission – Decision to exclude an operator from tendering procedures and from the award of grants for ‘serious professional misconduct’ – Judicial review – Unlimited jurisdiction – Compliance with the principle of proportionality in the determination of the penalty imposed on the operator
(European Parliament and Council Regulations No 966/2012, as amended by Regulation 2015/1929, Arts 106(3) and 108(11) and 2018/1046, Art. 143(9))
(see paragraphs 122, 125-128, 149, 150, 160)
Résumé
The General Court, sitting in an extended composition, dismissed the action for annulment brought by the applicant, VC, against the decision excluding that party from participating in procedures for the award of public contracts of the European Union for a period of two years on the basis of serious professional misconduct. (
1
) In its judgment, the Court rules, for the first time, on the effects of a national court decision suspending the administrative decision on which the exclusion was based. It has also taken the unprecedented step of specifying the scope of its unlimited jurisdiction in assessing the adequacy of the remedial measures adopted by a tenderer, as well as the need to replace an exclusion penalty by a financial penalty.
The applicant had submitted a bid for a lot in the call for tenders published by the European Agency for Safety and Health at Work (EU-OSHA) for the provision of information and communication technology services. After becoming aware of the existence of a decision of the Comisión Nacional de los Mercados y la Competencia (National Commission on Markets and Competition, Spain) (‘the CNMC’) finding that the applicant had participated in an infringement of competition law (‘the CNMC Decision’), EU-OSHA had requested a panel, convened in accordance with the financial regulation, (
2
) to make a recommendation concerning whether to impose an exclusion or a financial penalty on the applicant.
Subsequently, the Audiencia Nacional (National High Court, Spain) ordered a stay of execution of the CNMC decision (‘the national decision to stay execution’). However, after making a preliminary legal assessment of the applicant’s conduct, (
3
) the abovementioned panel recommended that EU-OSHA exclude that party, taking the view that the conduct in question should be regarded as ‘serious professional misconduct’. EU-OSHA followed this recommendation and adopted the contested decision.
Findings of the Court
In the first place, the Court clarifies the scope of the effects of the national decision to stay execution.
First, the Court notes that, based on the financial regulation, (
4
) an entity can be excluded from participating in procedures for the award of public contracts, in the absence of a final judgment or a final administrative decision, on the basis of a preliminary legal assessment of its conduct by the competent EU authority based on established facts or findings determined in particular by decisions of a national competition authority. It follows that the absence of a final judgment or decision establishing the misconduct in question does not preclude the adoption of an exclusion measure by the competent EU authority.
The Court infers from this that the EU legislature intended to allow the competent EU authority to make its own assessment of the acts committed by the economic operator concerned, without waiting for a court to give judgment.
Accordingly, in the present case, it was for EU-OSHA, in the absence of a final decision, to make its own assessment of the applicant’s conduct on the basis of the CNMC decision, but also of other relevant factors relating to the factual context, including, in particular, the stay of execution of that decision.
In the present case, the Court has held that EU-OSHA did take into account the stay of execution of the CNMC decision and that it rightly considered that the stay of execution of that decision did not preclude the findings of that decision from being taken into account in order to demonstrate the existence of serious professional misconduct on the part of the applicant and to adopt an exclusion measure.
Indeed, the facts alleged against the applicant are not based on mere supposition or presumption, but were established on the basis of the findings of an investigation carried out by the CNMC.
Furthermore, the national decision to stay execution does not take a position on the substance of the CNMC decision. The Court states that the findings and considerations of the CNMC decision relating to the applicant’s failure to comply with competition law are therefore in no way called into question, or even doubted, by the national court, which has based its decision to stay execution on considerations derived solely from the consequences of the fine imposed and of the prohibition to conclude contracts on the applicant’s continuation of its activities. In any event, the fact that, as the applicant maintains, by granting a provisional measure the national court implicitly but necessarily recognised the plausibility of the CNMC’s allegations cannot be sufficient to call into question the explicit considerations and findings of the CNMC decision.
Lastly, it is irrelevant that the national decision to stay execution suspends not only the payment of the fine imposed by the CNMC decision but also the prohibition on the applicant’s being awarded procurement contracts in Spain imposed by that decision. The reasons for the stay of execution of the CNMC decision do not call into question the accuracy of the facts serving as the basis for the contested decision and thus ordering the exclusion of the applicant. Furthermore, the national decision to stay execution does not contain any information as to whether the applicant had implemented any remedial measures or whether the adoption of such measures justified the stay of execution.
Secondly, as regards the alleged infringement of the principle of effective judicial protection by the adoption of the exclusion decision, the Court recalls its case-law according to which legislation which paid no heed to the effects of bringing administrative or legal proceedings on the opportunity to participate in a procedure for the award of a contract would risk infringing the fundamental rights of the parties concerned. However, as explained above, it cannot be considered that, in the present case, the national decision to stay execution was disregarded and that the applicant’s right to judicial protection was infringed.
Furthermore, the exercise of the power to exclude a person or entity – in this case the applicant – from procedures for the award of public contracts in the EU on the basis of a preliminary legal assessment of its conduct does not infringe Article 47 of the Charter of Fundamental Rights of the European Union. The existence of a remedy to challenge the contested decision before the Courts of the European Union makes it possible to ensure that the applicant is afforded judicial protection.
The Court considers that there is therefore no reason to give the national decision to stay execution the same effect as that given to final decisions or judgments. If the power of the EU authorities to exclude a party from such a procedure could be paralysed by the mere fact of the lodging of a suspensive appeal against the national decision that might serve as a basis for the exclusion or of a suspension of that decision, such a power would be rendered ineffective.
Lastly, the Court adds that, in the event that the national decision to stay execution is followed by a final judgment annulling the CNMC decision, the financial regulation provides (
5
) that the authorising officer is to terminate the exclusion without delay, thereby giving full effect to the national court decision and at the same time guaranteeing the applicant’s judicial protection, which attaches in this case to the national court decision, a decision that is binding on the EU authority.
In the second place, the Court clarifies the nature of its jurisdiction and the extent of its review of the remedial measures adopted by the applicant.
First, after reiterating that it has unlimited jurisdiction to review an exclusion decision, (
6
) the Court finds that the scope of that jurisdiction ought to be strictly limited to determining the penalty, without covering any changes in the constituent elements of the conduct justifying that penalty.
In the present case, however, the Court believes that the examination of remedial measures is part of the assessment of the conduct justifying a penalty. The assessment to be made of the remedial measures is tantamount to verifying whether the serious professional misconduct is continuing, inferred in this case from the infringement established by a national authority, and the possibility that it might recur. It is irrelevant in this respect that the remedial measures are generally implemented after the infringement established by the national authority has occurred. The Court concludes that it cannot exercise its unlimited jurisdiction for the purposes of examining the plea in law relating to the remedial measures adopted by the applicant. It cannot therefore substitute its own assessment of the remedial measures in question for that of EU-OSHA and must confine itself to reviewing the legality of that assessment.
Second, as regards the assessment by the Courts of the European Union as to whether a manifest error of assessment has been committed, on the one hand, the Court notes that in order to establish that an institution has committed a manifest error in assessing complex facts, the evidence adduced by the applicant must be sufficient to make the factual assessments used in the act implausible. Without prejudice to that examination of plausibility, it is not for the General Court to substitute its assessment of complex facts for that of the institution which adopted the decision. In so far as the institutions have a margin of discretion to assess whether conduct can be classified as serious professional misconduct and the assessment of remedial measures is an integral part of the assessment of such conduct, they must also be given a margin of discretion to assess remedial measures.
On the other hand, the Court specifies the factors that may be taken into account in order to review the legality of EU-OSHA’s assessment of the remedial measures adopted by the applicant. By providing that a person or entity is not excluded if it has taken sufficient remedial measures to demonstrate its reliability, (
7
) the financial regulation places the onus on the person or entity in question to establish that the remedial measures taken are such as to prevent its exclusion. The Court concludes that if the burden of proof imposed by those provisions is not to be rendered ineffective, it cannot be accepted that the operator concerned may adduce evidence before the Court that was not communicated during the exclusion procedure. A fortiori, the Court cannot rule in these proceedings on remedial measures not presented before EU-OSHA.
Furthermore, it would be prejudicial to the proper administration of justice and to the principle of institutional balance if the Court were to rule on new remedial measures or new evidence submitted, where applicable, at the same time to the authorising officer and which might lead that officer to review the contested decision in the course of the proceedings. Accordingly, the Court holds that only the evidence communicated to EU-OSHA before the adoption of the contested decision may be taken into account.
In the third place, the Court notes, in the context of the examination of the proportionality of the exclusion penalty, that the remedial measures adopted by the applicant were taken into account by EU-OSHA as mitigating circumstances in order to limit the duration of the exclusion. In the present case, therefore, it is a question of analysing the remedial measures adopted by the applicant in so far as they contribute not to the establishment of the wrongful conduct but to the determination of the associated penalty, thereby justifying the exercise by the Court of its unlimited jurisdiction.
To exercise that jurisdiction, the Court is therefore entitled to consider evidence communicated for the first time in the present proceedings that has not previously been communicated to EU-OSHA, subject, however, to compliance with the rules of admissibility laid down by the Rules of Procedure of the General Court.
Finally, the Court ruled on the alleged failure to assess the application of a financial penalty as an alternative to exclusion.
On the one hand, the Court infers from the provisions of the financial regulation (
8
) that EU-OSHA was not, in the present case, required to examine the possibility of replacing the exclusion penalty by a financial penalty.
On the other hand, as regards the request made to the Court that it should itself order that replacement within the scope of its unlimited jurisdiction, the Court rejects that request as unfounded. The applicant does not explain why the exclusion penalty should be replaced by a financial penalty in the present case. Furthermore, and in any event, the Court holds that it follows from an examination of the applicant’s arguments that the exclusion penalty imposed in the present case is appropriate and should not, therefore, be replaced by a financial penalty.
(
1
)	Decision of the European Agency for Safety and Health at Work of 13 January 2023 (‘the contested decision’).
(
2
)	Article 143 of Regulation (EU, Euratom) No 2018/1046 of the European Parliament and of the Council of 18 July 2018 on the financial rules applicable to the general budget of the Union, amending Regulations (EU) No 1296/2013, (EU) No 1301/2013, (EU) No 1303/2013, (EU) No 1304/2013, (EU) No 1309/2013, (EU) No 1316/2013, (EU) No 223/2014, (EU) No 283/2014 and Decision No 541/2014/EU, and repealing Regulation (EU, Euratom) No 966/2012 (OJ 2018 L 193, p. 1; ‘the financial regulation’).
(
3
)	See Article 136(2) of the financial regulation.
(
4
)	Article 106 of Regulation (EU, Euratom) No 966/2012 of the European Parliament and of the Council of 25 October 2012 on the financial rules applicable to the general budget of the Union and repealing Council Regulation (EC, Euratom) No 1605/2002 (OJ 2012 L 298, p. 1), as amended by Regulation (EU, Euratom) 2015/1929 of the European Parliament and of the Council of 28 October 2015 (OJ 2015 L 286, p. 1), (‘the former financial regulation’), and Article 136 of the financial regulation.
(
5
)	Article 136(2), third subparagraph, of the financial regulation.
(
6
)	Article 143(9) of the financial regulation.
(
7
)	Article 106(7)(c) of the former financial regulation and Article 136(6)(a) of the financial regulation.
(
8
)	Article 106(13)(a) of the former financial regulation.