WRITTEN QUESTION E-3736/00

by Christopher Huhne (ELDR) to the Commission

(30 November 2000)

Subject: Tendering for public services

Will the Commission state whether there are any requirements, existing or proposed, that would require public authorities to put tube (underground or metro) services out to tender?

Answer given by Mr Bolkestein on behalf of the Commission

(18 January 2001)

Where a public authority operates an Underground or Metro public transport network and proposes to enter into contracts in pursuit of that activity, the authority is obliged to follow the rules of Council Directive 93/38/EEC of 14 June 1993 co-ordinating the procurement procedures of entities operating in the water, energy, transport and telecommunications sectors(1) (the Utilities Directive). In most cases this means a tender with a call for competition must be made.

However, if the Honourable Member is referring to contracts for the operation of an Underground service to be let by a public authority, the situation is somewhat different. In this case the contract award is governed by the Utilities Directive if the authority is also an operator of a transport network. If the authority does not also operate a transport network, the award of the contract will be governed by Council Directive 92/50/EEC of 18 June 1992, on the co-ordination of procedures for the award of public service contracts(2) (the Services Directive). In both cases the service is a non-priority service (i.e. mentioned in part B of Annex I and Annex XVI of the Services and Utilities Directives respectively). Pursuant to these directives, contracts for this type of service are not subject to advertising or most of the other strict procedural requirements designed to ensure competitive tenders. In relation to this type of service the Utilities and Services Directives require only that technical specifications should not be discriminatory and that a contract award notice should be published showing the results of the award procedure.

The Commission recently adopted a proposal for a regulation on action by Member States concerning public service requirements and the award of public service contracts in passenger transport by rail, road and inland waterway(3).

This proposal deals with public authorities' decisions to pay financial compensation for the operation of public transport services, or to give operators exclusive rights.

The general rule is that these decisions should take the form of contracts, awarded following competition. However there are some exceptions, two of which specifically concern metro and light rail services. Competent authorities could decide to award contracts for these services without competition if: national or international rail safety standards could not be met in any other way; or any other arrangement would entail additional costs for maintaining coordination between the operator and the manager of the infrastructure, and those costs would not be offset by additional benefits.

Competent authorities deciding not to go to competition would need to make this decision public, along with the evidence and analysis on which it is based, at least a year beforehand.

The Commission's proposal has been submitted to the Parliament and the Council. It is subject to the co-decision procedure.

(1) OJ L 199, 9.8.1993.

(2) OJ L 209, 24.7.1992.

(3) COM(2000) 7 final.