WRITTEN QUESTION E-1583/01

by Anne Jensen (ELDR) to the Commission

(1 June 2001)

Subject: EU-wide invitation to tender for church organs

Danish organ manufacturers are in difficult economic circumstances, one reason for this being that they are not competing on a level playing field. The Danish national church is inviting tenders for church organs from throughout the EU, while the churches in Sweden and Germany, for instance, will not be doing so.

The Danish national church buys organs by means of small contributions from members of the church via a special church tax which is set in line with the church's financial requirements in the relevant deanery. The local tax administration is responsible for collecting the church tax which is divided between the individual parishes. The locally elected parish council in practice decides and administers the purchase of the organs within the constraints set by the authorities, e.g. having regard to historical values. In principle, the same process applies in Germany and Sweden, where a church tax is levied and administered by the public tax authorities, the funds being distributed to the individual parishes, which are responsible for purchasing organs.

This practice of inviting tenders throughout the EU often prevents Danish organ manufacturers from bidding for contracts in Sweden and Germany, while they are exposed to competition on the domestic market from foreign producers who may have a home market with no free competition.

In the Commission's view, is this situation in keeping with the philosophy underlying the development of the internal market in the EU?

Can the Commission explain why this discrimination occurs? Will the Commission take steps to ensure that competition takes place on equal terms in this sector?

Answer given by Mr Bolkestein on behalf of the Commission

(18 July 2001)

Whether contracts for the purchase of organs, the value of which is above the threshold, are subject to Council Directive 93/36/EEC of 14 June 1993 coordinating procedures

for the award of public supply contracts(1) (hereafter the Directive) depends on whether these contracts are awarded by a contracting authority, most often in the form of a body governed by public law within the meaning of the Directive.

Such bodies are defined as any body:

- established for the specific purpose of meeting needs in the general interest, not having an industrial or commercial character, and

- having legal personality, and

- financed, for the most part, by the Member State, or regional or local authorities, or other bodies governed by public law, or subject to management supervision by those bodies, or having an administrative, managerial or supervisory board, more than half of whose members are appointed by the Member State, regional or local authorities or by other bodies governed by public law;

Given the legal and financial situation of the Danish Church (Folkekirken), it is clear that it meets the conditions for being a contracting authority.

As can be seen from the definition, public financing is not necessarily sufficient to bring the receiving entity within the scope of the Directive; it is necessary to verify that this public financing constitutes the most part, cf. the judgment of 3 October 2000 in Case C-380/98, Cambridge. If that condition is not met, it would still be necessary to verify whether the two other alternative conditions of the definition's third indent are met.

As regards Germany, the Commission does not have sufficient information to assess whether churches in Germany are subject to the Directive. This information will be sought and evaluated as soon as possible.

As regards Sweden, it should be noted that the relations between the Swedish State and the Swedish Church have been changed and that, as a result thereof, the Swedish law on public procurement has recently been changed to provide that churches are contracting authorities only in respect of purchases related to their role as burial authorities. This legislative change is being evaluated.

The Commission will keep the Honourable Member informed of the results of these actions.

However, an analysis, based on a search in the relevant database, of tender notices specifically mentioning the supply (or construction) of organs, whether published by churches or other bodies, shows that a total of 24 tender notices was published over the period 1995-2000: ten from Finland, four from Denmark, three from France, two each from Austria and Sweden and one each from Germany, Portugal and the United Kingdom. Of these 24 notices, nine were published in 2000 (four from Finland, three from Denmark and one each from France and the United Kingdom). In addition there may have been other award procedures involving organs, which were not found because the supply of organs was part of, for instance, an integrated contract for the construction or refurbishment of a church.

(1) OJ L 199, 9.8.1993.