WRITTEN QUESTION E-3080/02 by Erik Meijer (GUE/NGL) to the Commission. Financial negotiations instead of conviction for fraud in the building sector to prevent the firms concerned from being excluded from the EU market.
Date: 2002-10-28
Institutions: European Parliament, Provisional data
Subjects: Netherlands, award of contract, building industry, control of restrictive practices, price agreement, public works, restriction on competition, single market, tendering, unlawful agreement

C 161 E/62

Official Journal of the European Union

EN

10.7.2003

(2003/C 161 E/065)

WRITTEN QUESTION E-3080/02

by Erik Meijer (GUE/NGL) to the Commission

(28 October 2002)

Subject: Financial negotiations instead of conviction for fraud in the building sector to prevent the firms

concerned from being excluded from the EU market

Is the Commission aware of the cases of fraud committed by large construction companies in the
1.
Netherlands, who agreed among themselves on sharing out the execution of government contracts and
who also agreed on common prices, a fraud that has since led to a national parliamentary inquiry?

Is the Commission also aware that in the case of fraud in the construction of railway tunnel at
2.
Schiphol airport prosecution was bought off in an out-of-court settlement, in other words an agreement
with the public prosecution service under which charges were dropped in return for payment?

3.
Is it correct that firms convicted of reaching agreements of the kind described in paragraph 1, or of
committing other types of fraud or failing to deduct social security contributions can be barred from
European tender procedures?

4.
Can it be assumed that, because of the threat of exclusion, out-of-court settlements are used to
protect large Netherlands companies against their competitors in other Member States, who could invoke a
conviction as grounds for requesting the exclusion of their Netherlands competitors?

Are there other instances of Member States protecting their firms against exclusion at EU level

5.
through procedures to avoid what would normally be expected to be a conviction?

6.
To what extent, if any, is it possible to take action in advance or after the event to exclude firms
which have not been convicted for infringing tender rules solely on the grounds of a national judicial
procedure from the European market for a certain period of time?

7. What measures are being taken to ensure that in the future it is no longer possible to avoid exclusion
by means of an out-of-court settlement with a government that is well disposed to the firm suspected of
fraud?

Answer given by Mr Monti on behalf of the Commission

(6 December 2002)

1.
The Commission is aware of the many cases of (alleged) fraud in the construction market in the
Netherlands through the national competition authority, NMA, and the media. In fact, the Member of the
Commission in charge of the Internal Market testified before the Dutch Parliamentary Enquiry Committee
concerning the building sector on 28 June 2002 and provided additional written information.

2.

Through the media, the Commission has become aware of this event.

3.
It is correct that the European Directives relating to public procurement, and more specifically their
rules concerning the qualitative selection of tenderers, foresee i. a. that a service provider, supplier or
contractor may be excluded from participation in a contract if he has been convicted of an offence
concerning his professional conduct by a judgement which has the force of res judicata or if he has not
fulfilled obligations relating to the payment of social security contributions in accordance with legal
provisions.

The Commission possesses no elements which would enable it to share the assumption made by the
4.
Honourable Member. In any case, an out-of-court settlement does not protect companies from their
possible exclusion from an European-wide tendering procedure, as the rules mentioned at point 3 equally
foresee that a service provider, supplier or contractor, who has been guilty of grave professional
misconduct proven by any means which the contracting authorities can justify, may be excluded from
participation in a contract.

10.7.2003

EN

Official Journal of the European Union

C 161 E/63

As mentioned at point 4, Member States cannot protect companies from their possible exclusion
5.
from an European-wide tendering procedure by an out-of-court settlement, as the European Directives
relating to public procurement, which apply in all Member States, foresee the possible exclusion on
grounds of professional misconduct proven by any means which the contracting authorities can justify.

6.
As mentioned at point 4, the Community Directives relating to public procurement foresee that a
service provider, supplier or contractor, who has been guilty of grave professional misconduct proven by
any means which the contracting authorities can justify, may be excluded from participation in a contract.

7.

In the light of the above, it is not necessary to take any supplementary measure.

(2003/C 161 E/066)

WRITTEN QUESTION E-3083/02

by Jonas Sjöstedt (GUE/NGL) to the Commission

(28 October 2002)

Subject: Failure in Sweden of EIB preferential loans for small businesses

There is much talk from political quarters in the European Union of protecting and promoting small and
medium-sized enterprises. Preferential loans for such businesses is one method of assisting them. Because
of its high standing, the EIB is able to lend money on preferential terms. The overriding objective of the
EIB is to promote development in the EU and integration between the Member States.

In 2001, Föreningssparbanken became the first Swedish bank to conclude an agreement with the EIB to
offer preferential loans to small and medium-sized businesses. Within the framework of a ‘global loan’,
Föreningssparbanken had the facility to lend some SEK 400 million, which was primarily intended to
finance small businesses’ investments in infrastructure and industry.

A year later, however, in May 2002, it was noted that the EIB’s partner had not lent a single krona of the
amount earmarked. The bank had had numerous inquiries but the customers thought that the benefits
were poor in relation to the terms. The bank in Sweden had hoped to be able to deliver something of
benefit to its corporate customers. The idea was that the EIB loan would be cheaper than the commercial
banks’ but in May 2002 it was observed that compared with Föreningssparbanken’s normal business loans,
the difference in interest rates was not even half a percent but rather 10 to 20 percentage points, which
was not particularly advantageous for borrowers.

Another reason for entrepreneurs’ lack of interest was the additional administrative work. The involvement
of the EIB means that yet another party demands scrutiny of the company, which may be reasonable but is
also a source of irritation. As the EIB is a participating party, it must in some way take part in the lending
process but, at the same time, the risk remains with Föreningssparbanken.

In what way will the Commission take this experience from Sweden into account when it discusses setting
up preferential loans for small and medium-sized businesses and the terms and conditions for them?

Answer given by Mr Solbes Mira on behalf of the Commission

(3 December 2002)

According to the European Investiment Bank (EIB), the arrangements with FöreningsSparbanken have been
in place for a relatively short time and have not yet led to full implementation. Nevertheless, progress is
being made on identifying suitable final beneficiaries and full allocation of the Global Loan can be
expected in due course in line with experience with Global loans programmes in other Member States.