WRITTEN QUESTION E-3837/02 by Camilo Nogueira Román (Verts/ALE) to the Commission. Breach of the principle of free competition by the Spanish state-owned company Tragsa.
Date: 2003-01-09
Institutions: European Parliament, Provisional data
Subjects: EU law - national law, Spain, award of contract, environmental protection, provision of services, public contract, public institution, restriction on competition, rural development, works contract

C 155 E/196

Official Journal of the European Union

EN

3.7.2003

19th annual report on monitoring the application of Community law, pointing out that it is in the process
of examining whether the alleged excesses could constitute infringements on the part of the Member State
in question. On this point, Greece assured the Commission that it would set up the necessary resources to
monitor application of the provision in question. Nevertheless, the procedure remains pending, since the
Commission is awaiting further information before taking a decision.

(1) Directive 97/36/EC of the European Parliament and of the Council of 30 June 1997 amending Council Directive
89/552/EEC on the coordination of certain provisions laid down by law, regulation or administrative action in
Member States concerning the pursuit of television broadcasting activities (cid:1) OJ L 202, 30.7.1997.

(2003/C 155 E/217)

WRITTEN QUESTION E-3837/02

by Camilo Nogueira Román (Verts/ALE) to the Commission

(9 January 2003)

Subject: Breach of the principle of free competition by the Spanish state-owned company Tragsa

The Spanish state-owned company Transformaciones Agrarias Sociedad Anónima (Tragsa) is, in direct and
systematic fashion, awarded most of the contracts handed down by the Spanish central government and
regional governments for the execution of development schemes, drawing-up of projects, provision of
services and other activities in the area of forestry, the environment and agriculture. This amounts to a
clear breach of the Community’s principles of publicisation, equal treatment, competition and transparency
the public
in public contracts. This privileged position which Tragsa enjoys, with the support of
is anti-competitive vis-à-vis the company’s private-sector counterparts, which are thus
authorities,
discriminated against,
free
competition.

laid down in the Treaties, of

the Community principle,

in breach of

According to Spanish media reports, the Commission has sent a letter of formal notice to the Spanish
government concerning contracts entered into with third parties by Tragsa, on the grounds of non-
compliance with the rules on publicisation and transparency laid down by the Community legislation on
public contracts. This arises from a complaint lodged by the National Association of Forestry Enterprises
(Asemfo), which, although it represents more than 85 % of the forestry development and services sector in
Spain, is not awarded a proportion of public contracts comparable to that awarded to Tragsa.

Can the Commission provide information on the matter, in particular on the letter sent to the Spanish
government concerning the legal situation of Tragsa and its activities in the field of public contracts?

Answer given by Mr Bolkestein on behalf of the Commission

(25 February 2003)

Tragsa is a state-owned Spanish company which provides services in the areas of rural development and
environmental protection, including works, projects and technical assistance. It is obliged to carry out the
work entrusted to it by central government and by the autonomous communities and dependent public
bodies.

In following up a complaint received from the National Association of Forestry Enterprises (Asociación
Nacional de Empresas Forestales (cid:1) Asemfo), the Commission did indeed find that the system for the award
of contracts placed by Tragsa as contracting authority was incompatible with the Community Directives in
several respects.

Under Spanish legislation, Tragsa is not deemed to be a body governed by public law. As a result, it does
not regard itself as being bound by the Community Directives as regards contracts which it enters into
with third parties in cases where the application thresholds are exceeded, or as having to meet the
obligations deriving from the principle of transparency and publicisation under the EC Treaty in other
cases.

3.7.2003

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Official Journal of the European Union

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In accordance with the established case-law of the European Court of Justice (1), the concept of a body
governed by public law has to be interpreted ‘in functional terms’ and to qualify for such a designation a
body must meet the three conditions set out in the Directives, which Tragsa does.

A letter of formal notice was sent to the Spanish authorities in April 2002. They replied in June 2002,
refuting the arguments put forward by the Commission.

However, contacts between the Spanish authorities and the Commission have clarified certain aspects of
the dossier, with the Spanish authorities notifying the introduction of certain legislative provisions in Law
53/2002 of 30 December 2002 relating to fiscal, administrative and social measures (law accompanying
the Law on the State Budget for 2003), which amends the legal arrangements regarding Tragsa so as to
meet the Commission’s requirements.

Thus, Article 87 of said Law adds a paragraph 7 to Article 88 of Law 66/1997 of 30 December 1997,
providing that Tragsa and its subsidiaries shall be subject, when concluding works, supplies, assistance and
services contracts with third parties, to the Law on the award of contracts by public bodies, which
regulates the implementation in Spanish law of the obligations deriving from Community legislation on
public contracts.

Under these conditions, the Commission will be able to decide at one of its forthcoming meetings on the
closure of this matter.

(1) According to the judgments in cases C-44/96 (Mannesmann) of 15 January 1998, C-360/96 (BFI Holding) of
10 November 1998, C-237/99 (H.L.M.) of 1 February 2001, C-380/98 (University of Cambridge) of 3 October
2000, C-223/99 and 260/99 (Ente Fiera di Milano) of 10 May 2001, the three conditions are that a body must:
(cid:1) have a legal personality of its own;
(cid:1) by controlled financially and administratively by the State;
(cid:1) and have been established for the specific purpose of meeting needs in the general interest, not having an

industrial or commercial character.

(2003/C 155 E/218)

WRITTEN QUESTION E-3838/02

by Camilo Nogueira Román (Verts/ALE) to the Commission

Subject: OLAF inquiry into training courses in the Spanish state

(9 January 2003)

Can the Commission provide information on the external inquiry opened on 22 October 2002 by the
European Anti-Fraud Office (OLAF) against
following complaints made in Spain
concerning training courses funded from the Community budget (ESF)?

the Spanish state,

Can the Commission provide information on the detailed projects allocated to Galicia under the ESF? In
the light of the requests made in earlier questions for an inquiry into fraudulent utilisation by the Galician
regional government of the ESF’s programming and partnership facilities, can the Commission state
whether it has opened an inquiry or sent a request to the Galician regional government in relation to this
subject?

Answer given by Mrs Diamantopoulou on behalf of the Commission

(25 February 2003)

With regard to irregularities which might have occurred in Spain in connection with training courses
funded from the Community budget (Structural Funds), the European Anti-Fraud Office (OLAF) opened an
external investigation on 22 October 2002. This is an ‘operational assistance’ case, given that the matter
had already been referred to the Spanish authorities. However, information obtained in the course of an
external
judicial authorities is subject to
confidentiality clauses.

investigation coming under the jurisdiction of the national

As far as approved projects in the autnomous community of Galicia are concerned, the Commission would
like to inform the Honourable Member that, in the context of the Structural Funds for the period 2000-
2006, a decentralised administrative system has been set up involving a significant
transfer of
responsibilities for management, evaluation and control to the Member States in line with the principle
of subsidiarity, whereby the Commission remains responsible for implementing the budget.