2004/703/EC:Guideline of the European Central Bank of 16 September 2004 on the procurement of euro banknotes (ECB/2004/18)
Date: 2004-09-16
Institutions: European Central Bank
Subjects: European Central Bank, central bank, euro, issuing of currency, paper money

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II

(Acts whose publication is not obligatory)

EUROPEAN CENTRAL BANK

GUIDELINE OF THE EUROPEAN CENTRAL BANK

of 16 September 2004

on the procurement of euro banknotes

(ECB/2004/18)

(2004/703/EC)

THE GOVERNING COUNCIL OF THE EUROPEAN CENTRAL BANK,

agreements for euro banknote production taking into
account the principle of decentralisation and the need
for an effective management framework.

Having regard to the Treaty
Community, and in particular Article 106(1) thereof,

establishing the European

Having regard to the Statute of the European System of Central
Banks and of the European Central Bank, and in particular
Article 16 thereof,

Whereas:

(1)

(2)

Article 16 of the Statute grants the Governing Council of
the European Central Bank (ECB) the exclusive right to
authorise
euro banknotes within the
Community. This exclusive right includes the competence
to define the legal framework for the procurement of
euro banknotes.

issue of

the

Under Article 106(1) of the Treaty and Article 12.1 of
the Statute, the ECB may allocate the responsibility for
issuing euro banknotes to the national central banks of
the Member States that have adopted the euro (the NCBs)
in accordance with the NCBs’ percentage shares in the
ECB’s subscribed capital for the relevant financial year
calculated using the NCBs’ weightings
in the key
referred to in Article 29.1 of
the Statute (hereinafter
the capital key). Moreover, the ECB should allocate the
concluding and managing supply
responsibility for

(3)

(4)

efficient

favouring

The framework for the procurement of euro banknotes
must, on the one hand, comply with the requirement laid
down in Article 105(1) of the Treaty and in Article 2 of
the Statute, for the Eurosystem to act in accordance with
the principle of an open market economy with free
allocation
competition,
of
an
take into account
resources and, on the other hand,
the particular nature of euro banknotes which are
printed to be issued by the Eurosystem alone as a safe
means of payment. In addition, in accordance with the
principle of decentralisation,
the
procurement of euro banknotes must also take into
account the fact that some NCBs have their own in-
house printing works or use public printing works to
produce euro banknotes.

the framework for

In view of the aforementioned principles, the Governing
Council decided on 10 July 2003 that a common Euro-
system competitive approach to tendering (hereinafter
the single Eurosystem tender procedure) should apply
to the procurement of euro banknotes at
the latest
from 1 January 2012 onwards. NCBs that have an in-
house printing works, or those using a public printing
works may elect not to participate in the single Euro-
system tender procedure. In such cases, these printing
works will remain responsible for the production of
the euro banknotes that have been allocated to their
NCBs in accordance with the capital key but will be
excluded from participating in the single Eurosystem
tender procedure. NCBs may decide to join the single
Eurosystem tender procedure at a later date. Such a
decision would be irreversible.

(5)

(6)

(7)

(8)

(9)

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A transitional period, which allows both NCBs and
printing works to prepare for this long-term approach,
should start as soon as it has been ascertained that the
production of at least half of the total annual Eurosystem
euro banknote requirement will be tendered and at least
half of all NCBs will
tender the production of euro
banknotes allocated to them. During the transitional
period the single Eurosystem tender procedure will
apply to those NCBs which tender the euro banknote
production allocated to them for issuance.

(10)

The Governing Council should review this Guideline’s
operation after its entry into force in the light of the
Eurosystem’s practical experience with it. The provisions
of this Guideline should be interpreted, where necessary,
in accordance with the rules contained in Directive
2004/18/EC of
the
Council of 31 March 2004 on the coordination of
procedures for the award of public works contracts,
public supply contracts and public service contracts (1).

the European Parliament and of

The single Eurosystem tender procedure will ensure a
level playing field between all printing works partici-
pating in the procedure by permitting competition
between in-house, public and private printing works in
a transparent and fair manner that does not give any of
the parties involved an unfair competitive advantage. In
order to ensure such a level playing field, specific rules
on
Eurosystem
of
Procurement Committee (hereinafter the ‘Procurement
Committee’),
its members and the
conditions for printing works participating in the single
Eurosystem tender procedure, are needed.

the conduct of

composition

single

the

the

Euro banknotes are of a sensitive and innovative nature.
Therefore, they have to be produced in a fully secure,
controlled and confidential manner that guarantees a
reliable, high quality and sustained supply over time.
Moreover, the Eurosystem needs to pay due regard to
euro
the possible
banknotes on public health and safety and on the envir-
onment. All
these requirements will be taken into
account in the single Eurosystem tender procedure.

the production of

impact of

(11)

In line with the ECB’s general transparency policy, tender
procedure information such as the eligibility and award
criteria and the outcome of such procedures should be
published.

(12)

In accordance with Article 12.1 and Article 14.3 of the
Statute, ECB guidelines
form an integral part of
Community law,

HAS ADOPTED THIS GUIDELINE:

TITLE I

GENERAL PROVISIONS

Article 1

Definitions

For the purposes of this Guideline:

1.

shall monitor all key raw
The Governing Council
materials and factors of production of euro banknotes
and, if necessary, take adequate measures to ensure that
they are selected and procured so as to ensure the
continuity of supply of euro banknotes, and, without
the
prejudice
European Commission’s competencies,
the
Eurosystem suffering due to the abuse of a dominant
market position by any contractor or supplier.

to European competition law and
to prevent

length principle’

shall mean the principle

‘arm’s
in
accordance with which there shall be full
separation
between an in-house or public printing works’ and its
NCB’s accounts and reimbursement by an in-house or
public printing works of all administrative and organisa-
tional support that it receives from its NCB. In particular,
this reimbursement shall cover: (a) the additional, variable
costs incurred by an NCB in providing administrative and
organisational support to its in-house printing works; (b) an
appropriate contribution by the in-house printing works to
the fixed costs related to the NCB’s administrative and
organisational support; and (c) an adequate return on the
NCB’s capital
investment in the in-house printing works.
Such contributions shall be calculated at market rates. This
definition shall take into account the relevant case-law of
the Court of Justice of the European Communities, as well
as the relevant common cost accounting principles defined
separately by the Governing Council;

The supply agreements concluded after the completion of
a single Eurosystem tender procedure between the
contracting authority and individual printing works
should comply with minimum common features estab-
lished by the ECB so as to ensure harmonised terms and
conditions for all contracted printing works.

(1) OJ L 134, 30.4.2004, p. 114.

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2.

3.

4.

5.

6.

7.

all

(b)

(c) all

third parties

the Procurement Committee;

information’ shall mean:

‘confidential
(a) all non-public
information regarding the proceedings and deliberations
of
information
submitted by printing
contained in tender documents
to the Procurement
works and/or other
information which consists of
Committee;
trade
confidential or proprietary technical
secrets or other
information related to euro banknote
and/or business
production;
information contained in the technical
(d)
specifications for each euro banknote denomination; and
(e)
information regarding euro banknote
production which is marked confidential or which by its
nature a reasonable person would deem confidential;

any other

‘contracting authorities’ shall mean either the NCBs that
conclude supply agreements with printing works which
have been awarded production orders in accordance with
the single Eurosystem tender procedure, or the ECB acting
on their behalf;

‘control’ shall mean the relationship between a parent
undertaking and a subsidiary,
in all the cases referred to
in Article 1(1) and (2) of the Seventh Council Directive
83/349/EEC of 13 June 1983 based on the Article
54(3)(g) of the Treaty on consolidated accounts (1), or a
similar relationship between any legal person and an under-
taking, whereby any subsidiary of a subsidiary undertaking
shall also be considered to be a subsidiary of the parent
undertaking which is at the head of those undertakings;

‘euro banknote production quality requirements (EBQR)’
shall mean the documentation defining the common
quality requirements for the production, acceptance and
validation of euro banknotes as regularly reviewed by the
Governing Council;

‘euro secure items’ shall mean fully or partly printed euro
banknotes, euro banknote components and other materials
and information requiring security protection,
the loss,
theft, disclosure or publication of which could damage
euro banknotes’
integrity and/or assist in the production
of counterfeit euro banknotes or their components;

‘in-house printing works’ shall mean any printing works
which is: (a) legally and organisationally part of an NCB;
(b) a separate undertaking in which an NCB owns, directly
or by way of control, at least 50 % of the voting rights or
capital; or (c) a separate undertaking in which an NCB
the decision-
appoints over half of
making bodies;

the members of

(1) OJ L 193, 18.7.1983, p. 1. Directive as last amended by Directive
2003/51/EC of the European Parliament and of the Council (OJ L
178, 17.7.2003, p. 16).

8.

9.

10.

‘public
including the State and regional or local authorities;

shall mean all public

authorities’

authorities,

‘public printing works’ shall mean any printing works in
which public authorities (a) own, directly or by way of
control, at least 50 % of the voting rights or capital; or
the decision-
(b) appoint over half of
making bodies;

the members of

procedure’

‘restricted
procurement
procedure whereby only printing works complying with
the
eligibility criteria defined in this Guideline may
submit tender bids;

shall mean

the

11.

‘supply agreement’ shall mean a contract concluded in
writing between a contracting authority and a printing
works that has been awarded an order for the production
of euro banknotes in consideration of payment;

12.

‘transitional period’ shall mean the period starting at the
earliest on 1 January 2008 or on a date thereafter decided
by the Governing Council once it has ascertained, acting on
a proposal from the Executive Board, that the production
of at
the total annual Eurosystem euro
banknote requirement will be tendered and at least half
of all NCBs will tender the production of euro banknotes
allocated to them. The transitional period shall end, at the
latest, on 31 December 2011.

least half of

Article 2

Scope of application

The single Eurosystem tender procedure shall start at the

1.
latest on 1 January 2012.

2.
The procurement in any six-month period of banknotes
denominated in euro that exceed a value of EUR 249 000, or
any other value specified in Directive 2004/18/EC shall be
subject to the single Eurosystem tender procedure set out in
this Guideline.

The value referred to in paragraph 2 shall be calculated by
3.
taking into account the combined costs of all the production
requirements for euro banknotes during a single Eurosystem
tender procedure,
including ancillary costs such as, amongst
others,
those related to the destruction of euro banknotes
production waste, but excluding VAT and transportation costs.

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The value of supply agreements shall not be calculated so
4.
as to avoid the application of this Guideline, nor shall any
procurement
euro
banknotes be divided with this same intention.

a given amount of

requirement

for

5.
The single Eurosystem tender procedure shall not apply to
the research and development, including the design and origi-
nation, of euro banknotes. Such activities shall be subject to
separate Eurosystem procurement rules.

TITLE II

PARTIES TO THE SINGLE EUROSYSTEM TENDER PROCEDURE

Article 3

Establishment

and composition of

the Procurement

Committee

A Procurement Committee shall be established, which
1.
shall
seven experts with relevant professional
consist of
experience, appointed by the Governing Council acting on
proposals from the ECB and the NCBs, selected from Euro-
system members qualified senior staff for predefined terms of
office.

The ECB shall provide

2.
Procurement Committee.

secretarial

support

to the

Article 4

Procurement Committee code of conduct

1.
The ECB and the NCBs shall ensure that any member of
their staff appointed to the Procurement Committee shall sign
the declaration in Annex I to this Guideline.

2.
If a member of the Procurement Committee infringes the
code of conduct in Annex I, the Governing Council shall (a)
dismiss them from the Procurement Committee; (b) commu-
nicate this, as appropriate, for disciplinary purposes to their
respective employer; and (c) appoint a successor
to the
Procurement Committee.

in

legal

shall
documentation

The ECB and the NCBs
the

introduce appropriate
3.
provisions
the
governing
employment relationships with their respective members of
the Procurement Committee, enabling them, within the limits
of
Procurement
Committee members’ compliance with the code of conduct in
Annex I and sanction any non-compliance therewith, as appro-
priate.

to monitor

legislation,

applicable

their

Article 5

The role of the Governing Council and of the Executive
Board

1.
The Governing Council, acting on a proposal from the
Executive Board, shall keep the conditions for the start of the
transitional period under review and it shall decide on the
starting date for the transitional period.

The Governing Council, acting on a proposal from the
2.
shall decide whether printing works are
Executive Board,
eligible in accordance with Articles 7 and 8 to participate in
the single Eurosystem tender procedure.

3.
The Governing Council, acting on a proposal from the
Procurement Committee via the Executive Board, shall adopt
the internal rules of procedure,
including the voting rules, of
the Procurement Committee.

Prior

to any single Eurosystem tender procedure the
4.
Governing Council shall decide which Eurosystem members
are to be designated as contracting authorities.

5.
The Governing Council, acting on a proposal from the
Procurement Committee via the Executive Board, shall adopt
the decision on the award of production orders.

The Governing Council shall, at the request of a printing
6.
works that has participated in the single Eurosystem tender
procedure in accordance with this Guideline, review any such
decision prior to the submission of a complaint to the Court of
Justice of the European Communities.

The Governing Council, acting on a proposal from the
the compliance of all
laid down in this

7.
Executive Board,
parties with the rules and procedures
Guideline is audited.

shall ensure that

Article 6

The ECB and the NCBs

1.
The NCBs, or the ECB acting on behalf of the NCBs, shall
enter into supply agreements with the printing works that have
been awarded production orders and shall monitor the due
performance of such agreements.

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NCBs that have an in-house printing works and NCBs
2.
using public printing works may choose not to participate in
the single Eurosystem tender procedure. In such cases these in-
house or public printing works shall be excluded from the
single Eurosystem tender procedure and they shall produce
the euro banknotes allocated to their NCBs in accordance
with the capital key. They may, however, decide to participate
in the single Eurosystem tender procedure at a later date. Such a
decision shall be irreversible.

(iv) the

for

the

requirements

environmentally friendly
production of euro banknotes decided separately by
the Executive Board taking into account the Banknote
Committee’s views;

(d) printing works,

including in-house and public printing
works, shall not receive any aid granted by a Member
State, NCB, or otherwise through State resources that is in
any way incompatible with the Treaty;

3.
Prior to conducting a single Eurosystem tender procedure
the ECB and the NCBs shall not provide any confidential infor-
mation to printing works, including (a) public printing works;
and (b)
in-house printing works, unless their NCBs do not
participate in single Eurosystem tender procedures.

(e) printing works shall not have been allocated part or all of
the banknote production of an EU Member State without a
tender procedure.

Article 7

Eligibility of printing works

Printing works,

1.
including in-house and public printing
works, shall be eligible to participate in the single Eurosystem
tender procedure on the following conditions:

(a) printing works shall be legally established in a European
Union (EU) Member State. Furthermore, euro banknotes
shall be produced in facilities that are physically located in
a Member State;

2.
The independent external auditors shall audit compliance
with the prohibition laid down in paragraph 1(d). The audited
printing works shall annually report the independent external
auditors’ findings to the Procurement Committee. To this end,
all printing works participating in single Eurosystem tender
procedures shall fully identify their income and costs and in
particular provide information on:
(a) the setting-off of any
operating losses; and (b) whether an NCB or any public
authority has provided the printing works with capital, non-
refundable grants or loans on preferential terms; and (c) any
forgoing of profits by an NCB or any public authority or the
recovery of sums due; and (d) any forgoing by an NCB or any
public authority of a normal return on public funds provided to
the printing works; and (e) any compensation received for
financial burdens or tasks imposed on it by an NCB or by
any public authority.

(b) printing works

shall
provided by the ECB;

sign a

confidentiality agreement

3.
Joint ventures, consortia or any other cooperative ventures
permitted by law, as well as printing works using subcon-
tractors
shall qualify for participation in the procurement
procedures provided that:

(c) printing works

shall be accredited by the Governing
Council, acting on the Executive Board’s assessment of
their compliance with:

(a) each member of a cooperative venture and each subcon-
tractor individually complies with the eligibility criteria set
out in paragraphs 1 and 2;

(i)

the security rules for the production and storage of
euro secure items decided separately by the Executive
Board taking into account the Banknote Committee’s
views;

(b) a main contractor or consortium leader

remain
euro banknote production

shall

responsible
process required to fulfil the contract;

the whole

for

(ii)

the EBQR decided separately by the Executive Board
taking into account the Banknote Committee’s views;

(c)

the members of a cooperative venture are all
jointly and
severally liable vis-à-vis the contracting authority for the
production of the euro banknotes; and

(iii) the health and safety requirements decided separately by
the Executive Board taking into account the Banknote
Committee’s views; and

(d) the bidder shall inform the Procurement Committee of the
identity and specific roles of all members of a cooperative
venture and of each subcontractor.

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it,

information, or part of

All printing works that have not yet been accredited in
4.
accordance with paragraph 1(c) and which are legally estab-
lished in the EU may obtain information from the ECB
in this Article. Before
relating to the requirements set out
the Governing
releasing this
Council shall, acting on a proposal from the Executive Board,
assess whether the printing works requesting information are
bona fide. In particular, the Governing Council shall check, in
accordance with any applicable national laws and regulations,
the
the personal
printing works concerned.
that any
owner or manager of the printing works requesting information
has been convicted for an offence concerning their professional
conduct, such information shall not be released to the printing
works requesting information. Bona fide printing works shall
sign a confidentiality agreement provided by the ECB.

the owners and managers of
these checks reveal

records of

If

Article 9

Exclusion from the single Eurosystem tender procedure

If,

elements

and shall

for a given procurement,

tender bids appear to be
1.
abnormally low in relation to the euro banknotes to be
provided,
the Procurement Committee shall, before rejecting
those tender bids, request in writing details of the relevant
constituent
constituent
elements taking into account the explanations received. Where
the Procurement Committee establishes that a tender bid is
abnormally low on grounds that
the tenderer has obtained
State aid,
the tender bid can only be rejected on those
grounds alone after consultation with the tenderer where the
latter is unable to prove, within a sufficient time limit fixed by
the Procurement Committee,
the aid in question was
granted legally.

verify

those

that

5.
The ECB shall inform all accredited printing works at least
six months prior to the start of the single Eurosystem tender
procedure of the Eurosystem’s euro banknote requirements as
referred to in paragraph 1(c)(i) to (iv).

Article 8

Additional eligibility criteria for

in-house and public

printing works

In-house and public printing works shall comply with the
1.
eligibility criteria laid down in Article 7 and with the following
additional eligibility criteria:

2.
The Governing Council, acting on a proposal from the
Procurement Committee via the Executive Board, or on a
proposal from the Executive Board, shall disqualify a printing
works from future participation in the single Eurosystem tender
procedure if it fails to comply with the eligibility criteria set out
in Articles 7 and 8. This exclusion shall remain in force until
the eligibility criteria set out in Articles 7 and 8 are met. If an
in-house or a public printing works that participates in the
single
the
production of
the euro banknotes allocated to its NCB in
accordance with the capital key shall be tendered in accordance
with the single Eurosystem tender procedure.

Eurosystem tender procedure

disqualified,

is

(a)

they shall have effective internal arrangements implementing
the arm’s length principle; and

The Procurement Committee may reject tender bids if a
3.
printing works no longer complies with the eligibility criteria
set out in this Guideline. The Procurement Committee shall
adopt and document any decisions in this respect.

(b) their income and costs shall be assigned on the basis of
common cost accounting principles defined separately by
from the
the Governing Council acting on a proposal
Executive Board; and

(c)

independent external auditors shall monitor in-house and
public printing works’ compliance with the abovementioned
In-house and public printing
additional eligibility criteria.
external auditors’
the
works
findings annually to the Procurement Committee.

independent

report

shall

TITLE III

SINGLE EUROSYSTEM TENDER PROCEDURE

Article 10

Separation of tender procedures

The required quantity of each euro banknote denomination
shall be the object of a separate single Eurosystem tender
procedure.

2.
From the time that an NCB decides that its in-house or
public printing works will participate in the single Eurosystem
tender procedure, the representative(s) of such an in-house or
public printing works
resign from the Banknote
shall
Committee and its subgroups.

Article 11

Restricted procedure

1.
The Procurement Committee shall apply a restricted
procedure to the procurement of supply agreements for euro
banknotes.

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The Procurement Committee shall publish its intention to
the

2.
initiate a restricted procedure in the Official
European Union. This notice shall include as a minimum:

Journal of

(a)

information on the total amount of euro banknotes
required, as well as the volume of the production quantities
which can be tendered, and the timeframe required for
production and delivery;

(b) the eligibility criteria set out in Articles 7 and 8;

(c)

the closing date for submitting applications to participate
and the address to which they must be sent;

(d) the request to provide evidence on sound financial status
and professional standing in accordance with paragraph 3;
and

(e) a signed declaration from the printing works certified by its
external auditor affirming that it has fulfilled: (i) its obli-
gations relating to the payment of social security contri-
butions in accordance with the legal provisions of
the
its obligations
Member State of establishment; and (ii)
relating to the payment of taxes in accordance with the
legal provisions of the Member State of establishment.

As

regards paragraphs 3(b),

4.
the
Procurement Committee may in exceptional circumstances
require a printing works to submit sufficient evidence as
specified in Article 45(3) of Directive 2004/18/EC.

and (e),

(c),

(d)

5.
The time limit for the receipt of applications to participate
shall not be less than 37 calendar days from the date on which
the contract notice is published in the Official
Journal of the
European Union.

(e)

the official Community language to be used in the single
Eurosystem tender procedure.

Printing works applying to participate in a restricted
3.
procedure shall submit
together with their applications the
following evidence relating to their sound financial status and
professional standing:

The Procurement Committee shall simultaneously and in
6.
writing invite all printing works that have submitted documen-
tation complying with the requirements of paragraph 3, the
eligibility criteria laid down in Articles 7 and 8 and with the
time limit in paragraph 5, to submit tender bids. The letter of
invitation shall be accompanied by supporting documentation
regarding the euro banknotes to be procured. It shall include as
a minimum:

(a) copies of their annual accounts for the last three years;

(a) where appropriate, the address from which further infor-
mation regarding the tender can be requested and the
closing date for making such a request;

(b) a signed declaration from the printing works certified by its
external auditor that:
in the six months prior to the
procurement no substantial change in the participation
its capital has taken place; and
on, or the control over,
(ii) during this period no substantial deterioration of
its
financial status has occurred;

(i)

(c) a signed declaration from the printing works certified by its
external auditor that it is not the subject of proceedings for
a declaration of bankruptcy, or for an order for compulsory
for an
winding-up or administration by the court, or
arrangement with creditors or of any similar proceedings
under national laws or regulations;

(b) the closing date for receipt of tender bids, the address to
which they must be sent and the language in which they
must be drawn up;

(c) a reference to the contract notice published;

(d) a signed declaration from the printing works affirming that
no member of
its decision-making bodies has been
convicted of an offence concerning their professional
conduct by a judgment which has the force of res judicata;
and

(d) an indication of the information and documents which need
to be provided by the printing works. In particular a tender
bid must comply with all predefined tender requirements
such as quality standards, volumes produced, production
and delivery schedules, and detail
the price offered for
each production quantity as defined by the Procurement
Committee; and

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(e)

the criteria for the award of production orders set out in
Article 13.

Any such exemption shall only be allowed in one or more

2.
of the following circumstances:

Provided that it has been requested in good time, addi-
7.
tional
information relating to a specific procurement shall be
supplied to all printing works not later than six calendar days
before the final date fixed for the receipt of tender bids.

(a)

in the absence of tender bids or of appropriate tender bids
in response to the procedure set out in Article 11 provided
that the original terms of the tender are not substantially
altered; or

8.
The time limit for receipt of written tender bids shall not
be less than 40 calendar days from the date of dispatch of the
written invitation.

9. Where urgency renders the time limits laid down in para-
graphs 5 and 8 impracticable, the Procurement Committee may
fix the following time limits:

(b) if for reasons of extreme urgency brought about by events
unforeseeable by the Procurement Committee, complying
with the normal procedure set out in Article 11 would
put the procurement of euro banknotes at risk.

(a) a time limit for the receipt of applications to participate
together with any required accompanying information
specified in paragraphs 3 and 4, which shall not be less
than 15 calendar days from the date of dispatch of the
original invitation; and

Article 13

Award criteria

The Procurement Committee shall evaluate and rank all
1.
tender bids against the economically most advantageous tender.
This evaluation shall take into account the following criteria:

(b) a time limit for the receipt of tender bids, which shall not
be less than 10 calendar days from the date of dispatch of
the invitation to tender.

10.
Tender bids may not be opened before the announced
deadline for their receipt. All tender bids shall be opened at the
same time and their contents shall be recorded in writing. At
the time of opening more than half of the members of the
Procurement Committee must be present.

(a)

the tendered ex-works price per
quantity; and

indicated production

(b) compliance with all tender requirements in particular in
terms of quality and security standards, volumes produced,
production and delivery schedules.

In addition to the case referred to in Article 9(3), tender
11.
bids received may be rejected:
the deadlines are not
(a)
respected; or (b) when not all the information or documents
specified in the letter of invitation have been submitted. The
any
Procurement Committee
decisions in this respect.

and document

adopt

shall

if

2.
The weighting of the criteria set out in paragraph 1 shall
be such that the criterion of the tendered price per indicated
production quantity shall be predominant.

Article 12

Exemptions

The Governing Council may, acting on a proposal from
1.
the Procurement Committee via the Executive Board, or from
the Executive Board, approve exemptions to the procedure laid
down in Article 11, or to specific aspects of this procedure. Any
such decision shall be duly motivated and fully substantiated in
writing.

Prior

to any single Eurosystem tender procedure the
3.
Governing Council may, acting on a proposal
from the
Executive Board, specify additional award criteria. Such addi-
tional criteria should ensure the stability and continuity of the
the long term and avoid
supply of euro banknotes over
the Governing
dependence on a sole supplier. Particularly,
Council may determine the maximum volume of
the total
tendered amount
including joint ventures,
that a bidder,
consortia or any other cooperative ventures permitted by law,
can obtain.

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Article 14

Award decision

Article 16

Supply agreements

The Procurement Committee shall draw up a list of the
1.
eligible printing works that it proposes for production orders,
indicating the respective amounts and denominations of euro
banknotes to be printed by them. The reasons underlying this
proposed list shall be clearly and properly documented. The
Procurement Committee shall submit this list for approval to
the Governing Council via the Executive Board. The Governing
Council may refer
the proposal back to the Procurement
Committee for further explanations or for renewed consid-
eration before taking a decision.

Following the conclusion of a single Eurosystem tender
1.
procedure and once the time limits in Article 15 for review of
the award decision have expired,
the contracting authorities
shall conclude supply agreements with the printing works that
have been awarded production orders. These supply agreements
shall comply with the minimum common features set out in
Annex II
to this Guideline. The Executive Board shall be
provided with copies of the supply agreements entered into
by the
abovementioned
printing works.

contracting authorities with the

2.
The Governing Council shall take a decision on which
printing works are awarded production orders, and on the
respective amounts and denominations of euro banknotes to
be produced by such printing works, no later
than two
months after the Procurement Committee has submitted a
proposal to the Executive Board.

3. Without prejudice to Article 6(3) the Governing Council’s
decision shall be notified to the printing works participating in
the single Eurosystem tender procedure and to all NCBs. They
shall also be informed of: (a) the price of the successful tender
bids; (b) the ranking of their respective tender bids; (c) the price
range of all tender bids; and (d) any further relevant consid-
erations that influenced the award decision.

Article 15

Review of award decision

A printing works that has participated in the single Euro-
1.
system tender procedure in accordance with this Guideline may
request the Governing Council to review its decision. Such a
request shall be made in writing within 15 calendar days of the
date of dispatch of the Governing Council’s decision and shall
include all supporting arguments and documentation.

In such cases, the Governing Council, acting on a proposal
2.
from the Executive Board, shall either reconfirm the list of
the
printing works
request back to the Procurement Committee for
renewed
consideration in the light of the procurement rules specified
in this Guideline.

awarded production orders, or

refer

The Governing Council’s

3.
recon-
firming or amending the list of printing works, shall be taken
within 30 calendar days of the submission of the request and
shall be duly motivated. Written notification thereof shall be
given to the printing works concerned.

final decision, either

2.
A supply agreement shall be concluded for a period
defined beforehand by the Governing Council, and the supply
agreement shall specify the number of euro banknotes to be
delivered periodically. The supply agreement shall allow the
contracting authority to periodically amend the number of
specified therein for production, however,
euro banknotes
such amendments
is
specified in the conditions set out in the invitation to tender
(alternatively the delivery schedule can be amended).

remain within the range that

shall

TITLE IV

RULES APPLICABLE PRIOR TO THE TRANSITIONAL PERIOD

Article 17

Production of euro banknotes prior to the transitional
period

Without prejudice to Article 6(2), prior to the start of the
transitional period NCBs
euro
shall
banknotes allocated to them in their in-house printing works
or respective public printing works, or alternatively they shall
award such production in accordance with applicable legislation
to accredited printing works.

either produce

the

TITLE V

TRANSITIONAL PROVISIONS

Article 18

Participation of in-house or public printing works in the
single Eurosystem tender procedure during the transitional
period

1.
The procedures laid down in this Guideline shall apply
during the transitional period to those NCBs that tender the
production of the euro banknotes allocated to them.

During the transitional period in-house or public printing
single Eurosystem tender

2.
works may participate
procedure on condition that:

in the

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(a)

from the
the Governing Council, acting on a proposal
Executive Board, confirms that they comply with the elig-
ibility criteria laid down in Articles 7 and 8; and

(b) the NCB of the printing works concerned does not exercise
the right set out in Article 6(2) to choose not to participate
in the single Eurosystem tender procedure.

TITLE VI

FINAL PROVISIONS

Article 20

Entry into force

This Guideline shall enter into force on the 20th day following
its publication in the Official Journal of the European Union.

A decision to participate in the single Eurosystem tender

3.
procedure shall be irreversible.

Article 21

Review

Article 19

Procurement Committee composition and functioning
during the transitional period

Article 22

Addressees

The Governing Council shall
beginning of 2008 and every two years thereafter.

review this Guideline at

the

During

period
1.
Committee shall consist of five members.

transitional

the

the

Procurement

This Guideline is addressed to the national central banks of
participating Member States.

During the transitional period the rules and procedures of
2.
this Title shall apply by way of derogation from those contained
in Titles I, II and III. The remaining rules and procedures set out
in this Guideline shall apply mutatis mutandis in the transitional
period.

For the Governing Council of the ECB
The President of the ECB

Jean-Claude TRICHET

Done at Frankfurt am Main, 16 September 2004.

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ANNEX I

Declaration regarding compliance with the Procurement Committee Code of Conduct

Without prejudice to the [ECB’s][the NCB’s] binding code of conduct, [add name], a member of the Procurement
Committee, undertakes to comply with the following code of conduct:

(a) members of the Procurement Committee must abstain from evaluating individual tender bids submitted by the in-

house or public printing works of their respective NCB;

(b) members of the Procurement Committee should avoid any situation likely to give rise to a conflict of interest, in
particular as regards past, current or future links of a personal or professional nature with any printing works or with
any member of a printing works’ decision-making bodies or management;

(c) members of the Procurement Committee are prohibited from using confidential information whenever they conduct

private financial transactions for their benefit or for the benefit of their immediate family members;

(d) members of the Procurement Committee must observe strict confidentiality regarding confidential

information.
Specifically, any such confidential information shall not be passed on to their respective NCBs or to the ECB; and

(e) members of the Procurement Committee must refrain from soliciting any gifts and/or entertainment from printing
works that are accredited, or might apply for accreditation, as a precondition for producing euro banknotes. Members
of the Procurement Committee must not accept gifts and/or entertainment from printing works in excess of a
customary or negligible amount, whether financial or non-financial. Any such gifts and/or entertainment must be
reported to the other members of the Procurement Committee. Members may not be employed by any printing
works that has been awarded a production order for a minimum period of two years after leaving the Procurement
Committee.

The signatory understands that in the event that they infringe any of these rules the Governing Council will: (i) dismiss
them from the Procurement Committee; (ii) communicate this, as appropriate for disciplinary purposes, to their respective
employer; and (iii) appoint a successor to the Procurement Committee.

Name

Date

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ANNEX II

Minimum common features for supply agreements

To the extent allowed by the applicable laws, supply agreements must comply with the following minimum common
features.

1.1. The Eurosystem’s plans for the production of euro banknotes must be included as an integral part of the supply
agreements. In particular, the exact amounts of euro banknotes to be produced and delivered, the contracting
authorities’ right to amend the total number of euro banknotes within predefined limits (alternatively the delivery
schedule), the allocation of production over the production lines made available by the printing works, as well as
the plans for the main production stages including the acceptance and validation stage, must all be detailed in
supply agreements. Comprehensive details of the management, acceptance and validation (on the basis of quantity
and quality checks) of the euro banknotes must be laid down in supply agreements.

1.2.

Supply agreements must contain a clause on the reporting of production progress, in accordance with the standards
and procedures to be defined separately by the ECB.

1.3.

Supply agreements must contain a clause on over/underproduction of euro banknotes. The amount of allowed
over/underproduction and their treatment must be specified separately by the ECB, and must be accurately reported
to the ECB in the frame of the common reporting system on production progress. In addition, supply agreements
must contain a clause prohibiting printing works from holding stocks of excess euro banknotes after a supply
agreement has been fulfilled.

1.4. Contracting authorities should introduce appropriate contractual safeguards into their supply agreements to the
effect that the amount and delivery schedule of ordered euro banknotes may be changed within the limits
established by the ECB.

1.5. Contracting authorities should introduce appropriate clauses into their supply agreements, which allow them to
terminate a supply agreement if unforeseen circumstances arise (e.g. the launch of a new series). The clause should
provide for appropriate compensation for losses and damage to be paid according to a scheme to be defined by the
ECB.

1.6.

Supply agreements must specify the price of the euro banknotes to be printed.

1.7. The contracting authorities must have the right to withhold payment of any invoice or part of an invoice when
situations arise that are not in accordance with the supply agreements, particularly in the case of any defect in or
non-compliance of the delivered euro banknotes with the EBQR.

1.8.

Supply agreements must expressly differentiate between level 1 quality control by the printing works concerned,
and level 2 quality validation by the contracting authority in accordance with the EBQR. In particular, supply
agreements must include a procedure, (to be laid down separately by the Executive Board taking into account the
Banknote Committee’s views), to authorise, before large-scale printing starts, the start of the main stages of
production, e.g. for paper manufacturing, offset printing and intaglio printing. Supply agreements must allow
the contracting authorities to accommodate reasonably justified revisions to the EBQR subject to endorsement
by the ECB beforehand.

1.9.

Printing works must have the complete current technical specifications necessary to produce euro banknotes when
commencing production. Printing works must ensure that euro banknotes are produced in strict compliance with
these technical specifications.

1.10. Printing works must, when commencing production, possess a complete and detailed description of (a) the current
quality control procedures applicable to the production of euro banknotes; and (b) the current common acceptance
criteria and procedures. Contracting authorities must be allowed to revise supply agreements, subject to endor-
sement by the ECB beforehand. The printing works must undertake to respect all these standards and to produce
euro banknotes in strict compliance with the said quality control procedures.

1.11. Printing works must possess the complete and detailed security rules for the production, storage and transport of
euro secure items decided separately by the Executive Board taking into account the Banknote Committee’s views.
Supply agreements must allow the contracting authorities to provide justified revisions to these documents subject
to endorsement by the ECB beforehand. Printing works must undertake in supply agreements to respect the
agreement and to produce euro banknotes in strict compliance with the said security rules.

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1.12. Supply agreements must include a clause that deals with late delivery, quality and quantity problems and any other
failure by the printing works to comply with the supply agreements. A contractual penalty clause (or any other
appropriate remedy) must be included in the supply agreements. For example, if any quality/quantity defects are
detected within a predefined period laid down in the supply agreements, the contracting authority must oblige the
respective printing works to replace the defective euro banknotes at no extra cost within a reasonable period
defined beforehand. These rules will be decided separately by the Executive Board taking into account the Banknote
Committee’s views.

1.13. Supply agreements must contain a liability clause which must at least include the printing works’s liability for direct
damage or losses as a result of its negligence or deliberate action. Contracting authorities may investigate whether
loss of production, additional
any claims for damages on the basis of indirect losses such as loss of profit,
production costs,
loss of business, etc. must also be covered by the supply agreements. Moreover, neither
contractual party will be considered in default of the supply agreements if and to the extent that such default
is due to force majeure.

1.14. Supply agreements must specify the numbering of euro banknotes, as defined by the ECB.

1.15. Supply agreements must contain a confidentiality clause as decided separately by the Executive Board taking into
account the Banknote Committee’s views. In particular, all information disclosed by contracting authorities to the
printing works, but excluding any information that is in or enters the public domain, must be treated as strictly
confidential and must not be disclosed to any third parties without the prior written consent of the contracting
authority.

1.16. Finally, in order to guarantee the confidential nature of any proceedings, all disputes between the parties arising out
of a supply agreement will be settled under the Rules of Arbitration of the International Chamber of Commerce by
three arbitrators appointed in accordance with the said Rules.