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# 51997AC0607

**Opinion of the Economic and Social Committee on the 'Green Paper entitled Public procurement in the European Union: Exploring the way forward'** 
  
*Official Journal C 287 , 22/09/1997 P. 0092*

  

Opinion of the Economic and Social Committee on the 'Green Paper entitled Public procurement in the European Union: Exploring the way forward` (97/C 287/20)

On 16 December 1996 the Commission decided, in accordance with Article 198 of the Treaty establishing the European Community, to consult the Economic and Social Committee on the 'Green Paper entitled Public procurement in the European Union: Exploring the way forward`.

The Section for Industry, Commerce, Crafts and Services, which was responsible for preparing the Committee's work on the subject, adopted its opinion on 7 May 1997. The rapporteur was Mr Malosse.

At its 346th plenary session (meeting of 29 May 1997), the Economic and Social Committee adopted the following opinion by 61 votes to zero, with two abstentions.

1. Introduction

1.1. In publishing a green paper on public procurement in Europe the Commission has launched a wide-ranging debate among all those concerned, decision-makers and political authorities in the member states and the EU and among public opinion generally.

This initiative is all the more laudable because it enables an overall and long-term assessment to be made of what should be the true objectives of a European public procurement policy. Such an assessment must therefore be very open and unrestricted.

1.2. Such an assessment must also take account of the evolution in practice of markets and contractual procedures in Europe, especially as part of the growth in private funding of public facilities.

1.3. The green paper assesses the state of public procurement in the EU and asks a number of questions, which could provide a guide to new Commission initiatives. The Commission does mention the probability of a forthcoming communication which would include a plan of action intended to 'bolster the effectiveness of the legal framework and more fully achieve the objectives of the Community's public procurement policy`.

1.4. This initiative is welcome. It is consistent with the communication on the impact and effectiveness of the single market published a few weeks earlier (COM(96) 520 final). The policy of opening up public procurement, which is laid down in the Treaty of Rome, was relaunched in 1985 by the programme for completing the single European market. The famous 1987 Commission report on the 'cost of non-Europe` (known as the Cecchini report from the name of its rapporteur-general) estimated the benefit of opening up public procurement at ECU 22bn. The Commission hoped to make major growth gains by boosting efficiency. In the green paper the Commission explicitly recognizes that this policy has so far not had the effects and results hoped for.

2. General comments on the green paper

2.1. The Commission notes that the directives on public procurement are not applied properly and that this is largely due to the member states not incorporating them into national law. While not wishing to play down this reality, the ESC does feel that two other factors play a role which is at least just as important: (i) the general conditions surrounding market access, with the survival of many obstacles and barriers, and (ii) the difficulties of gaining access to information, where small and medium-sized firms in particular are at a disadvantage.

2.2. The ESC considers that a European public procurement policy must, as a priority, be an instrument for bringing about a single European market by abolishing the present frontiers and barriers. In this way it can help to improve competitiveness, produce job-rich growth and contribute towards real market integration. Increased supply-side competition can only be beneficial in markets where competition is often restricted by de facto monopolies or cartels.

2.3. The ESC also thinks it a pity that there is no real debate on the impact of good public procurement management. The ESC would like the Commission to study more closely the impact over time of EU rules in terms of competitiveness, budget savings, jobs and the quality of work done and services provided.

2.4. The very definition of 'good management` in public procurement is a source of debate. The yardstick of price is not sufficient. Other factors may be involved: quality, respect for deadlines, environmental protection, workability, safety, in short the overall cost of operations in the long term. A European policy on public works contracts should consolidate this concept of the 'best bidder` by laying down concrete rules to be included by contracting authorities in their tender specifications, so as to encourage them to give precedence to the formula of 'the most economically advantageous bid`, as opposed to the cheapest bid.

2.5. In some member states bids are tending to become abnormally low. This situation is bad for all concerned. It is society as a whole that eventually has to bear all the consequences: faulty building work, company failures and higher prices due to contract supplements or the extra work made necessary. Such practices also distort competition between firms and endanger working conditions and jobs. A European public procurement policy today cannot ignore this problem and must try and find solutions to it.

2.6. A European public procurement policy should also consider what means should be used to enable firms to bid for these contracts under favourable conditions: equal treatment and access, whatever the legal status of the bidder, ethical behaviour on the part of the contracting authorities as regards payment deadlines and respect for copyright principles.

2.7. The green paper's figures on the application of Community procedures do not mean much. The number of notices published in the Official Journal (up from 12 000 in 1987 to almost 95 000 in 1995) is interesting but does not really show that markets have become more open, because of the existing barriers mentioned by the Commission. In fact, two of the figures quoted seem to indicate that EU directives have little or no impact: in the EU only 3 % of direct public purchases, and 4-7 % of purchases through local importers, have supposedly been made by firms from another member state. Moreover, 85 % of contracting authorities, including local authorities, do not comply with the directives' publication and transparency requirements. But how reliable is this latter figure, which the ESC finds highly pessimistic? Can it be trusted? The ESC suggests that more detailed needs to be carried out, especially in frontier regions, where the results may be the most meaningful. It trusts it will be involved in this work, as part of its brief as Single Market Observatory.

2.8. The ESC feels that the reason why so few public procurement contracts are concluded with firms from another member state is due more to external factors that to an inadequate application of directives. By external factors the ESC means both subjective factors, such as ignorance of national customs and practices, and objective factors, such as rates of return which are sometimes disappointing, because of the high cost of tendering abroad, the exchange risk, in the absence of a single currency, legal and regulatory obstacles, and, finally, language barriers. These factors are obstacles particularly for small and medium-sized firms. So, a European public procurement policy must cover the general conditions governing market access and aim to improve the conditions of access to information.

2.9. The ESC has already spoken out in favour of more effective rules on public procurement. In an additional opinion on public procurement () adopted on 30 May 1996 the ESC already called for a stepping-up of training programmes using the socio-economic groups and the setting-up of associations or forums for the promotion of public contracts. The ESC also published recently a series of opinions concerning standardization () which highlighted the existence of concrete barriers to the opening-up of markets due to the application of restrictive and, in some cases, discriminatory technical rules.

3. European directives on public procurement law

3.1. The ESC approves of the Commission's concern for legal stability and deplores the tardiness of some member states in incorporating directives into their national laws. However, it is still struck by the complexity of the present arrangements and would request some simplification eventually, as directives often intersect and overlap. Sometimes either the contracting authorities or the bidders cannot establish which directive they come under, and the distinction drawn between utilities and all other sectors may lead to confusion. The ESC also approves of the publication of short, simple guides drawn up in consultation with the parties concerned and the setting-up of training programmes, especially for the appropriate national, regional and local authorities and other public-sector contractors. These guides should show the extent to which directives have been incorporated in each country together with clear references to the relevant national laws. Large-scale publication and distribution of the guides may itself help speed up incorporation as it would highlight the most glaring delays.

3.2. The Commission is right to stress the problems encountered in getting directives incorporated by member states into their national laws. In addition to delays one finds in some member states in particular that national texts may contain provisions that are more complex or different, or even that some national texts which are still in force actually contradict European directives. Instead of 'cleaning up` national laws to bring them into line with European law the ESC wonders whether other means should not be considered for achieving a really uniform set of rules. It requests the Commission to consider eventually bringing in European regulations that would simply replace all current national and EU texts. Such considerations must not, under any circumstances, be used as a pretext by the most recalcitrant states to delay or postpone their work of incorporating directives into national law. However, the Commission should not rule out the regulation option, including its use as a means of exerting pressure to speed up directive incorporation.

3.3. Appeals, conciliation and compensation procedures are very important in public procurement rules. However, such machinery should be transparent, so as to avoid unjustified appeals based on erroneous or untrue allegations. There is no clear distinction drawn between appeals to the Commission and those to authorities in a member state. The current situation keeps things vague as regards allowing both types of appeal. It would be better to clarify the whole appeals system. The Commission should publish guides informing economic operators of the remedies possible if they suspect that rules are being broken and explaining clearly the different procedures in each member state, how to use them and what the possibilities of compensation are. Such guides should also explain what the Commission's duties are as regards complaints over public procurement, how a complaint should be lodged with the Commission and how this procedure ties in with procedures involving national bodies or the European Court of Justice.

3.4. One way of ensuring that controls were more efficient would be to set up monitoring bodies that were independent of the contracting authorities. Such national or regional bodies, which could co-operate within a European network, would be able both to help contracting authorities to apply directives correctly and provide bidders with a guarantee of independent monitoring of procedures. So, the ESC broadly supports the Commission in order to encourage member states to simplify the functioning of existing monitoring bodies and, where necessary, strengthen their autonomy.

3.5. Firms are often wary of using appeals procedures because of the high costs involved and the risk of reprisals on the part of the public contracting authorities. The ESC would emphasize the importance of having procedures which are easy to access, cheap, and which ensure real protection for the plaintiff with the prospect of obtaining rapid compensation where appropriate. It suggests that the Commission think about any initiatives that might be taken as part of the Third Pillar of European Union: choice of legal codes, the nature and amount of indemnities and compensation, legal aid, sharing of responsibilities, especially when sub-contractors are used. The ESC notes that compensation procedures are most used in those countries where they come under a specialist branch of the law.

3.6. In many EU countries most public contracts are initiated by local authorities or entities. The opening-up of these contracts is particularly important for small and medium-sized firms. The ESC recommends the Commission to turn its attention to this matter and set up, initially on a voluntary basis, procedures for certifying contracting authorities (attestations). In addition, the ESC recommends the Commission turn its attention to supporting training programmes for those responsible within local authorities and entities.

3.7. The use of long-term contracts to provide private financing for public works is growing in several countries. These are not the same as public procurement contracts. Such methods should be promoted and used more widely as they help states save public money. The Commission should draw up a communication on interpretation which safeguards the negotiated status of such contracts while ensuring they have the necessary publicity. A partnership between the private and public sectors needs a favourable and specific framework. The Commission must study the models that have been developed here: the Private Finance Initiative contracts in the UK, which ensure openness and respect for companies' interests, concession contracts where payment comes from the private, mixed or public sector and is spread over time (the Vorfinanzierungsmodell in Germany, contrats de promotion in Belgium, marchés d'entreprises de travaux publics in France and the TAV formula in Italy).

3.8. The question of concessions should also be examined in depth, given that their award must be transparent and subject to objective criteria. There are fundamental differences between a concession and a contract: object, duration, terms for financing, management methods and the extent of liability. To encourage the spread of such contracts the Commission could study what form of legal tool should be used for their implementation.

3.9. The ESC would also like the Commission to look at partial or total privatizations of public sector corporations. This process is very like the awarding of a public procurement contract, although there are some very specific differences. Because of the abuses noted in the past (lack of transparency, national preferences) the ESC would like EU rules to encompass this question and deal with it in a specific manner.

3.10. Some contracting authorities have no scruples about 'splitting-up` medium-sized contracts so as to keep below the thresholds for complying with EU directives and publication requirements. This practice should be condemned and the member states must see that the procedures in force are applied correctly.

3.11. The ESC also proposes lowering the thresholds, especially for works. This would make it possible to increase the number of contracts open at European level to small and medium-sized firms, which, because of their flexibility, are able to respond in a more competitive manner to small or medium-sized contracts. However, this question should be dealt with in the international framework of the World Trade Organization.

3.12. To ensure greater transparency the ESC suggests that the procedures for awarding public procurement contracts be covered by European directives subject to a report that is accessible to the public and a complete assessment of the operation on its completion ().

4. Improving access to public procurement

4.1. The ESC supports the idea of following up the application of public procurement rules and their impact more closely. The Single Market Observatory set up at the ESC, with proper means and the help of the parties concerned, could be given the task of carrying out studies and assessments with the aim of averting implementation problems, detecting violations of principle and tracking growth in the cross-frontier awarding of contracts.

4.2. New initiatives to improve information and transparency are always welcome. One must refer explicitly here to the needs of small and medium-sized firms, the crafts sector, the self-employed and co-operatives. The Euro Info Centres, which have already been given a pilot task along these lines, could be the backbone of a European information network. It is essential here to ensure that information is easy to read and understand and, in particular, that use of the CPV () system is compulsory, so that details of the different contracts can be compared instantly whatever the original language of publication.

4.3. In parallel with this effort to provide more information the ESC supports the idea of using existing associations or structures to set up forums for the promotion of public contracts. These would be responsible, in close collaboration with the relevant national authorities, for speeding up changes in thinking in the awarding of public procurement contracts. The forums' role would cover information, advice and promotion.

4.4. The choice of the best bid by an authority often depends on the qualifications and competence of those responsible for taking decisions in awarding entities. The Commission should support technical and legal training programmes for such persons. The ESC suggests that an initial pilot programme be carried out here in joint consultation with the member states and local authorities.

4.5. The ESC suggests that the Commission carry out pilot promotion and information schemes in frontier regions. Such measures, targeting as a priority small and medium-sized firms, would enable meaningful results to be achieved rapidly in terms of participation in contracts in neighbouring countries. They would also provide an excellent means of observing the real obstacles and barriers to the opening-up of markets.

4.6. The selection conditions set out in contracts may sometimes make it impossible for a firm to tender in a neighbouring EU country: obligation to be registered with a national body, comply with (sometimes) little-known national technical standards, have a fiscal or social representative, be listed in a professional register, have a professional certificate, comply with exaggerated turnover requirements. Where such measures are unavoidable, steps must be taken to see that they are not discriminatory or involve unnecessary costs, as is unfortunately the case in certain countries. Such distortions were noted by the ESC in a recent own-initiative opinion on the cross-border activities of SMEs (). They particularly penalize small businesses and craft firms. We think the Commission should study carefully the impact of these laws or selection rules and not hesitate to institute proceedings against states which practise discrimination.

4.7. The ESC agrees with the Commission that the development of electronic technologies for public procurement, electronic tendering is of importance to the future of public procurement in Europe. Until such time as the private sector develops attractive services in this area the ESC would stress the importance of current projects, and particularly SIMAP, where an analysis of costs involved and the protection of intellectual property should be published in a report. The Commission must propose more efficient machinery, since there are still too few subscribers (25 000) to the various European information services on public procurement. The ESC recommends that the Commission should intensify support for the work of the EBES () Expert Group on Public Procurement, which is the focus of work on electronic technologies in European public procurement. The ESC would mention the interest of having information distribution machinery that was specifically destined for frontier regions, because of their attraction for small and medium-sized firms.

4.8. Some 90 %, or even 95 %, of potential suppliers, contractors or suppliers of services in the public procurement sector are small or medium-sized firms. But these are generally excluded from the benefits of EU directives because of the present thresholds in the directives. The ESC would stress the importance of increasing smaller firms' involvement in public procurement in Europe and recommends that the thresholds be lowered and that appropriate accompanying measures be introduced. The Commission should use the USA's Small Business Act as a guide for encouraging EU contracting authorities to promote bidding from smaller firms.

5. The promotion of contracting firms

5.1. The opening-up of European public procurement markets is also of great importance to thousands of firms and millions of jobs in the EU. Many firms, especially in the building industry, are concerned about the present trend towards cutting public spending. It is therefore time to consider the problem of competition in terms of equal access to markets where unfair and excessively aggressive practices in any quarter are prohibited.

5.2. Many firms complain about the contracting authorities, including the European institutions, extending payment deadlines. This trend seems to be getting worse, despite the publication of an EU recommendation. The ESC therefore proposes that maximum deadlines be laid down, with penalties for late payment.

5.3. Firms and professional federations also say that many contracting authorities do not respect the principles of copyright. Inventions, innovations or solutions submitted in unsuccessful tenders are often copied, without any real possibility of redress. The ESC suggests that the Commission consider formulating a code of practice for contracting authorities regarding their behaviour during calls for tenders.

5.4. Such a code of practice must also tackle the problem of corruption, which recent revelations in various EU states have shown to be extremely harmful to the public image of public procurement. Some recent cases have also highlighted the urgent need for increased co-operation between member states' legal authorities, so as to thwart practices that might easily develop in a European or international setting.

5.5. The existence of abnormally low tenders disturbs competition. Their eventual consequences are generally disastrous for society: unfinished work, poor quality, company closures and unsettled conditions of competition. The ESC suggests promoting in the EU a system of compulsory bonds held by the contracting authority in order to guarantee proper performance of a tender.

5.6. As stated in the ESC's additional opinion adopted on 30 May 1996 (), 'the Committee considers that sub-contracting is a form of organization of labour suited to the specialized aspects of the execution of works`. It should be pointed out that sub-contracting contracts must respect all the obligations imposed on the main contractors, especially as regards labour law and safety. With this end in view it would be advisable to establish a linked responsibility between contractor and sub-contractor.

5.7. In any public procurement contract, and especially in the event of sub-contracting, the contracting authorities must be able to ensure that current labour law is respected, particularly that relating to clandestine working.

6. Public procurement and other Community policies

6.1. Many firms have noted here the existence of unwritten rules that, in fact, disturb conditions of competition and discourage them from tendering for public procurement contracts in another member state. The ESC declares that one cannot expect a policy on opening up public procurement to sort out other questions, such as environmental, social or regional policy concerns. It goes without saying that such a policy must be consistent with other Community priorities, especially in the social and environmental field, and that public contracting authorities may include such concerns in their public procurement contracts.

6.2. The ESC asks the Commission to set out in a communication, and as part of the regional, social or environmental policies, limits on any specific conditions that might be inserted into a contract (). Such criteria should not, however, have any discriminatory effect whatsoever on the capacity of a firm from another member state to bid for the contract. For instance, if a contracting authority wishes to favour certain types of people, such a clause should be subject to a certain number of conditions such as being limited in its duration, applying only to a given size of contract and to certain types of work, being really accessible to any firm without any discriminatory effect and being the subject, where appropriate, of a specific payment. The application of environmental rules should also be encouraged as a positive contribution to the well-being of the peoples living in the EU. However, such rules should not have a discriminatory effect and should, therefore, comply with EU rules concerning the environment.

6.3. At any event, the ESC insists that EU texts make it compulsory for contracts to have a very high degree of transparency, since the present level is inadequate. The 'unwritten` rules referred to by so many firms today (favouritism towards local firms, various types of compensation) must be clearly prohibited or limited and without any discriminatory effects. Unless this is done, they will continue to constitute 'invisible` but very real barriers to firms tendering for public procurement contracts.

6.4. Because of the scale of EU funding involved, an information policy is necessary for contracts involving objective 1 regions and countries. These must be the responsibility as much of the member states as of the Commission. The directorate responsible for the cohesion fund has provided information on the projects it financed in ineligible countries. Such a policy should be made more systematic and extended to the other structural funds, especially the ERDF. The Commission could also see that the contracting authorities apply the principles of equal access more strictly when they receive EU funding. To check that contract award procedures were being followed the certification procedure should be actually imposed in such cases on those benefiting from EU funds.

6.5. As guardian of the treaties the Commission must set an example in public procurement. But unfortunately the management of some programmes sometimes takes considerable liberties with the rules laid down for the whole of the EU. Under the Phare programme, framework contracts valid for two years dispense with any real call for competitive bids to supply services worth less than ECU 300 000 (when the Community threshold is ECU 200 000), thus giving a consortium of consultants a de facto monopoly in certain sectors. The Phare and Tacis award procedures for service contracts also include such questionable practices as the preparation of 'short lists` without announcing what criteria are used for selection, the forming of consortia from short-listed bidders and numerous cases of conflicts of interest where persons working under contract at the Commission have benefited from projects in which they were involved during the planning stage. The Court of Auditors has criticized the Commission on these grounds in its 1995 report. The ESC asks the Commission to introduce one single law for awarding contracts applying to all contracts irrespective of the programme concerned. For the awarding of services contracts it calls in particular for:

6.5.1. Compulsory advance calls for tenders, in order to draw up short lists.

6.5.2. The publication of short lists in the Official Journal.

6.5.3. The prohibition of agreements between shortlisted bidders before the contract has been awarded.

6.5.4. The prohibition of 'framework contracts` where these rule out any form of competition.

6.5.5. Stricter application of ethical rules within the Commission, prohibiting any person who has worked with the Commission under any form of contract whatsoever from being a beneficiary of a contract awarded by the Commission for a period of at least five years after the end of his or her contract with the Commission.

6.6. Projects for trans-European networks suffer from the absence of a single legal implementing framework, which, among other things, would ensure legal stability as regards the implementation of concessions. A European communication along these lines would help the emergence of European public procurement concessions. It should be based on the experiments currently in progress in some member states on publicly funded long-term contracts ().

6.7. The ESC notes that the special and strategic nature of the defence sector is recognized by Article 223 of the Treaty of Rome. However, care should be taken to see that civil or dual-use contracts and supplies of the defence and armed forces administrations are submitted to ordinary law, as recommended in the opinion adopted by the ESC on 19 March 1997 (). Some form of opening-up and greater competition can be envisaged for sensitive products as part of intergovernmental co-operation, particularly in connection with the plan for a European armaments agency.

7. Procurement outside the Union

7.1. The opening-up of public procurement in non-EU countries to EU firms must be a priority for the EU.

7.2. It should be possible to identify obstacles to access to non-EU countries so as to obtain guarantees for contracting parties to the World Trade Organization's Government Procurement Agreement (GPA) regarding the removal of such obstacles.

7.2.1. The ESC would like the Commission to study the conditions for access by foreign firms to EU procurement contracts and compare them with the conditions for access by EU firms to the major non-EU markets (Japan, the USA, Australia and Canada).

7.3. As a pilot scheme, the Commission could promote the dissemination of information on public procurement in non-EU countries (prior information and not calls for tenders published in the Official Journal or the TED bank, where the deadlines are generally much too short). On some big foreign projects co-operation between EU firms should be encouraged, as should the search for potential sub-contractors in the EU.

7.4. The ESC wishes to stress the EU's obligations as regards opening up its public procurement contracts under the GPA. The EU and the national bodies responsible must see that foreign firms, including sub-contractors, bidding for contracts on its territory operate practices that comply with the standards of the International Labour Organization and with the social legislation in force.

7.5. As regards contracts for long-term work carried out on EU territory by foreign firms, including sub-contractors, and in order to avoid 'social dumping`, the appropriate national authorities must have the right to require compliance with national provisions on social matters.

7.6. There seems to be grounds for providing technical assistance for the countries of central and eastern Europe and the Mediterranean countries in the public procurement sector. The best way for transferring essential know-how would be through courses with monitoring or awarding entities which applied EU rules strictly.

8. Conclusions and final resolution

8.1. Considering the advantages of greater transparency in applying rules on the awarding of public procurement contracts in the EU, in particular: greater effectiveness in achieving the single market, a better use of public resources, less corruption, more trade within the EU, higher quality goods and services, better use of the know-how of firms in our countries;

8.2. Considering too the economic importance of public procurement in the EU and the number of firms and jobs that depend on it;

8.3. The Economic and Social Committee, in reaction to the green paper of the European Commission:

8.3.1. Deplores the delays in certain member states in incorporating directives into national law and asks the Commission to take every step to remedy this situation.

8.3.2. Requests, however, also that work be started on simplifying and clarifying the present texts at both Community and national level and that particular consideration be given to the eventual drafting of a single legal framework, which could best be achieved through a regulation;

8.3.3. Calls upon the contracting authorities, as regards public procurement contracts, to take more account of the quality of the bids submitted to them in terms of economic advantages, of which price may only be one factor among others;

8.3.4. Submits the idea of an approximation of laws and exchange of best practices in the field of legal appeals procedures, within the framework of the Third Pillar of the European Union;

8.3.5. Suggests that the European Commission make the different appeals procedures more visible and more consistent with one another;

8.3.6. Desires that concessions be the subject of a specific regime, especially as regards trans-European networks;

8.3.7. Proposes that the Commission encourage the promotion of new contractual arrangements based on private investment in public infrastructures;

8.3.8. Calls upon the member states and the European Union to tighten up the obligations of public contracting authorities towards bidding firms: reduction of payment deadlines, respect for copyright in bids, drawing-up of a code of practice for contracting authorities;

8.3.9. Requests that a major effort be made at Community and national level to improve access to information, especially for small and medium-sized firms, and calls upon the Commission in this connection to launch pilot projects in frontier regions;

8.3.10. Proposes that the European Commission support a pilot training programme to improve the skills and competence of those in charge of contracting entities;

8.3.11. Supports the Commission's proposal to develop forums for the promotion of public procurement which should be run by economic and social interest groups and supports too the idea of certification schemes to encourage contracting authorities to apply EU rules in practice; such machinery, which is envisaged as voluntary, could be compulsory for contracts financed by the EU;

8.3.12. Stresses the need to give priority to education and training over stricter administrative controls and stronger remedies;

8.3.13. Proposes that machinery for observing the impact and effects of opening up public procurement be set up in liaison with the ESC's Single Market Observatory;

8.3.14. Requests that thought be given to developing performance guarantee procedures to combat the effects of abnormally low bids;

8.3.15. Notes the existence of environmental, social and regional concerns that may influence the choices made by contracting authorities, recognises the legitimacy of such concerns, which are in keeping with EU priorities, but insists that such criteria should not be allowed to have the least discriminatory effect;

8.3.16. Recognises the importance of opening up public procurement on an international scale under the World Trade Organization, recommends that the European Union concern itself as a priority with the conditions for access by EU firms to public procurement contracts in non-EU countries and stresses that the opening-up of EU markets to foreign firms, including sub-contractors, cannot be to the detriment of social standards laid down by the International Labour Organization, current labour law or safety rules, and must comply with provisions setting out clearly the legal and social responsibilities of the partners involved;

8.3.17. Requests the European Commission to improve as quickly as possible its own procedures for awarding contracts, especially in the field of services, so as to set a good example.

Brussels, 29 May 1997.

The President of the Economic and Social Committee

Tom JENKINS

() OJ C 212, 22. 7. 1996 - ESC opinion on public contracts.

() OJ C 256, 2. 10. 1995 - ESC opinion on public contracts; OJ C 212, 22. 7. 1996 - ESC opinion on technical standards and mutual recognition; OJ C 89, 19. 3. 1997 - ESC opinion on the Communication from the Commission to the Council and the European Parliament on standardisation and the global information society: the European approach.

() The Commission could take account here of the experience of the World Bank with its Uniform Procurement Standards.

() CPV - Common Procurement Vocabulary.

() Opinion on SMEs in frontier regions - problems encountered in cross-border business relations, including those relating to technical requirements. OJ C 206, 7. 7. 1997, p. 70.

() EBES = European Board for EDI Standardisation.

() ILO conventions must be included among these criteria and be discussed in relation to social security clauses in commercial contracts (Conventions 87, 98, 29, 105, 100, 111 and 138). The ILO convention on social security in public procurement is also an obvious criterion in this context.

() PFI contracts in the UK, the 'Vorfinanzierungsmodell` in Germany, 'Marchés d'entreprises de travaux publics` in France, 'Contrats de promotion` in Belgium, the TAV formula in Italy.

() OJ C 158, 26. 5. 1997 - ESC Opinion on the Communication from the Commission - The challenges facing the European defence-related industry, a contribution for action at European level.

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