CELEX: 62002CC0340
Language: en
Date: 2004-03-11
Title: Opinion of Mr Advocate General Geelhoed delivered on 11 March 2004. # Commission of the European Communities v French Republic. # Failure of a Member State to fulfil obligations - Directive 92/50/EEC - Procedure for the award of public service contracts - Assistance to the maître d'ouvrage for a sewage treatment plant - Award to the successful candidate in an earlier design contest without prior publication of a contract notice in the OJEC. # Case C-340/02.

OPINION OF ADVOCATE GENERALGEELHOED delivered on 11 March 2004(1)
         Case C-340/02Commission of the European CommunitiesvFrench Republic
            (Failure to comply with Article 15(2) of Council Directive 92/50/EEC of 18 June 1992 relating to the coordination of procedures
               for the award of public service contracts  –  Assistance to the awarding body (Chauvinière sewage treatment works)  –  Award of the contract by the Communauté Urbaine du Mans to a successful candidate in an earlier design contest without prior
               publication of tender notice in Official Journal of the European Communities)
            
            
      
         
        1.        In this case the Commission seeks a declaration that the French Republic has failed to fulfil its obligations under Council
      Directive 92/50/EEC of 18 June 1992 relating to the coordination of procedures for the award of public service contracts 
         			(2)
         		 (hereinafter ‘the Directive’) and, more specifically, Article 15(2) of that Directive.
      
      
        2.        The case was prompted by the award by the Communauté urbaine du Mans (municipality of Le Mans, hereinafter ‘the municipality’)
      of a study contract providing for assistance to the person responsible with the improvement of the Chauvinière sewage treatment
      works, without its having previously published a tender notice in the Official Journal of the European Communities.
      
      
      I –  Legal background
        3.        The following provisions of the Directive are relevant in this case:
      
        
      –
         Article 1(g) reads: ‘[For the purposes of this Directive] design contests shall mean those national procedures which enable
            the contracting authority to acquire, mainly in the fields of area planning, town planning, architecture and civil engineering,
            or data processing, a plan or design selected by a jury after being put out to competition with or without the award of prizes.’
         
      
      
        
      –
         Article 7(1) reads: ‘This Directive shall apply to public service contracts, the estimated value of which, net of VAT, is
            not less than ECU 200 000.’
         
      
      
        
      –
         Article 8 reads: ‘Contracts which have as their object services listed in Annex I A shall be awarded in accordance with the
            provisions of Titles III to VI.’
         
      
      
        
      –
         Article 11(3), opening clause and (c). This provision is included in Title III of the Directive under the heading ‘Choice
            of award procedures and rules governing design contests.’ It reads: ‘Contracting authorities may award public service contracts
            by negotiated procedure without prior publication of a contract notice in the following cases:
         
      
      
      …
      
      
         
            (c)
               where the contract concerned follows a design contest and must, under the rules applying, be awarded to the successful candidate
                  or to one of the successful candidates. In the latter case, all successful candidates shall be invited to participate in the
                  negotiations;
               
            
      
                …’
      
        
      –
         Article 13 contains the provisions which apply to design contests forming part of a procedure for the award of a service contract
            whose estimated value net of VAT is not less than the value referred to in Article 7(1).
         
      
      
        
      –
         Article 15(2) appears in Title V of the Directive under the heading ‘Common advertising rules’. It reads: ‘Contracting authorities
            who wish to award a public service contract by open, restricted or, under the conditions laid down in Article 11, negotiated
            procedure, shall make known their intention by means of a notice.’
         
      
      
      
      
      II –  Facts of the case and pre-litigation procedure
        4.        By letter of 7 October 1999 the Commission services requested the French authorities to explain the circumstances and procedures
      relating to a number of invitations for tenders issued by the municipality for the provision of services connected with improvements
      to the Chauvinière sewage treatment works.
      
      
        5.        The two notices of relevance to this case were placed in the Official Journal of 30 November 1996, Series S, No 233, and the
      Official Journal of 10 December 1998, Series S, No 239. The notice of 30 November 1996 concerned a restricted procedure for
      a contest relating to a feasibility study for a network of sewage treatment plants with a view to the requisite adaptation
      of the Chauvinière sewage treatment works to European environmental norms. In this contest FRF 200 000 was available for each
      of the three selected participants.
      
      
        6.        According to the notice of 30 November 1996, this contest formed the first of the three phases of a scheme of works for the
      improvement of the aforementioned sewage treatment works. The second phase consisted of the call for tenders for studies to
      assist the person responsible for the work with the establishment of the technical specifications on the basis of the successful
      design emerging from the contest, the drawing up of an environmental impact report for the operation and, finally, assistance
      to the person responsible for the performance of the work with the examination of the tenders received during the award procedure,
      with which the third phase was to begin. This third phase also involved the drawing up of the contract documents for the work
      and its performance.
      
      
        7.        The publication of the second notice of a call for tenders of 10 December 1998 concerned the provision of services in support
      of the person responsible for the work. It marked the beginning of the second phase, as described above.
      
      
        8.        When no official response was received from the French authorities to the Commission’s letter of 7 October 1999, the Commission
      put them on formal notice by letter of 3 August 2000. The letter in question raised three complaints. They relate to the infringement
      of, respectively, Article 15(2), Article 27(2) and Article 36(1) of the Directive. In the same letter the Commission requested
      the French authorities to forward their comments and to take the necessary corrective measures within a period of two months.
      
      
        9.        In their letter of 21 November 2000 the French authorities completely rejected the Commission’s complaints, as described in
      the letter of formal notice. The Commission considered this response unsatisfactory and, by letter of 26 July 2001, sent them
      a reasoned opinion.
      
      
        10.      In its reasoned opinion the Commission maintained the three complaints raised in the letter of formal notice. In its first
      complaint the Commission accused the French authorities of failing in the first award procedure to fulfil their obligation
      to ensure effective competition. Its second complaint was that the authorities had awarded a contract for assistance to the
      person responsible for the work to the successful candidates in the contest that formed part of the first phase of the project.
      That contract was for some FRF 5 million and was awarded without any prior public notice and without its being possible for
      potential competitors to be considered. In the third complaint the Commission maintained that in the public notice of 10 December
      1998 the contracting authority had wrongly referred only to the tenderers’ qualifications and capacities as award criteria.
      In its view, those factors might be used as selection criteria in the assessment of the admissibility of tenders, but not
      as award criteria.
      
      
        11.      By letter of 4 February 2002 the French authorities reacted to the Commission’s reasoned opinion, acknowledging that its first
      and third complaints were justified.
      
      
        12.      That being the case, the Commission decided to bring this action which concerns only the second complaint formulated in the
      letter of formal notice and the reasoned opinion.
      
      
      III –  Proceedings
        13.      In its application, which was received at the Court on 24 September 2002, the Commission claims that the Court should:
      
        
      –
         declare that, by virtue of the fact that the municipality awarded a study contract providing for assistance to the person
            responsible for the Chauvinière sewage treatment works, without previously publishing a tender notice in the Official Journal of the European Communities, the French Republic has failed to fulfil its obligations under Directive 92/50/EEC and in particular Article 15(2) thereof;
         
      
      
        
      –
         order the French Republic to pay the costs.
      
      
      
      
        14.      The French Government claims that the Court should:
      
        
      –
         dismiss the action;
      
      
        
      –
         order the Commission to pay the costs.
      
      
      
      
      IV –  Assessment
        15.      The Commission essentially advances two interconnected arguments in support of its view that the French Government has failed
      to fulfil its obligations under Article 15(2) of the Directive.
      
      
        16.      It maintains that it is clear from the notice of 30 November 1996 announcing a contest in which the participants were to submit
      conceptual solutions, in the form of feasibility studies, for the adaptation of sewage treatment works to the relevant European
      norms, and from the documents to which that notice referred, that the overall project was divided into three phases: the search
      for a sound solution, assistance with the development of that solution into technical specifications and, finally, the setting
      up and implementation of the final project.
      
      
        17.      For the selected participants in the first phase, the contest, a total amount of FRF 600 000 was set aside as remuneration.
      For assistance to the person responsible for the work during the second phase a total amount of over FRF 4.5 million was provided
      for.
      
      
        18.      From the contest notice and associated documents it was also clear, the Commission continues, that the first and second phases
      differed significantly in terms of their substantive subject-matter. The first phase concerned the search for possible solutions
      for the adaptation of the sewage treatment works. The second phase concerned cooperation with the person responsible for the
      work in the implementation of his design under a study contract.
      
      
        19.      According to the contest notice, involvement in the implementation might encompass three activities:
      
        
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         assistance to the person responsible for the work with the technical development of the design;
      
      
        
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         drawing up of an environmental impact report in connection with the intended work;
      
      
        
      –
         assistance to the person responsible for the work with analysis of the bids for the implementation of the third phase of the
            work.
         
      
      
      
      
        20.      This more detailed description of the second phase goes much farther, the Commission contends, than the subject-matter of
      a design contest, as defined in Article 1(g) of the Directive.
      
      
        21.      The Commission infers therefrom that the contest announced in the notice of 10 November 1996 can have concerned only the first
      phase of the work.
      
      
        22.      This view, it considers, is further corroborated by the wording of the notice itself, which states that the winner of the
      prize may be asked to become involved in the implementation of his design under a study contract.
      
      
        23.      This provision of the notice can be of no relevance because it presupposes that the subject-matter of that (subsequent) contract
      was clearly defined and that clear criteria for its award had been included in the notice.
      
      
        24.      As neither was the case, there could be no certainty on the part of the successful candidate that he would be awarded the
      contract for the implementation of the second phase of the work, let alone be entitled thereto.
      
      
        25.      The Commission states that the implementation of the second phase of the work should have formed the subject-matter of a second
      award procedure as distinct from the design contest of the first phase.
      
      
        26.      For its part, the French Government argues that there could have been absolutely no doubt about the contracting authority’s
      desire to retain the option of awarding the successful candidate a study contract committing him to assist the person responsible
      for the work. Both the contest notice of 30 November 1996 and the associated award rules were clear in this respect.
      
      
        27.      It was therefore permissible for the contracting authority in the second phase to award the study contract to the winner of
      the design contest without prior publication of a second notice in the Official Journal of the European Communities.
      
      
        28.      That view of the matter was, moreover, confirmed by the fact that only FRF 600 000 was available as prize money for the contest.
      That was less than half of the minimum amount at which publication of the contest in the Official Journal became compulsory.
      The contracting authority was therefore not requested to publish the notice if it concerned only the contest provided for
      in the first phase of the work.
      
      
        29.      It was in turn to be inferred therefrom that publication of the notice in the Official Journal demonstrated the willingness
      of the contracting authority to indicate that this case involved not only a design contest but also, subsequently, a study
      contract the remuneration for which exceeded the minimum specified by Community law.
      
      
        30.      Secondly, the French Government goes on, the procedure followed in the present case complied with the relevant Community legislation,
      and in particular with Article 11(3)(c) of the Directive. Pursuant to that provision, the study contract, which followed the
      contest, might, in accordance with the notice, be awarded to the winner or winners of the contest. The fact that, according
      to the notice, the award to the successful candidates in the present case was optional could not detract from the applicability
      of the aforementioned provision.
      
      
        31.      In their reply and rejoinder the Commission and the French Government focus their arguments on the interpretation to be given
      to Article 11(3)(c) of the Directive.
      
      
        32.      According to the Commission, which relies in that connection on the Court’s case-law, 
         			(3)
         		 the provisions authorising a departure from the rules seeking to ensure the effectiveness of Community law must be strictly
      interpreted.
      
      
        33.      In the present case the contest notice merely provided for the possibility of the study contract being awarded to the successful
      candidate, whereas Article 11(3)(c) of the Directive permits an award by negotiated procedure, without prior publication of
      a contract notice, only if the contract follows a design contest and must, under the rules applying, be awarded to one of the successful candidates.
      
      
        34.      From this the Commission infers that in the present case the limits to the exception to the general award requirements, which
      is to be interpreted strictly, were exceeded.
      
      
        35.      The French Government disputes the Commission’s view. It maintains that Article 11(3)(c) of the Directive must be interpreted
      as meaning that the contracting authority may reserve the right to invite competitive tenders for the contract which follows
      from the contest in an open procedure if express provision is made for that option in the notice, read, if necessary, with
      the rules concerning calls for tenders.
      
      
        36.      Such an interpretation would mean that the exception provided for in Article 11(3)(c) might be relied on only if the subsequent
      contract was awarded to the winner of the preceding contest. In all other cases there would have to be a further award procedure
      in accordance with the provisions of the Directive.
      
      
        37.      It seems to me that the Commission’s objections to the failure to invite tenders for the second phase of the activities associated
      with the adaptation of the Chauvinière sewage treatment works are justified, although the arguments on which those objections
      are based are not entirely apposite.
      
      
        38.      Article 1(g) of the Directive defines the instances in which a contracting authority may proceed to the somewhat exceptional
      procedure of a contest.
      
      
        39.      It is clear from the notice of 30 November 1996 that the first phase of the activities – the carrying out of feasibility studies
      into the various options for the improvement of the sewage treatment works – complies in every respect with the definition
      in Article 1(g) of the Directive. The plans or designs concerned relate to hydraulic engineering.
      
      
        40.      However, the activities scheduled for the second phase of the activities only partly conform to the definition in Article
      1(g) of the Directive. While this may be true of the first stage of those activities, namely assistance to the person responsible
      for the work with the establishment of detailed technical specifications, it is not true of the second and third stages. Neither
      the drawing up of an environmental impact report nor assistance to the person responsible with the analysis of the tenders
      for the implementation of the third phase conforms to the definition given in Article 1(g) of the Directive. Nor do these
      activities necessarily follow on from the contest.
      
      
        41.      The result of the foregoing is that a contest limited in content expands into a far wider range of activities, with a fairly
      substantial market value of more than FRF 4.5 million. In the procedure adopted by the contracting authority the general rules
      of the Directive on the award of public service contracts were not applied to those activities.
      
      
        42.      This prejudices the useful effect of the Directive, the very aim of which is to ensure that candidates for a public contract
      are in a position of equality both when they formulate their tenders and when those tenders are being assessed by the adjudicating
      authority. 
         			(4)
         		
      
        43.      An examination of the procedure adopted in this call for tenders for compatibility with Article 11(3)(c) of the Directive
      corroborates this finding.
      
      
        44.      That provision, after all, permits an exception to the general rules in connection with prior design contests only if two
      conditions are satisfied:
      (a)     the contract concerned must ensue from the preceding contest;
      (b)     it must, under the rules applying, be awarded to the successful candidate or 	one of the successful candidates participating
      in that contest.
      
      
        45.      In the case at issue not even the first condition is satisfied, for the reasons given in paragraphs 40 and 41: if the contract
      is far wider in substance than the preceding contest, it cannot be maintained that there is a functional link between the
      contest and the subsequent contract such that the latter ‘follows’ the former.
      
      
        46.      Nor, according to the letter of Article 11(3)(c), is the second condition satisfied. The notice, after all, expressly states
      that the successful candidate may be invited to become involved in the implementation of his idea.
      
      
        47.      Unlike the French Government, I am of the opinion that this second condition must be strictly interpreted. That follows from
      the cumulative nature of the two conditions in Article 11(3)(c): there must be a functional link between the contest and the
      subsequent contract such that the contracting authority can state in advance, i.e. in the contest notice, that the successful
      candidate, or one of the successful candidates, must become involved in the subsequent contract. In the absence of such functional
      link the subsequent contract cannot be reserved for the successful candidate and should be awarded separately with due regard
      for the general provisions of the Directive.
      
      
        48.      As the exception for which Article 11(3)(c) of the Directive provides cannot be relied on for the award of the study contract
      at issue, the contracting authority should, pursuant to Article 15(2) of the Directive, have made known its intention in this
      respect by means of a notice published in the Official Journal of the European Communities.
      
      
        49.      I therefore conclude that the Commission is right in regard to its allegations against the French Government concerning the
      call for tenders for a study contract for assistance to the person responsible with works at the Chauvinière sewage treatment
      plant.
      
      
        50.      As the Commission seeks an order for costs against the French Republic, I propose that the latter should be ordered to pay
      the costs in accordance with Article 69(2) of the Rules of Procedure.
      
       
      V –  Conclusion
        51.      In view of the foregoing I propose that the Court should:
      
        
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         declare that, by virtue of the fact that the municipality of Le Mans awarded a study contract providing for assistance to
            the person responsible for the Chauvinière sewage treatment plant, without previously publishing a tender notice in the Official Journal of the European Communities, the French Republic has failed to fulfil its obligations under Directive 92/50/EEC and, in particular, Article 15(2) thereof;
         
      
      
        
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         order the French Republic to pay the costs.
      
      
      
      
       1 –
         
         Original language: Dutch.
      
      2 –
         
         OJ 1992 L 209, p. 1.
            
         
      
      3 –
         
         Case C-57/94 Commission  v Italy [1995] ECR I-1249.
            
         
      
      4 –
         
         Case C-19/00 SIAC Construction [2001] ECR I-7725.