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PPT, L Kojnok, EC, Third ENP East public procurement conference, Tbilisi, 6 November 2019
1. Key requirements for independent and
impartial review system
Tbilisi, Georgia
7 November 2019
László Kojnok
Legal Officer
DG for Internal Market, Industry,
Entrepreneurship and SMEs (DG GROW)
Unit G2 – Access to Procurement Markets
3. Remedies in public procurement
• Procurement Directives set common principles and
procedures across the Single Market.
• Their objectives could not be entirely achieved if economic
operators were unable to ensure that their rights were
observed across the EU through access to clear, rapid and
effective review procedures.
• The Remedies Directives are at the core of public
procurement legislation.
4. Remedies Directives
Directives 89/665/EEC and 92/13/EEC, as amended by
Directive 2007/66/EC and Directive 2014/23/EU
• Enable economic operators to enforce the rights conferred
by Public Procurement Directives everywhere in the EU
• Require that decisions on contracts falling within the scope
of the Public Procurement Directives taken by contracting
authorities/entities may be reviewed effectively and as
quickly as possible
5. Remedies Directives
• Establish minimum EU review standards
• Most of the provisions in the Remedies Directives are
mandatory - ‘minimum conditions to be satisfied by the
review procedures established in the national legal systems’
• Member States may introduce conditions that go beyond
those laid down in the Remedies Directives
6. Main features of Remedies Directives
Effective and rapid remedies must be available in the case of
infringement of EU law in the field of public procurement or national
rules implementing that law. (Art. 1)
• Availability of review procedures:
Material scope (what)
Personal scope (who)
Time scope (when)
• Pre-contractual remedies:
Interim measures
Setting aside of decisions taken unlawfully by CA/CE
Standstill period
Automatic suspension
• Post-contractual remedies:
Ineffectiveness
Alternative penalties
Compensation/damages
7. Forum for review
Member States are free to decide which body is responsible for
the review procedure:
1. 1. Independent from contracting authority/entity
1) 2. Non judicial in character or judicial
2) 3. When not judicial
• Written reasons
• Review by either a judicial body or by another body that is
independent and has the power to request preliminary rulings
from CJEU
3) 4. Possibility of a compulsory review before the contracting
authority itself
8. Independent review body
• The members of such an independent body shall be
appointed and leave office under the same conditions as
members of the judiciary as regards the authority
responsible for their appointment, their period of
office, and their removal. At least the President of
this independent body shall have the same legal and
professional qualifications as members of the judiciary.
The independent body shall take its decisions following
a procedure in which both sides are heard, and these
decisions shall, by means determined by each Member
State, be legally binding.
9. Right to appeal to second instance
When the first review body is not judicial in character:
• Review by either a judicial body or by another body that is
independent and has the power to request preliminary
rulings from CJEU
10. Material scope of the review
Remedies Directive apply to violations of the EU law in the field of public
procurement or national transposing that law:
• Contracts falling within the scope of PP Directives
• All decisions taken by contracting authorities
11. Legal standing
Member States are free to have their own definition of
persons who can bring a request to review.
• According to Art. 1(3) Remedies Directive, remedies
should be available at least to “any person having or
having had an interest in obtaining a particular public
supply or public works contract and who has been or
risks being harmed by an alleged infringement.”
12. Remedies – before the contract conclusion
1. Interim measures
• review body must be able to take, at the earliest
opportunity and by way of interlocutory procedures,
interim measures to correct the alleged infringement
or prevent further damage to the interests concerned,
including measures to suspend the procedure for the award
of a public contract or the implementation of any
procedural decision taken by contracting authorities (Art.
2(1) a)
13. Remedies – before the contract conclusion
2. Setting aside of decisions taken unlawfully by CA/CE
Review bodies must be given the power to “set aside or
ensure the setting aside of decisions taken unlawfully”.
The power shall include the removal of discriminatory
technical, economic or financial specifications in the invitation
to tender, the contract documents or in any other document
relating to the contract award procedure
14. Automatic suspension
Automatic suspension in case of review: A contracting
authority cannot conclude the contract before the review body
has made a decision on the application either for interim
measures or for review. The suspension shall end no earlier
than the expiry of the standstill period.
15. Standstill period
Standstill period:
It allows an effective pre-contractual review. A contract may
not be concluded before the expiry of a period of at least 10
calendar days from the day on which the award decision is
send to tenderers.
16. Post-award sanctions
Ineffectiveness of contract
• No publication, no exemptions for direct award, no
standstill
• Possibility not to consider a contract ineffective for
overriding reasons relating to a general interest (in that
case alternative penalties shall apply)
Alternative penalties
• Fines on the contracting authorities
• Shortening of the duration of the contract
17. Damages
• The Remedies Directives include the possibility to award
damages to persons harmed by an infringement.
• The conditions depend on national provisions.
18. Bilateral and plurilateral
commitments concerning review
bodies
• Level of commitments
• - WTO Agreement on Government Procurement
• - Free Trade Agreements (FTAs)
• - Deep and Comprehensive Free Trade
Agreements (DCFTAs)
19. WTO GPA
Article XVIII.4 Each Party shall establish or
designate at least one impartial administrative
or judicial authority that is independent of its
procuring entities to receive and review a challenge
by a supplier arising in the context of a covered
procurement.
=> Inhouse review functions are not compliant
20. WTO GPA
• Each Party shall adopt or maintain procedures that provide for:
•
• (a) rapid interim measures to preserve the supplier's
opportunity to participate in the procurement. Such interim
measures may result in suspension of the procurement process.
The procedures may provide that overriding adverse
consequences for the interests concerned, including the public
interest, may be taken into account when deciding whether such
measures should be applied. Just cause for not acting shall be
provided in writing; and
•
•
21. WTO GPA
• (b) where a review body has determined that there has
been a breach or a failure as referred to in paragraph 1,
corrective action or compensation for the loss or
damages suffered, which may be limited to either the
costs for the preparation of the tender or the costs relating
to the challenge, or both.
22. Free Trade Agreement – EU-
Armenia
• Article 271 (5) Members of independent review
bodies shall not be representatives of any
contracting authorities.
• (c) the members of such an independent body
are appointed and leave office under the same
conditions as members of the judiciary as regards
the authority responsible for their appointment,
their period of office, and their removal;
23. Free Trade Agreement – EU-
Armenia
• (d) at least the President of such an
independent body has the same legal and
professional qualifications as members of the
judiciary;
• => Precise requirements both on members,
President
24. DCFTAs
• Phase 1 - In the framework of the institutional reform,
Ukraine/Georgia/Moldova shall designate in particular:
•
• an impartial and independent body tasked with the
review of decisions taken by contracting authorities or
entities during the award of contracts. In this context,
"independent" means that that body shall be a public
authority which is separate from all contracting entities and
economic operators. There shall be a possibility to subject
the decisions taken by this body to judicial review.
25. Further alignment with the
Remedies Directives - DCFTA
• Phase 2 (for classical) / Phase 3 (for
utilities):
• Article 1 Scope and availability of review
procedures - coverage, complainants,
suspension
•
26. Further alignment with the
Remedies Directives - DCFTA
• Article 2 Requirements for review procedures
• Interim measures
• Setting aside
• Damages
• Conditions on the members of the independent
and impartial review bodies
27. Further alignment with the
Remedies Directives - DCFTA
• Article 2a Standstill period
• Article 2b Derogations from the standstill period
• Point (b) of the first paragraph of Article 2b –
only one tenderer concerned to who the contract
is awarded and there are no candidates
concerned
28. Further alignment with the
Remedies Directives - DCFTA
• Article 2c and 2f Time limits
• Article 2d Ineffectiveness
• Article 2e Infringements of this Directive and
alternative penalties – fine on contracting
authorities or shortening the duration of the
contract
29. Further alignment with the
Remedies Directives - DCFTA
• Article 2c and 2f Time limits
• Article 2d Ineffectiveness
• Article 2e Infringements of this Directive and
alternative penalties – fine on contracting
authorities or shortening the duration of the
contract