Europe accuses seven of breaking procurement law

13 March 2003
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13 March 2003 | Robin Parker

Seven countries have been accused of anti-competitive procurement practices under European Union law.

France, Portugal, Spain and Germany are being taken to the European Court of Justice charged with flouting EU public procurement laws despite previous warnings.

The charges include:

• The city authorities in Munich and Coesfeld, Germany, awarding waste management contracts without going through the required Europe-wide tendering procedure.

• The Spanish national health service requiring candidates for a respiratory therapy contract to have offices in the regions where the service was to be supplied - discriminating against non-Spanish suppliers.

• France still using a law that restricts competition for key roles in major building projects.

The commission has also made formal requests to Ireland, Italy and Finland to alter their procurement practices after contracts were believed to have been awarded unlawfully.

Ireland faces censure for not putting out to international competition an extension to a contract for social welfare payment services by An Post, the national post office.

The court can take up to two years to make its judgment, and 90 per cent of such rulings to date have backed the EC.

Penalties can include a formal order to alter domestic law, fines and the halting of EU funds for specific projects.

The move comes ahead of proposed changes to EU public procurement law, due later this year, which aim to make it easier to award public-private partnership deals and to introduce long-term framework agreements into the public sector.

Chris Bovis, director of the centre of legal research at Lancashire Law School, who specialises in European and business law, said the EC was toughening its stance ahead of the revised rules.

"But the law is not crystal-clear and member states are exploiting what they see as loopholes."

Sue Arrowsmith, law professor at the University of Nottingham, said EC guidance on when to open a contract to international competition was too vague.

"This is a grey area that the court hasn't clarified and it remains a big practical problem."

SMmar2003

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