The Government Procurement Review: European Union


EU procurement law is set out in four principal directives, namely the 2014 Public Contracts Directive, the 2014 Utilities Contracts Directive, the 2014 Concession Contracts Directive (together, the 2014 Procurement Directives), and the 2009 Defence and Security Procurement Directive.2 Additionally, rules on remedies for breach of these four principal directives are set out (in respect of the 2014 Procurement Directives) in the Public Sector Remedies Directive and the Utilities Remedies Directive,3 and, (for defence) are written into the Defence and Security Procurement Directive itself. In this chapter, 'the Directives' means all six of these procurement directives.

The Directives are complemented by some specific legal acts, such as Regulation (EC) No. 1370/2007 concerning passenger transport services by rail4 and the Clean Vehicles Directive.5

Overriding principles of EU law, referred to as the EU Treaty principles, have been developed by the Court of Justice of the European Union (CJEU) on the basis of freedoms in the EU Treaties. These principles include free movement of goods and services within the European Union, freedom of establishment, non-discrimination on grounds of nationality, equal treatment, transparency, proportionality (i.e., fairness) and mutual recognition.

In cases before the CJEU, it may decide that an official opinion from the Advocate General is necessary before the judges deliberate and give their verdict. The Advocate General's opinion is published and provides guidance on the law.

As with all EU directives, the Directives require Member States to adopt national legislation transposing them into national law. Nevertheless, the national courts must interpret the relevant national legislation insofar as it is possible in accordance with the Directives.6 If national rules do not properly implement the Directives, then certain provisions of the Directives may be relied upon directly against the state.7

The European Union is a signatory to the Agreement on Government Procurement (GPA) adopted under the auspices of the World Trade Organization. As such, economic operators from GPA states benefit from most of the provisions set out in the Directives (and, therefore, national laws derived from them).8

Additionally, the European Union has entered into various free trade agreements, so economic operators from certain other countries also benefit from the Directives.

The European Commission (EC) is the 'guardian of the Treaties'. As such, it adopts guidance on procurement law (often by way of non-binding communications or notices). It initiates changes to the Directives and can also take enforcement action against Member States that are in breach of the Directives or the EU Treaty principles.9

Rules similar to the Directives apply to purchasing by EU institutions such as the EC, the Council and the CJEU. This chapter does not further consider those special rules.

Year in review


In the past year, the CJEU has dealt with a variety of topics. Some of the judgments are rather case-specific, while others address more fundamental issues and concepts of public procurement law. However, unlike in previous years, there was no real dominant theme.

In its judgment of 24 March 2021, the CJEU analysed the scope of legal protection of a tenderer whose tender had been excluded prior to the award of the contract. In the underlying case, a tenderer whose tender had already been excluded had objected to the admission of the tender of a competing tenderer. The CJEU highlighted that the Public Sector Remedies Directive aims at ensuring effective and rapid judicial protection. It does not authorise the Member States to make the exercise of the right to apply for review conditional on the fact that the public procurement procedure has formally reached a particular stage. Consequently, an unsuccessful tenderer may bring an action against the decision of the contracting body that admits the bid of one of its competitors, regardless of the stage of the procurement procedure at which that decision was made. Moreover, the exclusion of its own bid does not affect the tenderer's interest in bringing proceedings against the admission of the tender of one of its competitors, unless the exclusion of the tenderer was confirmed by a decision that has become definitive.10

In April 2021, the CJEU, once again, had to assess whether a lease agreement was a public works contract falling within the scope of public procurement law. In this case, a public body had concluded a long-term lease agreement regarding office premises before the building was actually constructed. Based on its prior case law, the CJEU held that a lease agreement may constitute a public works contract if the construction of the building corresponds to the requirements specified by the contracting authority. This is, in particular, the case if the authority has taken measures to define the characteristics of the work or, at the very least, has had a decisive influence on its design. In its judgment, the CJEU concluded that this was not the case with respect to the lease agreement under consideration. In this respect, the CJEU pointed out the following:

  1. the planning for the building had actually been completed when the public body entered into contract negotiations;
  2. the absence of a building permit at the time when the lease was concluded is standard commercial practice in large-scale architectural projects and does not imply that the lease agreement is a public works contract;
  3. the supervision of construction activities does not imply the exercise of a decisive influence on the design of the building; and
  4. the large number of detailed specifications by the public body does not justify classifying the lease agreement as a public works contract as the specifications do not exceed what a tenant of such a building may normally require.11

The CJEU has, once more, addressed the question of whether the Member States are entitled to provide for stricter rules for participation in an award procedure than those provided for in the 2014 Procurement Directives. In this respect, the CJEU held that a contracting authority may not be deprived of the option to require a tenderer to replace an entity on whose capacities the tenderer intends to rely if there are non-compulsory grounds for exclusion with respect to that entity.12

The CJEU took a somewhat different approach with regard to the legal regime for reserved contracts under Article 20 of the Public Contracts Directive. In this respect, it held that a Member State can impose additional criteria that exclude economic operators that would otherwise satisfy the criteria laid down in this directive, provided that the Member State complies with the principles of equal treatment and proportionality.13

In another decision, the CJEU devoted itself to the question of how to deal with (potentially) confidential information in review procedures. It held that an operator challenging the legality of a public procurement procedure is not entitled to unlimited and absolute access to all of the information relating to the procedure concerned. Rather, its right to an effective remedy has to be balanced against the right of other economic operators to protection of their confidential information and their trade secrets. It is for the competent national court to reconcile the conflicting legal interests. To that end, the competent national court must carry out a full examination of all the relevant matters of fact and law.14

The CJEU further elaborated on the requirements applicable to the award of framework agreements and, in particular, the information to be published within the tendering process. Repeating its earlier case law, the CJEU, at first, held that a contracting authority conducting a procurement procedure for the conclusion of a framework agreement has to publish in advance the maximum quantity or a maximum value (or both) of the supplies or services that may be purchased under a framework agreement. However, it also clarified that the contracting authority has to reveal the estimated quantity or the estimated value (or both) of the supplies or services that may be purchased.15

Finally, in its judgment of 3 February 2022, the CJEU addressed the highly important issue of modifications of contracts during their term. In this case, an economic operator had concluded several framework agreements with a contracting authority. Later, the economic operator became insolvent. Its insolvency administrator signed a contract with another company providing for the transfer of the framework agreements. Apart from that, the initial contractor did not transfer any other business to the other company. Against this background, the following question arose: may the company that has taken over the rights and obligations arising from the framework agreements from the initial contractor be regarded as having succeeded in part to that initial contractor following corporate restructuring according to Article 72(1)(d)(ii) of the Public Contracts Directive? The CJEU answered this question in the affirmative. It pointed out that there is no indication in the wording of the relevant provision that the concept of insolvency had to be understood as being limited to situations in which the business of the original contractor that enables the performance of the public contract is pursued. In fact, such a narrow interpretation would render the applicable provision largely ineffective.16

ii EC

In March 2021, the EC published a notice on tools to fight collusion in public procurement and on guidance on how to apply the related exclusion ground (Notice 2021/C).17 Notice 2021/C details the tools announced in the 2017 communication 'Making public procurement work in and for Europe', and explains the importance of detecting collusion in procurement procedures prior to the award of the contract and the difficulties in doing so. Notice 2021/C highlights that effective measures require a combined effort by Member States and contracting authorities to build the administrative capacity needed to ensure that the award procedure is conducted properly. Notice 2021/C contains legally non-binding guidance to contracting authorities on how to apply the collusion-related exclusion ground in accordance with Article 57(4)(d) of the Public Contracts Directive, Article 80(1) of the Utilities Contracts Directive and Article 38(7)(e) of the Concession Contracts Directive. In this respect, Notice 2021/C focuses on specific problems faced by Member States when implementing the Directives or by procurement officers when assessing tenders in award procedures.

On 5 May 2021, the EC issued a proposal for a new regulation to address distortions caused by foreign subsidies in the single market.18 The new regulation aims at closing the regulatory gap in the single market, which consists of the fact that subsidies granted by non-EU governments currently go largely unchecked while subsidies granted by Member States are subject to close scrutiny. It is designed to effectively tackle foreign subsidies that cause distortions and harm the level playing field in the single market. The regulation proposes the introduction of three tools:

  1. a notification-based tool to investigate concentrations involving a financial contribution by a non-EU government where the EU turnover of the company to be acquired (or of at least one of the merging parties) is €500 million or more and the foreign financial contribution is at least €50 million;
  2. a notification-based tool to investigate bids in public procurements involving a financial contribution by a non-EU government where the estimated value of the procurement is €250 million or more; and
  3. a general market investigation tool to investigate all other market situations as well as smaller concentrations and public procurement procedures.

According to the proposal, the EC can start the third tool on its own initiative (ex officio) and may request ad hoc notifications. The European Parliament and the Member States will now discuss the EC's proposal in the context of the ordinary legislative procedure. If the new regulation is adopted, it will be directly applicable across the European Union.

Before the end of 2021, the European Parliament adopted its position on the International Procurement Instrument (IPI).19 The European Parliament had been working on the file since the EC's original proposal in 2012, which was modified in 2016. It is intended to open access to public procurement markets around the world, and to address the imbalance between the open EU procurement markets and restrictions or discriminatory treatment applied by some countries on EU businesses bidding for contracts in their territories. The European Parliament backed the overall aim of the proposed IPI but modified its design, scope and Member States' discretionary powers in the way it is applied. Subsequently, the European Parliament entered into trilogue negotiations with the European Council and the EC. The trilogues concluded with a provisional agreement on 14 March 2021. The new IPI would allow the EC to initiate public investigations in cases of alleged discrimination of EU companies in procurement markets. If an investigation were to uncover discriminatory restrictions regarding EU goods, services or suppliers, the EC would invite the country concerned to consult on the opening of its procurement market. If the restrictions are serious and persist, the European Union would be able to restrict the access of that country's companies to EU public procurement markets.

Scope of procurement regulation

i Regulated authorities

The Directives regulate most public sector entities as well as a significant number of privately owned utility companies (collectively, the authorities).

The Public Contracts Directive applies to most public law bodies, including 'bodies governed by public law' that:

  1. have a separate legal personality;
  2. are established for the specific purpose of meeting needs in the general interest, not having an industrial or commercial character; and
  3. are more than 50 per cent funded, managed or controlled by other public sector authorities.20

Private operators may, in limited circumstances, have to procure in accordance with the Public Contracts Directive; for example, where they award certain works contracts that are more than 50 per cent subsidised by authorities,21 in which case the authorities are obliged to secure compliance.

The Utilities Contracts Directive applies to contracts for utility activities awarded by the following entities (when pursuing a utility activity): contracting authorities regulated by the Public Contracts Directive, undertakings subject to control by those authorities (public undertakings) and entities operating in a relevant utility sector on the basis of special or exclusive rights.22

Where a utilities market is directly exposed to competition and access to the market is not restricted, Member States may apply to the EC for a derogation from the Utilities Contracts Directive for contracts in pursuit of activities in that market.23 Derogations have been granted to a number of Member States in respect of, for example, postal services, electricity, and oil and gas.

The Concession Contracts Directive applies to the award of works and services concessions by contracting authorities that are caught by the Public Contracts Directive and the entities caught by the Utilities Contracts Directive when pursuing a utility activity.24 A contract becomes a concession where the consideration includes the right to exploit works or services and the operating risk (demand, supply or both) in such exploitation is transferred to the concessionaire.25

The Defence and Security Procurement Directive applies to defence and security contracts awarded by authorities governed by the Public Contracts Directive and the entities covered by the Utilities Contracts Directive.

ii Regulated contracts

Generally, contracts for construction of works, supply of goods and provision of services, and services and works concessions awarded by authorities are subject to the Directives if they meet specified minimum financial thresholds, which are regularly adjusted. As of 1 January 2022, the following thresholds apply.26

Supply of goods and provision of servicesPublic Contracts Directive€140,000 (central government authorities listed in Annex I) or €215,000 (all other authorities)
Defence and Security Procurement Directive€431,000
Utilities Contracts Directive€431,000
Construction of worksPublic Contracts Directive€5.382 million
Defence and Security Procurement Directive€5.382 million
Utilities Contracts Directive€5.382 million
Social and other specific servicesPublic Contracts Directive€750,000
ConcessionsConcession Contracts Directive€5.382 million

Anti-avoidance rules prevent artificial splitting of contracts to bypass the Directives.27

Contracts for certain social and other specific services are regulated to a limited 'light-touch' extent.28 In particular, there is no obligation to follow one of the specified procedures, although one of the principal changes from the predecessor directives is that, above the thresholds, advertising and competition is required. These services include health, social, educational, social security and community services. Any service that is not expressly listed as being subject to the light-touch regime is fully regulated.

Some types of contract are not regulated by the Directives, such as contracts for:

  1. the acquisition or rental of land;29
  2. employment;30
  3. certain research and development services;31 and
  4. certain financial services.32

There have been a number of CJEU cases deciding whether a transaction was properly classified as an (unregulated) land agreement or a (regulated) works contract.33 Often, the distinction turns on whether the economic operator is obliged to undertake the works34 or whether, while the parties envisage certain works being carried out, the economic operator is at liberty to construct something different or to leave the land undeveloped.

In some exceptional cases, authorities may negotiate contracts with economic operators without prior advertisement,35 for example, in the case of extreme urgency following a failed procurement process or where, for technical reasons, the contract may be awarded only to a particular economic operator. These exceptions are narrowly construed.

Where a public contract is substantially modified, this may amount to a completely new contract, which the authority must competitively tender under the Directives.36

Where the Directives do not apply, some form of advertisement is generally required if there is certain cross-border interest in the resulting contract.37

The Utilities Contracts Directive applies to the regulated activities listed in Articles 8 to 14 in the fields of gas, heat and electricity, water, transport, post, exploration for or extraction of coal and other solid fuels, and extraction of (but not exploration for) oil and gas (although the Concession Contracts Directive applies to the award of works and services concession contracts for those regulated activities). This extends to the procurement of services connected to a utility activity that facilitate the effective performance of that activity.38 A utility's other activities are unregulated unless the utility is also a contracting authority for the purposes of the Public Contracts Directive, in which case those other activities are subject to the procedures in that Directive.39

The Defence and Security Procurement Directive applies to contracts for the supply of military equipment; for works and services for military purposes; and for the supply of equipment, works and services involving, requiring or containing classified information. Where the Defence and Security Procurement Directive applies, neither the Utilities Contracts Directive nor the Public Contracts Directive applies. Works and services concession contracts in these fields are covered by the Concession Contracts Directive. The most sensitive defence contracts may still be awarded outside the scope of the Defence and Security Procurement Directive.

Special contractual forms

i Framework agreements and central purchasing

The Directives permit (but do not require) Member States to adopt certain rules aimed at reducing the burden on entities when awarding contracts. These include permitting:

  1. framework agreements (the Public Contracts Directive; the Utilities Contracts Directive; and the Defence and Security Procurement Directive);40
  2. purchasing through or from central purchasing bodies (the Public Contracts Directive; the Utilities Contracts Directive; and the Defence and Security Procurement Directive);41
  3. dynamic purchasing systems (DPSs) (the Public Contracts Directive and the Utilities Contracts Directive);42 and
  4. qualification systems (the Utilities Contracts Directive).43

These concepts are generally not relevant to the award of works and services concessions, and are not dealt with explicitly in the Concession Contracts Directive.

Authorities must not use framework agreements or DPSs improperly to prevent, restrict or distort competition. Framework agreements may not generally last longer than four years (public sector), seven years (defence) or eight years (utilities).

Framework agreements may be concluded with a single supplier or with multiple suppliers. When calling off from a multi-supplier framework, the authority either runs a 'mini-competition' to award each call-off contract or awards a call-off contract directly based on the terms of the framework agreement.

Central purchasing bodies must be contracting authorities as defined by the Public Contracts Directive.

ii Joint ventures

In principle, the Directives do not apply to the setting up of a joint venture by one or more authorities (whether public–public or public–private), but they are relevant to any subsequent supply of goods, works or services by the joint venture to the authority or authorities (or to other authorities).

A Commission interpretative communication44 on institutionalised public–private partnerships recommends that authorities should simultaneously advertise the selection of the joint venture partner and the award of a contract to the joint venture.

Contracts between authorities are, in principle, subject to the Directives. There are certain exceptions, although these all prohibit private participation or shareholdings.45

The Utilities Contracts Directive has separate rules on joint ventures between utilities and on intra-group supplies.46

The bidding process

i Notice

Most procurement processes are formally commenced by publication of a contract notice.

All official notices under the Directives – such as prior information notices, contract notices and contract award notices – must be submitted electronically for publication in the Official Journal of the European Union, which is accessible free of charge through Tenders Electronic Daily.47

ii Procedures

The Directives envisage various contract award procedures:

  1. open procedure: a one-stage process where bidders must show their good standing and their tender proposals in a single bidding round;48
  2. restricted procedure: a two-stage process where – based on financial standing, qualification and past experience – at least five bidders are shortlisted to tender;49
  3. competitive dialogue procedure: a process generally used for complex procurements where the authority knows only the output that it requires and has not yet identified a solution;50
  4. competitive procedure with negotiation51 or negotiated procedure with advertisement:52 a process generally used for procurements where the authority knows both the output and the likely solution but wishes to negotiate the terms with bidders;
  5. innovation partnership for the development of innovative products;53 and
  6. exceptionally, negotiated procedure without advertisement.54

For the procurement of social and other specific services under the light-touch regime, and where the Concession Contracts Directive applies, no procedure is specified.

There are minimum timescales for key stages in most procedures, particularly as regards the minimum period between the contract notice and bidders' initial expressions of interest. These periods may be shortened in some specified cases, and vary depending on the procedure adopted and which of the Directives applies.55

iii Amending bids

Once bids have been submitted, equal treatment and fairness significantly limit the scope for bid amendments.

Authorities may, in certain cases, seek clarification or allow bidders to correct obvious errors.56 However, in the case of bids in the open procedure or restricted procedure, or final tenders in the competitive procedure with negotiation or negotiated procedure with advertisement, negotiation or the submission of what should be viewed as a new tender are not allowed.

The competitive dialogue procedure is slightly more flexible: the authority may, before tender evaluation, request that bids be clarified, specified and optimised. However, this must not involve changes to the essential aspects of the tender or the procedure that are likely to distort competition or have a discriminatory effect.57 After selection of the winning bid, negotiations are permitted to confirm aspects of the tender and finalise the contract terms, provided that the essential aspects are not materially modified and, again, that there is no risk of distortion or discrimination.58


i Qualification to bid

Authorities may reject bidders at the selection stage where they do not meet certain objectively evaluated minimum standards. They may also restrict the number of bidders invited to the next stage of competition under the restricted, competitive dialogue, competitive with negotiation and negotiated procedures. These standards may relate to the bidder's:

  1. personal standing (e.g., whether the bidder has been declared insolvent, or convicted of money laundering or corruption offences);59
  2. enrolment on a professional or trade register as required in the bidder's state of establishment;60
  3. financial standing;61 and
  4. technical and professional ability.62

A bidder may rely upon the technical and professional ability or financial standing of other entities, which could include other members of a bidding consortium or nominated subcontractors.63

ii Conflicts of interest

The 2014 Procurement Directives contain express provisions on conflicts of interest. Authorities must investigate possible conflicts of interest where a member of the authority's award panel is connected with a bidder, although they have some discretion as to how to deal with such conflicts.64 Although the Defence and Security Procurement Directive does not contain an express provision, the obligation of non-discrimination imposes the same requirements in respect of procurements conducted under it.65

Where an economic operator was involved in design work before the start of the award process and then wishes to bid for the contract, it could have a knowledge advantage from having prepared the designs and it could, even without intending to, have influenced the design of the specification or procurement process in such a way as to favour itself. Authorities must consider these issues case by case and permit the economic operator the opportunity to explain why there is no conflict of interest in a given case.66 A blanket ban on involvement of those with prior knowledge has been held to be disproportionate and in breach of the equal treatment principle.67

iii Foreign suppliers

The Directives do not prohibit non-EU suppliers from bidding for public contracts. The GPA requires providers from GPA states68 to be given the same treatment as is afforded to national providers. Certain types of contracts are outside the GPA, including contracts for health services and defence contracts. Except for central government procurement, which is open to all GPA businesses, other procurements are only open to the extent that the bidder's home state allows EU undertakings access to government procurement.

Special rules apply to utilities for the supply of goods, but not works or services. Where more than half the products (including software in telecommunications network equipment) in a bid are from third countries with which the European Union does not have reciprocal agreements and the bid is equivalent in price and quality to an EU bid, then the utility must favour the bid comprising EU products.69

EU rules do not currently prevent non-EU access to public procurement, but restrictions may occur at Member State level. In practice, third-country businesses may be able to overcome any protectionist national rules if they bid through a subsidiary established within the European Union.


i Evaluating tenders

Authorities may assess bids on the basis of price or cost alone, taking a cost-effectiveness approach, or the best price to quality ratio to determine which is the most economically advantageous tender.

Authorities must disclose, before receiving bids, the criteria that they will use for bid evaluation and the weightings of the criteria chosen.70 In general, the criteria and weightings should not be changed during the process.

The authority must, if a tender appears to be abnormally low, request explanations from the bidder and may then reject the abnormally low tender.71

ii National interest and public policy considerations

Authorities must act in a non-discriminatory manner; therefore, any 'buy local' policy is unlawful. Indirect means of discrimination are also prohibited. For example, if the specification is written in a particular way to favour national suppliers, this infringes the requirement of non-discrimination. Accordingly, an authority should normally use a national technical specification transposing European standards and it can only use other national standards if there is no European standard.72

The procurement may take account of social or environmental considerations, but this must be non-discriminatory and proportionate to the objectives being pursued.73 Any requirements must be relevant to the contract.74

There are limited national interest exceptions in the Directives. For example, the Defence and Security Procurement Directive does not apply to contracts for the purpose of intelligence activities or that would oblige the relevant Member State to supply information contrary to the essential interests of its security.75 These exceptions are narrowly construed.

Information flow

As a result of the principle of transparency, during the procurement process, authorities must ensure that they give sufficient information to bidders to enable them to properly understand the authority's requirements and to ensure a level playing field. They must also disclose the award criteria that they will use to mark bids.

Under the Directives, authorities are required to notify bidders of decisions and supply certain information. When they make an award decision, they must then observe a standstill period for a minimum of 10 calendar days before signing the contract.76 This period allows unsuccessful bidders time to bring a legal challenge to prevent contract signing if they consider that the award decision is unlawful. Notices of award decisions to bidders must include scores as well as a narrative summary of the characteristics and relative advantages of the winning bid.

Challenging awards

Challenges to procurement decisions may be brought in the national courts. The cost, complexity and duration of these processes vary considerably from Member State to Member State.

i Procedures

Rules governing challenges under the 2014 Procurement Directives are dealt with in the Public Sector Remedies Directive and the Utilities Remedies Directive, with those governing defence in the Defence and Security Procurement Directive itself. The EC has reviewed the operation of these directives and has concluded that they are generally working well, so they will be maintained in their present form without further change at this stage.77 In this section, the general provisions common to all are considered and referred to as the Remedies Provisions, but references to article numbers are to articles of the Public Sector Remedies Directive.

Member States must ensure that decisions made by authorities 'may be reviewed effectively'78 and 'as rapidly as possible', in accordance with the Remedies Provisions.79 The term 'decisions' is construed broadly and can include a decision to admit a bidder.80 Member States may decide who is to carry out such reviews (the review body). The nature of review bodies varies considerably between Member States and no bidder should assume that the relevant review body will be the national court. Member States may require that a bidder first seek review with the authority or that a bidder be required to notify the authority of its intention to seek review.

The review body must be independent of the authority and the Member State must provide that its decisions can be effectively enforced. If the review body is not the national court, then written reasons for the decision of the review body must be given and there must be a further right of review by a court that is independent of both the review body and the contracting authority.

The review procedures must be available as a minimum to any person 'having or having had an interest in obtaining a particular contract' (i.e., to bidders themselves) who can show that he or she has been, or risks being, harmed by an alleged infringement. This leaves scope for interpretation of what a risk of being harmed might mean: for example, must the bidder show that, but for the breach, it would have good prospects of being awarded the contract or merely that it would have had a more than minimal prospect of being awarded the contract? The CJEU has clarified that a bidder who has been definitively excluded from a procedure by an authority (for failure to provide original documentation pertaining to financial standing) can be refused access to a review of the award decision in that procedure.81 However, it is not necessary for a bidder to prove that the procurement would have had to be re-run.82

It is for the Member State to decide on the relevant limitation period within which any application for review must be made. However, the right to bring a challenge must remain open after the deadline, where a reasonably well-informed and diligent bidder would only have understood the tender conditions after the authority had explained its decision.83 Member States may set a limitation period for claiming the remedy of ineffectiveness of at least 30 days from publication of a contract award notice and at least six months from the contract being concluded.

Review procedures adopted by individual Member States have been challenged on occasion. This has led the CJEU to consider areas such as court fees, limitation periods and the availability of remedies.

If the EC considers that a serious infringement of Community law has been committed during a contract award procedure, it will notify the relevant Member State, giving reasons, prior to a contract being concluded.84 The Member State must then either correct the infringement, give a reasoned submission as to why no correction has been made or suspend the contract award procedure pending a decision as to whether to correct.

ii Grounds for challenge

The Remedies Provisions say little about the grounds for challenge by bidders, providing simply that infringements of 'Community law in the field of public procurement or national rules transposing that law'85 can be challenged. This covers breaches of both national rules implementing the Directives and EU Treaty principles, such as equality, non-discrimination and transparency.

The number of challenges and prospects of success vary considerably between Member States.86

iii Remedies

There are four main types of remedies that must be available to the review body under the review procedures. The first three are:

  1. interim suspension of the award of the contract pending review by the first instance review body, which must continue at least for the standstill period; the review body's decision as to whether to uphold this interim suspension can take into account the consequences of the continued suspension for all interests likely to be affected, as well as any public interest;
  2. set aside of an unlawful decision, which includes the power to amend the invitation to tender, the contract documents and other documents relating to the contract award procedure to stop the procurement and to order a new procurement; and
  3. the power to award damages (compensation) to a person harmed by the infringement.87

The fourth and arguably most powerful remedy is that of ineffectiveness. Ineffectiveness must be available in three situations:

  1. if an authority has illegally awarded a contract without prior publication of a contract notice;
  2. if an authority has awarded a contract in breach of the standstill period or suspension of contract award and a bidder has thereby been deprived of the possibility to complain about some other infringement that has affected the bidder's chance of obtaining the contract; and
  3. where a Member State has permitted award of contracts without a standstill period under a framework or DPS.88

Where the ineffectiveness remedy is not available, Member States may provide that, once the contract has been concluded, the only remedy available is damages.

Member States can provide that the consequence of ineffectiveness is retroactive cancellation of all contractual obligations or may limit cancellation to future obligations only. If the latter option is chosen, the Member State must provide for the application of alternative penalties. If the general interest is in upholding the contract, so that the review body decides not to declare a contract ineffective, it must provide for alternative penalties.

Alternative penalties have to be effective, proportionate and dissuasive, and must be either the imposition of a fine on the authority or shortening of the duration of the contract.


It is likely that the covid-19 pandemic will remain a relevant topic in public procurement in 2022. Even if the crisis is eventually overcome, it remains to be seen what long-term effects will remain for public procurement markets.

In addition, it appears that the trend towards sustainability and innovation playing a greater role in public procurement has further intensified. What role the war in Ukraine will play remains an open question.


1 Jan-Oliver Schrotz, Michael Rainey and Eoghan Ó hArgáin are partners, and Clare Dwyer is a legal director at Addleshaw Goddard LLP.

2 Directives 2014/24/EU, 2014/25/EU, 2014/23/EU and 2009/81/EC, respectively.

3 Directives 89/665/EEC (as amended by Directives 92/50/EEC and 2007/66/EC) and 92/13/EEC (as amended by Directives 2006/97/EC and 2007/66/EC), respectively.

4 Regulation (EC) No 1370/2007 (as amended by Regulation (EU) 2016/2338).

5 Directive 2009/33/EC (as amended by Directive (EU) 2019/1161).

6 C-106/89 Marleasing SA v. La Comercial Internacional de Alimentacion SA.

7 C-8/81 Becker v. Finanzamt Münster-Imenstadt.

8 With the exception of the Defence and Security Procurement Directive.

9 Articles 258 and 260 of the Treaty on the Functioning of the European Union and the Remedies Directives (e.g., Public Sector Remedies Directive, Article 3).

10 C-771/19 NAMA Symvouloi Michanikoi kai Meletites AE.

11 C-537/19 European Commission v Republic of Austria.

12 C-210/20 Rad Service SrL Unipersonaler et al. v Del Debbio SpA et al.

13 C-598/19 Confederación Nacional de Centros Especiales de Empleo v Diputación Foral de Gipuzkoa.

14 C-927/19 Klaipedos regiono atlieku tvarkymo centras UAB.

15 C-23/20 Simonsen & Weel A/S v Region Nordjylland og Region Syddanmark.

16 C-461/20 Advania Sverige AB, Kammarkollegiet v Dustin Sverige AB.

17 EC, 'Notice on tools to fight collusion in public procurement and on guidance on how to apply the related exclusion ground', 2021/C 91/01 (18 March 2021).

18 EC, 'Press release: Commission proposes new Regulation to address distortions caused by foreign subsidies in the Single Market' (5 May 2021).

19 European Parliament, 'Press release: MEPs want the new international procurement instrument to apply more widely' (14 December 2021).

20 Article 2(1)(4).

21 Article 13.

22 Article 4.

23 Article 34.

24 Article 1(2).

25 Article 5(1).

26 See Commission Delegated Regulation (EU) 2021/1952 amending Directive 2014/24/EU (Public Contracts Directive); Commission Delegated Regulation (EU) 2021/1953 amending Directive 2014/25/EU (Utilities Contracts Directive); Commission Delegated Regulation (EU) 2021/1951 amending Directive 2014/23/EU (2014 Concession Contracts Directive); and Commission Regulation (EU) 2021/1950 amending Directive 2009/81/EC (Defence and Security Procurement Directive).

27 For example, Public Contracts Directive, Article 5.

28 Public Contracts Directive, Article 74 and Annex XIV; and Utilities Contracts Directive, Article 91 and Annex XVII. Some (but not all) of these services are also subject to lighter regulation under the Defence and Security Procurement Directive, Article 16 and Annex II.

29 For example, Public Contracts Directive, Article 10(a).

30 For example, Public Contracts Directive, Article 10(g).

31 For example, Public Contracts Directive, Article 14.

32 For example, Public Contracts Directive, Article 10(e).

33 For example, C-220/05 Jean Auroux and others v. Commune de Roanne.

34 C-451/08 Helmut Müller GmbH v. Bundesanstalt für Immobilienaufgaben.

35 For example, Public Contracts Directive, Article 32.

36 C-454/06 pressetext Nachrichtenagentur GmbH v. Republic of Austria and others. The 2014 Procurement Directives codify and amplify the case law (e.g., the Public Contracts Directive, Article 72).

37 See C-324/98 Telaustria Verlags GmbH and another v. Telekom Austria AG; EC, 'Interpretative communication on the Community law applicable to contract awards not or not fully subject to the provisions of the Public Procurement Directives', Official Journal of the European Union 2006/C 179/02 (1 August 2006); and T-258/06 Germany v. Commission.

38 C-521/18 Pegaso Srl Service Fiduciari v. Poste Tutela SpA.

39 C-393/06 Ing Aigner, Wasser-Wärme-Umwelt GmbH v. Fernwärme Wien GmbH.

40 Respectively, Articles 33, 51 and 29.

41 Respectively, Articles 37, 55 and 10.

42 Respectively, Articles 52 and 34.

43 Article 77.

44 EC, 'Interpretative communication on the application of Community law on Public Procurement and Concessions to Institutionalised PPP (IPPP)', C (2007) 6661 (5 February 2008).

45 C-107/98 Teckal Srl v. Comune di Viano and another; C-324/07 Coditel Brabant SA v. Commune d'Uccle and another; Hamburg Waste (C-480/06 Commission v. Germany). This case law is codified and amplified under the 2014 Procurement Directives (e.g., Public Contracts Directive, Article 12).

46 Articles 29 and 30.

48 For example, Public Contracts Directive, Article 27.

49 For example, Public Contracts Directive, Article 28.

50 For example, Public Contracts Directive, Article 30.

51 Public Contracts Directive, Article 29.

52 For example, Utilities Contracts Directive, Article 47.

53 For example, Public Contracts Directive, Article 31.

54 For example, Public Contracts Directive, Article 32.

55 For example, Public Contracts Directive, Articles 27 to 31 and 47.

56 Public Contracts Directive, Article 56(3) and Utilities Contracts Directive, Article 76(4). While there is no explicit provision in the 2014 Concession Contracts Directive or in the Defence and Security Procurement Directive, the same rules would be expected to apply under the EU Treaty principles to amendments during procedures governed by those directives.

57 For example, Public Contracts Directive, Article 30(6).

58 For example, Public Contracts Directive, Article 30(7).

59 For example, Public Contracts Directive, Article 57.

60 For example, Public Contracts Directive, Article 58(2).

61 For example, Public Contracts Directive, Article 58(3).

62 For example, Public Contracts Directive, Article 58(4).

63 For example, Public Contracts Directive, Article 63.

64 For example, the Public Contracts Directive, Article 24.

65 See T-160/03 AFCon Management Consultants and others v. Commission, which was decided under internal EC rules but the principles in the case are likely to apply to the Defence and Security Procurement Directive.

66 For example, the Public Contracts Directive, Articles 41 and 57(4)(f).

67 See joined cases C-21/03 and C-34/03 Fabricom SA v. Belgium, Paragraphs 25 to 36.

68 In addition to the 27 EU Member States, the other GPA states are Armenia, Australia, Canada, Hong Kong, Iceland, Israel, Japan, Liechtenstein, Moldova, Montenegro, the Netherlands (with respect to Aruba), New Zealand, Norway, Singapore, South Korea, Switzerland, Taiwan, Ukraine, the United Kingdom (from 1 January 2021, following its exit from the European Union) and the United States. A revised and expanded GPA, modernising certain aspects of its rules, entered into force on 6 April 2014.

69 Utilities Contracts Directive, Article 85.

70 For example, Public Contracts Directive, Article 67; C-532/06 Emm G Lianakis AE and others v. Dimos Alexandroupolis and others, Paragraphs 36 to 38.

71 For example, Public Contracts Directive, Article 69.

72 For example, Public Contracts Directive, Article 42(3), (4) and (5).

73 This is codified in, for example, the Public Contracts Directive, Articles 18(2) and 56(1), which permit authorities to exclude bidders that do not comply with their obligations in the fields of environmental, social and labour law.

74 See C-448/01 EVN AG and Wienstrom GmbH v. Austria, where the bidder was required to show it supplied volumes of 'green' electricity that went far beyond the authority's actual requirement. The CJEU held that this was unlawful.

75 Article 13(a) and (b). See also Public Contracts Directive, Article 15.

76 For example, Public Sector Remedies Directive, Article 2a.

77 EC, 'Report to the European Parliament and the Council on the effectiveness of Directives 89/665/EEC and 92/13/EEC as modified by Directive 2007/66/EC concerning review procedures in the area of public procurement' (24 January 2017).

78 See C-440/13 Croce Amica One Italia Srl v. Azienda Regionale Emergenza Urgenza (AREU). The purpose of the review is to ensure that the EU public procurement rules are complied with, so that a simple examination of whether the decision is arbitrary will not suffice.

79 Article 1(1).

80 C-391/15 Marina del Mediterraneo, SL v. Consejeria de Obras Publicas y Vivienda de la Junta de Andalucia.

81 C-355/15 Bietergemeinschaft Technische Gebäudebetreuung GesmbH und Caverion Österreich GmbH v. Universität für Bodenkultur Wien, VAMED Management und Service GmbH & Co. KG in Wien.

82 C-333/18 Lombardi Srl v. Commune di Auletta.

83 C-583/13 eVigilo Ltd v. Priesgaisrines apsaugos ir gelbejimo departamentas prie Vidaus reikalu ministerijos.

84 Article 3.

85 Article 1(1).

86 See national chapters for details of numbers and prospects for challenge.

87 Article 2(1).

88 Article 2d.

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