1.

Where certain public contracts are required to be awarded to the most economically advantageous tender or the tender with the lowest price, EU law permits the contracting authority to reject ‘abnormally low tenders’ for which there is no satisfactory justification.

2.

In this request for a preliminary ruling, a number of questions are referred in connection with the conclusion of a public contract for the planning, establishment and management of a system for the issue of Bulgarian identity documents. The referring court seeks to ascertain, in summary:

3.

Recital 90 states:

‘Contracts should be awarded on the basis of objective criteria that ensure compliance with the principles of transparency, non-discrimination and equal treatment, with a view to ensuring an objective comparison of the relative value of the tenders in order to determine, in conditions of effective competition, which tender is the most economically advantageous tender. …

In order to encourage a greater quality orientation of public procurement, Member States should be permitted to prohibit or restrict use of price only or cost only to assess the most economically advantageous tender where they deem this appropriate.

To ensure compliance with the principle of equal treatment in the award of contracts, contracting authorities should be obliged to create the necessary transparency to enable all tenderers to be reasonably informed of the criteria and arrangements which will be applied in the contract award decision. Contracting authorities should therefore be obliged to indicate the contract award criteria and the relative weighting given to each of those criteria. …’

4.

Recital 92 reads:

‘When assessing the best price–quality ratio contracting authorities should determine the economic and qualitative criteria linked to the subject matter of the contract that they will use for that purpose. Those criteria should thus allow for a comparative assessment of the level of performance offered by each tender in the light of the subject matter of the contract, as defined in the technical specifications. In the context of the best price–quality ratio, a non-exhaustive list of possible award criteria which include environmental and social aspects is set out in this Directive. Contracting authorities should be encouraged to choose award criteria that allow them to obtain high-quality works, supplies and services that are optimally suited to their needs.

The chosen award criteria should not confer an unrestricted freedom of choice on the contracting authority and they should ensure the possibility of effective and fair competition and be accompanied by arrangements that allow the information provided by the tenderers to be effectively verified.

…’

5.

Article 56 (‘General principles’) provides:

‘1.   Contracts shall be awarded on the basis of criteria laid down in accordance with Articles 67 to 69, provided that the contracting authority has verified in accordance with Articles 59 to 61 that all of the following conditions are fulfilled:

…’

6.

Article 69 (‘Abnormally low tenders’) provides:

‘1.   Contracting authorities shall require economic operators to explain the price or costs proposed in the tender where tenders appear to be abnormally low in relation to the works, supplies or services.

…

3.   The contracting authority shall assess the information provided by consulting the tenderer. It may only reject the tender where the evidence supplied does not satisfactorily account for the low level of price or costs proposed …’

7.

Recital 15 reads:

‘The award of contracts concluded in the Member States by contracting entities as referred to in Directive 2004/17/EC … and by contracting authorities as referred to in Directive 2004/18/EC … is subject to compliance with the principles of the Treaty and in particular the free movement of goods, the freedom of establishment and the freedom to provide services, and with the principles deriving therefrom, such as the principles of equal treatment, non-discrimination, mutual recognition, proportionality and transparency.

…’

8.

Recital 69 is worded as follows:

‘Contracts should be awarded on the basis of objective criteria which ensure compliance with the principles of transparency, non-discrimination and equal treatment and which guarantee that tenders are assessed in a transparent and objective manner under conditions of effective competition. As a result, it is appropriate to allow the application of two award criteria only: “the lowest price” and “the most economically advantageous tender”.’

9.

Pursuant to Article 38 (‘Verification of the suitability and choice of participants and award of contracts’):

‘1.   Contracts shall be awarded on the basis of the criteria laid down in Articles 47 and 49, taking into account Article 19, after the suitability of the economic operators not excluded under Articles 39 or 40 has been checked by contracting authorities/entities in accordance with the criteria of economic and financial standing, of professional and technical knowledge or ability referred to in Articles 41 to 46 and, where appropriate, with the non-discriminatory rules and criteria referred to in paragraph 3.

…’

10.

Article 49 (‘Abnormally low tenders’) states:

‘1.   If, for a given contract, tenders appear to be abnormally low in relation to the goods, works or services, the contracting authority/entity shall, before it rejects those tenders, request in writing details of the constituent elements of the tender which it considers relevant.

…

2.   The contracting authority/entity shall verify those constituent elements by consulting the tenderer, taking account of the evidence supplied.

…’

11.

Article 55 (‘Scope and availability of review procedures’) provides in paragraph 2:

‘Member States shall take the measures necessary to ensure that decisions taken by the contracting authorities/entities may be reviewed effectively and, in particular, as rapidly as possible in accordance with the conditions set out in Articles 56 to 62, on the grounds that such decisions have infringed [EU] law in the field of procurement or national rules transposing that law.’

12.

Article 72 of the Zakon za obshtestvenite porachki (Law on Public Procurement), headed ‘Abnormally low tenders’, provides:

‘1.   If, in a tenderer’s tender, an element that is linked to price or costs and is subject to assessment is more than 20% lower than the mean value of the tenders submitted by the other tenderers in respect of the same criterion for assessment, the contracting authority shall request a detailed written explanation of how that element was prepared, to be submitted within five days of receiving the request.’

13.

The Ministry of the Interior of the Republic of Bulgaria, in its capacity as a contracting authority, initiated a procedure for the award of a public contract, the subject of which was the ‘planning, establishment and management of a Generation 2019 system for the issue of Bulgarian identity documents’. ( 4 )

14.

Following the appropriate preselection, Veridos GmbH (‘Veridos’) and the consortium Mühlbauer ID Services GmbH-S&T (‘Mühlbauer’) were invited to submit tenders.

15.

The contract was ultimately awarded to Mühlbauer. ( 5 )

16.

Veridos challenged the award before the Komisia za zashtita na konkurentsiata (Commission for Protection of Competition, Bulgaria), arguing that the successful tender was abnormally low. ( 6 )

17.

By decision of 25 June 2020, the Commission for Protection of Competition rejected the complaint made by Veridos. The Commission for Protection of Competition took the view that Article 72 of the Law on Public Procurement was inapplicable because, as only two tenders had been submitted, it was not possible to calculate the mean value stipulated by that provision for the purpose of determining whether one of those tenders was abnormally low.

18.

Veridos appealed against the decision of 25 June 2020 before the Varhoven administrativen sad (Supreme Administrative Court, Bulgaria), which has referred the following questions to the Court of Justice for a preliminary ruling:

19.

The request for a preliminary ruling was received at the Registry of the Court on 8 December 2020.

20.

On 1 February 2021, the President of the Court of Justice decided not to grant the request that the reference be dealt with under the expedited procedure.

21.

Observations were lodged by Veridos, Mühlbauer, the Austrian, Bulgarian, Czech and French governments and the European Commission.

22.

It was not considered necessary to hold a hearing.

23.

Directive 2009/81 is applicable to this case because it concerns a public contract for the issue of identity documents in relation to ‘the fields of defence and security’. ( 7 ) As is apparent from the order for reference, the contracting authority published the invitation to tender for the single contract in accordance with that directive. ( 8 )

24.

However, the referring court has submitted its questions in relation to the relevant articles of Directive 2009/81 and Directive 2014/24. It justifies its approach on the basis of the ‘identical content and analogous function of the relevant provisions of the two directives’. ( 9 ) There is no reason not to proceed in this way, since the provisions of the two directives the interpretation of which the referring court seeks are substantially the same, so that the Court’s reply will apply equally to all those provisions. ( 10 )

25.

In the same vein, the case-law of the Court of Justice in this area can be applied to the present case even where it refers to analogous provisions of public procurement directives other than the two cited above, as I shall explain below.

26.

On account of their content, the referring court’s questions can be grouped together in two blocks:

27.

According to the referring court, the legal dispute concerns only the powers exercised by the national legislature in regulating, in Article 72(1) of the Law on Public Procurement, the criterion for assessing abnormally low tenders. ( 11 )

28.

If I have understood the referring court’s line of argument correctly, the inference from its interpretation of the national provision appears to be that the only criterion for categorising a tender as ‘abnormally low’ is that that tender is 20% lower than the mean value of the tenders submitted by the other tenderers. If that criterion could not be applied, because only two tenders exist, the contracting authority would not be able to assess whether either of those tenders is abnormally low. ( 12 )

29.

Before addressing whether the national provision, as interpreted in that way, ( 13 ) is compatible with Directives 2009/81 and 2014/24 (in particular, with Article 49 of the former and Article 69 of the latter), it should be recalled that:

30.

As I have pointed out above, those provisions must be read in the light of the Court’s case-law because the EU legislature did not provide a definition of what constitutes an abnormally low tender; nor did it provide a specific method of calculating an anomaly threshold. ( 14 ) That, I repeat, explains the importance of the interpretation given in the case-law, which has been notably consistent in this area over a period of time. ( 15 )

31.

The Court of Justice has ruled:

32.

As concerns Article 69 of Directive 2014/24, the Court has confirmed that:

33.

In short, the EU legislation imposes on contracting authorities the obligation to examine, in all cases, whether any of the tenders submitted appear prima facie to be abnormally low.

34.

It is immaterial for those purposes whether it is impossible ‘to apply the criterion laid down in national law for the evaluation of an abnormally low tender’ and whether a different criterion selected by the contracting authority was announced in advance. The contracting authority cannot, I repeat, refrain from examining whether the tender (all the tenders) is [(are)] suspected of being frivolous.

35.

It is also immaterial whether only two candidates have submitted tenders in the procurement procedure: each of those two tenders must be scrutinised by the contracting authority, which will assess whether they are suspect.

36.

In principle, as I have explained above, it is for the Member States and the contracting authorities to determine the method of calculating an anomaly threshold constituting an ‘abnormally low tender’. In any event, EU law provides guidelines for specifying the subject matter of the details that can be required of anyone who submits a suspect tender. ( 22 )

37.

The Bulgarian Government submits that the identification of abnormally low tenders may be based only on arithmetical calculations, like that referred to in the national legislation. In its submission, that approach ensures an objectivity which cannot be ensured if the identification of suspect tenders is based on the contracting authority’s subjective assessment. ( 23 )

38.

I do not agree with that argument. The contracting authority has to identify tenders which appear suspect (and are therefore subject to the inter partes examination procedure) in the light of all the features of the subject matter of the invitation to tender. Comparison with the other, competing tenders, however useful it may be in certain cases for the purpose of identifying any anomalies, cannot be held up as the sole criterion used by the contracting authority. The examination of all components, as such, of the tender enables the contracting authority to determine whether, despite appearances and the distance between its price and those of other tenderers, ( 24 ) the suspect tender is sufficiently genuine.

39.

In addition, the Court has ruled that the use of a mere mathematical criterion may be contrary to the development of effective competition in the field of public procurement. That is what occurred in the cases giving rise to the judgments in Fratelli Costanzo and Lombardini and Mantovani:

40.

The Court held that ‘a mathematical criterion in accordance with which tenders which exceeded the basic value fixed for the price of the work by a percentage more than 10 points below the average percentage by which the tenders admitted exceeded that amount would be considered anomalous and consequently eliminated, deprives tenderers who have submitted particularly low tenders of the opportunity to demonstrate that those tenders are genuine ones, so that application of such a criterion is contrary to the aim of Directive 71/305, namely to promote the development of effective competition in the field of public contracts’. ( 27 )

41.

On that basis, it may be inferred that a national provision pursuant to which the sole criterion for assessing whether a tender is abnormally low is that its value is 20% lower than the mean value of the tenders submitted by the other tenderers does not comply with EU law.

42.

The obligation to examine the genuine nature of all the competing tenders is intended to ensure compliance with the principles of transparency, non-discrimination and equal treatment, in accordance with which public contracts must be awarded. ( 28 )

43.

That aim would be undermined if national legislation were to confine to mere percentage criteria (in relation to the other competitors) the situations in which a tender may warrant the classification of ‘abnormally low’, thereby superseding the provisions of Article 49 of Directive 2009/81 and Article 69 of Directive 2014/24.

44.

Article 55(2) of Directive 2009/81 provides for the right to a review of decisions taken by a contracting authority. ( 29 ) The provision is aligned with the rules laid down in Directive 89/665/EC ( 30 ) and, as the Commission points out, ensures respect for the rights laid down in Article 47 of the Charter. ( 31 )

45.

Generally, and in accordance with Article 55(4) of Directive 2009/81, Member States have an obligation to make available ‘review procedures … at least to any person having or having had an interest in obtaining a particular contract who has been or risks being harmed by an alleged infringement.’

46.

In relation to abnormally low tenders, the answer to this second block of questions must be approached from a twofold perspective:

47.

In referring to abnormally low tenders, Article 49 of Directive 2009/81 does not impose on a contracting authority an indiscriminate obligation explicitly to state its views on whether the tender concerned is abnormally low.

48.

Rather, that obligation arises if, ‘for a given contract’, the contracting authority considers that ‘tenders appear to be abnormally low in relation to the goods, works or services’.

49.

As I have already stated, the obligation on ‘the contracting authority is …, first, to identify suspect tenders’, ( 32 ) in the light of all the characteristics of the subject matter of the invitation to tender and, as the case may be, the relationship between each characteristic and the other characteristics.

50.

If the contracting authority takes the view that none of the tenders thus assessed is abnormally low, it is not required to issue an ad hoc statement to that effect. I agree with Mühlbauer and the French Government on this point: mere acceptance of a tender by a contracting authority implicitly demonstrates the latter’s belief that that tender is not abnormally low.

51.

An ad hoc determination is necessary only where, after noting that a tender may be abnormally low, the contracting authority has allowed the tenderer (under Article 49(1) of Directive 2009/81) to demonstrate its genuineness by asking it to provide the details which the contracting authority considers appropriate.

52.

On completion of that inter partes procedure, the contracting authority must, in accordance with the case-law of the Court, assess ‘the merits of the explanations provided by the persons concerned’ in order to take the ‘decision as to whether to admit or reject [the] tenders’ that were initially suspect. ( 33 ) Naturally, that decision must be supported by a sufficient statement of reasons.

53.

Therefore, where it is suspected that a tender is abnormally low, and following the appropriate inter partes examination procedure, the contracting authority must decide whether to admit or reject that tender. When it does this, the contracting authority must set out its view in a reasoned decision in order to respect the rights of the person concerned. ( 34 )

54.

That follows from Article 35 of Directive 2009/81, pursuant to which the contracting authority must, ‘at the earliest opportunity, inform candidates and tenderers of decisions reached concerning the award of a contract’.

55.

On the other hand, if the contracting authority does not consider prima facie that any of the tenders might be abnormally low, no inter partes examination procedure will take place and there will be no explicit decision in that regard.

56.

In those circumstances, the decision bringing the tendering procedure to an end will implicitly include a decision not to regard as abnormally low any of the tenders submitted. The reasoning on which that decision is based is simply the lack of any evidence which would have necessitated the specific examination of a suspect tender.

57.

In order to determine how the required judicial review of the contracting authority’s decision should be carried out, it is necessary to distinguish between the two situations referred to above: either the contracting authority has explicitly stated its view on the suspicions aroused by a particular tender or it has done so implicitly, by deciding on the outcome of the procedure for the award of the contract without expressing any doubts as to the genuine nature of that or any other tender.

58.

Even though it is Directive 2009/81 that is directly applicable, I shall refer to the Court’s case-law in relation to Directive 89/665, ( 35 ) since, as I have noted, the former directive contains rules that are similar to those in Directive 89/665 as regards the institution of proceedings.

59.

The review to which the general provision in the last subparagraph of Article 1(1) of Directive 89/665 refers extends to all decisions by the contracting authority which apply EU law in that field. ( 36 )

60.

Decisions by the contracting authority which are open to review in this way include, of course, those that award a contract by selecting one of the tenders, but also others of a different kind which have a bearing on the legal position of the parties concerned. ( 37 )

61.

Directive 89/665 has not ‘formally laid down the time from which the possibility of review, as provided for in Article 1(1), must be open’. ( 38 ) The Court’s position is that it must be ensured that decisions by contracting authorities can be reviewed effectively and as quickly as possible. ( 39 )

62.

The EU legislature has entrusted to the Member States with the task of laying down the ‘detailed rules’ of the procedures for reviewing decisions by contracting authorities (Article 1(3) of Directive 89/665). ( 40 )

63.

It is therefore open to Member States, in principle, to legislate on applications for review of decisions adopted by a contracting authority by providing that they are to be made either jointly or separately (with/from the main challenge). Directive 89/665 neither prescribes nor excludes either of those mechanisms.

64.

If Member States, availing themselves of their procedural autonomy, choose to prescribe a joint challenge, they must do so without contravening the purposes of Directive 89/665 in relation to the required effectiveness and speed. They must, in addition, take into consideration:

65.

However, it must be borne in mind that the safeguarding of the principle of legal certainty ‘would be undermined if candidates and tenderers were allowed to invoke, at any stage of the award procedure, infringements of the rules of public procurement, thus obliging the contracting authority to restart the entire procedure in order to correct such infringements’. ( 43 )

66.

The case-law laid down in that judgment cited above is linked to the Court’s case-law in connection with the action for annulment provided for in Article 263 TFEU.

67.

As the French Government has observed, only measures the legal effects of which are binding on, and capable of affecting the interests of, the applicant by bringing about a distinct change in his or her legal position may be the subject of an action for annulment. ( 44 )

68.

With regard to acts or decisions which are drawn up in different stages, the measures which are open to challenge are those which definitively determine the position of the decision-making body ‘upon the conclusion of an administrative procedure, and which are intended to have legal effects … and not intermediate measures whose purpose is to prepare for the final decision …’ ( 45 )

69.

The Court has held that, for the purposes of the fourth subparagraph of Article 1(1) of Directive 89/665, the concept of ‘decisions taken by the contracting authorities’ must be interpreted broadly, as the wording of that provision – which ‘refers generally to the decisions of a contracting authority without distinguishing between those decisions according to their content or time of adoption and does not lay down any restriction with regard to the nature or content of the decisions to which it refers’ – ‘implies that every decision of a contracting authority falling under the EU rules in the field of public procurement and liable to infringe them is subject to … judicial review’. ( 46 )

70.

That interpretation of the concept of ‘decisions amenable to review’ led the Court to consider that a decision of a contracting authority allowing an economic operator to participate in a public procurement procedure constitutes such a decision. ( 47 )

71.

However, the generosity of that interpretation ( 48 ) has been limited in all cases to positive decisions, actually adopted by the contracting authority – in other words, decisions which entail an act of will whereby a contracting authority adopts a position when a legal provision requires it to make a decision.

72.

As I have pointed out, it is important to differentiate between:

73.

In so far as is important for these proceedings, it can be inferred from the information available that the contracting authority had no doubts which led it to suspect that either tender was abnormally low. Therefore, it did not have an obligation to commence the appropriate examination procedure.

74.

In acting in that way, the contracting authority did not adopt any decision which Directive 2009/81 provides may be the subject of a separate review at that time. I stress that, under Article 49 of that directive, the contracting authority was not required to adopt an express decision on whether all the tenders were abnormally low but rather only to follow a certain procedure before rejecting any tenders which it ‘considered’ to be abnormally low.

75.

As the French Government maintains, that article and, in parallel, Article 69 of Directive 2014/24, in conjunction with Article 47 of the Charter, mean only that, for the purposes of applying for a review of the award of the contract, a tenderer who has not been selected may challenge that award on the ground that the selected tender is abnormally low. ( 49 )

76.

In the light of the foregoing considerations, I propose that the Court of Justice give the following reply to the Varhoven administrativen sad (Supreme Administrative Court, Bulgaria):