Keywords
Summary

Keywords

1. Approximation of laws – Procedures for the award of public service contracts – Directive 92/50 – Award of a contract – Meaning – Amendments to the provisions of a public contract during the currency of the contract

(Council Directive 92/50, Arts 3(1), 8 and 9)

2. Approximation of laws – Procedures for the award of public service contracts – Directive 92/50 – Award of a contract – Meaning – Amendments to the provisions of a public contract during the currency of the contract

(Council Directive 92/50, Arts 3(1), 8 and 9)

3. Approximation of laws – Procedures for the award of public service contracts – Directive 92/50 – Award of a contract – Meaning – Amendments to the provisions of a public contract during the currency of the contract

(Council Directive 92/50, Arts 3(1), 8 and 9)

Summary

1. The terms ‘awarding’ and ‘awarded’, used in Articles 3(1), 8 and 9 of Directive 92/50 relating to the coordination of procedures for the award of public service contracts must be interpreted as not covering a situation where services supplied to the contracting authority by the initial service provider are transferred to another service provider established as a limited liability company, the sole shareholder of which is the initial service provider, controlling the new service provider and giving it instructions, provided that the initial service provider continues to assume responsibility for compliance with the contractual obligations.

Amendments to the provisions of a public contract during the currency of the contract constitute a new award of a contract within the meaning of Directive 92/50 when they are materially different in character from the original contract and, therefore, such as to demonstrate the intention of the parties to renegotiate the essential terms of that contract. An amendment to a public contract during its currency may be regarded as being material when it introduces conditions which, had they been part of the initial award procedure, would have allowed for the admission of tenderers other than those initially admitted.

Although the substitution of a new contractual partner for the one to which the contracting authority had initially awarded the contract must be regarded as constituting such a material change to one of the essential terms of the public contract in question, unless that substitution was provided for in the terms of the initial contract, the fact remains that an internal reorganisation of the contractual partner does not modify in any fundamental manner the terms of the initial contract. Accordingly, when the new contractual partner is a wholly-owned subsidiary of the former contractual partner and the latter has the power to instruct the subsidiary in the conduct and management of its business and the two companies are bound by a contract under which profit and loss are transferred, such an arrangement does not constitute a change to an essential term of the contract liable to constitute a new award of contract within the meaning of Directive 92/50.

(see paras 34-35, 40, 43-45, operative part 1)

2. The terms ‘awarding’ and ‘awarded’, used in Articles 3(1) and 8 and 9 of Directive 92/50 relating to the coordination of procedures for the award of public service contracts must be interpreted as not covering an adjustment of the initial agreement to accommodate changed external circumstances, such as the conversion to euros of prices initially expressed in national currency, a minimal reduction in the prices in order to round them off, and a reference to a new price index where provision was made in the initial agreement to replace the price index fixed previously.

Amendments to the provisions of a public contract during the currency of the contract constitute a new award of a contract within the meaning of Directive 92/50 when they are materially different in character from the original contract and, therefore, such as to demonstrate the intention of the parties to renegotiate the essential terms of that contract. An amendment to a public contract during its currency may be regarded as being material when it introduces conditions which, had they been part of the initial award procedure, would have allowed for the admission of tenderers other than those initially admitted.

Where, following the changeover to the euro, an existing contract is changed in the sense that the prices initially expressed in national currency are converted into euros, it is not a material contractual amendment but only an adjustment of the contract to accommodate changed external circumstances, provided that the amounts in euros are rounded off in accordance with the provisions in force. Moreover, such a conversion of contract prices into euros during the course of the contract may be accompanied by an adjustment of their intrinsic amount, which may even exceed the amount authorised by the relevant provisions relating to the introduction of the euro, without giving rise to a new award of a contract, provided the adjustment is minimal and objectively justified; this is so where it tends to facilitate the performance of the contract, for example, by simplifying billing procedures. With respect to the reformulation of the indexation clause, the reference to a new price index does not constitute an amendment to the essential conditions of the initial agreement such as to constitute a new award of a contract within the meaning of Directive 92/50 in so far as that reformulation merely applied the stipulations of the basic agreement as regards keeping the indexation clause up to date.

(see paras 34-35, 57-58, 61, 68-69, operative part 2)

3. The terms ‘awarding’ and ‘awarded’, used Articles 3(1), 8 and 9 of Directive 92/50 relating to the coordination of procedures for the award of public service contracts must be interpreted as not covering a situation where a contracting authority, through the use of a supplemental agreement, agrees with the contractor, during the period of validity of a contract concluded with it for an indefinite period, to renew for a period of three years a waiver of the right to terminate the contract by notice, the waiver no longer being in force at the time of the amendment, and agrees with it to lay down higher rebates than those initially provided for in respect of certain volume-related prices within a specified area of supply.

Since the relevant criterion for determining whether the conclusion of a new waiver of the right to terminate the contract constitutes a new award of contract is whether that clause must be regarded as being a material amendment to the initial contract, a clause which does not entail a risk of distorting competition, to the detriment of potential new tenderers, cannot be held to be such an amendment and, therefore, does not constitute a new award of a contract within the meaning of Directive 92/50.

The increase in the rate of the rebates, provided for by a supplemental agreement, having a comparable economic effect to a price reduction and therefore being liable to be interpreted as coming within the ambit of the clauses laid down in the basic agreement, is not to be regarded as being a material contractual amendment and therefore is not a new award of a contract within the meaning of Directive 92/50. Moreover, an increase in the rebate, which has the effect of reducing the remuneration received by the contractor as compared to what was initially provided for, does not shift the economic balance of the contract in favour of the contractor. Additionally, the mere fact that the contracting authority obtains a greater rebate on part of the services covered by the contract is not liable to entail a distortion of competition to the detriment of potential tenderers.

(see paras 76, 79-80, 83-87, operative part 3)