Rules on public works contracts, public supply contracts and public service contracts

This law seeks to ensure an open market for public procurement as well as the fair application of the rules for the award of public works, supplies and services contracts.

SUMMARY

Directive 2004/18/EC lays down European Union (EU) rules for awarding contracts for public works, supplies and services. It aims to ensure that the public procurement process is fair and open to bidders from anywhere in the EU.

Scope

The law covers most public contracts other than for utilities (water, transport, energy and postal services), telecommunications, service concessions (such as operating an existing car park) and certain defence and security contracts.

4 types of procedure

• open: any party may submit a bid;
• restricted: any party may ask to participate and the contracting authority decides which parties to invite to submit a bid;
• negotiated: where contracting authorities negotiate directly the terms of a contract;
• in the case of very complex contracts, where the contracting entity discusses requirements and solutions with candidates admitted to a procedure (known as ‘competitive dialogue’).

Transparency

This is ensured by the publication of notices on public contracts in the EU's Official Journal and TED database, as well as at national level. All publications must contain identical information so as not to favour any bidder. They contain information such as:

• deadlines for bids,
• language(s) of bid,
• award criteria and their relative weighting,
• certificates/documents to accompany bids to allow the evaluation of candidate's suitability to perform a contract.

Contract award

Contracts are awarded on the basis of:

• the most economically advantageous tender (based on criteria such as quality, price, technical merit, after-sales service); or
• the lowest price.

Thresholds

All public contracts with a value over a given threshold are covered. Thresholds are calculated every 2 years.

As of 1 January 2014, the main thresholds for procurement contracts for public works, public supply and public service as amended by Regulation (EU) No 1336/2013 are as follows:

Central government authorities

• works contracts, works concessions contracts, subsidised works contracts: € 5,186,000;
• all design contests (for architectural plans, for example), all service contracts subsidised by the contracting authorities and all service contracts for services listed in Annex IIA (except R&D services and certain telecommunications services): € 134,000;
• service contracts for services listed in Annex IIB and for R&D services and certain telecommunications services: € 207,000;
• all supplies contracts awarded by central government authorities not operating in the field of defence: € 134,000.

Supplies contracts awarded by central government authoritiesoperating in the field of defence: (i) for products listed in Annex V: € 134,000; (ii) for other products: € 207,000.

Sub-central contracting authorities

• works contracts, works concessions contracts, subsidised works contracts: € 5,186,000;
• all service contracts, all design contests, subsidised service contracts, all supplies contracts: € 207,000.

Directive 2004/18/EC remains in force until 18.4.2016, the date on which a new Directive replacing it (Directive 2014/24/EU) enters into force.

ACT

Directive 2004/18/EC of the European Parliament and of the Council of 31 March 2004 on the coordination of procedures for the award of public works contracts, public supply contracts and public service contracts (OJ L 134, 30.4.2004, pp. 114–240)

Successive amendments and corrections to Directive 2004/18/EC have been incorporated in the basic text. This consolidated version is of documentary value only.

RELATED ACTS

Directive 2004/17/EC of the European Parliament and of the Council of 31 March 2004 coordinating the procurement procedures of entities operating in the water, energy, transport and postal services sectors (OJ L 134, 30.4.2004, pp. 1–113)

Directive 2014/24/EU of the European Parliament and of the Council of 26 February 2014 on public procurement and repealing Directive 2004/18/EC (OJ L 94, 28.3.2014, pp. 65–242)

last update 30.09.2015