JUDGMENT OF THE COURT (Tenth Chamber)
23 November 2023 ( *1 )
(Reference for a preliminary ruling – Public contracts – Review procedures relating to the award of public contracts – Directive 2014/25/EU – Article 57(3) – Contracting entity having its head office in a Member State other than that of the head office of a central purchasing body acting in its name and on its behalf – Access to the review procedures – Applicable procedural rules and jurisdiction of review bodies)
In Case C‑480/22,
REQUEST for a preliminary ruling under Article 267 TFEU from the Verwaltungsgerichtshof (Supreme Administrative Court, Austria), made by decision of 23 June 2022, received at the Court on 18 July 2022, in the proceedings
EVN Business Service GmbH,
Elektra EOOD,
Penon EOOD,
THE COURT (Tenth Chamber),
composed of Z. Csehi (Rapporteur), President of the Chamber, M. Ilešič and D. Gratsias, Judges,
Advocate General: M. Campos Sánchez-Bordona,
Registrar: A. Calot Escobar,
having regard to the written procedure,
after considering the observations submitted on behalf of:
– |
EVN Business Service GmbH, by W. Schwartz, Rechtsanwalt, |
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Elektra EOOD, by O. Radinsky, Rechtsanwalt, |
– |
the Austrian Government, by A. Posch, J. Schmoll and M. Winkler-Unger, acting as Agents, |
– |
the European Commission, by G. Gattinara and G. Wils, acting as Agents, |
having decided, after hearing the Advocate General, to proceed to judgment without an Opinion,
gives the following
Judgment
1 |
This request for a preliminary ruling concerns, inter alia, the interpretation of Article 57(3) of Directive 2014/25/EU of the European Parliament and of the Council of 26 February 2014 on procurement by entities operating in the water, energy, transport and postal services sectors and repealing Directive 2004/17/EC (OJ 2014 L 94, p. 243). |
2 |
The request has been made in several actions brought by EVN Business Service GmbH (‘EBS’), a company incorporated under Austrian law with its head office in Austria, and by two companies established in Bulgaria against decisions of the Landesverwaltungsgericht Niederösterreich (Lower Austria Regional Administrative Court, Austria) whereby that court declares that it lacks jurisdiction as a review body in relation to the award of public contracts. |
Legal context
European Union law
Directive 92/13
3 |
Council Directive 92/13/EEC of 25 February 1992 coordinating the laws, regulations and administrative provisions relating to the application of Community rules on the procurement procedures of entities operating in the water, energy, transport and telecommunications sectors (OJ 1992 L 76, p. 14), as amended by Directive 2014/23/EU of the European Parliament and of the Council of 26 February 2014 on the award of concession contracts (OJ 2014 L 94, p. 1) (‘Directive 92/13’), includes Article 1, entitled ‘Scope and availability of review procedures’, which provides, in the first and fourth subparagraphs of paragraph 1: ‘This Directive applies to contracts referred to in Directive 2014/25/EU … unless such contracts are excluded in accordance with Articles 18 to 24, 27 to 30, 34 or 55 of that Directive. … Member States shall take the measures necessary to ensure that, as regards contracts falling within the scope of Directive 2014/25/EU or Directive 2014/23/EU, decisions taken by contracting entities may be reviewed effectively and, in particular, as rapidly as possible in accordance with the conditions set out in Articles 2 to 2f of this Directive, on the grounds that such decisions have infringed Union law in the field of procurement or national rules transposing that law.’ |
Directive 2014/25
4 |
Recitals 78 and 82 of Directive 2014/25 state:
…
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5 |
Entitled ‘Definitions’, Article 2 of Directive 2014/25 provides: ‘For the purposes of this Directive, the following definitions apply: …
…
…’ |
6 |
Entitled ‘Contracting entities’, Article 4 of Directive 2014/25 provides: ‘1. For the purpose of this Directive contracting entities are entities, which:
2. “Public undertaking” means any undertaking over which the contracting authorities may exercise directly or indirectly a dominant influence by virtue of their ownership of it, their financial participation therein, or the rules which govern it. …’ |
7 |
Entitled ‘Procurement involving contracting entities from different Member States’, Article 57 of that directive provides, in paragraphs 1 to 3 thereof: ‘1. Without prejudice to Articles 28 to 31, contracting entities from different Member States may act jointly in the award of contracts by using one of the means provided for in this Article. Contracting entities shall not use the means provided in this Article for the purpose of avoiding the application of mandatory public law provisions in conformity with Union law to which they are subject in their Member State. 2. A Member State shall not prohibit its contracting entities from using centralised purchasing activities offered by central purchasing bodies located in another Member State. In respect of centralised purchasing activities offered by a central purchasing body located in another Member State than the contracting entity, Member States may, however, choose to specify that their contracting entities may only use the centralised purchasing activities as defined in either point (a) or in point (b) of point (10) of Article 2. 3. The provision of centralised purchasing activities by a central purchasing body located in another Member State shall be conducted in accordance with the national provisions of the Member State where the central purchasing body is located. The national provisions of the Member State where the central purchasing body is located shall also apply to the following:
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Austrian law
8 |
Entitled ‘Joint cross-border procurement by several sectoral contracting entities’, Paragraph 180 of the Bundesvergabegesetz 2018 (Federal Law of 2018 on the award of public contracts) of 20 August 2018 (BGBl. I, 65/2018) (‘the BVergG 2018’) provides, in subparagraph 2: ‘Where a centralised purchasing activity is carried out for a sectoral contracting entity by a central purchasing body as referred to in Article 2(12) of [Directive 2014/25] which has its head office in another Member State of the Union or in another Contracting Party to the EEA Agreement 1. the conduct of the procurement procedure is governed … by the rules of the State in which the central purchasing body has its head office.’ |
The dispute in the main proceedings and the questions referred for a preliminary ruling
9 |
By a notice published in the Official Journal of the European Union on 22 May 2020, a public contract award procedure for a framework agreement was launched with a view to carrying out electrical installation work as well as related construction and demolition work. The contract was (territorially) divided into 36 lots for which the place of performance was in Bulgaria. The value of the contract exceeded the threshold above which the procedural and advertising rules on the award of public contracts under EU law apply. |
10 |
Elektrorazpredelenie YUG EAD (‘ER Yug’), a public limited company incorporated under Bulgarian law with its head office in Bulgaria, was the contracting entity in the context of that contract award procedure. |
11 |
EBS, a company incorporated under Austrian law whose head office is in Austria, acted in that contract award procedure as the central purchasing body, as the representative of ER Yug. |
12 |
Both ER Yug and EBS are indirectly wholly owned by EVN AG, which in turn is 51% owned by Land Niederösterreich (Province of Lower Austria, Austria). |
13 |
As provided in the call for tenders, EBS was responsible for the conduct and performance of that tender, while the contract relating to the services requested was to be concluded with ER Yug as the sectoral contracting entity. In that call for tenders, the Landesverwaltungsgericht Niederösterreich (Lower Austria Regional Administrative Court) was designated as the body responsible for review procedures. It was also provided that Austrian law was the law applicable ‘to the procurement procedure and all claims arising therefrom’ and that Bulgarian law applied to ‘the performance of the contract’. |
14 |
Elektra EOOD and Penon EOOD, two Bulgarian undertakings, submitted tenders for various lots under the framework contract. By decisions of 28 and 30 July 2020, they were informed that their tenders had not been accepted. |
15 |
Their applications for annulment of those decisions were dismissed, on 23 September 2020, by orders of the Landesverwaltungsgericht Niederösterreich (Lower Austria Regional Administrative Court), which declared that it lacked jurisdiction in that regard. |
16 |
That court held that the question before it was whether a Bulgarian undertaking could conclude with a contracting entity established in Bulgaria a contract to be performed in that Member State and governed by the law of that State. According to that court, to accept that it has jurisdiction in such circumstances would seriously encroach on the sovereignty of the Republic of Bulgaria and would create a conflict with the principle of territoriality recognised by international law. Moreover, the fact that the Province of Lower Austria exercises control over ER Yug in no way prejudges the jurisdiction of that court in relation to the award of contracts with undertakings having their head office abroad. |
17 |
Furthermore, like Article 57(3) of Directive 2014/25, Paragraph 180(2) of the BVergG 2018 lays down a rule relating to centralised purchasing activities carried out on behalf of a sectoral contracting entity by a central purchasing body established in a Member State other than that in which that entity is situated. Nonetheless, that rule merely lays down the substantive law which applies to the contract award procedure without specifying the procedural law applicable to a possible review procedure. It is true that recital 82 of Directive 2014/25 refers to the designation of the applicable legislation ‘on remedies’, although that was not reproduced in the actual wording of that directive. In addition, the concept of ‘centralised purchasing activities’ in Article 57 of that directive does not refer to the review procedure. |
18 |
Elektra, Penon and EBS brought appeals on a point of law before the Verwaltungsgerichtshof (Supreme Administrative Court, Austria) against the abovementioned orders. They produced a certified translation of a decision of the highest administrative court of the Republic of Bulgaria confirming the decision of the Bulgarian Public Procurement Agency as to its lack of competence in the case in question relating to the award of public contracts. |
19 |
Those parties submit that, having regard to its objective of providing uniform rules for centralised cross-border purchases, Article 57(3) of Directive 2014/25 and, in consequence, Paragraph 180(2) of the BVergG 2018, should be interpreted as meaning that they do not refer solely to the contract award procedure in the strict sense, but also to the review procedure which may possibly follow such an award. Since a central purchasing body should apply Austrian substantive procurement law, the review procedure should be conducted before an Austrian appeal body under Austrian procedural law. Thus, the decisive territorial connecting factor is the head office of the central purchasing body. |
20 |
In those circumstances the Verwaltungsgerichtshof (Supreme Administrative Court) decided to stay the proceedings and to refer the following questions to the Court of Justice for a preliminary ruling:
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The first question
21 |
By its first question, the referring court asks, in essence, whether Article 57(3) of Directive 2014/25 must be interpreted as meaning that a centralised purchasing activity, in the context of the joint award of contracts by contracting entities in different Member States, is carried out by a central purchasing body ‘located in another Member State’ where the contracting entity, irrespective of the control exercised over it by a body governed by public law of the Member State in which the central purchasing body is established, has its head office in a Member State other than that of the central purchasing body. |
22 |
According to Article 57(3) of Directive 2014/25, the provision of centralised purchasing activities by a central purchasing body located in another Member State is to be conducted in accordance with the national provisions of the Member State where the central purchasing body is located. The national provisions of the Member State where the central purchasing body is located are also to apply to the award of a contract under a dynamic purchasing system and to the reopening of competition under a framework agreement. |
23 |
The concept of ‘central purchasing body’ is defined in Article 2(12) of Directive 2014/25 as a contracting entity, within the meaning of Article 4(1) of that directive, or a contracting authority, within the meaning of point 1 of Article 2(1) of Directive 2014/24, providing centralised purchasing activities and, possibly, ancillary purchasing activities. |
24 |
It is apparent from the request for a preliminary ruling that the referring court’s main doubt relates to the manner in which the Member State where the contracting entity has its head office is to be distinguished from the Member State where the central purchasing body has its head office. In other words, it raises the question of the criterion connecting the contracting entity to a Member State for the purposes of the application of Article 57 of Directive 2014/25. |
25 |
The parties to the main proceedings and the other interested parties agree that the criterion of connection must be the place where the contracting entity is located and that it is irrelevant in that context whether, or even how and to what extent, that entity is owned by another entity located in a different Member State. Thus, the rule laid down in Article 57(3) of Directive 2014/25 applies where the central purchasing body and the other contracting entity are located in different Member States, such as Austria and Bulgaria in the present case. |
26 |
In that regard, it should be recalled that both the central purchasing body and the entity conducting the contract award procedure are contracting authorities within the meaning of Directive 2014/25, so that the criterion of connection to a Member State cannot be different for one or other of those entities. |
27 |
In addition, Article 57(1) of that directive provides that contracting entities may not use the cross border joint procurement in order to avoid the application of binding provisions of public law in conformity with EU law to which they are subject ‘in their Member State’. Paragraph 2 of that article refers to centralised purchasing activities offered by a central purchasing body ‘located in another Member State than the contracting entity’. |
28 |
Notwithstanding the fact that Directive 2014/25 thus uses, for the purposes of determining whether a contracting entity is connected to a Member State, expressions that are sometimes different, including in its various language versions, the fact remains that those expressions suggest that the criterion of connection adopted by the EU legislature is territorial in nature, which, moreover, corresponds to the general rule, which is apparent, in essence, from the second subparagraph of Article 57(1) of that directive, according to which any contracting entity is to comply with the rules in force in the Member State in which it is established. |
29 |
Therefore, where, in a case such as that in the main proceedings, the central purchasing body and the contracting entity are located in different Member States, it must be held that what is at issue is the award of a cross-border contract carried out through a central purchasing body. |
30 |
In that regard, it is important to note that it is not apparent from that directive and, in particular, from Article 57 thereof, that the fact that a regional authority or a body governed by public law exercising control over the contracting entity belongs to a particular Member State constitutes a relevant criterion connecting such an entity to that Member State. Where the EU legislature intended to use the criterion of the existence of a connection between a contracting entity and another entity, it used it expressly, as in Article 4(2) of that directive. |
31 |
In the light of the foregoing considerations, the answer to the first question is that Article 57(3) of Directive 2014/25 must be interpreted as meaning that a centralised purchasing activity, in the context of the joint award of contracts by contracting entities of different Member States, is carried out by a central purchasing body ‘located in another Member State’ where the contracting entity has its head office in a Member State other than that in which the central purchasing body is established, irrespective, as the case may be, of the location of the head office of a third entity controlling one or other of those entities. |
The second question
32 |
By its second question, the referring court asks, in essence, whether Article 57(3) of Directive 2014/25 must be interpreted as meaning that the conflict-of-law rule laid down in that provision, under which the centralised purchasing activities of a central purchasing body are to be provided in accordance with the national provisions of the Member State where the central purchasing body is located, covers review procedures, within the meaning of Directive 92/13, relating to those activities. |
33 |
As the referring court has pointed out, Article 57(3) of Directive 2014/25 does not expressly establish whether the national provisions of the Member State in which the central purchasing body is located also govern the review procedures and the jurisdiction of the review body, within the meaning of Directive 92/13. |
34 |
The ‘centralised purchasing activities’, to which that provision refers, are defined in Article 2(10) of Directive 2014/25 as activities conducted on a permanent basis, in the form of the acquisition of supplies and/or services intended for contracting entities, or in the form of the award of contracts or the conclusion of framework agreements for works, supplies or services intended for such entities. |
35 |
While it is true that, on the basis of a literal interpretation, Article 57(3) of Directive 2014/25 appears to refer only to the substantive law on the award of contracts, its wording does not preclude that provision from extending both to the legislation on review procedures and to the jurisdiction of the review body, within the meaning of Directive 92/13. |
36 |
In those circumstances, according to settled case-law, it is necessary, when interpreting a provision of EU law, to consider not only its wording but also its context and the objectives of the legislation of which it forms part (judgment of 29 June 2023, Interfel, C‑501/22 to C‑504/22, EU:C:2023:531, paragraph 53 and the case-law cited). |
37 |
Furthermore, it is also settled case-law that, where a provision of EU law is open to several interpretations, preference must be given to that interpretation which ensures that the provision retains its effectiveness (judgment of 29 June 2023, Interfel, C‑501/22 to C‑504/22, EU:C:2023:531, paragraph 54 and the case-law cited). |
38 |
In that regard, it should be recalled that, in accordance with recital 78 of Directive 2014/25, rules should be laid down for allocating responsibility for the observance of the obligations pursuant to that directive, also in the case of remedies, as between the central purchasing body and the contracting entities procuring from or through it. |
39 |
That recital envisages two situations, the first characterised by the fact that the central purchasing body alone assumes responsibility for the conduct of contract award procedures, and the second characterised by the fact that a contracting entity assumes responsibility for certain parts of the procedure, for instance the reopening of competition under a framework agreement or the award of individual contracts based on a dynamic purchasing system. In the first case, the central purchasing body should be solely and directly responsible for the legality of the procedures; in the second case, it should continue to be responsible for the stages it conducts. |
40 |
In addition, recital 82 of Directive 2014/25 states that new rules on cross-border joint procurement should be established and that those rules should determine the conditions for cross-border utilisation of central purchasing bodies and designate the applicable public procurement legislation, including the applicable legislation on remedies, in cases of cross-border joint procedures. |
41 |
It is apparent from those recitals that the EU legislature intended not only to determine the substantive law applicable to cross-border contracts and central purchasing bodies, but also the law relating to the review procedures to which those contracts and those activities may give rise. |
42 |
Consequently, preference must be given to an interpretation of the provisions of Directive 2014/25 governing such contracts and activities which makes it possible to encompass both substantive law and review procedures. |
43 |
Thus, it should be considered that Directive 2014/25 refers to the law of the Member States not only for the provisions of that law which govern the conduct of the cross-border contract award procedures but also for those which govern review procedures, including judicial review procedures, which are likely to follow such a contract award procedure. |
44 |
Such an interpretation is, moreover, consistent with the objective of Directive 2014/25, which is to establish a uniform system for centralised cross-border purchases. In so far as a central purchasing body is called upon to provide its centralised purchasing activities in accordance with the national provisions of the Member State in which it is located, it appears coherent that the review procedure, which may be initiated, is conducted in accordance with the law of that Member State and that the jurisdiction of the review body concerned is determined in accordance with that law. |
45 |
In addition, the principle that it is the provisions of the Member State in which a contracting entity is situated which govern the review procedures concerning the measures taken by those entities underlies the rule laid down in the fourth subparagraph of Article 1(1) of Directive 92/13, according to which the Member States are to take the measures necessary to ensure that, as regards contracts falling within the scope of Directive 2014/25 or Directive 2014/23, decisions taken by contracting entities may be reviewed effectively and, in particular, as rapidly as possible, on the ground that such decisions have infringed EU law in the field of procurement or national rules transposing that law. |
46 |
As the European Commission has observed, that does not preclude a distinction being drawn, where appropriate, between the law applicable to the contract award procedure and that which may apply to contracts subsequently concluded. |
47 |
It is also for the national courts, hearing a dispute arising from a cross-border contract award procedure, to pay particular attention to the allocation of the responsibilities incumbent on the parties involved in the conduct of that procedure and to the limits of their powers which, where appropriate, result therefrom, while taking into account the rule set out in Article 57(1) of Directive 2014/25, recalled in paragraph 27 of the present judgment. |
48 |
In the light of the foregoing considerations, the answer to the second question is that Article 57(3) of Directive 2014/25, read in the light of recitals 78 and 82 of that directive, must be interpreted as meaning that the conflict-of-law rule laid down in that provision, under which the provision of centralised purchasing activities of a central purchasing body is to be conducted in accordance with the national provisions of the Member State where that central purchasing body is located, extends to review procedures, within the meaning of Directive 92/13, relating to those activities, in so far as that central purchasing body is responsible for the conduct of the contract award procedure. |
The third question
49 |
In the light of the answers given to the first and second questions, there is no need to answer the third question referred by the referring court if the first or second question was answered in the negative. |
Costs
50 |
Since these proceedings are, for the parties to the main proceedings, a step in the action pending before the referring court, the decision on costs is a matter for that court. Costs incurred in submitting observations to the Court, other than the costs of those parties, are not recoverable. |
On those grounds, the Court (Tenth Chamber) hereby rules: |
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[Signatures] |
( *1 ) Language of the case: German.