91997E4077

WRITTEN QUESTION E-4077/97 by Guido Podestà (UPE) to the Commission (14 January 1998)

Subject: Promotion of a 'performance bond' guarantee system in the European Union

On 21 October 1997, in response to a statement which I made in plenary regarding the Tappin report on public procurement, Commissioner Monti said that he was not opposed to the introduction of new instruments designed to guarantee punctual performance of public contracts, such as 'performance bonds', but that it was necessary to avoid discriminating against and penalizing SMEs.

Can the Commission state whether it intends to conduct studies into the feasibility and arrangements for the introduction of such guarantee instruments and, if so, when?

If it does not intend to carry out such studies, would it state its reasons for not doing so?

If it does, will it be able to draw up a proposal for the introduction into Community law of such public contract performance guarantees, and how long does it think this will take?

Answer given by Mr Monti on behalf of the Commission (10 March 1998)

As indicated by the Commission in response to a question asked by the Honourable Member during the debate about the Tappin report on the public procurement green paper ((COM(96) 583 final. )), performance bonds can play an important role in facilitating the opening-up of public procurement in the construction sector. The study into the impact and effectiveness of the single market ((COM(96) 520 final. )) programme which was undertaken for the Commission in 1996 demonstrated that public procurement in this area has not yet been opened up to a significant degree. The Commission is convinced that this is due mainly to a lack of actual competition and welcomes therefore any measures which can favour an increase in competition.

In addition to initiatives taken by the Commission such as the mandate which has been given to the European Committee for standardisation (CEN) and the European Committee for electrotechnical standardization (Cenelec) to develop a qualification standard, initiatives from the private sector are certainly needed. The development of performance bonds would seem to be a very promising example of such initiatives. The Commission follows such initiatives very closely but does not think that its intervention is needed at this stage. It will, however, closely monitor this and similar developments. If this reveals that an important contribution to the success of the initiatives can be made by the Commission, it will take appropriate decisions based on the information available to it at the time.