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EVOSZ conference on Public Procurement 11 th April 2013 The revision of EU public EVOSZ conference on Public Procurement 11 th April 2013 The revision of EU public procurement directives Presentation Christine Le Forestier Economic and Legal affairs

SWEDEN www. fiec. eu NORWAY FINLAND DENMARK 1905 1 st meeting POLAND NETHERLANDS 29 SWEDEN www. fiec. eu NORWAY FINLAND DENMARK 1905 1 st meeting POLAND NETHERLANDS 29 countries 33 federations ESTONIA LITHUANIA Enterprises - of all sizes - active in all fields of building and civil engineering IRELAND CZECH REPUBLIC GERMANY SLOVAKIA BELGIUM HUNGARY ROMANIA FRANCE LUXEMBOURG TURKEY SPAIN BULGARIA PORTUGAL GREECE Full member Observer member Cooperation agreement SWITZERLAND AUSTRIA ISRAEL CROATIA ITALY CYPRUS SLOVENIA MALTA

Key figures 2012 Our preliminary results: ¾ Total construction output (EU): € 1 167 Key figures 2012 Our preliminary results: ¾ Total construction output (EU): € 1 167 Mln. ¾ Variation 2012/2011: - 4. 5% ¾ Weight of construction on EU GDP: 9% ¾ Total construction employment (EU): 14 Mln. ¾ Weight of construction employment: about 7%

Revision of EU public procurement directive Two legislative texts currently apply: ¾ The “classical” Revision of EU public procurement directive Two legislative texts currently apply: ¾ The “classical” directive: ¡ ¾ Directive 2004/18/EC on the award of public works contracts, public supply contracts and public service contracts The “utilities” directive: ¡ Directive 2004/17/EC on the award of entities operating in the water, energy, transport and postal services sectors ¾ Concessions are dealt with in a dedicated chapter of the “classical” directive ¾ These directives should have been transposed by Member States into national law by 31 January 2006

Revision of EU public procurement directive In 2010 already, the European Commission starts talking Revision of EU public procurement directive In 2010 already, the European Commission starts talking about a possible legislative revision: ¾ Amongst the few reasons provided: ¡ ¡ ¾ Public procurement = 17% PIB EU => budgetary restrictions necessitate the optimal use of these funds Simplify procedures and reduce the administrative burden Improve the access of SMEs to public procurement Allow that other political objectives be better taken into account (innovation, social and environmental aspects) Usual preparatory procedure: ¡ ¡ 1 st semester 2011: public consultation 2011: impact assessment

Revision of public procurment directive On 20 th December 2011, the European Commission proposes Revision of public procurment directive On 20 th December 2011, the European Commission proposes a “legislative package” aimed at modernising the public procurement rules: ¾ Legislative package: ¡ ¡ ¡ ¾ 1 directive replacing the “classical” directive 1 directive replacing the “utilities” directive 1 new directive on concessions This file has been followed up by the FIEC working group dedicated to public procurement ¡ ¡ Chair: Mr. Jan Wierenga, NL-Bouwnederland Rapporteur: Mr. Dick van Werven, NL-Bouwnederland

Revision of EU public procurement directive The “classical” directive has been the object of Revision of EU public procurement directive The “classical” directive has been the object of a continuous lobbying from FIEC towards the European Parliament all along the year 2012: ¾ Some of the supported issues: ¡ ¡ ¡ ¾ Confidentiality Variants Award criteria: Most Economically Advantageous Tender Some of the issues fought against: ¡ ¡ ¡ In/house and public-public cooperation Shortening of time limits Award criteria: “production process” Abnormally Low Tenders Performance conditions Subcontracting: direct payment, chain liability…

Revision of EU public procurement directive Confidentiality (art. 18): ¡ The respect of the Revision of EU public procurement directive Confidentiality (art. 18): ¡ The respect of the confidentiality of offers is key for contractors, in particular in procedures where negotiations intervene (i. e. competitive dialogue, negotiated proc. ). ¡ All the aspects of an economic operator’s offer are confidential and contracting authorities should be held responsible for “cherry picking”. ¡ Parliament and Council do not take this matter sufficiently into account…

Revision of EU public procurement directive Variants (art. 43): ¡ In order to promote Revision of EU public procurement directive Variants (art. 43): ¡ In order to promote innovation from enterprises in public procurement, as wished for by the European Commission, variants should systematically be accepted by public procurers. ¡ The Parliament has recognised this need: “Contracting authorities shall authorise tenderers to submit variants…” ¡ But not the Council: “Contracting authorities may authorise or require tenderers to submit variants. ”

Revision of EU public procurement directive Award criteria - MEAT (art. 66): “Yes, but!. Revision of EU public procurement directive Award criteria - MEAT (art. 66): “Yes, but!. . . ” ¡ The criterion of the Most Economically Advantageous Tender should be promoted, in order to support quality, innovation, sustainability and avoid potential abnormally low tenders. ¡ The Parliament has deleted the lowest price criterion, while the Council has kept it… ¡ Questionable is rather the use of complicated MEAT sub-criteria, i. e. the “process of production” => risk to loose the link with the subject-matter of the contract!

Revision of EU public procurement directive Relations between public authorities (art. 11): ¡ In-house Revision of EU public procurement directive Relations between public authorities (art. 11): ¡ In-house and inter-municipal cooperation are exceptions to the Internal Market and public procurement principles and therefore need to remain limited. ¡ Art. 11 goes against the interest of private economic operators in broadening the possibilities for contracting authorities / entities to escape from the scope of public procurement rules while playing on the same market! ¡ Both Parliament and Council support this extended approach!

Revision of EU public procurement directive Shortening of time limits (art. 25 to 28): Revision of EU public procurement directive Shortening of time limits (art. 25 to 28): ¡ The time limits for the reception of requests to participate and tenders have been reduced. ¡ However, it reduces competition, by being detrimental to the participation of a high number of companies and it reduces the quality of the offers. = counter-productive idea! ¡ Both the Parliament and the Council support a reduction of the time limits!. . .

Revision of EU public procurement directive Abnormally low tenders (art. 69): ¡ The Commission Revision of EU public procurement directive Abnormally low tenders (art. 69): ¡ The Commission proposed to set objective conditions for identifying what an abnormally low tender is (i. e. criteria in %). => Approach strongly supported by FIEC! ¡ Both the Parliament and the Council dropped these objective conditions… Ø Ø EP: “Contracting authorities shall require explanation [of the low price]…” Council: “Contracting authorities may require explanation [of the low price]…”

Revision of EU public procurement directive Abnormally low tenders (art. 69): ¡ Missing point: Revision of EU public procurement directive Abnormally low tenders (art. 69): ¡ Missing point: There is no obligation to reject an offer which has been identified as being abnormally low… except when this offer goes against environmental, social or labour law. ¡ As soon as a tender is identified as being abnormally low, and provided there is no acceptable explanation which justifies the low price, such tender must be rejected! ¡ Neither the Parliament, nor the Council have taken into account this key issue!. . .

Revision of EU public procurement directive Performance conditions (art. 70): ¡ Contractual issues depend Revision of EU public procurement directive Performance conditions (art. 70): ¡ Contractual issues depend on Court law, national legislations and the provisions of the remedies directive. ¡ Therefore, they should not be addressed in the public procurement directive. ¡ The Council support our views, but the Parliament uses this chapter to add a series of requirements.

Revision of EU public procurement directive Subcontracting (art. 71): ¡ A series of proposals Revision of EU public procurement directive Subcontracting (art. 71): ¡ A series of proposals has been introduced by the Commission: stricter indication of subcontractors’ names, direct payment to subcontractors… => FIEC strongly opposed to this approach! ¡ The Parliament has reinforced the provisions creating a legal frame for subcontractors: Ø Ø § EP backs direct payment, but provision remains voluntary EP introduces new paragraph on chain liability, but provision remains voluntary On the contrary, the Council advocated that provisions on relations between main contractor and subcontractors purely concern national contract law!

Revision of EU public procurement directive The “classical” directive has been the object of Revision of EU public procurement directive The “classical” directive has been the object of a continuous lobbying from FIEC. . . and its Member Federations! ¾ Towards the European Parliament: ¡ ¡ ¾ Towards the Council (Member States): ¡ ¡ ¾ FIEC => rapporteur and “shadow rapporteurs” Member Federations => national parliamentarians Member Federations => in front line towards their national representatives! FIEC => focuses on the on-going Presidency (IE) Towards the European Commission: ¡ ¡ FIEC => contacts on a regular basis, for information, support and lobbying Member Federations => case by case

Revision of EU public procurement directive Where to we stand now? ¾ Procedure: ¡ Revision of EU public procurement directive Where to we stand now? ¾ Procedure: ¡ ¡ ¾ Specific difficulties linked to the “trilogue”: ¡ ¡ ¡ ¾ December 2012: vote in “Internal Market” committee (EP) December 2012: “general approach” adopted by the Council “Trilogue” negotiations on-going (EC/EP/COUNCIL) Goal: agreement by summer 2013 (quasi) non written rules… Clear lack of transparency Negotiations of “carpet sellers”? Calendar out of control Uncertain outcomes… Our analysis, at this stage, on a dossier which has been the object of a huge lobbying by numerous stakeholders

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