JUDGMENT OF 23. 11. 1978 — CASE 56/77 AGENCE EUROPÉENNE D'INTERIMS v COMMISSION
In Case 56/77
THE COURT, composed of: H. Kutscher, President, J. Mertens de Wilmars and Lord Mackenzie Stuart (Presidents of Chambers), A. M. Donner, P. Pescatore, M. Sørensen, A. O'Keeffe, G. Bosco and A. Touffait, Judges, Advocate General: G. Reischl Registrar: A. Van Houtte
gives the following
JUDGMENT
Facts and Issues
I — Facts and procedure
II — Conclusions of the parties
Primarily
Alternatively
III — Submissions and arguments of the parties
Facts
Law
1. Infringement of essential procedural requirements
2. Infringement of the Financial Regulation
Factors leading to the choice of Randstad's tender
The rates
The salary level for the temporary staff
The unfavourable experience of the applicant mentioned in the Comparative Study of the Tenders
3. Infringement of Commission Regulation of 30 June 1975 on measures of implementation of certain provisions of the Financial Regulation (Official Journal L 170 of 1 July 1975)
4. Misuse of powers
5. The claim for damages
Facts
Law
1. Disregard of essential procedural requirements
2. Infringement of the Financial Regulation
3. Misuse of powers
IV — Question put to the Commission
V — Oral procedure
Decision
Costs
I —. Facts and procedure
1. The Commission of the European Communities contemplates employing temporary staff in its departments in Brussels on the basis of provision of services on the terms set out in Annex I.
2. …
3. The tender must:
4. …
5. Tenderers will be informed of the outcome of their tenders.
1. …
2. It is estimated that between 50 and 100 temporary staff will be required each month (save August).
3. The staff will be made up approximately of:
4. The figures given in paragraphs 2 and 3 are for guidance only and cannot bind the Commission.
7. The contract shall be for a term of two years from 1 April 1977; …
8. The tender must set out, inter alia, the clause for the review of prices and the possibilities of reduction — and terms of billing — on the basis of the forecast of monthly turnover.
9. The temporary staff made available must have the benefit of all the provisions of Belgian law relating to them.
—. It is proposed that the tender should be accepted which, for all the categories of staff required, having regard to the reductions granted, appears the lowest among those perfectly and unconditionally meeting all the terms in the invitation to tender;
—. The salaries actually paid to the staff are among the highest in comparison with the prices paid by the Commission;
—. The staff previously supplied from time to time by the firm in question has always fully met requirements and the firm has always earned the trust placed in it.
II —. Conclusions of the parties
1. Annul the contested decision;
2. Order the defendant to pay to the applicant the sum of Bfrs 26600000 by way of damages;
3. Order the Commission to pay the costs.
1. Order the production of the following documents:
2. Authorize the applicant to prove by all lawful means, including the calling of witnesses, the facts set out in the statement of claim and in particular the circumstances in which Randstad S.A. largely re-engaged the whole of the temporary staff which the applicant made available to the Commission;
3. Appoint an expert to determine the extent of the damage suffered by the applicant by reason of the fact that it has unlawfully been barred from the contract in question and forced to reconstitute its staff in order to carry on.
1. Dismiss the application;
2. Order the applicant to pay the costs.
1. Order the production of the following documents:
III —. Submissions and arguments of the parties
1. Infringement of essential procedural requirements
2. Infringement of the Financial Regulation
(a). this tender was, from the point of view of the factors of assessment listed in that article, more attractive than the tender which was accepted;
(b). the Commission did not seriously consider the tenders submitted and more particularly the one which it accepted.
(a). In the light of the criteria listed in Article 59 (2) the applicant's tender appears undoubtedly more attractive than that of Randstad. In fact:
(b). In the applicant's opinion a serious comparative examination of the tenders would have shown Randstad's inability to render the requisite services in due time. The Commission therefore disregarded the rules of good administration by adopting the decision in question.
3. Infringement of Commission Regulation of 30 June 1975 on measures of implementation of certain provisions of the Financial Regulation (Official Journal L 170 of 1 July 1975)
4. Misuse of powers
5. The claim for damages
1. Disregard of essential procedural requirements
2. Infringement of the Financial Regulation
3. Misuse of powers
IV —. Question put to the Commission
V —. Oral procedure
1. By application registered at the Court on 3 May 1977 the applicant, Agence Européenne d'Interims S.A., claims on the one hand the annulment of the decision of the Commission dated 1 March 1977 by which the Commission rejected the applicant's tender lodged in response to the Commission's invitation to tender for the supply of temporary staff and further an order that the Commission pay compensation for the damage the applicant suffered as a result of the said decision and because of the conduct of certain officials of the Commission.
2. It appears from the file that after the Commission had decided in November 1976 to terminate the contracts which it had had with the applicant since 1970 for the supply of temporary staff it issued on 7 December 1976 a restricted invitation to tender for the supply of temporary staff within the meaning of Article 59 (2) of the Financial Regulation of 25 April 1973 applicable to the general budget of the European Communities (Official Journal L 116, p. 1) and that the applicant duly followed the procedure.
3. Although not required to do so the Commission previously sought an opinion from the Purchases and Contracts Advisory Committee on the content and wording of the tender and the procedure to be followed.
4. The applicant, along with 18 others, lodged a tender in accordance with the conditions laid down in the invitation to tender.
5. In accordance with Article 62 of the Financial Regulation the tenders were submitted for the opinion of the Purchases and Contracts Advisory Committee. On 25 February 1977 the latter pronounced itself in favour of the conclusion of a contract with Randstad S.A. for the supply of temporary staff to the Commission.
6. The authorizing officer accepted the assessment of the Purchases and Contracts Advisory Committee and the Commission decided to enter into a contract with Randstad after obtaining authorization from the Financial Comptroller.
7. By letter dated 1 March 1977 the Commission informed the applicant that its tender had not been accepted.
8. Subsequently the majority of the temporary staff which had previously been employed by the applicant offered their services to Randstad who thereupon signed them up.
9. By order dated 30 November 1977 the Court gave Randstad leave to intervene in support of the Commission's claim to reject the application as unfounded.
10. The applicant is seeking the annulment of the Commission's decision of 1 March 1977 by which the Commission rejected the applicant's tender and alleges disregard of essential procedural requirements, infringement of the Financial Regulation of 25 April 1973 and of the measures implementing it and misuse of powers, all of which claims are contested by the Commission.
11. None of the parties has questioned the lawfulness of the extent of the Commission's recourse to the employment of temporary staff to provide the necessary staff for the performance of its normal work.
12. In the first place the applicant says the Commission disregarded essential procedural requirements when giving notice of rejection of the tender by letter dated 1 March 1977 since, contrary to the obligation on the Commission under Article 190 of the Treaty to state its reasons, no reasons were given.
13. Since the rejection of the applicant's tender was only the necessary and inevitable consequence of the decision to accept Randstad's tender it was unnecessary for the reasons to be separately stated.
14. In the second place the applicant alleges that the decision taken in favour of the intervener infringes the provisions of Article 59 (2) of the Financial Regulation in so far as it involves the rejection of the applicant's tender whereas
15. Article 59 (2) of the Financial Regulation provides:
16. According to this provision of the Financial Regulation the administration may freely choose the offer thought to be the most attractive; this gives it a certain discretion.
17. It is not stipulated that in the assessment of the technical and financial factors the price must constitute the sole criterion.
18. By providing in Article 62 that contracts involving amounts exceeding 12000 units of account shall, before the authorizing officer takes a decision, be submitted for the opinion of a Purchases and Contracts Advisory Committee the Financial Regulation itself contains a procedure for review of the administration's judgment.
19. In the present case the proposal to enter into a contract with Randstad received a favourable opinion from the Purchases and Contracts Advisory Committee.
20. Although the Court has jurisdiction to review the judgment of the departments of the Commission to decide whether there is any misuse of powers or a serious and manifest error of judgment it must, however, respect the discretion given to the competent authorities, including the Purchases and Contracts Advisory Committee, in assessing the factors to be taken into account in the interests of the department for the purpose of deciding to enter into a contract for the supply of temporary staff to an institution.
21. By producing a number of comparative tables of figures the applicant has attempted to show the obviously erroneous nature of the Commission's finding that Randstad's tender was the lowest.
22. On the other hand at the request of the Court the Commission has filed calculations in support of its claim that the prices offered by Randstad were more attractive than those proposed by the applicant.
23. The applicant has filed written observations on the Commission's calculations.
24. Provided that the Commission has assessed the tenders fairly on the same basis and according to the same criteria the choice of methods which it has employed to compare the tenders cannot be questioned.
25. It is accordingly necessary to consider the methods of comparison employed by the Commission.
26. The Commission has explained the basic principle of the calculations made by its departments when considering the prices of the tenders.
27. According to its explanations it drew up a scale of the net hourly salaries of its officials and other servants doing the same work as that required of the temporary staff in the invitation to tender.
28. A net figure in respect of the gross salaries proposed by the tenderers was obtained by adding 14.8 % for holiday pay and making the normal deductions, including social security contributions for which the worker is liable.
29. Comparison of the amounts so calculated with the scale of net salaries of officials or other servants of the Commission showed that the applicant's tender did not in most cases comply with the provisions of Article 10 of the Belgian Law of 28 June 1976 (Moniteur Belge, 7 August 1976) which came into force on 1 December 1976 and requires that the salary of temporary staff should not be less than that to which such staff would have been entitled if they had been employed on the same terms as a permanent worker and the Commission, therefore, in accordance with the review clause which the applicant's tender contained calculated the necessary coefficients of increase and applied them to the prices sought by the applicant.
30. Once the review clause was applied it was apparent that the applicant's prices were almost all higher than Randstad's prices all of which were already above the Commission's scale.
31. After the Commission had made a forecast of the use of temporary staff according to the staff policy which it contemplated pursuing it compared the costs of the tenders by multiplying the hourly rates proposed by the tenderers, after applying the review clause in the case of the applicant by the number of hours stated in the said forecast and taking account of any effect the index and reductions might have.
32. As regards the index the variations in 1976 were taken.
33. As a result of the above-mentioned operations the applicant's prices were higher than those of Randstad.
34. The objections raised by the applicant against the methods of calculation adopted by the Commission basically concern the factors of assessment which these involve and in particular the choice of the net salaries of the officials of the Commission applicable on 31 December 1976 as a criterion of conformity with Article 10 of the Belgian Law, the forecast of the use of temporary staff and reference to the variations in the index in 1976 as a criterion for the influence of the index on the prices proposed.
35. In view of the fact that when the Commission had to apply the Belgian Law for the purpose of its calculations that law had just entered into force and having regard to the absence of precise indications it is not possible to reproach the Commission for having adopted as a criterion of the conformity of the two tenders with the provisions of Article 10 of the Belgian Law the net hourly salary as at 31 December 1976 of officials of the Commission doing the same work as that stated in the invitation to tender for temporary staff.
36. Further, the Commission had to judge the tenders on the basis of an assessment of its future needs and in particular of the number of hours of use of, the temporary staff and the allocation of these according to occupations and only the Commission is in a position to make this assessment.
37. It is apparent from the Commission's calculations that this assessment relates in turn to the calculation of the amount of reductions offered respectively by the applicant and by Randstad.
38. It is not possible from the facts adduced by the applicant to show that the methods of calculation of the Commission or the criteria which it has adopted are such as to distort the comparison of prices proposed in the two tenders or the Commission's conclusion that Randstad's tender was the lowest.
39. Even assuming that in a procedure for request for tenders the Commission chose an undertaking whose offer was higher in price than the others, this is not in itself decisive.
40. Other factors referred to by the Commission to justify its choice, in particular the references of Randstad and the fact that the salary paid by it to temporary staff was, in relation to the prices paid by the Commission, among the highest, came within the considerations of a technical nature which it could take into account under Article 59 (2) of the Financial Regulation for the purpose of making its choice.
41. As has already been stated, the applicant claims that there was a misuse of powers in that the procedure for request for tenders was used not to supply the Commission with the most attractive services of competing firms but to favour Randstad.
42. This is apparent, according to the applicant, not only from the fact that the price proposals made by it were more attractive than those of Randstad but also from the fact that Randstad signed up the applicant's temporary staff in March 1977 immediately after the procedure for request for tenders and that the Commission's officials were involved in this, as was necessary if Randstad was to fulfil its contractual obligations towards the Commission.
43. On 17 March 1977 at a meeting held in Brussels Randstad, with the improper assistance of certain officials of the Commission, proceeded to sign up almost the whole of the temporary staff which the applicant had made available to the Commission.
44. This wrongful conduct by the Commission's officials corroborates the applicant's claim that the procedure for requests for tenders was used to favour one of the tenderers, namely Randstad.
45. Nevertheless, such conduct, which, however, is denied by the Commission, is no ground for challenging the choice of Randstad made previously by the Commission having regard to the fact that the applicant has not succeeded in establishing the unjustified nature of the said choice for the requirements of the Commission and having regard to Article 59 (2) of the Financial Regulation.
46. Accordingly the application for annulment must be dismissed.
47. The applicant claims further in its application that by rejecting its tender and accepting the less attractive tender of Randstad, the Commission acted wrongly and this is corroborated by the above-mentioned conduct of its officials which renders it liable to make good the damage ensuing to the applicant by the loss of the contract entered into with Randstad and for the loss of staff.
48. In its reply the applicant states more particularly that its recruitment efforts and selection of staff were largely nullified by the conduct of the Commission which assisted in the signing up of this staff by Randstad.
49. Since it has not been established that the choice of Randstad's tender was unjustified, the applicant's claim for damages for the loss of the contract must be dismissed.
50. As regards the damage which the applicant suffered by the loss of its temporary staff, it appears from the file that the contractual ties between the applicant and such staff did not continue beyond the duration of a contract between the applicant and the person who used the services of the temporary staff.
51. Accordingly the applicant cannot claim any legally protected interest in retaining its temporary staff after its contractual ties with such a person have been terminated.
52. Further it appears that the applicant did not have any important customers other than the Commission so that it could not offer employment prospects to the temporary staff which had previously been on its books.
53. In these circumstances even assuming that certain officials of the Commission had acted in such a way as to bring to the notice of the temporary staff in question the decision of the Commission to terminate the contract with the applicant and the possibility of continuing to work for the Commission as temporary employees of Randstad, such conduct, motivated by considerations of the interests of the service or social considerations is not an act giving rise to liability on the part of the Commission towards the applicant.
54. It follows from the premises that the claim for damages in respect of the applicant's loss of temporary staff must also be dismissed.
55. Article 69 (2) of the Rules of Procedure provides that the unsuccessful party shall be ordered to pay the costs.
56. The applicant has failed in its submissions.
57. However, it is right to order the Commission to pay the costs relating to the further hearing necessitated by its belated notification of the above-mentioned calculations.
On those grounds, THE COURT, hereby:
1 Dismisses the application;
2 Orders the applicant to pay the costs, save those relating to the reopening of the hearing which are to be borne by the Commission