Opinion of Advocate General
Mr President,
Members of the Court,
1. In the present case the Commission seeks a declaration from the Court that, in the procedure for inviting tenders for the construction of a bridge across the western channel of the Storebælt (Great Belt), the Kingdom of Denmark has failed to fulfil its obligations under Articles 30, 48 and 59 of the EEC Treaty and under Council Directive 71/305/EEC of 26 July 1971 concerning the coordination of procedures for the award of public works contracts. The Commission challenges two aspects of the procedure for awarding the contract: a) the inclusion in the general tender conditions of a clause which invited tenders on condition that the greatest possible use was made of Danish materials and consumer goods and of Danish labour and equipment (hereinafter the Danish content clause); b) the fact that the negotiations with the selected consortium were conducted on the basis of a tender which did not comply with the general tender conditions.
2. The facts and the pre-litigation procedure are described in detail in the Report for the Hearing, to which reference is made. Here I shall therefore merely recapitulate, so far as is necessary to make the subsequent observations easier to follow, the essential aspects of the matter.
3. On 18 May 1989, the Commission had contacted the Danish authorities to express its doubts about the compatibility with Community law of both the Danish content clause and the fact that the negotiations with ESG had been conducted on the basis of a tender which did not comply with Condition 3, Clause 3, of the general tender conditions. Not satisfied with the explanations offered by the Danish Government, the Commission sent a letter of formal notice on 21 June 1989 requesting inter alia postponement of the signature of the contract. In reply to that letter the Danish authorities informed the Commission that they did not consider it appropriate to postpone the signing of the contract, but that, by letter of 21 June, they had requested Storebælt to remove the Danish content clause, so that it no longer appeared in the final contract.
4. At the hearing of the application for interim measures on 22 September 1989, the Danish Government stated that it recognized that the Danish content clause constituted a breach of the fundamental principle of nondiscrimination enshrined in the EEC Treaty and undertook (a) to avoid any discriminatory clause or practice in relation to future contracts for public works or supplies, (b) to ensure that compensation would be paid for the damage incurred by the tenderers provided that they were able to demonstrate that their claims for damages were well founded in Danish law, and (c) in any event to ensure that bidding costs were recovered through arbitration, without the undertakings concerned having to establish that their failure to be awarded the contract was caused by the discriminatory effect of the Danish content clause.
(a) The Danish content clause
5. The Danish Government objects that the Commission is widening the dispute to include clauses in the general tender conditions other than those referred to in the letter of formal notice or the reasoned opinion since, in substance, new pleas in law are thereby introduced, which are contained and developed only in the reply.
6. That said, it should be pointed out that, according to settled case-law, the scope of an application under Article 169 of the Treaty is delimited by the pre-litigation procedure provided for in that article as well as by the forms of order sought, and both the reasoned opinion and the application must be based on the same grounds and pleas in law. Although the Court allows new matters of fact to be raised in the course of an action if they are of the same kind as those to which the reasoned opinion referred and constituted the same conduct, those facts must nevertheless, according to Article 42(2) of the Rules of Procedure, have occurred after delivery of the reasoned opinion or, in any event, the applicant must have been unaware of them at the time of lodging the application.
7. Next, with regard to those clauses which were included for the first time in the final version of the contract and which, according to the Commission, also formed Danish content specifications, it should first of all be observed that the form of order sought by the Commission in respect of the plea in law in question concerns only the unlawfulness of the procedure for awarding the contract. Therefore, unlike the discriminatory clauses in the general and specific tender conditions, those which were added to the final version of the contract cannot have had any influence on the conduct of that procedure. Strictly speaking, therefore, those clauses could serve as the basis for a separate action because, if they are unlawful, they would clearly constitute an infringement of Community law in the course of being committed, since the construction of the bridge is still in progress.
8. Now that it has been established that the subject-matter of the plea under examination is confined to the Danish content clause, as expressed in Condition 6, Clause 2, of the general tender conditions, and bearing in mind that the incompatibility of that clause with Articles 30, 48 and 59 of the Treaty is not in dispute, the first point to be examined is whether or not the Danish Government, in removing the clause in question, complied with the reasoned opinion. Indeed, as will be recalled, that clause was removed before the contract was signed (26 June) and thus before the Commission delivered its reasoned opinion to the Danish Government (14 July). And it is precisely in view of this circumstance that the Danish Government submits that the application should be declared inadmissible or at the very least dismissed, by analogy with the Court's decision in Case C-362/90 Commission v Italy. In that connection I must point out immediately that in my opinion the case under examination is not comparable with the case just mentioned.
9. The situation in the case now before us is quite different. As I have already mentioned, in its letter of formal notice the Commission not only requested the explanations sought within seven days but also postponement, during that interval, of the signature of the contract. By meeting the Commission's requests, the Danish Government could therefore have avoided consummating its failure to fulfil obligations; instead of doing that, it announced, in the course of the Treaty infringement proceedings, in its reply to the letter of formal notice, that Storebælt had already signed the contract. The taking of that step precluded the reopening of the procedure for awarding the contract, which is why, in its reasoned opinion, the applicant requested, as the only way to secure compliance with Community law, that the contract be rescinded and the tendering procedure be reopened. Consequently, in so far as the contract was concluded on the basis of an irregular tendering procedure, it seems to me that — given the undisputed unlawfulness of the Danish content condition — the existence of an infringement cannot be denied.
10. That said, it must now be established whether, and if so, to what extent, the Danish Government's statement of 22 September 1989 made in the proceedings for interim measures has any bearing on these proceedings. In that connection, the Danish Government contends that by that statement it not only recognized the existence of the infringement but also acknowledged its own financial liability towards the tenderers, so that the statement was equivalent in effect to a Court ruling definitively finding that an infringement had been committed.
11. Moreover, it appears from the settled case-law on this point, in which the Court has from time to time expressly pointed out that the interest in pursuing an action may reside in establishing the basis of liability which a Member State may incur as a result of its default, that there must in any case be a presumption that the Commission has an interest in pursuing an action which it has initiated under Article 169, even where the breach of obligations is not contested.
(b) The negotiations conducted on the basis of a tender which did not comply with the general tender conditions
12. In relation to this ground of application, the Danish Government has again raised a number of objections of inadmissibility, concerning both the additional matters of fact which the Commission added in its reply in support of the ground in question and — above all — an alleged change to the form of order sought, widening its scope.
13. I cannot accept that argument. In the first place, as the Danish Government itself has acknowledged, a reframing of the form of order sought is permissible if it delimits, in the sense of restricts, the formal claim. In my opinion, that is precisely the position in the present case, in so far as the Commission — by no longer relying in general on the fact that the negotiations were conducted on the basis of a tender which did not comply with the general tender conditions, but rather on the fact that the subject-matter of those negotiations was a clause in the general tender conditions which was not open to derogation and that they led to results manifestly contrary to the principle underlying Directive 71/305, which is, namely, the equal treatment of tenderers — in the end essentially delimited and restricted the scope of its charge as expressed in the reasoned opinion.
14. That said, let me move on to consider the substance of the ground of application. It is appropriate first of all to examine Condition 3, Clause 3, of the general tender conditions, that is to say, the wording of the clause with which ESG failed to comply when submitting its tender.
15. In my opinion, it clearly follows from the wording of paragraph 6.2 that a tender framed in those terms does not comply with Condition 3, Clause 3, of the general tender conditions. The argument put forward by the Danish Government — according to which the contracting authority is only to assume liability for execution of the project and for the risks of variations in the quantities in the event that it undertakes the design of the project — is moreover contradicted by Storebælt itself, as is clear from the note of 21 June 1989 annexed to the Danish Government's reply to the Commission's request for clarification.
16. Indeed, as I have just explained, ESG had undertaken to take on the detailed design of the project for a fixed sum of DKR 42 million, but did not undertake to assume liability for the project or for the risks involved. Those conditions must, therefore, have been the subject of negotiation, as must the risk relating to quantity variations.
17. The Danish Government contends nevertheless that the increase in the price was quite proportional to the total cost of the work in question and that, in any case, the facts complained of by the Commission are not governed by Community law; in particular, the possibility of accepting offers which contain reservations and the contracting authority's right to hold negotiations with tenderers are both matters governed by national law. The Danish Government therefore maintains that Directive 71/305 does not govern the limits within which negotiations may take place and that the relevant national law was applied without discrimination of any kind between the different tenderers.
18. It is true that Directive 71/305 does not contain any specific rule regarding reservations; nor does it expressly codify the principle of equal treatment. That does not mean, however, that all maners related to public contracts may be governed by national law without taking into account such a fundamental principle. And quite frankly, I find it astonishing that the parties have expended so much energy in demonstrating, or denying, that the principle of equal treatment lies at the heart of Directive 71/305. On that point, it is hardly necessary to point out that, where a public contract falls to be awarded, it is precisely because the procedure is a competition that it must be ensured that all those who take part have an equal chance: otherwise, it would no longer be a public tendering procedure but private bargaining. In sum, equal treatment underlies any set of rules governing procedures for the award of public contracts since it is the very essence of such procedures.
19. As regards the joint statement of July 1989, attached to Council Directive 89/440/EEC — which in open or restricted procedures rules out all negotiation with tenderers on fundamental aspects of contracts, variations in which are likely to distort competition, and in particular on prices — it does not seem to me possible to accept the Danish Government's view that the statement in question has no legal consequences and that, in any case, since it postdates the events in issue, it is of no significance in these proceedings.
20. In the light of the foregoing I therefore propose that the Court uphold the application and order the defendant State to pay the costs.
1 Original language: Italian.
2 OJ, English Special Edition 1971 (II), p. 682.
3 See, most recently, the judgment in Case C-52/90 Commission v Denmark [1992] ECR I-2187, paragraph 23.
4 See the judgment in Case 42/82 Commission v France [1983] ECR 1013 and in Case 113/86 Commission v Italy [1988] ECR 607.
5 See page 44 of the rejoinder. In fact, the Danish Governmen expressly recognized that some provisions of the contract described as being of secondary importance, still contain Danish content specifications.
6 Of course, the observations which I have just made hold true in this case, too: it would at the very least be illogical if the Danish Government, having recognized the incompatibility of the Danish content clause with Community law and therefore requested its removal, were then to allow unlawful requirements of the same kind to be included in the final version of the contract.
7 See the judgment in Commission v Italy [1992] ECR I-2353.
8 See the judgment in Case C-362/90, cited above, at paragraph 12.
9 See the judgment in Case 121/84 Commission v Italy [1986] ECR 107, paragraph 10.
10 Sec, most recently, the judgment in Case C-29/90 Commission v Greece [1992] ECR I-1971, paragraph 12.
11 On that point, it is sufficient to note that the Court has never questioned the Commission's interest in obtaining a declaration that a Member State has failed to fulfil its obligations, even when the default in question was fully acknowledged by the Member State and where there was obviously no problem regarding compensation for damage.
12 See judgment in Case 167/73 Commission v France [1974] ECR 359, paragraph 15.
13 In its reply the Commission no longer referred exclusively to the negotiations concerning the reservation made by ESG with respect to Condition 3, Clause 3, of the general tender conditions, but also referred to negotiations allegedly conducted on the unit price of embankment sand, penalties and making up of delays, the contribution of support for the employment market, the price-adjustment formula and so on.
14 See, for instance, the judgment in Case 278/85 Commission v Denmark [1987] ECR 4069.
15 In order to show that the tender submitted by ESG, in the form described at paragraph 6.2, in no way influenced the result of the negotiations, Storebælt states in that note that it had not accepted the proposal put forward by ESG in terms of which the contracting authority would have borne le risque lié à la conception du projet et aux quantités, même si l'entrepreneur effectuait cette conception (the risks linked to the design of the project and the quantities involved, even if the tendering company undertook the design).
16 The grounds for the refusal being (a) the documents concerned were confidential, and (b) Storebælt was under no obligation, in any case, to determine the price of the reservations in question.
17 Sec page 54 of the Danish Government's rejoinder.
18 OJ 1989 L 210, p. 22.
19 Directive of 18 July 1989 amending Directive 71/305/EEC concerning coordination of procedures for the award of public works contracts (OJ 1989 L 210, p. 1).
20 Judgment in Case C-292/89 Antonissen [1991] ECR I-745.