Public Procurement Oversight
in EU Member States:
A New Approach
in the New Directive?
Professor Martin Trybus
Director, Institute of European Law
University of Birmingham
United Kingdom
The current EU Directives 1
O The objective of the EU procurement
Directives is to open the procurement
markets of the Member States.
O Emphasis is to ensure non-discrimination on
grounds of nationality and equal treatment
in public procurement decisions.
The current EU Directives 2
O The Directives are NOT intended or designed
as an instrument against corruption!
O But: principles of transparency and
enforceability support probity.
O Publication of contract notices, award
notices, etc. in the OJ.
O Public specs, qualification, award.
O Review bodies, procedures, remedies.
The current EU Directives 3
O Article 45 Public Sector Directive 2004/18/EC:
Personal situation of the candidate or tenderer
O 1. Any candidate or tenderer who has been the
subject of a conviction by final judgment of which
the contracting authority is aware for one or more
of the reasons listed below shall be excluded from
participation in a public contract: […]
O (b) corruption, as defined in Article 3 of the Council
Act of 26 May 1997(21) and Article 3(1) of Council
Joint Action 98/742/JHA(22) respectively;
United Kingdom
O According to the PWC report on corruption in the
UK, procurement stands out as the most
vulnerable business operation.
O The Office of Government Commerce (OGC); The
Scottish Procurement Directorate (SPD); Central
Procurement Directorate Northern Ireland); The
Welsh Assembly – not oversight authorities.
O Article 45 Directive 2004/18/EC is enough; UK
considers further harmonising measures to be
non-beneficial.
O UK Anti-Corruption Forum + TI UK (private).
Slovenia
O Slovenian Independent Commission for the Prevention
of Corruption: analysis, coordination and consultancy
O National Review Commission: independent public body
in charge of the control of the legality of public
procurement procedures
O In September 2012 many new laws on public
procurement introduced, their main goal being to
reduce the risks of corruption
O Greater transparency, namely with regard to the possible
link between the tenderer and individuals involved in the
procurement procedure on the part of the contracting
authority.
Central procurement institutions
Bulgarian Public Procurement Agency
Cypriot Public Procurement Directory
Czech Office for the Protection of Competition
Estonian Public Procurement Office
Hungarian Public Procurement Council
Latvian Procurement Monitoring Bureau
Lithuanian Public Procurement Office
Maltese Department of Contracts
Polish Public Procurement Office
Romanian National Authority for Regulating and
Monitoring Public Procurement
O Slovak Office for Public Procurement
O
O
O
O
O
O
O
O
O
O
Review and remedies
O Imposition of fines on contracting authorities
who violated public procurement rules
O Disciplinary measures against individual
contracting officers
O Non judicial resolution of disputes between
contracting entities and contractors
O Initiation of proceedings for judicial review in
courts of law for violations of public procurement
law
O Prosecution of cases of corruption and other
criminal offences in public procurement
O Preparation of the rules for arbitrators and
administration of the list for arbitrators
The ‘new’ Directive (13/7/13)
O Recital (43): Public contracts should not be awarded to
economic operators that…have been found guilty of corruption
O Derogation if overriding requirements in the general interest
that make a contract award indispensable exist.
O Recital (52) Traceability and transparency of decision-making:
keeping copies of concluded high-value contracts; a
procurement report by contracting entities.
O Article 24(c)b) In particular tenders…where there is evidence
of…corruption…shall be considered as being irregular.
O Corruption being one of the grounds for exclusion of an
economic operator : Article 55(1)(b): as before
O Corruption has to be reported to the Commission in a
monitoring report every three years : Article 83(3).
The ‘new’ Directive
COM (2011) 896 final
O (6) Even if they do not
necessarily lead to corrupt
conduct, actual, potential or
perceived conflicts of interest
have a high potential to
improperly influence public
procurement decisions with the
effect of distorting competition
and jeopardising equal
treatment of tenderers.
Effective mechanisms should
therefore be set up to prevent,
identify and remedy conflicts of
interest.
13/07/2013
O (6) Contracting authorities
should make use of all
possible means at their
disposal under national
law in order to prevent
distortions in public
procurement procedures
stemming from conflicts of
interest. This could include
procedures in order to
identify, prevent and
remedy conflicts of
interests.
The ‘new’ Directive
COM (2011) 896 final
O (7) Illicit conduct by participants in a
procurement procedure, such as
attempts to unduly influence the
decision-making process or to enter
into agreements with other
candidates to manipulate the
outcome of the procedure, can result
in violations of the basic principles of
Union law and in serious distortions
of competition. Economic operators
should therefore be required to
submit a declaration on honour that
they do not engage in such illicit
activities and be excluded if this
declaration proves to be false.
13/07/2013
O ?
The ‘new’ Directive
Explanatory Memorandum p.12
O To reinforce the fight against corruption and favouritism,
contracting authorities will be obliged to transmit the text of
concluded contracts to the oversight body, which will thus
be able to scrutinize these contracts for suspicious
patterns, and give access to these documents to interested
persons to the extent that legitimate public or private
interests are not jeopardized.
O However, the creation of disproportionate administrative
burden must be avoided; the obligation to transmit the full
text of concluded contracts should therefore remain limited to
relatively high value contracts. The thresholds proposed would
strike the right balance between increasing administrative
burden and ensuring greater transparency: with a threshold of
1 000 000 EUR for supplies and services, and of 10 000 000
EUR, this obligation would apply to 10 - 20 % of all
procurement published in the Official Journal.
The ‘new’ Directive
COM (2011) 896 final
O Public oversight
O 1. Member States shall
appoint a single
independent body
responsible for the
oversight and coordination
of implementation activities
(hereinafter 'the oversight
body').
O Member States shall inform
the Commission of their
designation.
O All contracting authorities
shall be subject to such
oversight.
13/07/2013
O Enforcement
O 1. In order to effectively
ensure correct and
efficient implementation,
Member States shall
ensure that at least the
tasks set out in this Article
are performed by one or
more authorities, bodies or
structures. They shall
indicate to the Commission
all authorities, bodies or
structures competent for
these tasks.
New Directive COM(2011) 896
O Annual Report containing inter alia:
O (d) centralized data about reported cases of fraud,
corruption, conflict of interests and other serious
irregularities in the field of public procurement,
including those affecting projects cofinanced by the
budget of the Union.
O Tasks including:
O (d) establishing and applying comprehensive,
actionable 'red flag' indicator systems to prevent, detect
and adequately report instances of procurement fraud,
corruption, conflict of interest and other serious
irregularities;
New Directive 13/7/13
O To the Commission every three years monitoring
report covering, […] detection and adequate
reporting of cases of procurement fraud,
corruption, conflict of interest and other serious
irregularities.
Conclusions
O The Directives – old and new – are not intended as
anti-corruption instruments.
O TFEU does not provide legal base for EU anti-
corruption measures unless
O Exclusion as irregular tenders + excluded tenderers.
O Envisaged oversight body and annual reports to the
Commission not in trilog text.
O However, this leaves room for Member State action.
Děkuji/Ďakujem
O Martin Trybus
O Professor of European Law and Policy
O University of Birmingham
O M.Trybus@bham.ac.uk