Brussels, 28 October 2010
Public procurement: Commission requests Germany to comply with Court judgment on the award of a waste disposal contract in Bonn
The European Commission has today requested Germany to comply with a judgment of the Court of Justice of the European Union. In that judgment (Case C-17/09), the Court ruled that Germany had failed to fulfil its obligations under the EU public procurement rules by concluding a contract for the disposal of biodegradable and green waste without any competitive tendering procedure. The aim of EU public procurement rules is to ensure fair and transparent competition for public contracts in Europe, thereby creating opportunities for European companies while ensuring best value for public money. If the rules are not respected, there is a risk of a closed market and waste of public money. The Commission considers that the German authorities have not taken the necessary measures to comply with the judgment of the Court as the waste disposal contract has not yet been terminated. In the absence of compliance, the Commission may refer the case to the Court for the second time and it to impose a lump sum or penalty payment.
What is the aim of the EU rule in question?
Public procurement is about how public authorities spend public money. It covers purchases of everything from coffee to computer systems, waste water plants, ship building or consulting services. Total public procurement in the EU is estimated at about 17% of the Union’s GDP. The open and transparent tendering procedures required under EU public procurement rules mean more competition, stronger safeguards against corruption, and better service and value for money for taxpayers.
How is Germany not respecting these rules and why are citizens and business suffering as a result?
The Court judgment concerned a combined waste disposal arrangement concluded between the City of Bonn and a private waste management company: the company collects and delivers the household waste that is to be incinerated in the City's incineration plant and in return treats bio-waste for the City in its composting plants. The Court confirmed the Commission's position that, with respect to the bio-waste part, this arrangement has to be regarded as a public service contract. By awarding the contract without a competitive tendering procedure, the German authorities failed to fulfil their obligations under the Public Procurement Directives.
Under Article 260 of the Treaty on the Functioning of the European Union, Member States are obliged to take the necessary measures to comply with the judgments of the Court. In the Commission’s view, the German authorities are obliged to bring the contract between the city and the investment company to an end as soon as possible. If the German authorities do not comply within two months, the Commission may again refer the case to the Court.
Latest information on infringement proceedings concerning all Member States:
For more information on EU infringement procedures, see MEMO/10/530.