European Commission - Press release
Public procurement: Commission requests Germany to ensure fair access to waste disposal contract in Sachsen-Anhalt
Brussels, 29 September 2011 - The European Commission has requested Germany to respect EU rules on public procurement concerning a waste disposal contract in Sachsen-Anhalt. This would ensure that other waste disposal companies have an opportunity to seek this business and German taxpayers would have the opportunity to get better value for money.
The Commission's request to Germany takes the form of a reasoned opinion, the second stage of EU infringement proceedings. If Germany does not notify measures to ensure compliance with EU public procurement rules within two months, the Commission may refer this matter to the EU's Court of Justice.
In 2002, the former district of Sangerhausen– now merged with Mansfelder Land into the district of Mansfeld-Südharz - concluded a waste disposal contract with a public-private company without a tender procedure. In 2004, the same company won a contract from the Mansfelder Land, this time following an EU-wide tender procedure.
In 2007, Sangerhausen and Mansfelder merged into the Mansfeld Südharz district and now held 75% of the company carrying out the waste disposal contracts. The contracts are due to run until 2015 and 2017 respectively. However, in 2009 the district sold all of its shares in the company to another private company.
The case-law of the EU's Court of Justice makes clear that public contracts have to be (re)opened to competition if amended in a way which is materially different in character from the original contract. The Commission considers that the change of ownership of the waste disposal contractor constitutes a new contract award, given the involvement of the new owner in the operational management of the contracts. The Commission therefore considers that the contract should be opened up to a new open and competitive tendering process in line with EU public procurement rules.
What is the aim of EU public procurement rules?
Public procurement is when public authorities spend public money to construct infrastructure and to purchase all sorts of goods and services, from computer systems, waste water treatment systems and shipbuilding to consultancy. It is estimated that all the public contracts awarded in the EU represent, together, some 17% of GDP. The open and transparent evaluation procedures laid down by the EU rules on public procurement promote competition, offer better protection against corruption and enable taxpayers to benefit from more effective and better value goods and services.
If essential terms and conditions of a public contract are modified without giving other bidders the opportunity to compete for the contract, there is a serious risk of distorting competition, deterring potential new bidding companies and wasting taxpayers' money.
Latest information on infringement proceedings concerning all Member States:
For more information on infringement procedures, see MEMO/11/646