European Commission - Press release
Public procurement: Commission acts to ensure fair access to information technology services in Italy
Brussels, 29 September 2011 - The European Commission has requested Italy to comply with EU rules on public procurement – the spending of public money by public authorities – as regards the award of information technology (IT) service contracts by the Italian Region of Molise. The Commission's request to Italy takes the form of a reasoned opinion. If Italy does not inform the Commission within two months of measures taken to ensure compliance with EU law, the Commission may refer this matter to the Court of Justice.
The specific case concerns the Italian Region of Molise, which did not comply with EU public procurement rules by directly awarding information technology (IT) services contracts to a company whose shares are held both by the Region of Molise and a private undertaking. The total value of the contracts at stake is more than €4 million.
In fact, since 2006, the Region of Molise has awarded a number of IT services contracts to a company of which the Region is the co-owner. The total value of the contracts is estimated at more than €14 million. In all these cases the contracts were awarded directly, with no tender procedure. As a result, other IT service companies were denied the opportunity to seek this business and Italian taxpayers were denied the opportunity to get value for money by awarding the contracts to companies prepared to offer better services for less money.
Under EU rules, public authorities can directly award contracts to companies they own themselves but only under very strict conditions. In previous rulings (e.g. see Case Teckal – http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=CELEX:61998J0107:EN:HTML), the Court of Justice of the European Union made it clear that authorities are only allowed to do so when the award concerns an "in-house" situation: that is when an authority exercises the same amount of control over the company as it does over its own administrative departments.
The Commission does not consider that the in-house conditions as set out by the EU Court have been met in this case. The participation, even as a minority shareholder, of a private undertaking in the capital of the company in which the Region Molise is also a participant excludes the possibility that the Region can be considered to exercise over that company a control similar to that which it exercises over its own departments.
What is the aim of the 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 IT systems to waste water purification facilities, shipbuilding or advisory services. It is estimated that total public procurement expenditure in the EU represents around 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 services.
Latest information on infringement proceedings concerning all Member States:
See also MEMO/11/646
Chantal Hughes (+32 2 296 44 50)
Catherine Bunyan (+32 2 299 65 12)
Carmel Dunne (+32 2 299 88 94)