Friday, 21 November 2014

Short procurement reflection

I am teaching an undergraduate module on EU Public Procurement Law as an option for the LLB students at Leicester. One of the activites I have designed consists in asking students to submit short (500-word) 'reflection papers' assessing streamlined cases. The objective of this activity is to make sure that they have a strong hold of the mechanics of the system and the basic elements that contracting authorities need to take into account when making procurement decisions.
 
The first exercise asked them to “Highlight the advantages and the legal risks of resorting to a competitive procedure with negotiation instead of an open procedure for the supply of medical supplies such as vaccines.” They submitted some interesting reflections and, on that basis and with my own views, I have prepared the following model answer to give them feedback. I thought it could be of interest, despite its simplicity, so I am posting it here for your consideration. Comments welcome!
 
Medical supplies are highly commoditised goods[1] and relatively easy to subject to strict technical specifications (art 42(3)(b) dir2014/24), particularly when EU standards exist and may limit the ability of the contracting authority to reject standardised and CE-marked products (Medipac-Kazantzidis, C-6/05, EU:C:2007:337). This is particularly clear in the case of vaccines, given the very stringent processes that regulate their commercialisation.[2] Their supply can consequently be procured through open procedures (art 27 dir2014/24) and, possibly, even focus on cost-efficiency only (art 67(2) dir2014/24).
However, such a procurement strategy is likely to trigger a significant number of offers, which can result in significant evaluation and administrative costs for the contracting authority (CA). Hence, resorting to other procedures (or framework agreements) could be in the CA’s interest if it can limit the costs linked to the administration of the procedure without sacrificing technical or commercial advantages derived from significant competition.
A competitive procedure with negotiation (art 29 dir2014/24) would be available in this case if the CA can justify that it meets one of the grounds for its use (art 26(4) dir2014/24), and probably if it can justify the need for negotiations prior to award (art 26(4)(iii)). However, resorting to this procedure can be risky if avoidance of other options (mainly, a restricted procedure, art 28 dir2014/24) is seen as a circumvention of the applicable rules. The use of negotiated procedures has been limited in the case law (Commission v Italy, 199/85, EU:C:1987:115) and the changes introduced by Directive 2014/24 create uncertainty regarding CA’s actual freedom to negotiate.[3] However, this risk can be minimised by shortlisting in a transparent manner (art 65 dir2014/24).
The second main risk derives from the negotiation capacity of the CA. If the CA is inexperienced in negotiations, it can incur in both commercial risks derived from its inability to obtain the best possible economic conditions, and legal risks derived from an improper or discriminatory development of the negotiations (art 29(5) dir2014/24). It could also create risks if it does not have solid management procedures for confidential information and business secrets (idem).
Hence, in order to reap the benefits derived from the lower cost of the competitive procedure with negotiations, the CA needs to have strong legal and commercial expertise. If it does, this is a procedure from which it can benefit. Otherwise, the CA will be better off with the open procedure.

[1] EY, Pulse of the industry: Differentiating differently, Medical technology report 2014, 5. http://www.ey.com/Publication/vwLUAssets/ey-pulse-of-the-industry-report/$FILE/ey-pulse-of-the-industry-report.pdf (Accessed: 21.11.2014).
[2] For background information, see http://www.vaccineseurope.eu/about-vaccines/eu-regulatory-framework-for-vaccines/ (Accessed: 21.11.2014).
[3] For discussion, see P Telles and L Butler, ‘Public Procurement Award Procedures in Directive 2014/24/EU’, in F Lichère, R Caranta and S Treumer (eds), Novelties in the 2014 Directive on Public Procurement, vol. 6 European Procurement Law Series, (Copenhagen, DJØF Publishing, 2014). http://ssrn.com/abstract=2443438 (Accessed: 21.11.2014).

Thursday, 20 November 2014

"Monitor and the Competition and Markets Authority": My new paper on health care, procurement and competition in the UK

I have just uploaded my new piece "Monitor and the Competition and Markets Authority" as the University of Leicester School of Law Research Paper No. 14-32. The paper looks at the institutional design for the enforcement of competition and public procurement rules in the health care sector in the UK and criticises the concurrency regime developed in 2013. It is linked to my previous paper on the substantive aspects of the NHS Competition, Choice and Procurement Regulations 2013 (about to be published in the Public Procurement Law Review and available here).

I will be presenting this new paper at the EUI (Florence), at a workshop on Antitrust Law in Healthcare organised by Prof Giorgio Monti. Comments welcome!
Abstract 
As part of its enforcement duties under the National Health Service (Procurement, Patient Choice and Competition) (No. 2) Regulations 2013, and in exercise of the powers assigned to it by the Health and Social Care Act 2012, the health care sector regulator for England (Monitor) is co-competent with the competition watchdog (Competition and Markets Authority) to enforce competition law in health care markets. Oddly, though, unlike other sector regulators, Monitor does not have a duty to promote competition but ‘simply’ to prevent anti-competitive behaviour. Monitor is also competent to carry out reviews and to decide bid disputes concerning procurement carried out by health care bodies, provided there is no formal challenge under the Public Contracts Regulations 2006.
This paper contends that such a concentration of regulatory, competition enforcement and procurement review powers puts Monitor in a unique situation of (potential) structural conflict of interest that can diminish significantly its ability to act as an effective (co-competent) competition authority. This paper focusses on this difficult structure for the enforcement of competition law in the health care sector in England, in particular due to the asymmetrical, sui generis concurrency regime created by the Enterprise and Regulatory Reform Act 2013 and the Concurrency Regulations 2014. As examples of such conflict of interest and its implications, the paper assesses Monitor’s incentives to bend the interpretation of both art.101(3) TFEU and the new special regime on procurement of social services (arts.72-77 dir 2014/24). The paper concludes that this situation requires regulatory reform to devolve powers to the Competition and Markets Authority.
A Sánchez Graells, 'Monitor and the Competition and Markets Authority' (November 20, 2014). University of Leicester School of Law Research Paper No. 14-32. Available at SSRN: http://ssrn.com/abstract=2528569.

Thursday, 6 November 2014

CJEU confirms strict approach against acceptance of incomplete submissions in public procurement (C-42/13)

In its Judgment in Cartiera dell’Adda and Cartiera di Cologno, C-42/13, EU:C:2014:2345, the Court of Justice of the European Union (CJEU) has confirmed its strict approach against the acceptance of incomplete submissions in public procurement procedures, at least where the tender documentation imposes the (automatic, non-discretionary) rejection of non-compliant or non-fully compliant submissions. This Judgment is fully in line with its previous Judgment in Manova, C-336/12, EU:C:2013:647 and, consequently, Cartiera dell'Adda does not advance EU procurement law in a significant manner. However, given its brevity and the harshness of the solution adopted by the CJEU (at least if analysed in functional or practical terms), I think that the case deserves some further consideration.
 
In short, the CJEU has confirmed that the exclusion of a tenderer that omitted a declaration is acceptable under EU law, even if the declaration was not necessary or, in any case, the facts concerned by the declaration would not trigger exclusion. In an extreme reading, the case confirms the legality under EU procurement law of an absolute obligation to reject submissions that are 'merely' affected by strictly formal shortcomings [for discussion, see A Sanchez Graells, 'Rejection of Abnormally Low and Non-Compliant Tenders in EU Public Procurement: A Comparative View on Selected Jurisdictions', in M Comba & S Treumer (eds), Award of Contracts in EU Procurement, vol. 5 European Procurement Law Series (Copenhagen, DJØF, 2013) 289]. As mentioned, this is an area of very significant practical relevance and there is a need to properly understand the conditions under which such a stringent case law is being developed.
 
In that regard, it is important to highlight that, as the CJEU emphasises, the grounds for exclusion of tenderers expressly disclosed by the contracting authority in the tender documentation included situations where 
one of the documents and/or one of the sworn statements the purpose of which is to demonstrate that both the general and special requirements have been complied with is incomplete or irregular, except where any irregularity is of a purely formal nature and may be remedied but is not decisive for the assessment of the tender (C-42/13, para 10).
 
After juggling with the other (rather complicated) circumstances of the case, the CJEU clarifies the relevant legal dispute as a question of the
compatibility with European Union law of the fact that it is impossible for ... a tenderer, after submitting his bid, to remedy the fact that he failed to annex ... a statement to his bid [confirming that its technical director was not affected by mandatory exclusion grounds related to criinal records], whether by submitting such a statement to the contracting authority directly or by showing that the person concerned was identified as the technical director in error (C-42/13, para 40).
 
At this point, the CJEU reiterates its position in Manova, and stresses that "the contracting authority must comply strictly with the criteria which it has itself established, so that it is required to exclude from the contract an economic operator who has failed to provide a document or information which he was required to produce under the terms laid down in the contract documentation, on pain of exclusion" (para 42, emphasis added). The CJEU further reiterates that this strict requirement derives from the principles of equal treatment and transparency (paras 43-49).
 
It is also important to stress that the CJEU clearly indicates that "in so far as the contracting authority takes the view that that omission is not a purely formal irregularity, it cannot allow the tenderer subsequently to remedy the omission in any way after the expiry of the deadline for submitting bids" (para 45), which seems to create significant space for the flexibilisation of ommissions that can be remedied, particularly before the expiry of the deadline for submission of tenderers--but equally of omissions that can be reduced to purely formal irregularities.
 
More generally, in my view, the Manova - Cartiera dell'Adda line of case law offers some interesting opportunities for Member States and contracting authorities to avoid such impractical situations, provided they restrict themselves to the general rules under the new art 56(3)  of Directive 2014/24. This provision indeed stresses that
Where information or documentation to be submitted by economic operators is or appears to be incomplete or erroneous or where specific documents are missing, contracting authorities may, unless otherwise provided by the national law implementing this Directive [or excluded by themselves in the specific tender documents, as per Manova and Cartiera dell'Adda], request the economic operators concerned to submit, supplement, clarify or complete the relevant information or documentation within an appropriate time limit, provided that such requests are made in full compliance with the principles of equal treatment and transparency.
Consequently, any criticism against the Manova - Cartiera dell'Adda line of case law seems rather unjustified in view of the fact that the origin of any potential obligation to automatically and non-discretionally exclude non-compliant or incomplete submissions does not have an origin on the EU rules or their general principles (now in art 18(1) of dir 2014/24), but on excessively stringent domestic rules or, even worse, in the specific conditions imposed by the contracting authority in its own tender documentation. In the absence of those restrictions, EU law as interpreted in Manova - Cartiera dell'Adda does not constrain the proper exercise of administrative discretion in this area. Hence, contracting authorities (and Member States) will be clever not to put a noose around their own necks. In the end, the only thing the CJEU has done in Manova - Cartiera dell'Adda is to pull their legs...

Monday, 13 October 2014

My approach to public procurement and competition: A rebuttal to Prof Arrowsmith (2012) and Prof Kunzlik (2013)

I am at the latest stages of updating my monograph Public Procurement and the EU Competition Rules (Oxford, Hart), which 2nd edn will be published by Hart again in 2015. Preparing the revision of the book, and seeing that the 1st edn raised some criticism by very notable procurement scholars, I thought that it would be good to write an introduction that provides some context. The following is from this introduction and basically amounts to a rebuttal of the arguments developed by Professor Sue Arrowsmith and Professor Peter Kunzlik to my 1st edn, both of them published in the Cambridge Yearbook of European legal studies. Hopefully, this rebuttal will contribute to a transparent academic debate about public procurement--and it will persuade readers to look for the new edition as soon as it is available Needless to say, further comments from Arrowsmith or Kunzlik would be enriching.
 
* * *
 
From an academic perspective, it has been remarkable to see how the first edition of this book has sparked a rather intense, estimulating and fruitful debate between Professor Sue Arrowsmith, Professor Peter Kunzlik and myself about the ultimate goal of the EU public procurement rules. More specifically, we seem to hold very different views about the meaning of ‘competition’ and the ensuing economic efficiency, as well as their place in the EU procurement Directives. I think that the readers of this second edition will benefit from a short summary of this academic debate, since it fundamentally underpins the work in this book.
 
(1) Professor Sue Arrowsmith’s contention that the pro-competitive framework on which this book is based constitutes a stretched and distorted reading of the competition elements included in the EU public procurement Directives and their interpreting case law.

Professor Sue Arrowsmith criticises my competition-oriented approach in a section of her article ‘The Purpose of the EU Procurement Directives: Ends, Means and the Implications for National Regulatory Space for Commercial and Horizontal Procurement Policies’ [(2011-2012) 14 Cambridge Yearbook of European legal studies 1–47].
 
She argues for her own interpretation of the goal of the EU rules and tries to limit their scope in search for some ‘regulatory space’ for Member States. This is part of a larger endeavour of hers, likely to carry on in the written proceedings of her coming conference on “Rethinking ‘economic’ derogations and justifications under the EU’s free movement rules” within the Current Legal Problems 2014-15 series.  
 
In her 2012 paper, Professor Arrowsmith considered that my book espouses ‘a broad notion of competition as a tool for replicating the private sector market’ in the public procurement setting. She considers that such point of departure should be rejected, as it is a misunderstanding of the concept of competition embedded in the pre-2014 public procurement Directives, which she considers limited to ‘removing discrimination and barriers to entry into the competitive market, and implementation of the competitive procedures for transparency reasons’. She adopted a rather positivistic approach and stressed that ‘[i]t seems significant that while non-discrimination, transparency and equal treatment were written into the directives as general principles, [its] ‘competition’ provisions are confined to specific areas’. She eventually concluded that ‘a broad interpretation of the directives as being concerned with replicating market competition is incorrect. While apparently supported by some statements in the jurisprudence these are based on misunderstanding and such a broad interpretation, it is submitted, represents unwarranted judicial reorientation of the directives’ rules’ (all quotes from pages 25–34). My reaction to the line of criticism voiced by Professor Arrowsmith is as follows.

Firstly, I am not sure that my approach can be conceptualised as an attempt to make the directives ‘replicate market competition’. I would submit that it is rather an attempt to properly integrate them within an environment of market competition. Or, put differently, this is an attempt to avoid public procurement rules from distorting or restricting the competition that already takes place in the market, or from preventing the competition that would emerge but for the constraints imposed by the procurement rules. 

Secondly, as to the point that this approach is flawed and based on misunderstandings, taking exclusively into account the pre-2014 materials, I would suggest that Professor Arrowsmith’s views do not lie on the strongest economic foundations. Professor Arrowsmith basically comes to the view that EU public procurement rules are concerned with preventing barriers to trade within the internal market (by means of transparency and non-discrimination), but that this has nothing to do with economic efficiency derived from undistorted competition because the ultimate objective of the rules (beyond internal market integration per se) belongs to the domestic regulatory space of the Member States. However, economic efficiency must, by necessity, derive from the completion of the internal market if that results in stronger competitive pressures for economic operators.
 
Furthermore, as the Court of Justice of the EU has very recently stressed in an interpretation of the 2004 public procurement Directives, the ultimate objective of the internal market rules and the EU public procurement Directives is to allow all the economic operators involved to achieve economic efficiency derived from competition strategies unaffected by restrictive procurement decisions—in particular, even if that is attained by deriving a competitive advantage from the differences between the respective rates of pay applicable in different Member States (Judgment in Bundesdruckerei, C-549/13, EU:C:2014:2235, 34). It seems very clear that EU public procurement rules, just as everywhere else, are concerned with economic efficiency. Hence, limited doubt can seriously be cast on the fundamental proposition that the development of the internal market, including public procurement rules, and its supporting system of competition rules aim at generating economic efficiency by relying on (economic) market mechanisms.

Thirdly, and from a more legalistic perspective, the development of the EU public procurement rules in the revised 2014 Directives also disprove the point that the general principle of competition does not exist and that competition considerations are limited or confined to specific areas. As discussed at length in Chapter 5 of this second edition, article 18(1) of Directive 2014/24 now clearly consolidates the principle of competition amongst the general principles of the system. It is true that the wording of this provision could have been clearer and that there are significant interpretative questions that need being addressed, but it should be acknowledged that by clearly stating that ‘The design of the procurement shall not be made with the intention … of artificially narrowing competition [and that]competition shall be considered to be artificially narrowed where the design of the procurement is made with the intention of unduly favouring or disadvantaging certain economic operators’, Directive 2014/24 stresses the relevance of competition considerations across the board and provides an interpretative tool that is likely to further develop the pro-competitive orientation of the system of EU public procurement rules in the coming years. In my view, this is a truly welcome development, and not only because it clearly supports the ideas and approach developed in the first edition of this book and now further refined in this second edition. As has always been my conviction, a competition-oriented public procurement system is necessary for the public sector to properly carry out their missions with the minimum distortion of private sector activities and, ultimately, with the minimum loss of social welfare. 

In the 2005 second edition of her magnificent treatise The Law of Public and Utilities Procurement, 2nd edn (London, Sweet and Maxwell, 2005) 432, Professor Arrowsmith had indicated that ‘competition might be developed as a general principle with the same status as transparency and equal treatment. The very broad conception of competition endorsed by the Advocate General [Stix-Hackl in case C-247/02 Sintesi] was criticised … it was suggested that the directives are merely concerned with removing restrictions on participation in competitions held in public markets. However, a general principle of competition could properly be developed to support this latter objective of removing restrictions on participation’. Consequently, even if back in 2005 she already stressed the same points she later emphasised in the 2012 paper regarding transparency and non-discrimination, she seemed to be open to a development such as the ‘creation’ of a principle of competition like the one now included in article 18(1) of Directive 2014/24.
 
However, when she now reads that article in 2014, she considers that it ‘appears to be simply a manifestation of the more general equal treatment principle, as designing any aspect of the procurement for this reason [ie, ‘unduly favouring or disadvantaging certain economic operators’] rather than based on the needs and preferences in the project would clearly infringe that principle’ (The Law of Public and Utilities Procurement. Regulation in the EU and the UK, Vol. 1, 3rd edn (London, Sweet & Maxwell, 2014) 631). Professor Arrowsmith has overlooked the first part of the clause of article 18(1) of Directive 2014/24, where contrary to what she concluded regarding the 2004 rules, it is at least clear that competition is ‘elevated’ to the same altar of the general principles of the EU public procurement system as equality, non-discrimination, transparency and proportionality.

Overall, there is very little left to support Professor Arrowsmith’s view that the pro-competitive approach advocated for in this book is based on misunderstanding. On the contrary, I would claim that the arguments presented in the first edition paved the way for a stronger recognition of the existence of the principle of competition embedded in the EU public procurement Directives, which has now culminated in its explicit consolidation in article 18(1) of Directive 2014/24. That being said, this second edition will provide the reader with arguments why this is a development that still requires further fine-tuning and optimisation. And this is an endeavour to which I plan to continue dedicating my academic efforts.
 
(2) Professor Peter Kunzlik’s argument that this book ‘as well as being a scholarly analysis within the neoliberal normative frame, is a manifesto for the neoliberalisation of public procurement regulation in the EU’ and is ‘the most systematic statement’ of the argument that ‘the dominating aim of the EU procurement directives is to advance competition in the sense of a competition doctrine intended only to achieve efficiency’.

The further debate with Professor Peter Kunzlik was equally refreshing. Indeed, he thought that Arrowsmith had fallen short from exhausting the criticism of the first edition of this book and further expanded it in his article ‘Neoliberalism and the European Public Procurement Regime’ [(2012-2013) 15 Cambridge yearbook of European legal studies 283, 312–56]. Interestingly, Kunzlik took a completely different approach and focussed his criticism on the ideology that he imputes to the book (and myself, by extension). I must say that I am not completely dissatisfied by the label of ‘neoliberal manifesto’ and that, as Kunzlik recognises, this is something I disclose rather openly in the book when I warn the reader that 'this is a ‘free-market type’ study of competition in the public procurement environment'. However, when it comes to the details of his criticism, I think that Kunzlik fails to provide a convincing argument for the following reasons.

Kunzlik starts off with a very lengthy discussion of Neoliberalism to set the tone for his criticism, and then goes on to acknowledge Arrowsmith’s position. Taking issue with both her and my positions, Kunzlik indicates that he aims to ‘offer a third approach to the relevance of competition and value for money in EU public procurement regulation’. He considers that ‘the concept of ‘competition’ to which the public procurement directives relate is not the ‘efficiency’ concept suggested by [Sanchez] Graells, but rather a ‘structure of competition’ concept that is concerned to protect the structure of the market and equality of competitive opportunity of traders in the interests of customers, competitors and ultimate consumers. It is a concept that in the public procurement context simply requires that the law must ensure equality of opportunity for potential tenderers and a structure of competition for public contracts that allows sufficient opportunities for EU-wide competition, thereby ensuring the integrity of the internal market—the very same objectives that are asserted by Arrowsmith’ (quotes from pages 327 and 335). Kunzlik was trying to square a circle between Arrowsmith’s and my position. However, beyond the dismissive way in which he uses the terms efficiency and neoliberalism, there are no such differences in the implications of his and my arguments. Indeed, I do not see any third view in his proposal.

I find it even harder to understand how his argument deviates from the ones presented in this book when he stresses that ‘the public procurement directives do have a competition objective. However, … the objective in question is not to achieve ‘efficiency’ in the sense contended by [Sanchez] Graells, but to ensure a structure of competition for public contracts to be opened up to EU-wide competition on the basis of equality of competitive opportunity’ (340). Tertium non datur. I struggle to understand how equality of competitive opportunity on an EU-wide level does not amount to (facilitating) economic efficiency. Consequently, I hope the reader will agree with me in that there is no ‘third view’ and that, once it is accepted (as he does) that the public procurement directives do have a competition objective, the argument is over—regardless of the ideological content one tries to give to it.

Overall, then, I think that the academic debate (as I understand it) strongly supports the approach taken in this book, where these and other criticisms are addressed in further detail. There is nothing left for me to say. It is now for you, dear reader, to decide.

Thursday, 9 October 2014

CJEU keeps Lianakis interpretation relevant under Directive 2014/24 (C-641/13)


In its Judgment in Spain v Commission (financial support for cuenca hidrográfica del Júcar), C-641/13, EU:C:2014:2264 (not available in English), the Court of Justice of the EU has reiterated in very clear terms the currency of its Lianakis case law [C-532/06, EU:C:2008:40]. Indeed, in Spain v Commission (paras 33-41), the CJEU has clearly stressed that Lianakis (paras 30-32) and Commission v Greece [C-199/07, EU:C:2009:693, paras 55-56] prevent the past experience of the tenderer being used as an award criterion. Given the brevity and clarity of the reasoning of the CJEU, few doubts can remain as to the rather absolute character of the prohibition.
 
This should come as no suprise, as this was the majoritarian interpretation of the Lianakis Judgment [for a possibilistic interpretation seeking flexibility, though, see S Treumer, ‘The Distinction between Selection and Award Criteria in EC Public Procurement Law—A Rule without Exception’ (2009) 18 Public Procurement Law Review 103, and A Sanchez Graells, Public procurement and the EU competition rules (Oxford, Hart Publishing, 2011) 310-12]. Moreover, this was precisely one of the points in which the 2011 proposals for new EU public procurement Directives aimed to deviate (or fine-tune) the case law of the CJEU [for discussion, see M Orthmann, 'The experience of the Bidder as Award Criterion in EU Public Procurement Law' (2014) 1 Humboldt Forum Recht 1 ff].
 
With this in mind, it is worth stressing that Directive 2014/24 now (well, as soon as the Member States transpose it, which they must do by 18 April 2016) deviates from the standard reading of the Lianakis case law. Directive 2014/24 decouples the treatment of the general experience of the tenderer as a qualitative selection criterion [art 58(4), where Lianakis applies full-force] from the assessment of more limited and specific aspects of experience evaluation clearly linked to the subject-matter of the contract, which allow for the specific experience of staff assigned to performing the contract to be taken into consideration at award stage, 'where the quality of the staff assigned can have a significant impact on the level of performance of the contract' [art 67(2)(b), which restricts, specifies of modifies Lianakis].
 
The justification given by Directive 2014/24 for this change is that
Wherever the quality of the staff employed is relevant to the level of performance of the contract, contracting authorities should also be allowed to use as an award criterion the organisation, qualification and experience of the staff assigned to performing the contract in question, as this can affect the quality of contract performance and, as a result, the economic value of the tender. This might be the case, for example, in contracts for intellectual services such as consultancy or architectural services. Contracting authorities which make use of this possibility should ensure, by appropriate contractual means, that the staff assigned to contract performance effectively fulfil the specified quality standards and that such staff can only be replaced with the consent of the contracting authority which verifies that the replacement staff affords an equivalent level of quality [rec (94), emphasis added].
In my view, all of this indicates that the use of staff (specific) experience at award stage will need to be assessed under strict proportionality terms (particularly as the 'significance' of its impact on the level of performance of the contract is concerned), given that exceptions[art 67(2)(b)] to the general rules [art 58(4)] of Directive 2014/24 and the applicable interpretative case law need to be constructed strictly. Moreover, recourse to this sort of award criterion will still need to comply with general requirements and, in my view, avoid distortions of competition such as first comer advantages for incumbent contractors.

Wednesday, 8 October 2014

Competition lawyers, please, please, please be aware of public procurement rules: A comment on Bornico & Walden (2011)

I have just read L Bornico & I Walden, 'Ensuring Competition in the Clouds: The Role of Competition Law?' (2011) 12(2) ERA Forum 265-85 (part of the largest QMUL Cloud Legal Project) and have been, once more, surprised at the complete oversight of the public procurement rules that would have been relevant to the competition law analysis.

The paper engages in an exploratory analysis of the role of EU competition law could have in keeping the cloud computing industry competitive and, if possible at all, free from (potential) abuses of dominance by its main players. The paper has the good intuition to suggest that public procurement decisions by governments may play a key role in either the promotion of undistorted competition (if they opt for transparent standards based on interoperability) or, on the contrary, the creation of a very concentrated and potentially monopolistic market structure (if they unduly impose specific technological solutions). This is a very important point, and one that public procurement economists and commentators have been stressing for a long time.

However, when the paper moves on to suggest how to legally prevent and control those issues, it is completely oblivious to the existence of EU public procurement rules. Indeed, Bornico & Walden indicate that, where the contracting authority imposes a given (propietary) technological solution
... harmed competitors may challenge the choice of the public administration alleging that their specifications fit best the requirements ... or may challenge the behaviour of the firm whose specifications were chosen, but only if the firm can be considered dominant. More importantly competitors may challenge the choice of the public administration under Article 107 TFEU if the outcome of public procurement distorts competition.  The choice of formal specifications may soon be a source of disputes in the EU market, along the lines of the Google dispute in the US [by reference to  Google Inc. and Onix Networking Corporation v. The United States and Softchoice Corporation (United States Court of Federal Claims 2011)]; although it is too early to tell how technological choices made by public administrations will be dealt with by competition authorities in the EU. (p. 27, emphasis added).
There are three important points to stress here. Firstly, this is nothing new, but State aid litigation based on public procurement decisions is very limited, generally unsuccessful, and likely to be 'phagocytised' by 'pure' procurement litigation [for an extended discussion, see A Sanchez Graells, 'Enforcement of State Aid Rules for Services of General Economic Interest before Public Procurement Review Bodies and Courts' (2014) 10(1) Competition Law Review 3-34]. 

Secondly, aggrieved competitors would have a much better shot under the applicable rules on the design of technical specifications. Indeed, it has long been the position of the ECJ, now consolidated in the applicable Directives 2004/18 (and/or 2014/24, where transposed), that '[u]nless justified by the subject-matter of the contract, technical specifications shall not refer to a specific make or source, or a particular process, or to trade marks, patents, types or a specific origin or production with the effect of favouring or eliminating certain undertakings or certain products. Such reference shall be permitted on an exceptional basis, where a sufficiently precise and intelligible description of the subject-matter of the contract ... is not possible; such reference shall be accompanied by the words "or equivalent".' (emphasis added) [art 23(8) dir 2004/18, and now art 42(4) dir 2014/24; for discussion, see S Arrowsmith, The Law of Public and Utilities Procurement. Regulation in the EU and UK, 3rd edn, vol. 1 (London, Sweet & Maxwell, 2014) 254-55 and 1068 ; and A Sanchez Graells, Public procurement and the EU competition rules (Oxford, Hart Publishing, 2011) 271-72]. Consequently, specific technological choices that excluded equivalent solutions would immediately be in breach of EU public procurement rules.

Thirdly, a breach of those rules gives aggrieved bidders and other interested economic operators a ground to challenge the procurement procedure before domestic courts or procurement complaints boards, under the provisions of Directives 89/665 and 92/13 (as amended by dir 2007/66). This is a much clearer litigation path and one that would yield much better results to disappointed bidders and competing (technological) firms.

Consequently, in this specific area, competition law is not the best tool to achieve pro-competitive results in the public procurement setting. Public procurement law is. So, competition lawyers, please familiarise yourselves with public procurement rules. In the end, they are two sides of the same coin [C Munro, ‘Competition Law and Public Procurement: Two Sides of the Same Coin?’ (2006) 15 Public Procurement Law Review 352; and A Sanchez Graells, 'Competition Law Against Public Restraints in the Public Procurement Field: Importing Competition Considerations into the EU Public Procurement Directives' (2010)].

Monday, 6 October 2014

A 'private tax-payer test' for State aid? ... or how the Commission is not getting it (about the Apple APA case)

Thanks to @Detig's twitter encouragement, I have finally set out to read the recently released 11 June 2014 Decision of the European Commission SA.38373 in the case of alleged Irish aid to Apple due to the treatment of its advanced pricing arrangements (APAs). Generally, this is a case that pushes the boundaries of State aid law as tax sovereignty is concerned and may force some interesting developments. However, in the particulars, its seems that some of the foundations of the Commission's position are rather shaky.
 
In my view, one of the points where the Commission's logic is particularly flimsy comes when it tries to justify the application of the private operator/investor test in this context, in what should be rebranded as 'private tax-payer' test, by stressing that 'to avoid this type of advantage [ie the allocation of profit to subsidiaries in low tax jurisdictions] it is necessary to ensure that taxable income is determined in line with the taxable income a private operator would declare in a similar situation' (para 9, emphasis added). This just does not make sense and incorrectly focusses on the incentives of the economic operator (tax payer) instead of those of the tax authority (which, in the end, is the one that may have accepted APAs that granted an undue economic advantage to the former).
 
 As the Commission had itself very clearly indicated (para 8 of the same document), the financial incentives that (multinational) private operators have are exactly in line with Apple's behaviour. Hence, the Commission should have stuck to the simple truth that, from an economic perspective, the only rational behaviour that can be expected from economic (corporate) operators is to try to minimise fiscal pressure and to incentivise their tax directors to do so [Armstrong, Blouin & Larcker, 'The incentives for tax planning' (2012) 53(1) Journal of Accounting and Economics 391-411].
 
This may not be the socially desirable behaviour, and precisely that is why tax law is there [as, indeed, 'if we were ideally virtuous, there would be no need to study what people should pay in taxes to finance subsidies to the poor, the employment of a police force, and provision of an urban infrastructure, or to find ways of reducing the environmental damage we do'; J Mirrlees, Welfare, Incentives, and Taxation (Oxford, OUP, 2006) iv]. 
 
If the Commission is of the view that the activity of the (Irish) tax authorities was not in line with rational behaviour, it should not try to find a justification in the behaviour that could be expected from the tax payer, but rather on the rationality of the decision of the tax authorities on the basis of the existing knowledge on optimal taxation--an issue discussed by Mirrlees (131-73) and many others, without having necessarily reached a final conclusion so far [see an interesting discussion of the main insights achieved so far in NG Mankiw, M Weinzierl and D Yagan, 'Optimal Taxation in Theory and Practice', (2009) 23(4) Journal of Economic Perspectives 147-74].
 
Trying to conflate this insight and to word the criterion for the assessment of Apple's APAs as a 'private tax-payer' test does not make sense and risks damaging the consistency and logic behind the principle of private operator/investor test as a general principle for the assessment of State aid [for discussion, see A Sanchez Graells, 'Bringing the ‘Market Economy Agent’ Principle to Full Power' (2012) 33 European Competition Law Review 35-39].
 
In my view, this is plain to see in the oddity of the detailed reasoning in which the Commission engages, when it establishes that
When accepting a calculation method of the taxable basis proposed by the taxpayer, the tax authorities should compare that method to the prudent behaviour of a hypothetical market operator, which would require a market conform remuneration of a subsidiary or a branch, which reflect normal conditions of competition. For example, a market operator would not accept that its revenues are based on a method which achieves the lowest possible outcome if the facts and circumstances of the case could justify the use of other, more appropriate methods (SA.38373, para 56, emphasis added).
Quite honestly, it is very difficult to understand what the Commission exactly means by this--and this is the more worrying because '[i]t is in the light of these general observations that the Commission will examine whether the contested rulings comply with the arm’s length principle' (para 57). If what the Commission indicates is that for the purposes of taxation, a rational/prudent economic operator would not accept a method that results in the lowest possible tax base, this just does not make sense. Differently, if what the Commission means is that for purposes other than taxation (which would those be?) the rational/prudent economic operator would equally oppose that method, then much more detailed explanation of why and how that is the case would be needed.
 
Worse of all, the Commission has a strong cases on the facts. The Irish tax authorities entered into negotiations with Apple and allowed the company to deviate very significantly from the applicable (general) tax rules. Moreover, despite the very significant development of international standards on transfer pricing, a 1991 ruling was used until 2007 with no revision. This sweet deal for Apple was clearly linked to an objective of keeping (regional) employment and ensruring some tax income. These may be rational (?/justifiable?) political decisions, but they do not meet any acceptable standard of objectivity, professionalism and transparency and, consequently run against the basic requirements of good (tax) administration. And, what is more important, clearly point towards a selectivity in the application of the tax system that makes the whole deal fall foul of the prohibition in Art 107(1) TFEU [the important legal point is, indeed, made at para 70 of the Decision].
 
 
In view of all this, one cannot but wonder why would the Commission base its case on such unfocussed and difficult to share (to put it mildly) points of departure. One possible option, of course, is the rebalancing of powers in tax matters derived from the Treaty of Lisbon and the very limited space for action in the front of direct taxation that is not supported unanimously by the 28 Member States (see art 115 TFEU) [for discussion, see TA Kaye, 'Direct taxation in the European Union: from Maastricht to Lisbon' (2012) 35(5) Fordham International Law Journal].
 
Another possible option is that the Commission is trying to deflect the bad publicity from the Member State concerned (Ireland) towards the multinational (Apple), hoping to find less resistance (or to trigger support) at Member State level. There can be a myriad other reasons, of course. But none of them seems to justify risking a case (and a principle of enforcement of State aid law) in an attempt to get the prohibition decision through.

Friday, 3 October 2014

A refresher on the rules applicable to charges having the equivalent effect of a custom duty (C-254/13)

In its Judgment in Orgacom, C-254/13, EU:C:2014:2251, the Court of Justice of the EU has revisited the 'classical issue' of financial barriers to free movement of goods and their treatment under either article 30 or 110 TFEU, depending on whether they are classed as (a) charges having an equivalent effect to custom duties (art 30 TFEU) [see LW Gormley, EU Law of Free Movement of Goods and Customs Union (Oxford, OUP, 2009), chapter 11] or (b) measures of internal taxation (art 110 TFEU) [for discussion, see J Snell, ‘Non-Discriminatory Tax Obstacles in Community Law’ (2007) The International and Comparative Law Quarterly 56(2): 339-370 and S Douma, ‘Non-discriminatory tax obstacles’ (2012) EC Tax Review 21(2): 67-83]. 

In Orgacom, the dispute concerned a Belgian tax on the production and importation of livestock manure into the Flanders region. Given the structure of the applicable levies, the Belgian Constitutional Court found that they affected fertiliser imported into the Flanders region more heavily than fertiliser produced in that region. Orgacom challenged those levies on the basis of articles 30 and 110 on the basis that the restriction to inter-regional movement of the goods are contrary to EU law.

First of all, the CJEU reiterated the impossibility to proceed to the joint application of articles 30 and 110 TFEU and clearly classed the measure as a charge having an equivalent effect to customs duties (paras 18-26). In doing so, the CJEU reiterated its classic definition of charge of equivalent effect, whereby
any pecuniary charge, however small and whatever its designation and mode of application, which is imposed unilaterally on goods by reason of the fact that they cross a frontier, and which is not a customs duty in the strict sense, constitutes a charge having equivalent effect within the meaning of Articles 28 TFEU and 30 TFEU (see, to that effect, judgment in Stadtgemeinde Frohnleiten and Gemeindebetriebe Frohnleiten, EU:C:2007:657, paragraph 27) (C-254/13 para 23).

It also indicated that
customs duties and charges having equivalent effect thereto are prohibited regardless of the purpose for which they were introduced and the destination of the revenue from them (see, to that effect, judgments in Brachfeld and Chougol Diamond, 2/69 and 3/69, EU:C:1969:30, paragraph 19, and Carbonati Apuani, EU:C:2004:506, paragraph 31) (C-254/13 para 35).

Hence, the CJEU has stuck very clearly to its traditional approach to the assessment of charges having an equivalent effect to customs duties and has shown no willingness to explore any possibility of declaring them compatible with the internal market, even if the reasons argued by the Belgian government concerned the protection of the environment (para 34)--which is an area where the CJEU is showing increased deference towards Member States regulatory intervention (see comment here).

Secondly, it is interesting to stress that the case affects trade between regions of the same Member State rather than 'proper' cross-border trade., which creates the difficulty of assessing the link with the crossing of a frontier of the controversial measure. However, as the CJEU had already clarified in Legros, C-163/90, EU:C:1992:326 (paras 16 to 18), the provisions on free movement prohibiting charges of an equivalent effect (art 30 TFEU) also apply when the restriction affects movement of goods between regions of the same Member State. This has now been reiterated in clear terms
it is settled case-law that a charge imposed when goods cross a territorial boundary within a Member State constitutes a charge having effect equivalent to a customs duty (see judgment in Carbonati Apuani, C-72/03, EU:C:2004:506, paragraph 25 and the case-law cited) (C-254/13 para 24). 
It is also interesting to highlight the arguments that the CJEU rejected when the classification of the measures as charges of equivalent effect was challenged
27 The classification of the levy provided for by that provision of the Fertiliser Decree as a charge having equivalent effect to a customs duty cannot be called into question by the argument advanced by the Kingdom of Belgium that that levy, because there is a similar levy imposed on fertilisers produced in the Flanders Region, forms an integral part of a general system of internal taxation applied systematically, in accordance with the same criteria, to national products and imported and exported products and should, in consequence, be assessed in the light of Article 110 TFEU.
28 In that regard, it must be noted, firstly, that the essential feature of a charge having equivalent effect to a customs duty which distinguishes it from an internal tax is that the former is borne solely by a product which crosses a frontier, as such, whilst the latter is borne by imported, exported and domestic products (see, to that effect, judgment in Michaïlidis, C‑441/98 and C‑442/98, EU:C:2000:479, paragraph 22).
29 Secondly, it must be borne in mind that, in order to relate to a general system of internal taxation, the tax charge in question must impose the same duty on both domestic products and identical exported products at the same marketing stage and the chargeable event triggering the duty must also be identical in the case of both products (see, to that effect, judgment in Michaïlidis, EU:C:2000:479, paragraph 23) (C-254/13 paras 27-29, emphasis added).
Overall, then, Orgacom is a short and clear reminder of the rules applicable to charges having an equivalent effect to customs duties--and an indication that even in the area of the protection of the environment, the CJEU is not willing to create additional regulatory space for the Member States than that already existing, or at least not without limits.

Thursday, 2 October 2014

Three recent cases on EU Institutions' procurement and one common theme: good administration and confidential information (T-498/11, T-91/12 & T-199/12)

Within the last week, the General Court has ruled on three disputes concerning public procurement activities of the European Commission to which the Financial Regulation was applicable. All cases involved the rejection of tenderers/tenders (at different stages of the procurement procedures) and challenges against the immediate rapport established between the Commission and the disappointed tenderers, which involved some sort of (discretionary) management of confidential information by the contracting authority. Remarkably, all cases have been decided in favour of the European Commission.

Reading them together, a common theme emerges from the Judgments in Evropaïki Dynamiki v Commission (OLAF), T-498/11, 
EU:T:2014:831Flying Holding and Others v Commission, T-91/12, EU:T:2014:832; and Euro-Link Consultants and European Profiles v Commission, T-199/12, EU:T:2014:848. Functionally, all these Judgments are concerned with the duty of good administration, some of its more specific requirements (such as the duty to provide reasons, or the duty to protect confidential information), and its boundaries--which is a topic of increasing relevance in EU public law and, particularly, in EU public procurement law [see J Mendes, ‘Good Administration in EU Law and the European Code of Good Administrative Behaviour’, EUI Working Paper Law 2009/09, and some related comments here].
 
In my view, these three Judgments clearly indicate that despite the increasing complexity and detail of the public procurement rules, most decisions end up being assessed on the basis of the reasonableness, objectivity and proportionality of the decisions taken by contracting authorities as implicit requirements of the principle of good administration. The following is a closer discussion on why I think this is so.
 
(1) Evropaïki Dynamiki v Commission (OLAF) is concerned with the rejection of an offer submitted for the services contract concerning the revamping of the website of the European Anti-Fraud Office (OLAF). More specifically, Evropaïki Dynamiki challenges the withholding of information regarding the technical aspects of the winning offer, which the Commission justified on the basis that it 'might affect the successful tenderer’s legitimate business interests ..., or might distort fair competition between the undertakings concerned' (which follows what is established in art 100(2) Financial Regulation, as discussed here, here and here). In the applicant's view, this amounts to a violation of the duty to state reasons and, ultimately, of the principle of good administration.
 
The GC engages in a detailed assessment of the duty to state reasons and the balance with the protection of the confidential information and business interest of other tenderers (and, particularly, the awardee of the contract) (paras 28-50). In my view, the argument is ultimately concerned with compliance with these two conflicting requirements of the more general duty of good administration. It is worth highlighting that the GC clarifies that
in order to fulfil its obligation to state reasons, the [contracting authority] was required to communicate to the applicant the reasons for the rejection of its tender, the characteristics and relative merits of the successful tender, and the name of the successful tenderer (order of 29 November 2011 in Case C-235/11 P Evropaïki Dynamiki v Commission, not published in the ECR, paragraph 46). By contrast, it does not follow from those provisions or from the judgment of 10 September 2008 in Case T-59/05 Evropaïki Dynamiki v Commission, not published in the ECR [...] that the [contracting authority] was required to provide the applicant with a complete copy of the evaluation report (see, to that effect, order of 20 September 2011 in Case C-561/10 P Evropaïki Dynamiki v Commission, not published in the ECR, paragraph 25) (T-498/11 at para 43).
It is also important to stress that the GC finds no shortcoming based on the principle of good administration in the use of relatively generic justifications for the withholding of information:
It is thus apparent that the [contracting authority] fulfilled its obligation to state reasons [...] regardless of the fact that the wording of those letters was stereotypical in nature as regards the reasons for the removal of some information (see, to that effect, judgment of 24 April 2012 in Case T‑554/08 Evropaïki Dynamiki v Commission, not published in the ECR, paragraph 141). Such wording is permissible in light of the fact that it may be impossible to state the reasons precisely justifying the confidentiality of each of the pieces of information concerned without disclosing them and therefore negating the effectiveness of the second subparagraph of Article 100(2) of the Financial Regulation (T-498/11 at para 45, emphasis added).
In my view, this Judgment is important in that it should reinforce the message that the principle of good administration requires a careful balance of the duty to state reasons against the duty to protect propietary and confidential business information, which should allow contracting authorities to give more importance to the second element and be less afraid of litigation on the basis of alleged shortcomings in the duty to state reasons. Generally, it may contribute to a better balance between transparency and competition in the public procurement setting, which should be welcome [for discussion, see A Sánchez Graells, Albert, 'The Difficult Balance between Transparency and Competition in Public Procurement: Some Recent Trends in the Case Law of the European Courts and a Look at the New Directives' (2013) University of Leicester School of Law Research Paper No. 13-11].
 
(2) Flying Holding and Others v Commission (not available in English) concerned the hire of aerotaxis for the President and other members of the EU Institutions and was organised as a two-stage restricted procedure. In this case, Flying Holding and its subsidiaries were not invited to the second phase of the tender due to the incompleteness of the documentation supporting their expression of interest and, in particular, certain security audits.

The dispute revolves around the (lack of) clarity of the documentary requirements included in the call for expressions of interest, as well as the Commission's unwillingness to accept the belated submission of those documents by Flying Holding due to a previous false declaration that they did not exist. The arguments of the challenger fundamentally rely on alleged breaches of the principles of proportionality, right to defence, and good administration. Interestingly, the GC has upheld the initiative taken by the Commission to directly contact the relevant aviation authorities to enquire about the safety of the operations of Flying Holding and its subsidiaries in the absence of documentation in the expression of interest. Furthermore, the GC has considered that even if the way in which such contact was carried out may have amounted to a violation of the right of defence, that would not have altered the outcome of the procedure due to the automatic application of the exclusion grounds based on falsity of (self)declarations in the public procurement setting (under art 94 Financial Regulation).
 
The reasoning of the GC is riddled with very technical points (see paras 41-50) but, in my opinion, the ultimate functional reading is that contracting authorities that proactively seek to clarify the (in)existence of a ground for exclusion/qualitative selection of tenderers are adequately discharging their duties under the principle of good administration, even if they contact third parties or authorities [for discussion of the new rules under Directive 2014/24, see A Sánchez Graells, 'Exclusion, Qualitative Selection and Short-listing in the New Public Sector Procurement Directive 2014/24', in F Lichere, R Caranta and S Treumer (ed) Novelties in the 2014 Directive on Public Procurement, vol. 6 European Procurement Law Series, (Copenhagen, Djøf Publishing, 2014)]. The requirements of the right of defence in that case are limited to communicating the result of such enquiries to the candidate or tenderer concerned, as well as providing it with an opportunity to comment.
 
It is also interesting to stress the reasoning the GC undertakes in relation to false or inexact (self)declarations and their relationship with the right to defend against the imposition of administrative sanctions (paras 51-79), which in my view are bound to trigger significant litigation in non-institutional (or general) procurement once Directive 2014/24 gets transposed (and, particularly, its rules on the European Single Procurement Document of art 59). The GC sees no breach of the principle of proportionality in the application of very strict standards in the interpretation and enforcement of exclusion grounds (paras 81-91). On that point, some more space may be created in the treatment of non-fully compliant tenderers, in the same way as for abnormally low and non-fully compliant bids [for discussion, see A Sánchez Graells, (2013), 'Rejection of Abnormally Low and Non-Compliant Tenders in EU Public Procurement: A Comparative View on Selected Jurisdictions' in M Comba & S Treumer (eds), Award of Contracts in EU Procurements, vol. 5 European Procurement Law Series, Copenhagen, DJØF, 2013, 267-302].
 
(3) Euro-Link Consultants and European Profiles v Commission concerned the provision of services related to the 'Crimean tourism diversification and support project', for which the challenging consortium's offer was not selected. Legally, this case is peculiar because the application of the Financial Regulation derives from the Practical Guide to Contract Procedures for EU external actions, in its 2010 version, updated in March 2011 (‘the PRAG’). Generally, the case is interesting because it focusses on the irregular situation where the disappointed tenderer seemed to have gained access to confidential information while the tender procedure was still under way, which triggered the involvement of the European Anti-Fraud Office (OLAF) [however, I could not find public information on that strand of the case].
 
As procurement is concerned, in the case at hand, Euro-link had access to a version of the CV of the team leader proposed by a competing tenderer and used it to challenge the technical assessment of her experience. Avoiding issues of confidentiality of that document, the GC considered that, even if the two versions of the CV (the one submitted by the competing consortium and the one used by Euro-link in its challenge) were different, this was not relevant. In its words,
As regards the alleged infringement of the principle of equal treatment, it must be noted that, according to settled case-law, that principle requires that comparable situations not be treated differently and different situations not be treated alike unless such treatment is objectively justified (see judgment of 10 October 2013 in Manova, C‑336/12, ECR, EU:C:2013:647, paragraph 30 and the case-law cited). In the present case, it must be noted that the different treatment of the version of Ms T.’s CV submitted to the Evaluation Committee by the consortium led by GDSI and that submitted by the applicants is justified by the different situations in which those two documents were submitted. The first, submitted in the context of the evaluation procedure, was intended to be examined by the contracting authority, whereas the second, submitted after the contract had been awarded, did not constitute, subject to the examinations carried out by the Commission, evidence capable of calling into question the probative value of the first (T-199/12 para 78).
This reasoning based on the principle of equal treatment seems odd and it is submitted that an alternative assessment based on the principle of good administration may have led to the same conclusion. Where the Commission has carried out a proper evaluation procedure and is satisfied that all requirements are met by a given tenderer, there is no breach of its duty of good administration if it does not reassess that position on the basis of (confidential) documentation submitted by a tenderer that does not provide substantial new facts.
 
As a tentative working conclusion, I think that this group of cases highlight the increasing trend of litigation of procurement decisions based on general principles of EU administrative and public law. Moreover, it makes it clear that contracting authorities will not be blamed for balancing the duty to state the reasons for their decisions with competing needs, even if they: 1) ensure a high level of protection of confidential information, particularly where third party (business) interests are at stake; 2) take proactive steps in the verification of the information provided by candidates (hence, lifting partially the confidentiality of the procedure or seeking access to third party confirmation, provided defence rights are upheld); or 3) disregard competing claims based on confidential information if they have carried out their own verification procedures (at evaluation stage).
 
Generally, I think that this group of cases should show that contracting authorities that exercise discretion in the management of confidential information are much less open to (viable) legal challenge than could have been though. And this should reduce the existing pressure towards excessive transparency in the public procurement setting, which can ultimately result in a healthier competitive environment. Consequently, this line of legal development must be welcome.