Reg.64 of the Public Contracts Regulations 2015 (PCR2015) transposes Article 64 of Directive 2014/24 regarding the rules applicable to the recognition of official lists of approved economic operators and certification by certification bodies for the purposes of qualitative selection. The UK (England and Wales) has decided not to create its own official list or certification system [reg.64(10) PCR2015] and, consequently, the rules only apply to the recognition in the UK of inscription in official lists or certification obtained in other Member States. In my view, the transposition is correct. Pedro has some interesting additional insights.
The following remarks are based on my Public Procurement and the EU Competition Rules, 2nd edn (Oxford, Hart, 2015)323-325, and focus on the text of the Directive. However, they are equally applicable to reg. 64 PCR2015.
Official Lists of Contractors and
Certification Systems. The
same logic and criteria applied in the analysis of the rules relating to the
qualitative selection of candidates and bidders are of relevance in the analysis of the rules regulating the establishment of
official lists of contractors, suppliers or service providers,[1] or of systems of certification by
public or private bodies complying with European certification standards within
the meaning of Annex VII of Dir 2014/24.[2]
Such registers[3]
and certification systems are aimed at reducing administrative costs and at simplifying
the documentation requirements involved in tender procedures,[4] allowing undertakings (or groups of undertakings)
to register or get certified for a given period of time, and thereby comply
with the formalities regarding professional, economic, financial, quality and
environmental standing in all tenders developed during that period of time simply
by producing proof of registration or certification (art 64(3) dir 2014/24).[5] They also provide
partial or limited proof of suitability to contracting authorities of other
Member States by the registered or certified contractors of the Member State
holding the official list (art 64(4), 64(5) and 64(6)), and particularly ‘certified
registration on official lists by the competent bodies or a certificate issued
by the certification body shall constitute a presumption of suitability with
regard to requirements for qualitative selection encompassed by the official
list or certificate’, thereby partially carrying on this reduction of the
administrative burden to the participation in cross-border tender procedures.
These
systems can create significant competition problems, particularly depending on
the domestic rules applicable by Member States as concerns the authorisation
for private certification entities to operate in the market, or the tariffs and
prices applicable to certification services, which can raise significant
barriers of access to the procurement market. However, these are issues not
covered by Dir 2014/24 and, consequently, are dealt with under the applicable
competition rules.[6]
In
order to guarantee the functionality of these registration and certification systems,
Dir 2014/24 establishes certain additional rules—such as a prohibition of
revision of information which can be deduced from the ensuing certificates by
contracting authorities without justification (art 64(5)), the obligation to run
the systems in a non-discriminatory manner (art 64(6)), the non-mandatory
character of such systems for operators of other Member States, or the
recognition of equivalent certificates and alternative means of proof (art 64(7)
dir 2014/24). It also creates some additional
mechanisms for the exchange of information between Member States in order to
further reduce the administrative burden (art 64(8) dir 2014/24).
From
a substantive point of view, it is worth noting that the requirements available
to Member States in the design of such registration and certification systems
are guided by the general rules and criteria regarding qualitative selection of
candidates (art 64(2) dir 2014/24). This is a logical requirement, since these systems
should be conceived as instances of (indirect) qualitative selection of bidders
with potential effects over a large number of tenders. Indeed, as directed by article
64(2) of Dir 2014/24, Member States shall adapt the conditions for registration
on these lists and for the issue of certificates by certification bodies to the
relevant provisions regulating qualitative selection criteria, including the
specific rules applicable to groups of undertakings.
Therefore, in general terms, the same pro-competitive requirements
already discussed apply here. Notwithstanding this
general idea, registers of approved contractors and certification systems
present an additional feature that seems to merit detailed analysis: the
establishment of the categories or types of contracts, as well as the quantitative
thresholds for which registration or certification is available. In this regard,
it should be noted that nothing in Dir 2014/24 expressly regulates the
categories and thresholds applicable to certification and registration
procedures. Establishing excessively narrow or excessively broad categories for
registration or certification might generate distortions of competition between
registered and non-registered (or certified and non-certified) tenderers, as
well as competition amongst tenderers included in each of these groups.
In
this regard, it is submitted that an objective, transparent and
competition-neutral way to organise the registration and certification systems
is to adopt the classifications and descriptions contained in the Common Procurement
Vocabulary (CPV)[7]—which, in my opinion, are binding on
Member States for these purposes (art 4 in fine Commission Regulation
213/2008). In this regard, certification and registration for each activity and
for each product should be available separately, without affecting the
possibility of obtaining joint registration or certification for multiple activities
and/or products by a single undertaking or group of undertakings.
Also, the
economic thresholds set for certification or registration—that is, the value of
the contracts for which certification or registration is obtainable should not
be set at excessively high levels—thereby limiting the competitive ability of undertakings
in the high range of each of the categories. On the contrary, if possible, the
system should allow for ‘continuous’ certification or registration—ie, for a
continuous sliding scale of values, perhaps grouped at small intervals—so that each
undertaking can get certified or registered to tender for contracts with a value
up to whichever amount is proportionate to its particular economic and financial
standing, without the need to meet specific minimum thresholds.[8]
In
any case, it should be emphasised that the establishment of these registration
and certification systems should not prevent unregistered or uncertified operators
from proving that they meet the applicable professional, technical, economic,
financial, quality and environmental requirements by means other than the
relevant certificates—so that lack of registration or certification shall not per
se determine the exclusion of interested undertakings from a given tender
procedure.[9] Put otherwise, registration or
certification cannot be used as a mandatory selection requirement by contracting
authorities. This is specifically regulated with relation to economic operators
from other Member States, who cannot be obliged to undergo such registration or
certification in order to participate in a public contract (art 64(7) dir 2014/24).
As regards domestic economic operators, it is submitted that the anti-formalist logic applicable to the system of qualitative selection, as well as the mandates of the principle of competition and the principle of equality and non-discrimination, prevent contracting authorities from excluding domestic contractors due to the sole fact that they are not registered or certified for a given category of contracts.[10] In this regard, official lists of contractors and certification systems should be seen as an instrument aimed at easing and fostering participation in tender procedures, but cannot constitute barriers or impediments to access such procedures. Therefore, contracting authorities should be obliged to adopt a possibilistic approach and accept proof of compliance with the relevant professional, technical, economic, financial, quality and environmental requirements by means other than certification or registration (analogically, as regards the obligation to accept proof by means other than certification of compliance with quality and environmental standards, see arts 60 and 62 dir 2014/24).
[1] The practice of developing and keeping
bidders’ mailing lists has long been used in some Member States. For a review
of the use of the same technique in the US, see RE Lieblich, ‘Bidder
Pre-Qualification: Theory in Search of Practice’ (1972) 5 Public Contract
Law Journal 32; P Shnitzer, Government Contract Bidding, 3rd edn
(Washington, Longman–Federal Publications, 1987) 4–9; and KM Jackson,
‘Prequalification and Qualification: Discouragement of New Competitors’ (1989–1990)
19 Public Contract Law Journal 702.
[2] See: S Arrowsmith, The Law of Public and Utilities
Procurement. Regulation in the EU and the UK, Vol. 1, 3rd edn
(London, Sweet & Maxwell, 2014) 1311–20; PA Trepte, Public Procurement in the EU: A
Practitioner’s Guide, 2nd edn (Oxford, Oxford University Press, 2007) 358–63; and C Bovis, EC Public Procurement: Case Law and
Regulation (Oxford, Oxford University Press, 2006) 136–37,
170–71 and 231–32.
[3] For related discussion, see W Kostka, ‘Vendors'
list for procurement following expressions of interest - a critical analysis of
a new procurement mechanism for the EU institutions’ (2014) 23 Public Procurement Law Review 219–28.
[4] See: S Arrowsmith, ‘Framework Purchasing
and Qualification Lists under the European Procurement
Directives’ (part 1) (1999) 8 Public Procurement Law Review 115,
116.
[5] However, given the functional and
anti-formalistic interpretation of the ECJ regarding the possibility to rely on
the capacity of other entities, particularly in Case C-94/12 Swm Costruzioni 2 and Mannocchi Luigino
[2013] pub. electr. EU:C:2013:646 35 and 36, the actual effectiveness of
these systems and their continued existence can be queried. Indeed, it can be
argued that certification systems should only cover ‘works with special requirements necessitating a certain capacity which
cannot be obtained by combining the capacities of more than one operator’
as, otherwise, the whole certification system is completely superficial if the
contracting authority must (as indeed it shall) accept any ‘jigsaw’ of
(partial) certifications presented by a group of undertakings (or by an incapable main contractor that enters into subcontract agreements) in order to
prove that they have sufficient (aggregate) economic, technical and financial
standing.
[6] For a recent case where the CJEU rubber
stamped the Italian minimum tariffs for certification in public procurement,
subject to proportionality, see Case C-327/12 Soa Nazionale Costruttori [2013] pub. electr. EU:C:2013:827.
[7] Commission Regulation (EC) No 213/2008
of 28 November 2007 amending Regulation (EC) No 2195/2002
of the European Parliament and of the Council on the common procurement
vocabulary (CPV) and Directives 2004/17/EC and 2004/18/EC of the European
Parliament and of the Council on public procurement procedures, as regards the
revision of the CPV (Regulation 213/2008) [2008] OJ L74/1.
[8] The only minimum threshold that could be
relevant would be the setting of the threshold that triggers the application of
the EU public procurement directives. However, if Member States opt for the
development of a certification or registration system, they might as well also
adopt it for procurement activities not covered by the directives (ie,
procurement below thresholds) and, consequently, then, there would be no clear
justification for the setting of minimum economic thresholds—other than,
arguably, considerations related to the administrative costs of running the
certification or registration system which, in this case, should be
proportionate to the minimum thresholds set.
[9] Generally, on certain types of mandatory
qualification lists and the undesirability of their restrictive
effects—although based on the previous utilities directive—see S Arrowsmith,
‘Framework Purchasing and Qualification Lists under the European Procurement
Directives’ (part 2) (1999) 8 Public Procurement Law Review 161, 171–80
and 185–86.
[10] Although based in the previous EU directives,
see Arrowsmith, Framework Purchasing and Qualification Lists (part 2) (1999)
175–76, who found support for this argument in Case C-87/94 Commission v
Belgium [1996] ECR I-2043 51–56, where the ECJ determined that ‘the
principle of equality underlying the directive applies as much to domestic as
to foreign firms’.