Judgment of 16th February 2024 of the NCAC (case 01666/23.9BEPRT), Portugal
Article(s) in Directive 2014/24/EU: Arts. 56(3), 57, 59 and 63
Topic: open procedure; subcontracting; declaration of commitment; exclusion of offer
Member State: PT
Court/rev. board: North Central Administrative Court (NCAC)
1. IMPLEMENTATION / RELEVANT NATIONAL LEGISLATION
Articles 51, 72(3), 77(2), paragraph c), 146(2) and 168(4) of the Portuguese Public Contracts Code (PCC).
2. FACTS
This case is similar to the Judgment of 14th September 2023 of the Portuguese Supreme Administrative Court (SAC), case 01418/22.3BELSB, in the part regarding the lack of presentation of the commitment to unconditionally carry out the services (a case we commented on a previous occasion).
In an open procedure for a contract regarding the transport and deposit of waste, one of the bidders challenged the decision to award the contract to the successful tenderer, arguing that the offer presented by the selected bidder should have been excluded, since it did not present i) the European Single Procurement Document (ESPD) regarding the entities to be subcontracted during contract performance (articles 59 and 63 of the Directive); ii) the declaration of commitment by the abovementioned entity to perform some of the tasks of the contract [article 63(1), in fine, of the Directive]; and iii) a declaration indicating the tasks to be carried out by the subcontractor in the contract (which was requested by the tender documents). The bidder in question justified the lack of presentation of those documents with the fact that the alleged “subcontractor” was indeed a subsidiary the bidder (implying that the collaboration of that company in the performance of the contract would not be a “real” subcontract).
3. JUDGMENT
It was the Court’s understanding that when a tenderer who does not assume explicitly, in the offer, the intention to resort to subcontracting, but mentions in the offer that he will resort to a third-party entity “holding the administrative licenses necessary for the performance of the contract”, this should be considered as implicitly indicating that he will use a subcontractor. According to the Court, the qualification as a subcontracted entity depends, solely, on the scope of its intervention in the context of the services offered by the tenderer, and not, e.g., on the fact that the bidder acknowledges, or not, that he will use subcontractors.
The Court decided, therefore, that the entity that would carry out part of the tasks of the contract was indeed a subcontractor, despite the fact that such an entity was not identified in the offer as such. Consequently, the Court ruled that an offer in which the economic operator intends to resort to a third party’s capacities to perform a public contract but fails to present the ESPD and the declaration of commitment regarding this third party, must be excluded from the tender.
The judgment can therefore be analyzed regarding two different topics. The first is what kind of collaboration between two entities qualifies as “subcontracting” or not. From this perspective, the Court’s decision seems to raise little doubt.
The second topic concerns the legal consequences and regime of subcontracting, namely in what concerns the declarations that should be presented with the application or offer in the tender phase. And this, in contrast with the first topic, is generally a controversial issue in Portuguese Law, due to some doubts arising on whether the PCC is completely aligned with the Directive in terms of the documents that need to be presented with the offer and the phases in which they are presented, in these types of situations (use of other entities to perform the contract). The PCC does not explicitly provide that the ESPD should be presented also for subcontractors. As for the declaration of commitment of the subcontractor, it would seem only to apply when a restricted procedure is involved, and this, as mentioned, was an open procedure. Article 63 of Directive 2014/24/EU seems to impose different rules, namely, insofar as it provides that the absence of exclusion grounds should always be analysed when the economic operator relies on other entities, regardless of the type of procedure in question, which means the ESPD should be presented in those cases. Another topic of doubt regards the declaration of commitment, namely, the doubt as to whether this declaration is mandatory in any event of subcontracting, or only when the bidder uses the subcontractor to comply with selection criteria in the strict meaning of article 58 of the Directive. The need for this declaration is also only mentioned in the PCC in the context of restricted procedures, not open procedures.
Recalling a decision from the Supreme Administrative Court (SAC) that mentions CJEU’s case law – namely, the decision in case C-631/21 and case C-210/20 –, as well as transcribing the first instance’s judgment, the NCAC reminds that the CJEU does not consider the demand for the declaration of commitment a “complex bureaucratic demand”, or violating the proportionality and reasonableness tests when it comes to protecting the principle of competition. On a similar ground, the Court also stated that the principles of equality of treatment and transparency are also protected by the rule contained in article 63 of Directive 2014/24/EU.
Link to the original decision: https://www.dgsi.pt/jtcn.nsf/89d1c0288c2dd49c802575c8003279c7/b916cbb7ca60f69a80258adf00362caa?OpenDocument
