Order n. 10530 [preliminary ruling procedure], 5th December 2023, Council of State, sec. V, Italy
Article(s) in Directive 2014/24/EU: Art. 67
Topic: lowest price criterion; standardised contract; highly labour-intensive contract
Member State: IT
Court/rev. board: Council of State
1. IMPLEMENTATION / RELEVANT NATIONAL LEGISLATION
Art. 95, comma 3, letter a) and comma 4, letter b), Public Contracts Code (legislative decree 50/2016).
2. FACTS
The case concerned the procurement of occasional and urgent manpower service related to transportation for the central and peripheral needs of the Ministry of Defense. The procurement documents had foreseen the lowest price criterion since the service at stake displayed standardized features. However, since the contract was highly labor-intensive, the procurement documents had specified that the labor costs would have remained unchanged independently from the price offered, since they depended upon the collective bargaining agreement for the specific category, in this way respecting the Public Contracts Code’s aim of guaranteeing occupational levels and protecting workers (Art. 50, legislative decree 50/2016). Mara s.c.r.l. won lot n. 6. The second-ranking company, Gruppo SAMIR Global Service s.r.l., sought the annulment of the entire tender. The administrative tribunal upheld the claim and annulled the tender. The winner appealed to the Council of State.
According to Italian public procurement law, for services and supplies procurements with standardized features, the contracting authority has the possibility to foresee the lowest price criterion (Art. 95, comma 4, letter b, legislative decree n. 50/2016), except for services with high intensity of labor, for which only the most economically advantageous criterion is possible (Art. 95, comma 3, letter a)). The appellant (Mara s.c.r.l.) argued that the national rule prohibiting the lowest price criterion for highly labor-intense procurements was not to be applied for standardized contracts. Otherwise, the procurement documents would have been in breach of both Art. 67 Directive 2014/24/EU, which seeks to favor the best quality of performance, and of the principle of proportionality.
3. JUDGMENT
The question of the case is whether a public procurement tender which is highly labor-intensive and, at the same time, displays standardized features, shall be carried out solely according to the most economically advantageous criterion, or if the contracting authority has a margin of discretion in opting for the lowest price criterion.
According to the Council of State, as the labor guarantees that had been already secured in the procurement documents (since the labor costs would have remained unchanged as the wages of the workers employed are paid according to the collective agreement category), it appears that the EU law preference for the most economically advantageous offer is not compatible, in these circumstances, with the reasons that support it. It would thus be disproportionate to require the contracting authority to use the most economically advantageous offer criterion where the labor guarantees were considered already secured.
The Council of State stayed the proceedings and asked the Court of Justice of the EU (CJEU) whether freedom of establishment, freedom to provide services and the principle of proportionality preclude a national law ruling that in procurements involving services with standardized features and, at the same time, highly labor-intensive, the contracting authority is prevented from using the lowest price as award criterion, even where the procurement documents secured the costs of labor.
Link to the original decision: https://portali.giustizia-amministrativa.it/portale/pages/istituzionale/visualizza/?nodeRef=&schema=cds&nrg=202303990&nomeFile=202310530_18.html&subDir=Provvedimenti
