Commission of the European Communities v Italian Republic. [1985] EUECJ C-274/83 (28 March 1985)

[ Home ] [ Databases ] [ World Law ] [ Multidatabase Search ] [ Help ] [ Feedback ] [ DONATE ] Court of Justice of the European Communities (including Court of First Instance Decisions) You are here: BAILII >> Databases >> Court of Justice of the European Communities (including Court of First Instance Decisions) >> Commission of the European Communities v Italian Republic. [1985] EUECJ C-274/83 (28 March 1985) URL: https://www.bailii.org/eu/cases/EUECJ/1985/C27483.html Cite as: [1985] EUECJ C-274/83 [ New search ] [ Help ] IMPORTANT LEGAL NOTICE - The source of this judgment is the web site of the Court of Justice of the European Communities . The information in this database has been provided free of charge and is subject to a Court of Justice of the European Communities disclaimer and a copyright notice . This electronic version is not authentic and is subject to amendment. 61983J0274 Judgment of the Court of 28 March 1985. Commission of the European Communities v Italian Republic. Directive - Coordination of procedures for the award of public works contracts. Case 274/83. European Court reports 1985 Page 01077 1 . ACTION FOR FAILURE OF A STATE TO FULFIL OBLIGATIONS - PROCEDURE PRIOR TO THE APPLICATION TO THE COURT - FORMAL INVITATION TO SUBMIT OBSERVATIONS - DEFINITION OF THE SUBJECT-MATTER OF THE DISPUTE - REASONED OPINION - DETAILED LIST OF COMPLAINTS - PERMISSIBILITY ( EEC TREATY , ART . 169 ) 2. APPROXIMATION OF LAWS - PROCEDURES FOR THE AWARD OF PUBLIC WORKS CONTRACTS - AWARD OF CONTRACTS - CRITERIA - THE MOST ECONOMICALLY ADVANTAGEOUS TENDER ( COUNCIL DIRECTIVE 71/305/EEC , ART . 29 ( 1 )) 3. MEMBER STATES - IMPLEMENTATION OF DIRECTIVES - OBLIGATION TO PROVIDE INFORMATION - FAILURE TO PROVIDE INFORMATION - FAILURE TO FULFIL OBLIGATIONS ( EEC TREATY , ARTS 5 AND 155 ) 1 . IT FOLLOWS FROM THE PURPOSE ASSIGNED BY ARTICLE 169 OF THE EEC TREATY TO THE PRELIMINARY STAGE OF THE PROCEDURE UNDER ARTICLE 169 , OF WHICH THE INITIAL LETTER IS PART , THAT THE LETTER IS INTENDED TO DEFINE THE SUBJECT-MATTER OF THE DISPUTE AND TO INDICATE TO THE MEMBER STATE WHICH IS INVITED TO SUBMIT ITS OBSERVATIONS THE FACTORS ENABLING IT TO PREPARE ITS DEFENCE . THE OPPORTUNITY FOR THE MEMBER STATE CONCERNED TO SUBMIT ITS OBSERVATIONS CONSTITUTES AN ESSENTIAL GUARANTEE REQUIRED BY THE TREATY AND , EVEN IF THE MEMBER STATE DOES NOT CONSIDER IT NECESSARY TO AVAIL ITSELF THEREOF , OBSERVANCE OF THAT GUARANTEE IS AN ESSENTIAL FORMAL REQUIREMENT OF THE PROCEDURE UNDER ARTICLE 169 . ALTHOUGH IT FOLLOWS THAT THE REASONED OPINION PROVIDED FOR IN ARTICLE 169 MUST CONTAIN A COHERENT AND DETAILED STATEMENT OF THE REASONS WHICH LED THE COMMISSION TO CONCLUDE THAT THE STATE IN QUESTION HAS FAILED TO FULFIL ONE OF ITS OBLIGATIONS UNDER THE TREATY , THE COURT CANNOT IMPOSE SUCH STRICT REQUIREMENTS AS REGARDS THE INITIAL LETTER , WHICH OF NECESSITY WILL CONTAIN ONLY AN INITIAL BRIEF SUMMARY OF THE COMPLAINTS AND THERE IS NOTHING THEREFORE TO PREVENT THE COMMISSION FROM SETTING OUT IN DETAIL IN THE REASONED OPINION THE COMPLAINTS WHICH IT HAS ALREADY MADE MORE GENERALLY IN ITS INITIAL LETTER . 2. FOR THE PURPOSES OF ARTICLE 29 ( 1 ) OF DIRECTIVE 71/305 CONCERNING THE COORDINATION OF PROCEDURES FOR THE AWARD OF PUBLIC WORKS CONTRACTS THE AWARD OF A CONTRACT ON THE BASIS OF THE CRITERION OF THE MOST ECONOMICALLY ADVANTAGEOUS TENDER PRESUPPOSES THAT THE AUTHORITY MAKING THE DECISION IS ABLE TO EXERCISE ITS DISCRETION IN TAKING A DECISION ON THE BASIS OF QUALITATIVE AND QUANTITATIVE CRITERIA THAT VARY ACCORDING TO THE CONTRACT IN QUESTION AND IS NOT RESTRICTED SOLELY TO THE QUANTITATIVE CRITERION OF THE AVERAGE PRICE STATED IN THE TENDERS . 3. THE MEMBER STATES ARE OBLIGED , BY VIRTUE OF ARTICLE 5 OF THE EEC TREATY , TO FACILITATE THE ACHIEVEMENT OF THE COMMISSION ' S TASKS WHICH , UNDER ARTICLE 155 OF THE EEC TREATY , CONSIST IN PARTICULAR OF ENSURING THAT THE PROVISIONS OF THE TREATY AND THE MEASURES ADOPTED BY THE INSTITUTIONS PURSUANT THERETO ARE APPLIED . WHERE , FOR THAT PURPOSE , A DIRECTIVE IMPOSES UPON THE MEMBER STATES AN OBLIGATION TO PROVIDE INFORMATION IN ORDER TO ENABLE THE COMMISSION TO CHECK WHETHER THE DIRECTIVE HAS BEEN IMPLEMENTED EFFECTIVELY AND COMPLETELY , THE FAILURE BY A MEMBER STATE TO PROVIDE THE INFORMATION CONSTITUTES A FAILURE TO FULFIL ITS OBLIGATIONS , EVEN IF THE COMMISSION WAS , IN FACT , ABLE TO OBTAIN INFORMATION REGARDING THE IMPLEMENTING PROVISIONS ADOPTED BY THAT STATE . IN CASE 274/83 COMMISSION OF THE EUROPEAN COMMUNITIES , REPRESENTED BY ALBERTO PROZZILLO , ACTING AS AGENT , WITH AN ADDRESS FOR SERVICE IN LUXEMBOURG AT THE OFFICE OF MANFRED BESCHEL , A MEMBER OF ITS LEGAL SERVICE , JEAN MONNET BUILDING , KIRCHBERG , APPLICANT , V ITALIAN REPUBLIC , REPRESENTED BY ARNALDO SQUILLANTE , HEAD OF THE DEPARTMENT FOR CONTENTIOUS DIPLOMATIC AFFAIRS , ACTING AS AGENT , ASSISTED BY IVO BRAGUGLIA , AVVOCATO DELLO STATO , WITH AN ADDRESS FOR SERVICE IN LUXEMBOURG AT THE ITALIAN EMBASSY , DEFENDANT , APPLICATION FOR A DECLARATION THAT , BY ADOPTING CERTAIN PROVISIONS CONCERNING THE AWARD OF PUBLIC WORKS CONTRACTS AND BY FAILING TO NOTIFY THE COMMISSION OF THE MAIN PROVISIONS OF NATIONAL LAW WHICH IT ADOPTED IN THE FIELD COVERED BY COUNCIL DIRECTIVE 71/305/EEC OF 26 JULY 1971 CONCERNING THE COORDINATION OF PROCEDURES FOR THE AWARD OF PUBLIC WORKS CONTRACTS ( OFFICIAL JOURNAL , ENGLISH SPECIAL EDITION 1971 ( II ), P . 682 ), THE ITALIAN REPUBLIC HAS FAILED TO FULFIL ITS OBLIGATIONS UNDER THE EEC TREATY , 1 BY APPLICATION LODGED AT THE COURT REGISTRY ON 16 DECEMBER 1983 , THE COMMISSION OF THE EUROPEAN COMMUNITIES BROUGHT AN ACTION PURSUANT TO ARTICLE 169 OF THE EEC TREATY FOR A DECLARATION THAT , BY ADOPTING CERTAIN PROVISIONS CONCERNING THE AWARD OF PUBLIC WORKS CONTRACTS AND BY FAILING TO NOTIFY THE COMMISSION OF THE MAIN PROVISIONS OF NATIONAL LAW WHICH IT ADOPTED IN THE FIELD COVERED BY COUNCIL DIRECTIVE 71/305/EEC OF 26 JULY 1971 CONCERNING THE COORDINATION OF PROCEDURES FOR THE AWARD OF PUBLIC WORKS CONTRACTS ( OFFICIAL JOURNAL , ENGLISH SPECIAL EDITION 1971 ( II ), P . 682 ), THE ITALIAN REPUBLIC HAS FAILED TO FULFIL ITS OBLIGATIONS UNDER THE EEC TREATY . 2 ON 26 JULY 1971 , THE COUNCIL OF THE EUROPEAN COMMUNITIES ADOPTED TWO DIRECTIVES FOR ATTAINING FREEDOM OF ESTABLISHMENT AND FREEDOM TO PROVIDE SERVICES IN RELATION TO PUBLIC WORKS CONTRACTS . THE FIRST , DIRECTIVE 71/304/EEC ( OFFICIAL JOURNAL , ENGLISH SPECIAL EDITION 1971 ( II ), P . 678 ) IMPLEMENTS , WITH REGARD TO PUBLIC WORKS CONTRACTS , THE PRINCIPLE OF THE PROHIBITION OF DISCRIMINATION BASED ON NATIONALITY IN THE MATTER OF FREEDOM TO PROVIDE SERVICES . THE SECOND , DIRECTIVE 71/305/EEC ( OFFICIAL JOURNAL , ENGLISH SPECIAL EDITION 1971 ( II ), P . 682 ), PROVIDES FOR THE COORDINATION OF NATIONAL PROCEDURES FOR THE AWARD OF PUBLIC WORKS CONTRACTS AND LAYS DOWN IN PARTICULAR : COMMON ADVERTISING RULES ( ARTICLE 12 ET SEQ .); COMMON RULES ON PARTICIPATION ( TITLE IV ) COMPRISING THE INTRODUCTION OF OBJECTIVE CRITERIA BOTH FOR QUALITATIVE SELECTION OF UNDERTAKINGS ( ARTICLE 23 ET SEQ .) AND FOR THE AWARD OF CONTRACTS ( ARTICLE 29 ). 3 IN ITS JUDGMENT OF 22 SEPTEMBER 1976 ( CASE 10/76 COMMISSION V ITALY ( 1976 ) ECR 1359 ) THE COURT HELD THAT BY FAILING TO ADOPT , WITHIN THE PRESCRIBED PERIOD , THE MEASURES NECESSARY TO COMPLY WITH COUNCIL DIRECTIVE 71/305 , THE ITALIAN REPUBLIC HAD FAILED TO FULFIL AN OBLIGATION UNDER THE TREATY . ON 8 AUGUST 1977 THE ITALIAN REPUBLIC ADOPTED , IN RESPONSE TO THAT JUDGMENT , LAW NO 584 ( GAZZETTA UFFICIALE ( OFFICIAL GAZETTE ) NO 232 OF 26 AUGUST 1977 , P . 6272 ), WHICH IN THE COMMISSION ' S OPINION DULY IMPLEMENTED THE DIRECTIVE . 4 ON 10 DECEMBER 1981 , THE ITALIAN LEGISLATURE ADOPTED LAW NO 741 CONCERNING ' SUPPLEMENTARY RULES TO SPEED UP PROCEDURES FOR THE PERFORMANCE OF PUBLIC WORKS ' ( GAZZETTA UFFICIALE NO 344 OF 16 DECEMBER 1981 , P . 8271 ). SINCE THE COMMISSION CONSIDERED THAT SEVERAL OF THE PROVISIONS OF THAT LAW , ESPECIALLY ARTICLES 9 , 10 , 11 , 13 AND 15 , INFRINGED IN PARTICULAR THE PROVISIONS OF DIRECTIVE 71/305 CONCERNING THE PUBLICATION OF CONTRACT NOTICES IN THE OFFICIAL JOURNAL OF THE EUROPEAN COMMUNITIES , PROOF OF THE FINANCIAL , ECONOMIC AND TECHNICAL CAPACITY OF THE CONTRACTOR AND THE CRITERIA FOR THE AWARD OF CONTRACTS AND THAT , MOREOVER , BY FAILING TO NOTIFY IT OF THE TEXT OF THAT LAW , ITALY HAD FAILED TO FULFIL ITS OBLIGATIONS UNDER ARTICLE 33 OF THE DIRECTIVE , IT REQUESTED THE ITALIAN GOVERNMENT , BY A LETTER DATED 17 DECEMBER 1982 , PURSUANT TO ARTICLE 169 OF THE EEC TREATY , TO SUBMIT ITS OBSERVATIONS WITH REGARD TO THE EIGHT ALLEGATIONS THEREIN CONTAINED WITHIN TWO MONTHS OF RECEIPT OF THE LETTER . 5 BY A LETTER DATED 24 FEBRUARY 1983 FROM ITS PERMANENT REPRESENTATION , THE ITALIAN GOVERNMENT ADMITTED THAT THE COMPLAINTS WITH REGARD TO THE THIRD , FOURTH AND FIFTH PARAGRAPHS OF ARTICLE 10 AND ARTICLE 13 OF LAW NO 741 WERE JUSTIFIED BUT CONTESTED THE ALLEGATIONS WITH REGARD TO ARTICLE 9 , THE FIRST PARAGRAPH OF ARTICLE 10 AND ARTICLE 11 AND THE FIRST SENTENCE OF THE SECOND PARAGRAPH OF ARTICLE 15 OF THE LAW . THE ITALIAN GOVERNMENT SENT TO THE COMMISSION , IN AN ANNEX TO THAT LETTER , THE TEXT OF A PRELIMINARY DRAFT LAW DRAWN UP BY THE MINISTER OF PUBLIC WORKS IN RESPONSE TO THE REQUESTS MADE BY THE COMMISSION . 6 SINCE THE COMMISSION TOOK THE VIEW THAT IT WAS UNABLE TO TAKE THAT PRELIMINARY DRAFT LAW INTO ACCOUNT IN SO FAR AS IT AMOUNTED MERELY TO ' A VAGUE AND INCOMPLETE INTENTION ON THE PART OF THE COMPETENT AUTHORITIES TO COMPLY WITH THE PROVISIONS OF THE DIRECTIVE ' , IT DELIVERED A REASONED OPINION DATED 2 AUGUST 1983 WHICH REPEATED ALL THE COMPLAINTS WHICH HAD ALREADY APPEARED IN ITS INITIAL LETTER . IN THAT OPINION , THE ITALIAN REPUBLIC WAS INVITED TO ADOPT THE NECESSARY MEASURES WITHIN ONE MONTH . 7 BY A TELEX MESSAGE DATED 27 SEPTEMBER 1983 , THE ITALIAN GOVERNMENT , IN RESPONSE TO THE REASONED OPINION , INFORMED THE COMMISSION OF THE INTENTION OF THE MINISTER OF PUBLIC WORKS TO LAY THE AFOREMENTIONED DRAFT BEFORE THE ITALIAN PARLIAMENT ONCE AGAIN SINCE IT HAD LAPSED AT THE END OF THE PREVIOUS LEGISLATIVE PERIOD . SINCE NO FURTHER STEPS WERE TAKEN THE COMMISSION DECIDED TO BRING AN ACTION BEFORE THE COURT . 8 LAW NO 687 AMENDING LAW NO 741 AND THE PROVISIONS RELATING TO PROVISIONAL SECURITY AND ADVERTISING WAS NOT ADOPTED UNTIL 8 OCTOBER 1984 . 9 IN THIS ACTION THE COMMISSION ALLEGES IN THE FIRST PLACE THAT ON 10 DECEMBER 1981 , ITALY ADOPTED LAW NO 741 CONCERNING SUPPLEMENTARY RULES TO SPEED UP PROCEDURES FOR THE PERFORMANCE OF PUBLIC WORKS ( GAZZETTA UFFICIALE NO 344 OF 16 DECEMBER 1981 , P . 8271 ) ARTICLES 9 , 10 , 11 , 13 AND 15 OF WHICH INFRINGE CERTAIN PROVISIONS OF DIRECTIVE 71/305 AND IN THE SECOND PLACE THAT CONTRARY TO ARTICLE 33 OF THAT DIRECTIVE ITALY DID NOT NOTIFY THE TEXT OF THE LAW TO THE COMMISSION . I - THE ADOPTION OF CERTAIN PROVISIONS IN LAW NO 741 ( A ) ADMISSIBILITY OF INCREASED TENDERS 10 THE COMMISSION CONTENDS THAT ARTICLE 29 ( 1 ) OF THE DIRECTIVE PROVIDES FOR ONLY TWO CRITERIA FOR THE AWARD OF CONTRACTS , THAT IS TO SAY THE LOWEST PRICE OR THE MOST ECONOMICALLY ADVANTAGEOUS TENDER , WHILST ARTICLE 9 OF THE ITALIAN LAW PERMITS THE ACCEPTANCE OF AN INCREASED TENDER NOT CORRESPONDING TO EITHER OF THOSE TWO CRITERIA IN THE CASE OF A RESTRICTED INVITATION TO TENDER . 11 THE ITALIAN GOVERNMENT REPLIES TO THAT ALLEGATION THAT THE POSSIBILITY OF SUBMITTING TENDERS INCREASED WITH REGARD TO THE BASIC PRICE FOR TENDERS FIXED BY THE ADMINISTRATION CONFORMS TO THE CRITERION OF ' THE LOWEST PRICE ' PROVIDED FOR IN ARTICLE 29 ( 1 ) OF THE DIRECTIVE . ARTICLE 9 OF THE ITALIAN LAW PROVIDES THAT THE CONTRACT IS TO BE AWARDED TO THE TENDERER WHO SUBMITS THE OFFER WHICH EXCEEDS THE PRICE FIXED BY THE SMALLEST MARGIN SO THAT THE CONTRACT IS ALWAYS AWARDED TO THE PERSON WHO TENDERS ' THE LOWEST PRICE ' . 12 IN THE LIGHT OF THE SUBMISSIONS MADE BY THE ITALIAN GOVERNMENT , THE COMMISSION HAS WITHDRAWN ITS COMPLAINT WITH REGARD TO THAT MATTER . ( B ) PROCEDURE FOR MAKING INCREASED TENDERS 13 ACCORDING TO THE COMMISSION , ARTICLE 9 OF ITALIAN LAW NO 741 OF 10 DECEMBER 1981 , IN CONJUNCTION WITH THE THIRD PARAGRAPH OF ARTICLE 1 OF LAW NO 504 OF 3 JULY 1970 ( GAZZETTA UFFICIALE NO 179 OF 17 JULY 1970 ), PROVIDES THAT THE CALCULATION OF PRICES IN THE CONTEXT OF TENDERING PROCEDURES IS TO INCLUDE THE POSSIBILITY OF MAKING HIGHER TENDERS ACCORDING TO THE ' ANONYMOUS ENVELOPE ' PROCEDURE , WHEREAS ARTICLE 29 ( 3 ) OF THE DIRECTIVE PROHIBITS THE CALCULATION OF PRICES IN ACCORDANCE WITH THAT PROCEDURE AFTER THE EXPIRY OF THE TIME-LIMITS REFERRED TO THEREIN . 14 THE ITALIAN GOVERNMENT REPLIES TO THAT ALLEGATION THAT RECOURSE TO THE ANONYMOUS ENVELOPE PROCEDURE DOES NOT FOLLOW FROM ARTICLE 9 OF THE LAW OF 1981 AND THAT IN PRACTICE THAT PROCEDURE IS NEITHER PROVIDED FOR NOR USED IN CONNECTION WITH THE AWARD OF CONTRACTS UNDER ARTICLE 9 . IT IS ONLY IN ORDER TO CLARIFY THE POSITION AND TO ELIMINATE THE COMMISSION ' S DOUBTS THAT ARTICLE 1 OF THE DRAFT LAW , APPROVED ON 22 DECEMBER 1983 , PROHIBITS THE USE OF THE ANONYMOUS ENVELOPE PROCEDURE PROVIDED FOR IN ARTICLE 1 OF LAW NO 504/70 WITH REGARD TO CONTRACTS FALLING WITHIN THE SCOPE OF THE DIRECTIVE . 15 SINCE THE DRAFT LAW WAS ADOPTED ON 8 OCTOBER 1984 THE COMMISSION HAS WITHDRAWN ITS COMPLAINT IN THE COURSE OF THE ORAL PROCEDURE . ( C ) SECRET TENDER EQUAL TO OR CLOSEST TO THE AVERAGE TENDER 16 ACCORDING TO THE COMMISSION THE CRITERION FOR THE AWARD OF A CONTRACT , FOR WHICH IN ITALY THE FIRST PARAGRAPH OF ARTICLE 10 OF LAW NO 741 REFERS TO ARTICLE 4 OF LAW NO 14 OF 2 FEBRUARY 1973 AND THEREFORE TO ARTICLE 1 ( D ) OF THAT LAW WHICH PROVIDES THAT THE CONTRACT IS TO BE AWARDED TO THE TENDERER WHOSE TENDER EQUALS THE AVERAGE TENDER OR FAILING THAT IS THE NEAREST TENDER BELOW THAT AVERAGE , DOES NOT CORRESPOND TO EITHER OF THE TWO CRITERIA PROVIDED FOR IN ARTICLE 29 ( 1 ) OF THE DIRECTIVE , THAT IS TO SAY THE LOWEST PRICE OR THE MOST ECONOMICALLY ADVANTAGEOUS TENDER ACCORDING TO VARIOUS CRITERIA DEPENDING ON THE CONTRACT . 17 THE ITALIAN GOVERNMENT , ON THE CONTRARY , CONSIDERS THAT THE CRITERION OF THE AVERAGE PRICE ENABLES THE MOST ECONOMICALLY ADVANTAGEOUS TENDER TO BE DETERMINED BY VIRTUE OF THE SPECIFIC RULES RELATING TO THE APPLICATION OF THAT CRITERION AS DEFINED IN ARTICLE 4 OF LAW NO 14/73 . MOREOVER , IN THE COURSE OF THE ORAL PROCEDURE THE ITALIAN GOVERNMENT HAS RAISED AN OBJECTION OF INADMISSIBILITY ON THE GROUND THAT IN THE COMMISSION ' S INITIAL LETTER THE FIRST PARAGRAPH OF ARTICLE 10 OF LAW NO 741 WAS ALLEGED TO BE INCOMPATIBLE ONLY WITH ARTICLE 29 ( 3 ) OF THE DIRECTIVE , WHEREAS IN ITS REASONED OPINION THE COMMISSION MAINTAINED THAT THE CRITERION FOR THE AWARD OF A CONTRACT IN QUESTION DID NOT CORRESPOND TO EITHER OF THE CRITERIA PROVIDED FOR IN ARTICLE 29 ( 1 ) OF THE DIRECTIVE . 18 IT SHOULD BE RECALLED THAT UNDER ARTICLE 169 OF THE TREATY THE COMMISSION MAY BRING BEFORE THE COURT AN ACTION FOR A DECLARATION THAT A STATE HAS FAILED TO FULFIL ITS OBLIGATIONS ONLY IF THAT STATE DOES NOT COMPLY WITH THE REASONED OPINION WITHIN THE PERIOD LAID DOWN THEREIN BY THE COMMISSION . THE COMMISSION DOES NOT DELIVER ITS REASONED OPIONION UNTIL THE MEMBER STATE HAS BEEN GIVEN AN OPPORTUNITY TO SUBMIT ITS OBSERVATIONS . 19 IT FOLLOWS FROM THE PURPOSE ASSIGNED TO THE PRELIMINARY STAGE OF THE PROCEDURE UNDER ARTICLE 169 THAT THE INITIAL LETTER IS INTENDED TO DEFINE THE SUBJECT-MATTER OF THE DISPUTE AND TO INDICATE TO THE MEMBER STATE WHICH IS INVITED TO SUBMIT ITS OBSERVATIONS THE FACTORS ENABLING IT TO PREPARE ITS DEFENCE . 20 AS THE COURT HELD IN ITS JUDGMENT OF 11 JULY 1984 ( CASE 51/83 COMMISSION V ITALY ( 1984 ) ECR 2793 ) THE OPPORTUNITY FOR THE MEMBER STATE CONCERNED TO SUBMIT ITS OBSERVATIONS CONSTITUTES AN ESSENTIAL GUARANTEE REQUIRED BY THE TREATY AND , EVEN IF THE MEMBER STATE DOES NOT CONSIDER IT NECESSARY TO AVAIL ITSELF THEREOF , OBSERVANCE OF THAT GUARANTEE IS AN ESSENTIAL FORMAL REQUIREMENT OF THE PROCEDURE UNDER ARTICLE 169 . 21 ALTHOUGH IT FOLLOWS THAT THE REASONED OPINION PROVIDED FOR IN ARTICLE 169 OF THE EEC TREATY MUST CONTAIN A COHERENT AND DETAILED STATEMENT OF THE REASONS WHICH LED THE COMMISSION TO CONCLUDE THAT THE STATE IN QUESTION HAS FAILED TO FULFIL ONE OF ITS OBLIGATIONS UNDER THE TREATY , THE COURT CANNOT IMPOSE SUCH STRICT REQUIREMENTS AS REGARDS THE INITIAL LETTER , WHICH OF NECESSITY WILL CONTAIN ONLY AN INITIAL BRIEF SUMMARY OF THE COMPLAINTS . AS THE COURT STATED IN ITS JUDGMENT OF 31 JANUARY 1984 ( CASE 74/82 COMMISSION V IRELAND ( 1984 ) ECR 317 ) THERE IS NOTHING THEREFORE TO PREVENT THE COMMISSION FROM SETTING OUT IN DETAIL IN THE REASONED OPINION THE COMPLAINTS WHICH IT HAS ALREADY MADE MORE GENERALLY IN ITS INITIAL LETTER . 22 IN THAT RESPECT IT IS CLEAR FROM THE DOCUMENTS ON THE FILE THAT IN ITS INITIAL LETTER DATED 17 DECEMBER 1982 THE COMMISSION ALLEGED THAT THE FIRST PARAGRAPH OF ARTICLE 10 OF LAW NO 741 INFRINGED ARTICLE 29 ( 3 ) OF DIRECTIVE 71/305 WHICH PROHIBITS THE ANONYMOUS ENVELOPE PROCEDURE . BUT IT ALSO STATED , AFTER CITING THE TEXT OF THE LAW , THAT THE PROVISION INFRINGED THE DIRECTIVE ' IN A MANNER ANALAGOUS TO THAT INDICATED IN THE PRECEDING PARAGRAPH ' . IN THAT PARAGRAPH IT COMPLAINED THAT ARTICLE 9 OF LAW NO 741 PROVIDED INTER ALIA FOR A CRITERION FOR THE AWARD OF CONTRACTS WHICH WAS NOT COMPATIBLE WITH EITHER OF THE TWO CRITERIA PROVIDED FOR IN ARTICLE 29 ( 1 ) OF THE DIRECTIVE . 23 CONSEQUENTLY , ALTHOUGH ITS WORDING IS NOT VERY EXPLICIT , THE INITIAL LETTER DID GIVE NOTICE TO THE ITALIAN GOVERNMENT OF THE COMPLAINT AGAINST IT . THE COMMISSION ' S COMPLAINT IS THEREFORE ADMISSIBLE . 24 WITH REGARD TO THE SUBSTANCE OF THE COMPLAINT IT APPEARS THAT THE FIRST PARAGRAPH OF ARTICLE 10 OF LAW NO 741 CONTAINS , IN ADDITION TO THE CRITERIA FOR THE AWARD OF CONTRACTS OF THE LOWEST PRICE AND THE MOST ECONOMICALLY ADVANTAGEOUS TENDER , WHICH ARE PROVIDED FOR IN THE DIRECTIVE , THE CRITERION OF THE AVERAGE PRICE CALCULATED ON THE BASIS OF THE TENDERS IN THE LOWER HALF OF THE SCALE BETWEEN THE LOWEST AND HIGHEST TENDERS . 25 THE ITALIAN GOVERNMENT ' S CONTENTION THAT THE CRITERION FOR THE AWARD OF THE CONTRACT TO THE PERSON WHO SUBMITS ' THE TENDER WHICH EQUALS THE AVERAGE TENDER OR IS THE CLOSEST TO IT ' SERVES TO DETERMINE ' THE MOST ECONOMICALLY ADVANTAGEOUS TENDER ' WITHIN THE MEANING OF ARTICLE 29 OF THE DIRECTIVE IS INCORRECT . IN ORDER TO DETERMINE THE MOST ECONOMICALLY ADVANTAGEOUS TENDER , THE AUTHORITY MAKING THE DECISION MUST BE ABLE TO EXERCISE ITS DISCRETION IN TAKING A DECISION ON THE BASIS OF QUALITATIVE AND QUANTITATIVE CRITERIA THAT VARY ACCORDING TO THE CONTRACT IN QUESTION AND CANNOT THEREFORE RELY SOLELY ON THE QUANTITATIVE CRITERION OF THE AVERAGE PRICE . 26 IT IS THEREFORE NECESSARY TO DECLARE THAT THE FIRST PARAGRAPH OF ARTICLE 10 ( 1 ) OF LAW NO 741 IS NOT COMPATIBLE WITH DIRECTIVE 71/305 IN SO FAR AS IT CONTAINS A CRITERION FOR THE AWARD OF CONTRACTS WHICH IS NOT PROVIDED FOR IN ARTICLE 29 ( 1 ) OF THE DIRECTIVE . ( D ) PUBLICATION OF CONTRACT NOTICES 27 THE COMMISSION ALSO MAINTAINS THAT THE THIRD PARAGRAPH OF ARTICLE 10 OF LAW NO 741 , IN SO FAR AS IT SUSPENDS UNTIL 31 DECEMBER 1983 THE OPERATION OF ARTICLE 7 OF LAW NO 14 OF 2 FEBRUARY 1973 AND THE PROVISIONS OF LAW NO 584 OF 8 AUGUST 1977 WITH REGARD TO THE PUBLICATION OF CONTRACT NOTICES , IS INCOMPATIBLE WITH ARTICLE 12 OF THE DIRECTIVE WHICH LAYS DOWN AN OBLIGATION TO PUBLISH CONTRACT NOTICES FALLING WITHIN THE SCOPE OF THE DIRECTIVE IN THE OFFICIAL JOURNAL OF THE EUROPEAN COMMUNITIES . ACCORDING TO THE COMMISSION THE FOURTH PARAGRAPH OF ARTICLE 10 CONCERNING THE PUBLICATION OF AWARDS IS ALSO INCOMPATIBLE WITH ARTICLE 12 OF THE DIRECTIVE WHICH PROVIDES THAT CONTRACT NOTICES ARE NOT TO BE PUBLISHED IN THE DAILY PRESS BEFORE THEY HAVE BEEN DISPATCHED TO THE OFFICIAL JOURNAL . 28 THE ITALIAN GOVERNMENT DOES NOT DISPUTE THAT THESE COMPLAINTS ARE WELL-FOUNDED . IT IS THEREFORE NECESSARY TO DECLARE THAT IT HAS FAILED TO FULFIL ITS OBLIGATIONS IN THE MANNER ALLEGED . ( E ) THE CONTRACTOR ' S FINANCIAL AND ECONOMIC STANDING AND TECHNICAL KNOWLEDGE AND ABILITY 29 THE FIFTH PARAGRAPH OF ARTICLE 10 OF LAW NO 741 , TO THE EXTENT TO WHICH IT SUSPENDS UNTIL 31 DECEMBER 1983 ARTICLES 17 AND 18 OF LAW NO 584 OF 8 AUGUST 1977 , WHICH IMPLEMENT ARTICLES 25 AND 26 OF THE DIRECTIVE , IS IN THE COMMISSION ' S OPINION INCOMPATIBLE NOT ONLY WITH THE PROVISIONS LISTING THE REFERENCES WHICH THE AUTHORITY AWARDING THE CONTRACT MAY REQUIRE IN ORDER TO ASSESS THE CONTRACTOR ' S FINANCIAL AND ECONOMIC STANDING AND TECHNICAL KNOWLEDGE AND ABILITY , BUT ALSO WITH ARTICLES 17 ( D ), 20 , 22 AND 27 OF THE DIRECTIVE , ACCORDING TO WHICH THE SUITABILITY OF CONTRACTORS IS TO BE CHECKED IN ACCORDANCE WITH THE CRITERIA OF ECONOMIC AND FINANCIAL STANDING AND TECHNICAL KNOWLEDGE AND ABILITY REFERRED TO IN ARTICLES 25 , 26 AND 27 OF THE DIRECTIVE . 30 THE ITALIAN GOVERNMENT DOES NOT DISPUTE THAT THESE COMPLAINTS ARE WELL-FOUNDED . IT IS THEREFORE NECESSARY TO DECLARE THAT IT HAS FAILED TO FULFIL ITS OBLIGATIONS . ( F ) ADDITIONAL OR MODIFIED WORKS 31 THE COMMISSION CONTENDS THAT ARTICLE 11 OF LAW NO 741 , BY AUTHORIZING THE ADMINISTRATION TO PROCEED WITH ' THE AWARD OF ADDITIONAL OR MODIFIED WORKS , ONCE A FAVOURABLE OPINION HAS BEEN DELIVERED BY THE COMPETENT CONSULTATIVE BODY OR DELIBERATIVE BODY WITH REGARD TO APPROVAL OF THE RELEVANT EXPERTISE ' IS INCOMPATIBLE WITH ARTICLE 9 ( F ) OF THE DIRECTIVE IN SO FAR AS IT FAILS TO TAKE ACCOUNT OF ANY OF THE CONDITIONS PROVIDED FOR BY THAT PROVISION WITH REGARD TO THE AWARD OF ADDITIONAL WORKS TO THE CONTRACTOR WHO SUCCESSFULLY TENDERED FOR THE MAIN WORKS . 32 THE ITALIAN GOVERNMENT STATES , ON THE CONTRARY , THAT ARTICLE 11 RELATES SOLELY TO ' THE AWARD OF ADDITIONAL OR MODIFIED WORKS ' AND DOES NOT RELATE TO THE CONDITIONS ON WHICH ADDITIONAL WORKS ARE TO BE AWARDED TO THE CONTRACTOR WHO WAS AWARDED THE MAIN CONTRACT PROVIDED FOR IN ARTICLE 9 ( F ) OF THE DIRECTIVE . THOSE CONDITIONS CONTINUE TO BE GOVERNED BY ARTICLE 5 ( F ) OF LAW NO 584/77 WHICH CONFORMS TO THE AFOREMENTIONED ARTICLE 9 ( F ) OF THE DIRECTIVE . WHERE THE CONDITIONS IN ARTICLE 5 ( F ) ARE SATISFIED , ARTICLE 11 PERMITS , AT THE MOST , THE AWARD OF WORKS TO THE SUCCESSFUL TENDERER BEFORE THE CONTRACT FOR ADDITIONAL WORKS HAS BEEN APPROVED IN ORDER TO SPEED UP PROCEDURES FOR THE PERFORMANCE OF PUBLIC WORKS . THE HYPOTHESIS ON WHICH THE COMMISSION ' S COMPLAINT IS BASED , NAMELY THAT ARTICLE 11 INTRODUCES A DEROGATION FROM THE PROVISIONS OF ARTICLE 9 ( F ) OF THE DIRECTIVE , THEREFORE LACKS ANY FOUNDATION . 33 IN THE LIGHT OF THE SUBMISSIONS MADE BY THE ITALIAN GOVERNMENT , THE COMMISSION HAS STATED THAT IT IS NOT PROCEEDING WITH THIS COMPLAINT . ( G ) URGENCY 34 THE COMMISSION MAINTAINS THAT ARTICLE 13 OF LAW NO 741 , IN SO FAR AS IT PERMITS , BY REFERENCE TO ARTICLE 41 ( 5 ) OF THE REGOLAMENTO ( REGULATION ) APPROVED BY REGIO DECRETO ( ROYAL DECREE ) NO 827 OF 23 MAY 1924 , THE AWARD OF PRIVATE CONTRACTS ' WHEN THE URGENCY OF THE WORKS , PURCHASES , TRANSPORT AND MATERIALS IS SUCH THAT THERE MUST BE NO DELAY ' , IS INCOMPATIBLE WITH ARTICLE 9 ( D ) OF THE DIRECTIVE TO THE EXTENT TO WHICH IT PERMITS URGENCY TO BE RELIED UPON IN CIRCUMSTANCES WHICH DO NOT CORRESPOND TO THE CONDITIONS PROVIDED FOR EXPRESSLY IN ARTICLE 9 ( D ). 35 THE ITALIAN GOVERNMENT HAS NOT CONTESTED THAT ALLEGATION . IT IS THEREFORE NECESSARY TO DECLARE THAT IT HAS FAILED TO FULFIL ITS OBLIGATIONS IN THE MANNER ALLEGED . ( H ) SECURITY 36 FINALLY THE COMMISSION CONSIDERS THAT THE FIRST SENTENCE OF THE SECOND PARAGRAPH OF ARTICLE 15 OF LAW NO 741 , ACCORDING TO WHICH ' IF IT IS PROVIDED THAT THE UNDERTAKING INVITED TO TENDER CAN BE AWARDED ONLY ONE CONTRACT THAT UNDERTAKING SHALL PROVIDE ONLY ONE PROVISIONAL DEPOSIT , CALCULATED ON THE BASIS OF THE AMOUNT OF THE MOST VALUABLE CONTRACT ' , IS INCOMPATIBLE WITH ARTICLES 25 AND 26 OF THE DIRECTIVE TO THE EXTENT TO WHICH THE PROVISION OF SECURITY IS NOT MENTIONED IN THE EXHAUSTIVE LIST OF REFERENCES IN ARTICLES 25 AND 26 THAT MAY BE REQUIRED AT THE TENDERING STAGE AS PROOF OF THE CONTRACTOR ' S FINANCIAL AND ECONOMIC STANDING AND TECHNICAL KNOWLEDGE AND ABILITY . SINCE A DEPOSIT SERVES AS A GUARANTEE TO THE AUTHORITY AWARDING IN THE CONTRACT THAT THE WORKS WILL BE PERFORMED PROPERLY , IT CAN BE REQUIRED ONLY OF THE CONTRACTOR TO WHOM THE CONTRACT IS AWARDED . 37 ACCORDING TO THE ITALIAN GOVERNMENT , THIS COMPLAINT IS INADMISSIBLE ON THE GROUND THAT THE COMMISSION HAS NO INTEREST IN THE MATTER IN SO FAR AS THE COMPLAINT IS BASED SOLELY ON THE FIRST SENTENCE OF THE SECOND PARAGRAPH OF ARTICLE 15 OF LAW NO 741 SINCE IT IS NOT THAT PROVISION WHICH REQUIRES CONTRACTORS TO PROVIDE A PROVISIONAL DEPOSIT IN ORDER TO TAKE PART IN THE TENDERING PROCEDURE , BUT OTHER PROVISIONS WHICH ARE NOT IMPUGNED . THE FIRST SENTENCE OF THE SECOND PARAGRAPH OF ARTICLE 15 MERELY PROVIDES A POWER TO PERMIT A CONTRACTOR WHO IS TAKING PART IN SEVERAL TENDER PROCEDURES TO LODGE ONLY ONE PROVISIONAL DEPOSIT . 38 IN ADDITION , THE ITALIAN GOVERNMENT CONTENDS THAT ARTICLE 16 ( I ) OF THE DIRECTIVE REFERS IN GENERAL TERMS TO ' DEPOSITS AND ANY OTHER GUARANTEES , WHATEVER THEIR FORM , WHICH MAY BE REQUIRED BY THE AUTHORITIES AWARDING CONTRACTS ' AND THEREFORE REFERS NOT ONLY TO THE DEFINITIVE DEPOSIT TO BE PAID BY THE TENDERER TO WHOM THE CONTRACT IS AWARDED , BUT ALSO TO A PROVISIONAL DEPOSIT WHOSE SPECIFIC PURPOSE IS TO GUARANTEE THAT THE TENDER IS SERIOUS AND TO COMPENSATE THE ADMINISTRATION IN ADVANCE FOR ANY INJURY . THE PROVISIONAL DEPOSIT MERELY REINFORCES THE OBLIGATION LAID DOWN IN ARTICLE 16 ( M ) OF THE DIRECTIVE THAT THE TENDERER MUST KEEP OPEN HIS TENDER FOR A CERTAIN PERIOD OF TIME . 39 SINCE ITALIAN LAW NO 687 AMENDING LAW NO 741 AND IN PARTICULAR THE PROVISIONS RELATING TO PROVISIONAL SECURITIES WAS ADOPTED ON 8 OCTOBER 1984 , THE COMMISSION HAS WITHDRAWN ITS COMPLAINT IN THE COURSE OF THE ORAL PROCEDURE . II - FAILURE TO NOTIFY THE TEXT OF LAW NO 741 40 THE COMMISSION CLAIMS THAT , BY FAILING TO NOTIFY IT OF THE TEXT OF LAW NO 741 OF 10 DECEMBER 1981 , ITALY HAS FAILED TO FULFIL ITS OBLIGATIONS UNDER ARTICLE 33 OF DIRECTIVE 71/305 . 41 THE ITALIAN GOVERNMENT FOR ITS PART CONSIDERS THAT THIS COMPLAINT HAS CEASED TO BE MATERIAL IN SO FAR AS THE COMMISSION WAS WELL AWARE OF THE TEXT OF THE LAW WHEN IT DELIVERED ITS REASONED OPINION . 42 IN THAT RESPECT IT IS NECESSARY TO DECLARE THAT EVEN IF THE COMMISSION WAS AWARE OF LAW NO 741 WHEN IT DELIVERED ITS REASONED OPINION , THE FACT REMAINS THAT THE ITALIAN GOVERNMENT HAS NOT NOTIFIED IT OFFICIALLY OF THE TEXT OF THE LAW AS IT IS OBLIGED TO DO UNDER ARTICLE 33 . IT SHOULD BE EMPHASIZED IN THAT RESPECT THAT THE MEMBER STATES ARE OBLIGED , BY VIRTUE OF ARTICLE 5 OF THE EEC TREATY , TO FACILITATE THE ACHIEVEMENT OF THE COMMISSION ' S TASKS WHICH , UNDER ARTICLE 155 OF THE EEC TREATY , CONSIST IN PARTICULAR OF ENSURING THAT THE PROVISIONS OF THE TREATY AND THE MEASURES ADOPTED BY THE INSTITUTIONS PURSUANT THERETO ARE APPLIED . IT IS FOR THOSE REASONS THAT ARTICLE 33 OF THE DIRECTIVE IN QUESTION , LIKE OTHER DIRECTIVES , IMPOSES UPON THE MEMBER STATES , AN OBLIGATION TO PROVIDE INFORMATION . IN THE ABSENCE OF SUCH INFORMATION , THE COMMISSION IS NOT IN A POSITION TO ASCERTAIN WHETHER THE MEMBER STATE HAS EFFECTIVELY AND COMPLETELY IMPLEMENTED THE DIRECTIVE . 43 IT IS THEREFORE NECESSARY TO DECLARE THAT THE ITALIAN REPUBLIC , BY FAILING TO NOTIFY THE COMMISSION OFFICIALLY OF THE TEXT OF LAW NO 741 , HAS FAILED TO FULFIL ITS OBLIGATIONS UNDER ARTICLE 33 OF DIRECTIVE 71/305 . III - COSTS 44 UNDER ARTICLE 69 ( 2 ) OF THE RULES OF PROCEDURE , THE UNSUCCESSFUL PARTY IS TO BE ORDERED TO PAY THE COSTS . AS THE DEFENDANT HAS FAILED IN THE MAJORITY OF ITS SUBMISSIONS , IT MUST BE ORDERED TO PAY THE COSTS . ON THOSE GROUNDS , THE COURT HEREBY : ( 1 ) DECLARES THAT THE ITALIAN REPUBLIC , BY ADOPTING ARTICLE THE FIRST , THIRD AND FIFTH PARAGRAPHS OF 10 AND ARTICLE 13 OF LAW NO 741 , HAS FAILED TO FULFIL ITS OBLIGATIONS UNDER DIRECTIVE 71/305/EEC . ( 2)DECLARES THAT THE ITALIAN REPUBLIC , BY FAILING TO NOTIFY THE COMMISSION OFFICIALLY OF THE TEXT OF LAW NO 741 , HAS ALSO FAILED TO FULFIL ITS OBLIGATIONS UNDER ARTICLE 33 OF DIRECTIVE 71/305 . ( 3)ORDERS THE DEFENDANT TO PAY THE COSTS . © European Communities, 2001 All rights reserved BAILII: Copyright Policy | Disclaimers | Privacy Policy | Feedback | Donate to BAILII URL: https://www.bailii.org/eu/cases/EUECJ/1985/C27483.html