I.Introduction

The new Italian Public Contract Code (hereafter, the code) was approved on the 28^th of March 2023 and entered into force on the 1^st of April 2023, with applicability from July 1^st, 2023. The code was adopted with the Legislative Decree 31 of March 2023, n. 36 titled -in Italian- ‘Codice dei contratti pubblici in attuazione dell’articolo 1 della legge 21 giugno 2022, n. 78, recante delega al Governo in materia di contratti pubblici’ and published on the Italian Official Gazzette n. 77 of 31 March 2023. The Italian government enacted the Legislative Decree exercising the powers conferred by the Italian parliament under Article 1 of Law No. 78 of 21 June 2022 concerning the delegation to the Government in public contracts. The official entry into force of the code is among the most relevant reforms within the Italian recovery plan ‘Piano Nazionale di Ripresa e Resilienza -PNRR’, and it is connected to the Next Generation EU plan.

With article 1 of Law No. 78 of 21 June 2022, the Italian parliament has delegated the Italian government to adopt one or more legislative decrees concerning the regulation of public contracts to adapt it to European law, to the principles expressed by the case law of the Constitutional Court and of the higher, domestic and supranational courts, and to rationalize, reorganize and simplify the existing regulations on public contracts relating to works, services, and supplies. By doing so, Italy would also avoid the initiation of infringement procedures by the European Commission and seek the closure of the procedures initiated.

The four keywords that characterize this reform are i) simplification, achieved by increasing the discretion of administrations and removing gold plating wherever possible; ii) acceleration, understood as maximum speeding up of procedures, and guaranteeing certainty in terms of awarding, execution, and payment times to companies; iii) full digitization of procedures and interoperability of platforms; and iv) protection, by fully implementing the delegation to protect workers and companies (e.g. through division into lots).

In this vein, Law 78/2022 has laid down several principles and objectives to be respected in enacting the new code. The most relevant are recalled hereafter:

1) compliance with the EU directives and/or maintenance of the minimum levels of legislation required, without prejudice to labour protection, safety, the fight against irregular work, legality, and transparency; ensuring competition and with particular attention to SMEs;

2) revision of the competencies of the National anti-corruption authority (ANAC) to strengthen its supervisory functions and support to contracting authorities;

3) redefinition and strengthening of the rules on the qualification of contracting authorities;

4) enhancing public authorities’ staff qualification through specific training courses;

5) simplifying applicable rules below the European thresholds in compliance with the principles of publicity, transparency, competitiveness, rotation, non-discrimination, proportionality, the economy, effectiveness, and impartiality of the procedures;

6) simplification of procedures for realizing investments in green and digital technologies, in innovation and research, as well as in social innovation, also to achieve the objectives of the 2030 Agenda for sustainable development;

7) rationalization and simplification of the grounds for exclusion to make the rules for participation clear and certain;

8) reduction and certainty of times for tendering procedures.

II. The preliminary works leading to the new code

Compared to previously adopted public contracts codes, a peculiar aspect is that Law 78/2022 has explicitly referred to the possibility for the government to use the Italian Council of State to draft the legislative decree. This possibility is foreseen in Article 14(2), of the Consolidated Text of the Laws on the Council of State, under Royal Decree No 1054 of 26 June 1924. To draft the new code, the Council of State has established a Special Commission assisted by magistrates from the Regional Administrative Courts, the Court of Cassation, the Court of Auditors, state lawyers, external experts such as professors, lawyers, economists, engineers, drafting experts, a computer scientist and an academic from the Crusca (expert in the Italian language). This varied composition allowed the Commission, enriched by the fundamental contribution of non-legal knowledge, to follow a rigorously multidisciplinary method of legislative drafting with a ‘technical/economic feasibility’ check, i.e., a realistic application simulation by experts from several disciplines. Given the very tight schedule, the special Commission divided into groups met assiduously and worked even in the summer and on holiday without remuneration. The requests of the social partners were solicited through a public consultation published on the Administrative Justice website, and several hearings were held in person.

This incredible and hard work has resulted in a whole new public procurement code that does not refer to further implementing measures and is ‘self-executing’ and self-contained, immediately allowing full knowledge of the entire discipline to be implemented.

As a result, the Council of State wrote a code that ‘tells a story’ of tendering procedures, accompanying administrations, and economic operators, step by step, from the initial planning and design to the awarding and execution of the contract.

The table of contents of the code summarizes this story divided by books: book I, art 1-47, lays down the general principles of the code (principles, digitalization, the responsible of the project, technical rules, and integrated contracts); book II, art 48-140, continues with the part dedicated to contracting in all its phases (contracts under the EU thresholds, awarding commission, lots, framework agreements, subjects, economic operators, procedures, selection,  award criteria, the contract performance, etc.), book III, art 141-173 is dedicated to public procurement in the utilities sectors; book IV, art 174-208, continues with rules concerning the public-private partnership and concession sectors; and finally, book V, art 209-229 refers to remedies and final provisions.

To guarantee a successful and effective reform, the code also introduced a help desk to accompany the administrations during the first year of the code’s life (art. 221).

III. Novelty elements of the code

III.a General principles of procurement

The new code aims to repeal all the previous legislation linked to public contracts and to enact the entire public procurement process in a new text.

The principles of procurement are the ‘opening act’ of the code. The general principles of a field spell out values and evaluation criteria that are immanent in the legal order. Moreover, the principles are characterized by a prevalence of deontological content compared to individual rules. Employing principles also fulfills a function of the legal system’s completeness and guarantees the protection of interests that would otherwise not be adequately accommodated in individual provisions.

More generally, through the codification of principles, the new code aims at fostering greater freedom of initiative and self-responsibility of contracting authorities, enhancing their autonomy and discretion (administrative and technical) in a sector where the presence of rigid and detailed regulations has often created uncertainties, delays, and inefficiencies.

Fundamental to this renewed regulatory framework is the innovative introduction of result, trust, and market access principles. The principle of the result specifically concerns the awarding of the contract and its timely execution, and the best possible ratio between quality and price, always respecting the principles of legality, transparency, and competition. Trust, conversely, means confidence in the lawful, transparent, and correct action of the public administration, its officials, and economic operators. Finally, the principle of market access that contracting authorities must guarantee to economic operators, was introduced.

III.b The public contract combining design and execution of works

Under Article 59(1) of Legislative Decree 50/2016 (former Italian public contract code, applicable until July 1^st, 2023, and as a general rule, a ‘combined’ public contract that includes design and execution of works was prohibited. The former code only allowed the award of an integrated procurement -launching one tender to award an economic operator all the agreed services, including design and execution of works- only if the type of public contract held a technological or innovative element of the works to be procured that was predominant for the total value of the works. The rationale behind this prohibition is that the Italian legislator aimed at awarding public tenders guaranteeing the compliance of the works with the predetermined quality requirements and the time and costs schedules by the contracting authorities. However, this prohibition was suspended during the pandemic period.

The new article 44 allows integrated procurement for complex works, leaving it to the contracting authority to decide that the contract shall have as its object the executive design and the execution of the works based on a previously approved technical and economic feasibility project. The option for the integrated contract must be justified concerning the technical requirements and always consider the risk of possible cost deviations in the execution phase.

Finally, the article stipulates that tenders for integrated contracts are to be evaluated using only the economically most advantageous tender criterion based on the best value for money and that the integration in one award procedure of the design and execution of the works is to be indicated separately.

III.c Public contracts under the EU thresholds

Article 48 states that the common principles mentioned above must also inspire the award and performance of below-threshold contracts, which, due to their general scope, concern all contracts awarded by contracting authorities, irrespective of their amount. Paragraph 2 is entirely new and provides for the differential legal regime that the contracting authority must apply to contracts below the European thresholds when it establishes the existence of a cross-border interest. This provision takes into account the rulings of the Court of Justice of the European Union, according to which contracts below the EU thresholds, although not subject to the specific rules of the public procurement directives, must be awarded transparently and competitively if they present a cross-border interest.

Lastly, the rotation principle applies to public contracts under the EU thresholds. The principle of rotation of invitations and awards is aimed to avoid the economic operator finishing performing the contract and having already more knowledge of the contract to be carried out acquired in the previous management, can easily prevail over other new economic operators.

III.d The achievement of sustainability objectives.

With respect to sustainability objectives, the code has brought substantial changes. The code has completely changed the former transposition of art. 18.2 of Directive 2014/14/EU. In particular, the former code stated in its previous formulation under art. 30.3 ‘In the execution of public contracts and concessions, economic operators shall comply with the environmental, social and labour obligations established by European and national legislation, collective agreements or the international provisions listed in Annex X’. The former copy-paste provision referred to annex X of the former Italian code listing the ILO conventions. The new code, Legislative Decree 23/2023, no longer contains this formulation, nor an annex specifically dedicated to the ILO conventions. However, we can find articles and annexes dedicated to or including social and environmental considerations; namely article 57 and annexes II.13 and II.14.

Main references from the annexes to the new code

During the performance of the contract, the director of the work (the person trusted by the contracting authority to supervise the proper execution of the works) must ensure that technical documents, lab results, and certifications meet the requirements of the national action plan for the environmental sustainability of public administration (so-called ‘PAN GPP’) and deliver all the checks and tests requested by current national and European standards, drawing up, in the event of findings, a report. Likewise, the RUP (responsible for the project) assesses the quality and adequacy of the supply or service on the basis of the quality standards, with particular reference to environmental standards, provided for in the contract (Annex II.14).

Normally, offers submitted are secured by a provisional guarantee amounting to 2% of the total value of the procedure, as indicated in the invitation to tender (art. 106). The new code provides that the amount of the guarantee is reduced by a maximum of 20%, combinable with other reductions (up to 30 % for EN 45000, ISO 9000 certifications; or for SMEs or temporary groups of only SMEs up to 50%) when the economic operator certifies specific labels such as ISO 14001(environmental management system), ISO 45001 (management systems of occupational health and safety) Ecolabels (Regulation n.66/2010), EMAS (Regulation 1221/2009) and others (Annex II.13).

The article 57

Article 57, titled ‘Social clauses in the call for tenders and notices and energy and environmental sustainability criteria’, of the new code re-proposes and reformulates the provisions provided in former article 34, ‘Energy and environmental sustainability criteria’ and former article 50, ‘Social clauses in the call for tenders and notices’.  Thus, the new article highlights in paragraph 1 the social clauses, and in paragraph 2 the Italian minimum environmental criteria.

The first paragraph establishes the obligation for contracting authorities to include in their calls for tenders, notices, or invitations, for public works and services contracts specific social clauses requiring, as a prerequisite for the tender, measures aimed, inter alia, at ensuring equal opportunities in terms of generation, gender and labour inclusion for disabled or disadvantaged persons, the employment stability of the staff employed, as well as the application of collective agreements and territorial sectoral agreements, as well as to ensure the same economic and regulatory protections for subcontracted workers as for the contractor’s employees and against illegal work. Article 57.1 is, therefore, trying to end the several criticism and doubts that occurred with the previous formulation. In fact, including social clauses is now mandatory for contracting authorities, who must demand, as a requirement of the offer, measures to guarantee the stability of the personnel employed.

Conversely, the second paragraph follows former art. 34 and focuses on environmental clauses and states that contracting authorities contribute to the environmental objectives by including in the tender documents the minimum environmental criteria adopted by Ministerial decrees, at least in the technical specifications and the contractual clauses. Environmental award criteria are also considered for drafting the tender documents to apply the economically most advantageous tender criterion. Regrettably, the provision does not explicate this obligation for above and below the EU thresholds contracts as before.

IV. Concluding remarks

The new Italian Public Contracts Code signs a new era of public procedures focused on digitalization, simplification, and acceleration. The code was presented as ‘a piece of art’ due to the fast enactment and the involvement of the most distinguished experts in the field. Several articles represent a way forward and an enhancement compared to the past, but in the author’s opinion, the new legislation also presents shortcomings -or better- a missed opportunity. Especially concerning the minimum mandatory criteria, it seems that article 57.2 has not insisted nor given particular attention to social and environmental requirements to be included in the public tender. At the same time, this could have been the perfect occasion to strengthen and widen the mandatory nature of Italian minimum environmental criteria to other phases of public procurement. However, social clauses have clearly been recognized, ending the debate and criticism of Italian jurisprudence, which has permanently opted for a narrow application of social clauses. Nevertheless, it is not excluded that within a year from the entry into force, the Italian government will adopt a further delegated act to amend and adjust the current one, having, therefore, another chance to intervene in favor of sustainability objectives.

Bibliography

The elaboration of the present paper is based on Legislative Decree 36/2023 and its working documents.