On 31 March- 1 April, the Academy of European Law (ERA) held the Annual Conference on European Public Procurement Law 2022 in Trier, Germany. As one of the speakers at the conference, SAPIENS Network Coordinator Prof. Roberto Caranta (University of Turin) gave a presentation on the main practical challenges related to Socially Responsible Public Procurement (SRPP) and how to introduce social considerations throughout the procurement process. Prof. Caranta published his reflections from the conference as an article in the ERA Forum (Journal of the Academy of European Law) titled “Towards socially responsible public procurement”.

Article Abstract

The 2014 procurement and concessions directives have clarified the possibilities that exist for referring to social considerations in public procurement (and socially responsible public procurement). Still, these rules fall, in the main, well short of being mandatory and instead leave wide margins to the Member States and their contracting authorities which do not wish to consider social and human rights concerns when buying. Furthermore, concerns about ensuring the widest competition possible may limit reference to social considerations. Recently proposed reforms may however go a long way towards more sustainable production and procurement.

Towards socially responsible public procurement

Background

In this article, Prof. Caranta investigates why socially responsible public procurement (SRPP) is progressing relatively slow compared to green public procurement (GPP). The initial steps in sustainable public procurement (SPP) were on social aspects by the Court of Justice of the EU (CJEU) on employment concerns. (see Case C-31/87 Beentjes, Case C-225/98 Commission v. French Republic). Though the following CJEU judgments were mainly focused on GPP they are very relevant for SPP, and as a result, also for SRPP (see Case C-513/99 Concordia Bus, Case C-448/01 EVN Wienstrom). In these judgments, the CJEU established and further developed what is one of the biggest impediments to sustainable purchase by public buyers: the link to the subject matter. Case C-368/10 Commission v. Kingdom of the Netherlands (Max Havelaar), which shaped the next Directives to follow, is crucial not only for SRPP but SPP in general. This is because as Prof. Caranta argues “The judgment in Max Havelaar is central for sustainable public procurement in that it dispatched for good the Commission’s contention that only those elements in the life-cycle of goods or services that impact upon the ‘substance’ of what is purchased are linked to the subject matter.” With the 2014 reform (Directive 2014/23/EU on concession contracts, Directive 2014/24/EU on public sector procurement, and Directive 2014/25/EU on procurement in the utilities sectors) the place of SPP in the European public procurement regime has gained impetus.

Principle of Sustainability?

According to Article 18(2) “Member States shall take appropriate measures to ensure that in the performance of public contracts economic operators comply with applicable obligations in the fields of environmental, social and labour law established by Union law, national law, collective agreements or by the international environmental, social and labour law provisions listed in Annex X”. Though the provision has “cardinal value” as the CJEU emphasized in Case C-395/18 Tim; the exact value of the provision is still missing. Prof. Caranta argues that the lack of mandatory exclusion ground for breach of provisions in Article 18(2) is not consistent with the cardinal value of sustainability.

Main Findings

• While workers’ right has been subject to several cases before the CJEU from Case C-346/06 Rüffert to Case C-115/14 RegioPost; the big issue in workers’ right is monitoring the performance of the contract and sanctioning breaches. Considering the lack of EU-level rules national practices are important such as mandatory SPP criteria from Italy or Equal Pay certification from Iceland.
• Accessibility is not only a requirement under drafting technical specifications but also a breach of rules on the protection of people with disabilities may lead to exclusion of a tenderer as an indication of grave professional misconduct.
• Due to the development of CJEU case law, contract performance conditions are associated with the award criteria rather than technical specifications. Nevertheless, contract performance conditions can be used to pursue policies relating to working conditions provided that they are not corporate social responsibility policy requirements which are considered to pertain to the contractor rather than to the contract.
• The principle of equal treatment is at the core of EU public procurement. However as allowed under the procurement rules, there is still room for reserving public contracts to pursue social policies through procurement (see Case C-70/95 Sodemare, Case C-598/19 Conacee).
• With Green Deal, SPP in Europe is moving from “how to buy” to “what to buy”. The new legislative proposals will also affect SRPP.

The full article is now available on the ERA Forum.