One of the most recent developments in Italian procurement law is the issuance of decision C-642/20 of 28 April 2022 by the European Court of Justice.
Such judgment is part of a series of EU decisions and interventions that are urging Italy to conform its procurement regulations to the content of the EU directives. In particular, just a few days after the EU Commission’s communication of April, confirming the decision to pursue the infringement procedure No. 2018/2273 against Italy (essentially, for not having yet removed the “cascade” subcontracting prohibition), last month the Court of Justice declared the non-compliance with the EU legislation of the Article 83, paragraph 8 of the Italian Procurement Code (“IPC” Legislative Decree No. 50 of 18 April 2016). The Court held that “Article 63 of Directive 2014/24/EU of the European Parliament and of the Council of 26 February 2014 on public procurement and repealing Directive 2004/18/EC must be interpreted as precluding national legislation according to which the leading company of a group of economic operators participating in a procedure for the award of a public contract must meet the requirements laid down in the contract notice and perform the services of that contract to a majority extent“.
In fact, the mentioned Italian provision states that, in the event of participation in a public tender through a “Raggruppamento Temporaneo d’Impresa – RTI” (temporary grouping), the leading company must in any case possess a majority share of the requirements and perform majority of the awarded services. The purpose of the national rule is to prevent the group leader from assuming a secondary role both during the tender phase and the subsequent performance of the contract, while it is instead required that the group leader shall be the most qualified party and perform the preponderant part of the contract. This rule is not to be understood in the sense that the leading company must possess the requirements in an absolute majority (i.e., 51% of the requirement), but it is sufficient that it possesses the requirements in a higher percentage than each of the mandating parties.
In the case at hand, the competent Regional Administrative Court had annulled the awarding of the procurement contract, pointing out a violation of the minimum thresholds for a grouping leader set out by Article 83, paragraph 8 of the IPC, and then the Council of State in the appeal – noting a possible conflict with the Community provisions – referred the case to the Court of Justice.
The latter considered that (i) the European provision (Article 63 of Directive 2014/24/EU) on RTI merely provides that a group of operators may rely on the capacities of its members and that (ii) just in certain types of contracts (such as, in particular, service contracts), contracting authorities may require that certain essential tasks be performed directly by a specific participant in the grouping. Therefore, the EU Court concluded that Article 83, paragraph 8 of IPC sets a far stricter condition than that provided for by the aforementioned European provision and is therefore incompatible with EU law.
For further information, please contact:
Simone Cadeddu, Partner, Bird & Bird
simone.cadeddu@twobirds.com
