Question

Instruction:
A). Submit a maximum of four pages.
B). The deadline is on Monday (14 January) before 12:00 (lunch time).
C). Write your name on your assignment
D). Cite your sources properly.

Questions:

1. On the basis of the legal source of the European Union,
       I). Discuss binding legal sources of the EU
       II). Discuss Written and unwritten legal sources of the EU law
       III). Can we consider the Agreement on Government Procurement (GPA) as a source of EU Law? Why? 

2. Of the institutions of the European Union, which institution(s) is/are entrusted with the power to legislate EU Directives on Public Procurement? Besides the power to legislate, explain in detail the role (s) of the institution(s) you have identified. 
 

Answer 1

Answer1.

( i ) -

EU law is binding between all European Union member states. EU law is superior to national law, and thus, national law has to be changed sometimes when there is a new EU law. When EU law and national law are contradicting each other, EU law prevails. EU law is an autonomous legal order which has effects not only on the Member States as states, but also on the citizens of the EU. EU Member States have limited their sovereign rights in favour of the EU, legislation adopted at EU level immediately becomes Member State domestic legislation once adopted (Regulations and Decisions).

             The other form of EU legislative instrument are Directives and these are also binding laws but allow Member States a certain discretion in their implementation. They may implement it as part of the domestic law or include it as a practice, for example, an administrative practice.

             An important feature of EU law is its capability of direct effectiveness, i.e. it can be directly pleaded and relied on by the individual, before the national courts; it has been declared to have primacy over any conflicting national laws and most importantly, the EU has an effective mechanism for enforcement of the observation and implementation of EU law by Member States.

( ii ) -

Written constitution is one which is found in one or more than one legal documents duly enacted in the form of laws whereas An unwritten constitution is one in which most of the principles of the government have never been enacted in the form of laws.

General principles of law are unwritten sources of law developed by the case law of the Court of Justice. These principles have allowed it to implement rules in different domains of which the treaties make no mention, concerning the non-contractual liability of the EU, for example. The general principles of law may be:

• common to national laws: the Court of Justice identified those principles common to all the national legal systems and which are compatible with EU objectives. For example, this is the case with legal certainty and legitimate expectation which protects an individual from unforeseeable amendments to the law;

• derived from particular national laws: the Court of Justice took inspiration from the principles enshrined in certain national legal systems only. This is also the case when the Court must name the institution responsible for harm caused by the EU and it must determine the extent of the harm;

• specific to the EU: the Court of Justice identified the principles specific to the EU even if the source of their inspiration was from a national legislation. This is the case with the solidarity between Member States, institutional balance and Community preference.

The specific case of fundamental rights:

There are three sources of fundamental rights in the EU:

• the EU’s Charter of fundamenral rights

• the Euopean convention on human rights

• the constitutional traditions of Member States.

( iii ) -

Public procurement is subject to the general, basic freedoms enshrined in the Treaty on the Functioning of the European Union, as amended by the Lisbon Treaty; that is, free movement of goods, freedom to provide services, and freedom of establishment within the territories of the twenty-seven EU Member States. In practice, EU Member States within the single market may not discriminate in awarding public contracts against firms from other EU Members; they are obliged to treat contracts based on the principles of equal treatment, nondiscrimination, mutual recognition, proportionality, and transparency. Public procurement has been regulated by a number of Directives, which require further implementation by the Member States. In 2004, following a lengthy debate, the European Union (EU) reformed the rules on public procurement in light of case law of the Court of the European Union and adopted two Directives, the so-called Public Procurement Directives, which replaced prior directives. Within the EU framework, cross-border procurement occurs in two ways; Direct crossborder procurement and indirect cross-border procurement. Direct cross-border procurement occurs when firms that operate from their home market bid and win contracts for invitations to tender initiated in another EU Member; while indirect cross-border procurement takes places when firms bid for contracts through subsidiaries.

The EU legal regime on public procurement also applies to signatories to the WTO Agreement on Government Procurement.2 For the purposes of the award of contracts, Member States are required to apply “in their relations conditions as favorable as those which they grant to economic operators (the term includes contractors, suppliers and service providers) of third countries in implementation of the Agreement on Government Procurement (AGP).”3 Pursuant to the AGP, EU Members are also required to ensure that their entities do not treat a locally established supplier less favorably than another locally established supplier based on the degree of foreign affiliation or ownership; moreover, EU Members must also ensure that their entities do not discriminate against locally established suppliers on the grounds of the country of production of the good and services being supplied, if the country of production is a party to the AGP.

Answer2 -

The two basic public procurement Directives, which were adopted in 2004, are as follows:

a. Directive 2004/18/EC on the coordination of procedures for the award of public works contracts, public supply contracts and public service contracts and,

b. Directive 2004/17/EC on coordinating the procurement procedures of entities operating in the water, energy, transport and postal services sectors.

Directive 2004/18/EC -

Directive 2004/18/EC applies to public contracts that are not excluded from the scope of the Directive and that have a value exclusive of value-added tax (VAT) estimated to be equal to or greater than the following thresholds.

a) Euro 125.000 for public supply and service contracts, other than those covered by point (2)(c), directly below; in the case of public supply contracts awarded by contracting authorities in the field of defense, this applies only to contracts involving products listed in Annex V; and

b) Euro 193.000 for (a) public supply and service contracts awarded by contracting authorities other than those listed in Annex IV; (that is, central government authorities); (b) public supply contracts awarded by contracting authorities listed in Annex IV operating in the field of defense, where these contracts involve products not covered by Annex V (related to defense); and (c) for public service contracts awarded by any contracting authority in respect of the services listed in Category 8 of Annex IIA or Category 5 (telecommunications services); and,

100. Euro 4,845,000 for public works contracts.

2. Excluded Contracts - Directive 2004/18/EC does not apply to the following contracts:

   • Public contracts for procurement procedures operating in the water, energy, transport and postal services sectors regulated under Directive 2004/17/EC (see Part II(B), below);

   • Public telecommunications networks or service.

   • Secret contracts and contracts that require special security measures.

   • Public contracts governed by an international agreement between a Member State and one or more third states.

   • Public contracts concluded on the basis of an international agreement relating to the stationing of troops; and,

   • Those contracts pursuant to the international procedure of an international organization.

Directive 2004/17/EC -

Directive 2004/17/EC applies to contracts that have a value estimated to be no less than the following thresholds: (a) €387.000 in the case of supply and service contracts; and (b) €4,845,000 in the case of works contracts.

1. Contracts Outside the Scope of the Directive Directive 2004/17/EC does not apply in the following cases:

   • Works and service concessions that are awarded by contracting entities involved in gas, heat, electricity, water, transport services, and postal services, and exploration for, or extraction of, oil, gas, coal, or other solid fuels, as well as ports and airports.

   • Contracts awarded for the purpose of resale or lease to third parties.

   • Contracts awarded for purposes other than the pursuit of an activity covered or for the pursuit of such an activity in a third country.

   • Contracts that are secret or require special security measures.

   • Contracts awarded pursuant to international rules, and

   • Contracts awarded to an affiliated undertaking, or to a joint venture.