European Commission Notice on Tools to Fight Collusion in Public Procurement Is Timely Reminder for Life Sciences Industry
- 22/03/2021
- Articles
On 18 March 2021, the Official Journal of the European Union published a European Commission (Commission) Notice on “tools to fight collusion in public procurement and on guidance on how to apply the related exclusion ground” (see, attached copy; the Notice). The Notice develops the tools which the Commission announced in its Communication COM(2017) 572 entitled “Making public procurement work in and for Europe” (available here) with a view to assisting EU Member States and their contracting authorities in tackling the issue of collusion in public procurement.
The Notice provides guidance on how:
(i) EU Member States and contracting authorities can effectively deter, detect and address collusion in public procurement (see, Section 3);
(ii) cooperation between national central procurement (NCP) and competition authorities can be improved – NCP refers to the authority entrusted with drawing up, implementing, monitoring and/or supporting the functioning of the public procurement regulatory framework at national level (see, Section 4); and
(iii) contracting authorities should apply the collusion-related exclusion ground provided for in the EU public procurement Directives (see, Section 5).
The Notice is accompanied by an Annex which provides pointers to contracting authorities on how to (i) design award procedures in a way that would deter collusion between tenderers; (ii) detect potential collusion when evaluating tenders; and (iii) react to such suspected collusion.
While the Notice is of general application, it is particularly relevant for a sector such as that of the life sciences in which public tendering procedures are common (e.g., tenders by hospitals). Last month’s decision of the Spanish Competition Authority fining colluding suppliers of the radiopharmaceutical fluorodeoxyglucose (18-FDG) illustrates how the life sciences sector is not immune from collusive behaviour in public procurement procedures (see, Van Bael & Bellis Life Sciences News Alert of 9 February 2021).
Collusion in public procurement has been high on the agenda of competition authorities in recent years and is set to remain so over the next years. For example, the Belgian Competition Authority (BCA) signalled its determination to tackle anticompetitive behaviour in public procurement proceedings by publishing a 34-page guide on bid rigging in January 2017 (see, Van Bael & Bellis Life Sciences News Alert of 3 February 2017). Similarly, in the BCA’s list of enforcement priorities for 2021, which was adopted on 5 March 2021 and released on 10 March 2021 (available in Dutch and French), collusive behaviour in response to public procurement procedures again features among the BCA’s eight key sectors for enforcement, alongside the pharmaceutical sector. Incidentally, the BCA is currently investigating high-profile allegations of bid rigging between private security firms in tendering procedures for the provision of security services to both private customers and public-sector clients such as the Belgian Ministry of Defence and NATO.
Considering the economic importance of public procurement, bid rigging in public procurement has also caught the attention of the Organisation for Economic Co-operation and Development (OECD) and the European anti-fraud office OLAF, which have both issued extensive guidelines on the matter (available here and here).
The Notice’s section on the application of the collusion-related exclusion ground provided for in the EU public procurement Directives includes a discussion on the so-called right to “self-cleaning” of tenderers (see, Section 5.7). The discussion considers the impact of the RTS Infra judgment which the Court of Justice of the European Union delivered on 14 January 2021 in response to a request for a preliminary ruling from the Belgian Council of State (Raad van State / Conseil d’État). A discussion of this judgment can be found here.
