A Belgian contracting authority decided not to select the tender submitted by an economic operator because only one of the three subcontractors which it wanted to use met the selection criteria. The other two subcontractors did not meet the requirements in terms of diplomas and references.
The economic operator instigated a suspension procedure before the Belgian Council of State contesting its non-selection.
After a subsequent rejection of its claim, the economic operator filed an application for annulment. In support of that application, it was argued, inter alia, that the contracting authority had unfairly rejected the tender. Specifically, the applicant argued that pursuant to Article 73, paragraph 1, second subparagraph of the Belgian Royal Decree of 18 April 2017, the contracting authority should have offered it the opportunity to propose other subcontractors to replace those subcontractors which, according to the contracting authority, did not comply with the selection criteria.
Since Article 73, paragraph 1, second subparagraph, of the Belgian Royal Decree of 18 April 2017, is more or less a verbatim reproduction of Article 63, paragraph 1, second subparagraph, of the Public Procurement Directive 2014/24, the Belgian Council of State referred questions to the Court of Justice of the European Union for a preliminary ruling on the scope of the latter provision.
In its order of 6 October 2021 in case C-316/21, the Court first confirmed that an economic operator may, where appropriate and for a particular contract, rely on the capacities of other entities, regardless of the legal nature of the links which it has with them. The contracting authority must verify whether the entities on the capacity of which the economic operator intends to rely fulfil the relevant selection criteria and whether there are grounds for exclusion.
The Court then stated that the contracting authority has no discretionary power in this respect but must offer the economic operator in question the possibility of replacing the subcontractors which do not meet the qualitative selection criteria.
However, this principle is subject to an important nuance: in accordance with the principles of equality, non-discrimination and transparency, the replacement of the subcontractor concerned must not result in a substantial modification of the economic operator’s tender.
It is not simple to determine whether the replacement of a subcontractor is a substantial modification of a tender. The Court did not provide any guidance in this regard, even though the Council of State sought clarification, in its second question, as to whether there are circumstances in which the contracting authority should, or may, not require a substitution, in the light of the above-mentioned principles.
Please contact Peter Teerlinck or Raluca Gherghinaru for further information about this case and/or for general legal advice relating to public procurement.