Research On EU's Directive On The Award Of Concession Contracts

The EU Concessions Directive begins with the Green Paper on public-private partnerships and Community law on public contracts and concessions.As the EU Concessions Directive enacted before,works concessions in the public sector did fall within the ambit of Directive 2004/18 Public Sector Procurement and services concessions in the public sector and works concessions in utilities sectors were only subject to the general principles of the TFEU.On the other hand,the case law of the European Court of Justice on concession contracts is also very complex,and the basic principles explained in the case are not the same.Once the absence of certainty of the law,not only will the operators face an uneven competitive environment,but also very likely to hinder the public authorities choose to use concessions.As a result,the EU Concessions Directive is a uniform legislation for works concessions and services concessions.This paper is divided into six chapters:Chapter ? The Legislative Logic of the EU Concessions Directive.The absence of clear rules at Union level governing the award of concession contracts gives rise to legal uncertainty and to obstacles to the free provision of services and causes distortions in the functioning of the internal market.It is a gradual legislative process of concessions in EU,which formulated a uniform legislation for works concessions and services concessions.The EU Concessions Directive is closely related to the rise of PPP and the vague definition of concessions in EU law.Since the differnences between concession contracts and public contracts,such as nature,the award precesure etc.,it is necessary to make a separate legislation for the concession contracts.The EU Concession Directive has reformed the rules governing the award of concession contracts,which applied a light regulation.However,there are serious shortcomings in the EU Concessions Directive.Firstly,most of the general provisions are a copy of provisions already available in Directive 2014/24 Public Sector Procurement.Secondly,although the sui generis of the concessions,there is no independent procedures for the award of concessions,which only provides that the Member States may freely design the award of concessions according to equal treatment,transparency and proportionality.But there are differences between concession contract and public contract,the absence of award procedure shall affect the tender of concessions and the effective implementation of the EU Concessions Directive in Member States.Chapter ? The Scope of the EU Concessions Directive.The EU Concessions Directve made rules governing the award of concession contracts.It clarifies that the concept of a concession requires the transfer of an operating risk to the concessionaire in exploiting those works or services,encompassing demand risk or supply risk or both.The concessionaire is deemed to assume the operating risk where,under normal operating conditions,it is not guaranteed to recoup the investments made or the costs incurred in operating the works or providing the services that are the subject of the concession.The EU Concessions Directive regulates the award of both works concessions and services concessions to economic operators by contracting authorities or contracting entities,provided that the works or services are intended for the pursuit of one of the activities referred to in Annex II of the directive.The contracting authorities and contracting entities may be state,regional or local authorities,bodies governed by public law or associations formed by one or more such authorities or one or more such bodies governed by public law other than those authorities,bodies or associations,public undertakings or,exceptionally,private undertakings operating on the basis of exclusive or special rights.For the activities listed in Annex II include activities related to energy,public passenger transport,exploitation of geographical areas,and postal services.However,there is a lot of controversy about the exclusion of concessions between public sector entities and the exclusion of drinking water services.The EU Concessions Directive applies only to the works and services concessions that have a value equal to or greater than certain values.Most importantly,public authorities should in particular be encouraged to divide large contracts into lots to facilitate the SME participation.Chapter ? The Award Criteria of the EU Concessions Directive.There is no independent procedure for the award of concessions in the directive,which only provides that the Member States may freely design the award of concessions according to equal treatment,transparency and proportionality.Though rules governing the award of concession contracts are more flexible,it should be subject to the general rules of the EU public procurement law.Firstly,the concession contracts shall be awarded by the most economically advantageous tender,which would encourage the SME to participate in the public procurement.Value for money is also another important criterion for the award of concession contracts.Secondly,the award criteria shall include,inter alia,environment,social or innovation-related criteria.One of the areas in which the interaction between competition law and public procurement is closest relates to concession contracts.Therefore,the introduction of competition rules in theEU Concessions Directive is conducive to the economic operators.The EU Concessions Direvtive shall be a tool to maintain the economic balance of the contract for value for money.Chapter ? The Award Procedure of EU Concessions Directive.The EU Concessions Directive only provides the concession notices and general principles and procedural guarantees applicable to the award of concessions.The contracting authority or contracting entity shall have the freedom to design the procedure leading to the choice of concessionaire subject to compliance with this Directive.Thererfore,the award of concessions contract can apply the open procedure,restricted procedure,competitive procedure with negotiation,competitive dialogue,innovation partnership and the negotiated procedure without prior publication.However,the design of the concession award procedure shall respect the principles of principles of equal treatment,non discrimination and transparency.The duration of the concession and e-procurement are essential in the award procedure of the EU Concessions Directive.On one hand,the duration of concession is limited,the maximum duration of the concession must not exceed the estimated time that a concessionaire could reasonably be expected to take in order to recoup the investments made in operating the works or services together with a return on invested capital,taking into account total investment.On the other hand,although the use of electronic means is not mandatory,the e-procurement is to be a tendency in the public procurement.Chapter ? The Relationship between the Award of Concessions and State Aids Rules.Concessions,as important aspects of EU public procurement,could promote the equal treatment and competition in internal market.Howerver,The increased flexibility which gives rise to greater discretion to public authorities,specifically in the light of the new competitive negotiated procedure,may create advantage for certain economic operator.When public authorities purchase supplies,services or works,they should thus buy in accordance with the private consumer principle or market economy investor principle.Any award procedure that favours a particular firm without securing lower price,higher quality or higher return does not only infringe the EU Concessions Directive but also constitutes State Aid in the meaning of Article 1o7(1)TFEU.Therefore,the award of concession contracts should comply with the EU Concessions Directive or fall within the various categories of exemption of State Aids Rules.Chapter ? The Status quo and Suggestions on Concessions Legislation in China.With the increase of PPP projects,the legislation of concessions in China is insufficient.Since 2014,the Ministry of Finance and the National Development and Reform Commission have issued documents to guide the development of PPP and concessions.However,the current legislation only provides an institutional framework for PPP which applies concession contracts.The concession legislation system is not coordinated inside.At the same time,there exist problems in the scope,definition,duration of concession and the supervision.Therefore,the concessions legislation should be completed in the guidance of EU Concessions Directive,including the purpose,definition,scope,duration of concession,the award procedure and the supervisory authority.