Abstract
This chapter reviews the public procurement principles at the EU level with a focus on transparency. It discusses the origins and the various understandings of this principle as well as the lack of any common definition. The principle of transparency is reviewed further as a core principle in the process of awarding procurement contracts. The specific features and functions of transparency are discussed and the evolution of the principle as an anticorruption tool in the procurement process is further analysed. The second part of the chapter presents an example of the national legislation of a Member State (Bulgaria), where the principle of transparency is overexposed and has become a burden on procedures, but its anticorruption effect remains doubtful. This serves as a base for the comparative analysis of the procurement systems and the anticorruption politics of three Members States, different in their approach towards transparency, performed in this book.
‘Cellophane, Mister Cellophane
Should have been my name
Mister Cellophane
‘Cause you can look right through me
Walk right by me
And never know I’m there!’
(Fred Ebb ‘Mister Cellophane’, ‘Chicago’ musical)
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Notes
- 1.
Directive 2014/24/EU of the European Parliament and of the Council on public procurement and repealing Directive 2004/18/EC OJ L94/65; The general principles of procurement are inherited by the provisions of European Parliament and Council Directive 2004/18/EC on procedures in public works contracts, public supply contracts and public service contracts, OJ L 134, 30.4.2004 and slightly amended. These principles comply with the principles of the Treaty on the Functioning of the European Union (TFEU) and in particular the free movement of goods, freedom of establishment and the freedom to provide services, as well as the principles deriving therefrom - equal treatment, non-discrimination, mutual recognition, proportionality and transparency.
- 2.
See Case 31/87 Gebroeders Beentjes BV v Netherlands [1988] ECR 4635.
- 3.
OECD, ‘Public Procurement in the EU: Legislative Framework, Basic Principles and Institutions’ (2011) Sigma Brief 1, accessed 20 April 2016 <www.sigmaweb.org/publications/Public_Procurement_EU_2011.pdf>.
- 4.
R Oliver, What is transparency? (New York: McGraw-Hill, 2004) ix.
- 5.
D Curtin,‘The Fundamental Principle of Open Decision-making and EU (Political) Citizenship’, in D O’Keeffe and P Twomey (eds), Legal Issues of the Amsterdam Treaty (Oxford: Hart, 1999) 71, 72–73.
- 6.
P Trepte, Public procurement in the EU (Oxford: Oxford University Press, 2007) 16.
- 7.
Ibid.
- 8.
See eg S Schooner, ‘Desiderata: Objectives for a System of Government Contract Law’ (2002) 11 Public Procurement Law Review 103; M Krivachka, M Markov, E Dimova. and Z Lilyan, The new aspects in the Public Procurement Act (Sofia: IK Trud i Pravo, 2006) 33.
- 9.
See eg S Arrowsmith, The law of public and utilities procurement (London, Sweet & Maxwell, 2005); Trepte (n 6).
- 10.
See S Arrowsmith, ‘Transparency in Government Procurement: The Objectives of Regulation and the Boundaries of the WTO’ 37 (2003) Journal of World Trade 283; and S Arrowsmith, ‘Towards a multilateral agreement on transparency in government procurement’ (1998) 47 International and Comparative Law Quarterly 793–816.
- 11.
Above (n 4).
- 12.
K Lord, The perils and promise of global transparency (Albany: State University of New York Press, 2006) 2.
- 13.
Ibid.
- 14.
Ibid.
- 15.
Above (n 4).
- 16.
Oliver (2004) (n 4), commented that ‘being transparent is ‘table stake’ for politicians around the world […]. Government transparency extends from the local town council to the federal government in each action’.
- 17.
A Chayes and A Chayes, The new sovereignty (Cambridge, Mass., Harvard University Press, 1995), 135.
- 18.
Ibid.
- 19.
Ibid.
- 20.
JE Nolan (ed), A Chayes. and A Chayes, Regime Architecture: Elements and Principals in Global Engagement: Cooperation and Security in the 21st Century (Washington DC: Brookings Institution, 1994) 66–67. Although quite comprehensive, the definition of Chayes and Chayes (1995) and the analysis of the transparency principle lead to some conclusions of the authors which could not be completely shared. The idea that transparency is an instrument which enhances the compliance with treaty norms by imposing on participants the (passive) obligations to report and to inform about a particular regime and its practices is only the best case scenario in which access to and the availability of information leads necessarily to the positive effect of obedience to the regime.
- 21.
BusinessDictionary.com, ‘What is transparency? definition and meaning’ <www.businessdictionary.com/definition/transparency.html> accessed 20 April 2016.
- 22.
Ibid.
- 23.
D Jones, ‘Competition and Transparency in Government Procurement in Southeast Asia’, in C Wescott, B Bowornwathana and LR Jones (eds), The Many Faces of Public Management Reform in the Asia-Pacific Region (Research in Public Policy Analysis and Management, Volume 18) (Bingley: Emerald Group Publishing Limited, 2010) 97–121.
- 24.
CPC Decision 1778–2011.
- 25.
EW Welch, CC Hinnant, Internet Use, Transparency, and Interactivity Effects on Trust in Government (2003) Proceedings of the 36th Hawaii International Conference on System Sciences.
- 26.
D Curtin, Executive power of the European Union: Law, Practices and the living Constitution (New York: Oxford University Press, 2009), 219.
- 27.
See above (n 5), 86.
- 28.
CE Jimenez-Gomez and M Gasco-Hernandes, Achieving Open Justice through Citizen Participation and Transparency, (Hershey: IGI Global, 2017), 158.
- 29.
A Buijze, ‘The Principle of Transparency in EU Law’ (Den Bosch: BOXPress, 2013), 47–48.
- 30.
I Georgieva, ‘The miracle of transparency’ (2015) ‘Capital’ newspaper <http://www.capital.bg/biznes/vunshni_analizi/2015/09/27/2616907_chudoto_na_prozrachnostta/>, accessed 2 October 2016.
- 31.
The current consolidated version of these Treaties can be found in OJ 2016 C202, p. 13 and 47 respectively.
- 32.
The main relevant provisions are Arts 34–36 TFEU on the free movements of goods, Arts 49–55 TFEU on the freedom of establishment, Arts 55–62 TFEU on services and Art 106 TFEU on special or exclusive rights on public undertakings and entities.
- 33.
C-324/98 Telaustria Verlags GmbH and Telefonadress GmbH v Telekom Austria AG [2000] ECR I-10745.
- 34.
In light of the discussion of the lack of any unanimous definition of transparency, Arrowsmith (n 9) 191–199, discusses whether the conception of transparency provided by the ECJ in Telaustria is indeed clear and comprehensive and whether transparency involve requirements other than advertising.
- 35.
Historically, the first case which considered the principle of transparency is Case C-87/94 Commission v. Belgium (Walloon Buses) [1996] ECR I-02043. Case C-275/98 Unitron Scandinavia A/S [1999] ECR I-8305 then added that transparency should always apply, even when no tendering requirements are under consideration. However, Telaustria had the most definitive impact on the implementation of this principle in public procurement procedures.
- 36.
Arrowsmith (n 9) 197.
- 37.
Trepte (n 6) 19–22.
- 38.
Ibid 22.
- 39.
See Case C-59/00, Bent Mousten Vestergaad v Spottrup Boligselkab [2001] ECR I-9095; Case C-264/03 Commission v France [2005], ECR I-8831; Case C-458/03 Parking Brixen GmbH v Gemainde Brixen, Stadtwerke Brixen AG [2005], ECR I-8612 – which reiterate to a great extent the conclusions in Telaustria and discuss again the applicability of the general rules of the Treaties to below-threshold contracts.
- 40.
Case C-231/03 Consorzio Aziednde Metano (‘Coname’) v Padania Acque SpA [2005] ECR I-7287.
- 41.
Case C-195/04, Commission v Finland [2007] ECR I-3351, 3353.
- 42.
See paras 79 to 98 of the Opinion of Advocate General Sharpston in that case.
- 43.
See also paras 27 to 32 of the judgment in Commission v Finland (n 41).
- 44.
See also D McGowan, ‘Clarity at Last? Low value Contracts and the Transparency Obligations’ (2007) 4 Public Procurement Law Review 274–283.; T Kotsonis, ‘The Extent of the Transparency Obligation Imposed on a Contracting Authority Awarding a Contract Whose Value Falls Below the Relevant Value Threshold: Case C-195/04, Commission v Finland, 26.4.2007’ (2007) 5 Public Procurement Law Review NA119–NA122.
- 45.
Council Directive 71/304/EEC of 26.7.1971 concerning the abolition of restrictions on freedom to provide services in respect of public works contracts and on the award of public works contracts to contractors acting through agencies or branches [1971] OJ L185; and Council Directive 71/305/EEC of 26.7.1971 concerning the coordination of procedures for the award of public works contracts [1971] OJ L185/5.
- 46.
The preamble to Directive 89/440/EEC [1989] OJ L210, amending Directive 71/305/EEC, discusses the need for increased transparency in the procedures to improve monitoring of the compliance with the prohibition of restrictions to the Treaties freedom of establishment and the freedom to provide services.
- 47.
ie Council Directive 92/50/EEC relating to the coordinating of procedures for the award of public work contracts [1992] OJ L209/1; Council Directive 93/36/EEC co-ordinating procedures for the award of public supply contracts [1993] OJ L199; Council Directive 93/37/EEC concerning the co-ordination of procedures for the award of public works contracts [1993] OJ L199; and Council Directive 93/38/EEC co-ordinating the procurement procedures of entities operating in the water, energy, transport and telecommunications sectors [1993] OJ L199.
- 48.
Council Directive 93/38/EEC co-ordinating the procurement procedures of entities operating in the water, energy, transport and telecommunications sectors [1993] OJ L199.
- 49.
Arrowsmith (n 9) and S Arrowsmith, The law of public and utilities procurement. Vol. 1 (London: Sweet & Maxwell, 2014).
- 50.
Ibid 155 and 164–166 and Arrowsmith (n 9) 127–128.
- 51.
Although Arrowsmith (n 9) does indeed provide the most detailed explanation of the transparency principle, covering all its possible features and characteristics, I remain unsure whether transparency in procurement must be such an overly meaningfully loaded idea.
- 52.
Directive 2004/17/EC of the European Parliament and of the Council coordinating the procurement procedures of entities operating in the water, energy, transport and postal services sectors OJ L134/1; and Directive 2004/18/EC of the European Parliament and of the Council on the coordination of procedures for the award of public works contracts, public supply contracts and public service contracts OJ L134/114.
- 53.
Directive 2014/24/EU of the European Parliament and of the Council on public procurement and repealing Directive 2004/18/EC OJ L94/65; and Directive 2014/25/EU of the European Parliament and of the Council of on procurement by entities operating in the water, energy, transport and postal services sectors and repealing Directive 2004/17/EC OJ L94/243 (both directives to be transposed by 18 April 2016).
- 54.
The mechanism provided by all these European directives in the field of the public procurement, past and present shows that the European legislator has rejected full harmonisation of all public procurement procedures, with the idea of ‘general harmonisation’ being perceived as sufficient. Individual Member States have thus preserved some differences in their legislative schemes, which also affects the transparency rules.
- 55.
Not exhaustively enumerated and reviewed.
- 56.
The EU and the United Nations have also developed specific anticorruption policies and endorse transparency programmes and instruments as the fundamental instruments to combat corruption. See also the 2011 Uncitral Model Law on Public Procurement, (Uncitral.org 2011) <www.uncitral.org/uncitral/en/uncitral_texts/procurement_infrastructure/2011Model.html> accessed 20 April 2016.
- 57.
An international organisation established in 1947.
- 58.
The Agreement on Government Procurement entered into force 1981, and was renegotiated in 1994 (entered into force 1996). The GPA was further revised in 2012, which entered into force on 6 April 2014.
- 59.
Singapore WTO Ministerial 1996 (Ministerial Declaration) 13 December 1996 WT/MIN(96)/DEC, <www.wto.org/english/thewto_e/minist_e/min96_e/wtodec_e.htm> accessed 20 April 2016.
- 60.
The agreement of the delegates was for these negotiations to be conducted at the Fifth Ministerial Conference in Cancun, 2003. However, no such negotiations were launched at this Conference and the agenda was referred to the General Council of the WTO.
- 61.
Doha WTO Ministerial 2001 (Ministerial Declaration) 14 November 2001 WT/MIN(01)/DEC/1 <www.wto.org/english/thewto_e/minist_e/min01_e/mindecl_e.htm> accessed 20 April 2016.
- 62.
WTO ‘Doha Agenda Work Programme’ (General Council Decision) 1 August 2004 WT/L./579 <www.wto.org/english/tratop_e/dda_e/draft_text_gc_dg_31july04_e.htm> accessed 20 April 2016.
- 63.
Ibid.
- 64.
OECD/DAC Joint Venture on Procurement, ‘Integrity and transparency in public procurement – from good practice to the OECD Checklist’ (Presentation) (2007) Copenhagen, 6.
- 65.
OECD ‘Revised Recommendation of the Council on Combating Bribery in International Business Transactions’ (adopted by the Council at its 901st session on 23 May 1997) C/M(97)12/PROV 4.
- 66.
Transparency International, ‘The Global Anticorruption Coalition’ <www.transparency.org> accessed 20 April 2016.
- 67.
Transparency International, ‘Corruption Perception Index – Transparency International Bulgaria’ <www.transparency.bg/en/research/corruption-perception-index> accessed 20 April 2016.
- 68.
Briefing No. 3: The guiding principles of public procurement transparency, equal treatment and proportionality <http://www.clientearth.org/reports/procurement-briefing-no-3-guiding-principles-equal-treatment-transparency-proportionality.pdf> accessed 20 October 2016.
- 69.
C Bovis (ed), Research Handbook on EU Public Procurement Law (Cheltenham: Edward Elgar, 2016), 35.
- 70.
Public Procurement Practice: Transparency in Public Procurement <https://www.nigp.org/docs/default-source/New-Site/global-best-practices/transparency.pdf?sfvrsn=2> accessed 20 October 2016.
- 71.
See eg Art 35(5), Art 57, Art 83(3) Directive 2014/24/EU.
- 72.
A Popescu, ‘Public Procurement Corruption in the European Union’ (2014) Journal of Public Administration, Finance and Law, issue 1/2014 <http://www.jopafl.com/uploads/special-issue-1-2014/PUBLIC_PROCUREMENT_CORRUPTION_IN_THE_EUROPEAN_UNION.pdf> accessed 24 October 2016, 15.
- 73.
Ibid.
- 74.
OECD Competition and Procurement (Key Findings) (2011) Competition Committee <https://www.oecd.org/daf/competition/sectors/48315205.pdf> accessed 24 October 2016, 56.
- 75.
R Balfour and C Stratulat The enlargement of the European Union (2014) Discussion Paper <http://www.epc.eu/documents/uploads/pub_3176_enlargement_of_the_eu.pdf> accessed 24 October 2016, 1.
- 76.
Transparency International <http://www.transparencyinternational.eu/focus_areas/enlargement/> accessed 24 October 2016.
- 77.
See above (n 75), 2.
- 78.
C Lindstedt, D Naurin, Transparency is not Enough: Making Transparency Effective in Reducing Corruption, International Political Science Review Vol. 31, No. 3 (London: Sage Publications, Ltd., 2010), 301.
- 79.
The European Community Association Treaty came into effect on 1 February 1995 for Bulgaria.
- 80.
As a consequence of the above, the Bulgarian legal scholarship has not specifically explained and analysed the transparency principle.
- 81.
M Karadjova, ‘Legal mechanisms for decreasing the conflict of interest by the assignment of public procurements’ (2008) Yearbook of New Bulgarian University <www.nbu.bg/PUBLIC/IMAGES/File/CPA/Godishnik_2008/MilenaKaradjova.pdf> accessed 20 April 2016.
- 82.
Ibid 3.
- 83.
M Markov and M Krivachka, The new aspects in the Public Procurement Act (Sofia: IK Trud i Pravo, 2006).
- 84.
Art 2(4) New PPA.
- 85.
After Bulgaria ceases to be part of the Ottoman Empire and regained its independence after five centuries lack of statehood in 1878.
- 86.
Art 6 Public Tenders Act 1882 stated that ‘No one could participate in the tender if he/she does not present a certificate of honesty taken from the local municipality’.
- 87.
R Avramov, The communal capitalism – among the Bulgarian economical past (vol III, Sofia: Centre for Liberal Strategies, 2007).
- 88.
ie the Bulgarian currency, the Lev, internationally abbreviated as BGN or Lv.
- 89.
M Ivanov, Reformation without reforms. Political economy of the Bulgarian communism 1963–1989 (Sofia: Open Society Institute and Ciela 2008).
- 90.
OJ 1995 L358/3.
- 91.
As promulgated SG 9/3.1.1997; repealed by SG 56/22.6.1999.
- 92.
As promulgated SG 56/22.6.1999; repealed by SG 28/2004.
- 93.
Art 2 First PPA.
- 94.
In its ‘Regular Report on Bulgaria’s progress towards accession’ (2003) the European Commission found that: ‘As to public procurement, further efforts are necessary to align with the acquis and to build up the necessary administrative capacity’, 24, and concluded that Bulgaria needs to address urgently the delays incurred in aligning with EU public procurement rules. (European Commission report <http://ec.europa.eu/enlargement/archives/pdf/key_documents/2003/rr_bg_final_en.pdf> accessed 20 April 2016).
- 95.
SG 28/6.4.2004, as amended.
- 96.
Commission (EU), ‘Comprehensive monitoring report on the state of preparedness for EU membership of Bulgaria and Romania’ (Communication) COM (2005) 534 final, 25 October 2005.
- 97.
Commission (EC), ‘On the Management of EU-funds in Bulgaria’ (Report from the European Commission to the European Parliament and the European Council) COM (2008) 496 final, 23 July 2008.
- 98.
SG 13/16.2.2016, effective as of 15 April 2016.
- 99.
ie Regulation for Implementation of the New PPA (SG 28/08.04.2016, in force as of 15 April 2016).
- 100.
I Stoyanov, ‘Analytical overview of the main points in the draft Regulation for Implementation of the PPA’ (2016) 3 ZOP+ 7–8.
- 101.
SG 40/13.5.2014, effective as of 1 July 2014 and 1 October 2014 respectively.
- 102.
See above (n 4) ix.
- 103.
Introduced as an additional but non-mandatory option for ensuring procurement publicity under Art 35 Directive 2004/18/EC (also mirrored in Directive 2004/17/EC). The New Procurement Directives (eg Art 48 Directive 2014/24/EU) also refer to the ‘buyer’s profile’, without adding additional content on the previous rules or making its use obligatory.
- 104.
ie prior notices, decisions on the launch of procedures, the relevant participation documentation and any supplementary documents and explanations thereto and any other documents containing important information for interested parties and candidates. Further, commission’s protocols and reports on procedures; concluded public procurement contracts; subcontracting agreements and information on payments made under those agreements; the date, grounds and amount of each payment made under public procurement contracts and subcontracting agreements including advance payments, if any; and the date and grounds for the release, claim or retention of performance guarantees for each contract are also to be published.
- 105.
Explanatory Memorandum to the draft Bill amending and supplementing the Public Procurement Act 2013 (2015) < www.government.bg/cgi-bin/e-cms/vis/vis.pl?s=001&p=0211&n=73&g> accessed 28 May 2015.
- 106.
The mechanism for award under Bulgarian law is divided on (i) procurements below the thresholds; (ii) procurements above certain national thresholds as determined by the national legislation and (iii) procurements above the EU thresholds as defined by the EU legislation.
- 107.
It is not clear why the legislator has chosen to transpose some of the rules of the New Procurement Directives into the PPA so early, given the clear intention that the whole package should be transposed at the same.
- 108.
Commission (EC) ‘Country Report Bulgaria 2015 including an In-Depth Review on the prevention and correction of macroeconomic imbalances’ (Staff Working Document) SWD(2015) 22 final, 26 February 2015, 57.
- 109.
There is a separate Chapter 5 of the New PPA, as well as Chapter 4 of the Regulation for Implementation of the PPA, dedicated to publicity and transparency, providing rules for exchange of information
- 110.
See also my comments on these legislative amendments: I Georgieva, ‘Bulgarian Procurement: The Old Razzle-Dazzle’ (2014) CEE Legal Matters <www.ceelegalmatters.com/index.php/component/content/article?id=358:bulgarian-procurement-the-old-razzle-dazzle> accessed 20 April 2016.
- 111.
See above (n 9).
- 112.
(а) elements (features) of transparency, as a multi-layered concept, but also (b) elements of the control and prevention system for violations in public procurement (eg the judiciary, the executive power etc).
- 113.
See above (n 12) 3.
- 114.
MZ Hillebrandt, D Curtin, A Meijer, ‘Transparency in the EU Council of Ministers: An Institutional Analysis’ <http://www.clientearth.org/reports/aarhus-centre-resources-library/scholarly-articles/Transparency%20in%20EU%20Council,%20Curtin.pdf>, accessed 2 October 2016, 18.
- 115.
eg Commission (EU), ‘Report from the Commission to the European Parliament and the Council on Progress in Bulgaria under the Co-operation and Verification mechanism’ SWD (2016) 15 final; Commission (EU) ‘Annex Bulgaria to the EU Anticorruption Report’ (The First EU Anticorruption Report) 3 February 2014, <http://ec.europa.eu/dgs/home-affairs/what-we-do/policies/organized-crime-and-human-trafficking/corruption/anticorruption-report/docs/2014_acr_bulgaria_chapter_en.pdf> accessed 20 April 2016.
- 116.
M Fenster, The Opacity of Transparency (2006) 91 Iowa Law Review 893.
- 117.
C Hood, ‘Transparency in Historical Perspective,’ in C Hood and D Heald (eds), Transparency, the Key to Better Governance? (Oxford, New York: Oxford University Press, 2006), 3.
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Georgieva, I. (2017). The EU Principles in Public Procurement. Transparency – Origin and Main Characteristics. In: Using Transparency Against Corruption in Public Procurement. Studies in European Economic Law and Regulation, vol 11. Springer, Cham. https://doi.org/10.1007/978-3-319-51304-1_2
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