COMMISSION v ITALY JUDGMENT OF THE COURT 10 March 1987 * In Case 199/85 Commission of the European Communities, represented by Guido Berardis, a member of its Legal Department, acting as Agent, with an address for service in Luxembourg at the office of G. Kremlis, also a member of its Legal Department, Jean Monnet Building, Kirchberg, applicant, v Italian Republic, represented by Luigi Ferrari Bravo, Head of the Department for Contentious Diplomatic Affairs, acting as Agent, assisted by Pier Giorgio Ferri, Avvocato dello Stato, with an address for service in Luxembourg at the Italian Embassy, defendant, APPLICATION for a declaration that the Italian Republic, more particularly the Municipality of Milan, as a local public authority, by deciding to award by private contract a contract for the construction of a plant for the recycling of solid urban waste and thus failing to publish a contract notice in the Official Journal of the European Communities, has failed to fulfil its obligations under Council Directive 71/305/EEC concerning the coordination of procedures for the award of public works contracts, THE COURT composed of: Lord Mackenzie Stuart, President, T. F. O'Higgins and F. Schockweiler (Presidents of Chambers), T. Koopmans, K. Bahlmann, R. Joliét and G. C. Rodriguez Iglesias, Judges, Advocate General: C. O. Lenz Registrar: D. Louterman, Administrator * Language of the Case: Italian. 1055
JUDGMENT OF 10. 3. 1987 CASE 199/85 having regard to the Report for the Hearing and further 6 November 1986, to the hearing on after hearing the Opinion of the Advocate General delivered at the sitting on 13 January 1987, gives the following Judgment 1 By an application lodged at the Court Registry on 28 June 1985 the Commission of the European Communities brought an action under Article 169 of the EEC Treaty for a declaration that the Italian Republic, more particularly the Municipality of Milan, as a local public authority, by deciding to award by private contract a contract for the construction of a plant for the recycling of solid urban waste and thus failing to publish a notice thereof in the Official Journal of the European Communities, has failed to fulfil its obligations under Council Directive 71/305 of 26 July 1971 concerning the coordination of procedures for the award of public works contracts (Official Journal, English Special Edition 1971 (II), p. 682). 2 Reference is made to the Report for the Hearing for the facts and the submissions and arguments of the parties, which are mentioned or discussed hereinafter only in so far as is necessary for the reasoning of the Court. I Admissibility 3 The Italian Republic has raised an objection of inadmissibility. It maintains that it fully complied with the reasoned opinion delivered by the Commission and that, consequently, an action before the Court of Justice under Article 169 of the EEC Treaty is no longer admissible. 4 In its reasoned opinion delivered in the pre-litigation procedure the Commission requested the Italian Republic 'to adopt the measures necessary to comply with this reasoned opinion within 30 days of notification hereof' and in the final paragraph 1056
COMMISSION v ITALY thereof stated that 'by necessary measures is meant above all a written undertaking by the Municipality of Milan that it will comply with all the provisions of Directive 71/305/EEC in future'. 5 In response to the reasoned opinion, the Italian authorities sent to the Commission a copy of a letter in which the Minister for the Interior instructed the Prefect of Milan to enjoin the Municipality of Milan strictly to ensure that the directive was complied with in full in future together with the following written declaration by the Mayor of Milan dated 19 April 1984: '... although convinced that the Municipal Administration acted, as on every other occasion, in a lawful manner in authorizing the award by private contract of a contract for the construction of the said plant for the recycling of solid urban waste, I hereby declare, as requested in the aforementioned opinion, that the Municipality of Milan will ensure that, in the future, too, its administrative action is in conformity with the provisions of primary and secondary legislation, including all the provisions of Directive 71/305/EEC, by according them full respect, in both form and substance'. 6 It is clear from the documents before the Court that subsequently there were considerable delays in the construction of the proposed plant, the award of the contract for which was objected to by the Commission in its reasoned opinion, and that considerable changes had to be made to the project. However, no steps were taken with a view to proceeding to a fresh invitation to tender under conditions complying with the terms of the reasoned opinion. 7 It must be pointed out that the purpose of the procedure provided for in Article 169 of the EEC Treaty is, inter alia, to avoid a situation in which a Member State's conduct is put at issue before the Court when, following the commencement by the Commission of the infringement procedure, the State admits the breach of obligations with which it is charged and remedies that breach within the period fixed by the Commission. 1057
JUDGMENT OF 10. 3. 1987 CASE 199/85 8 In this case, however, the declaration issued by the Mayor of Milan disputes the view expressed by the Commission in its reasoned opinion as to the existence of an infringement and no practical measure entailing acceptance of that point of view has been adopted by the Italian authorities. 9 In those circumstances, the Italian Republic cannot be considered to have complied with the reasoned opinion delivered by the Commission and therefore the action brought by the Commission under Article 169 of the EEC Treaty cannot be considered inadmissible. Consequently, the action must be declared admissible. II Substance 10 By reference to the observations submitted to the Commission by the Municipality of Milan during the pre-litigation procedure, the defendant justified the award by private contract of the contract in question by relying upon Article 9 (b) and (d) of Directive 71/305. 11 According to the defendant, the construction of the type of plant envisaged involved the use of exclusive rights held by the undertakings to which the contract was awarded and secondly, as the result of certain events, in particular the accident at Seveso, the construction of the plant was a matter of extreme urgency. 12 It should be observed that Directive 71/305 is intended to facilitate the effective attainment within the Community of freedom of establishment and freedom to provide services in respect of public works contracts. To that end it lays down common rules, in particular regarding advertising and participation, so that public works contracts in the Member States are open to all undertakings in the Community. 13 Article 9 of the directive permits awarding authorities to award their works contracts without applying the common rules, except those contained in Article 10, in a number of situations, including (b) and (d), described under the following: 1058
COMMISSION v ITALY 'when, for technical or artistic reasons or for reasons connected with the protection of exclusive rights, the works may only be carried out by a particular contractor'; (b) and 'in so far as is strictly necessary when, for reasons of extreme urgency brought by events unforeseen by the authorities awarding contracts, the time-limit laid down in other procedures cannot be kept'; (d). 1 4 Those provisions, which authorize derogations from the rules intended to ensure the effectiveness of the rights conferred by the Treaty in the field of public works contracts, must be interpreted strictly and the burden of proving the actual existence of exceptional circumstances justifying a derogation lies on the person seeking to rely on those circumstances. 15 In the present case, no facts of such a nature as to show that the conditions justifying the derogations provided for in the aforementioned provisions were satisfied have been put forward. Consequently, the Commission's application must be granted without any need to examine the facts at issue more closely. 16 It must therefore be declared that since the Municipality of Milan decided to award by private contract a contact for the construction of a plant for the recycling of solid urban waste and thus did not publish a contract notice in the Official Journal of the European Communities, the Italian Republic has failed to fulfil its obligations under Council Directive 71/305 of 26 July 1971 concerning the coordination of procedures for the award of public works contracts. Costs 17 According to Article 69 (2) of the Rules of Procedure, the unsuccessful party is to be ordered to pay the costs. Since the defendant has failed in its submissions, it must be ordered to pay the costs. 1059
JUDGMENT OF 10. 3. 1987 CASE 199/85 On those grounds, THE COURT hereby: (1) Declares that since the Municipality of Milan decided to award by private contract a contract for the construction of a plant for the recycling of solid urban waste and thus did not publish a contract notice in the Official Journal of the European Communities, the Italian Republic has failed to fulfil its obligations under Council Directive 71/305/EEC of 26 July 1971 concerning the coordination of procedures for the award of public works contracts; (2) Orders the Italian Republic to pay the costs. Mackenzie Stuart O'Higgins Schockweiler Koopmans Bahlmann Joliet Rodríguez Iglesias Delivered in open court in Luxembourg on 10 March 1987. P. Heim Registrar A. J. Mackenzie Stuart President 1060