Privacy Policy
Code of Ethics

Public Contract of the EU as an Autonomous Concept and its Role in Unification of National Legal Doctrines of the Member States

In the era of the high market value of the so-called public contracts within the EU market, the matter of its doctrinal origin, as well as the issue of its autonomy as a concept is found to be useful for a deeper understanding of the public contract as a concept originating from EU regulation, as well as for facilitating its further development within the both EU law and law of the Member States.

Attempts to conceptually determine the administrative contract are present in the legal doctrine of various legal systems, almost as long as the existence of the administrative contracts themselves. The concept of administrative contracts is the field for some of the most fruitful comparative legal research, bearing in mind the variety of solutions that appear in legal systems. However, the main characteristics of the comparative analysis of administrative contracts are crude attempts to bring the same or similar institutes of different systems under the same term. Thus, through the definition of administrative contracts in French law, an attempt was made to find an analogous institution of German and other laws, although it did not deal with administrative contracts as such.

With the emergence of the supranational law of the European Union, the results of such research regained importance and gained a new dawn. If the explanation is not self-evident, it should be hereby highlighted. First of all, for the sake of a comprehensive overview of the institute, it is necessary to know its origin and what solutions it was inspired by. This motive, with the development of the case-law of the Court of Justice of the European Union and other judicial instances, begins to lose its importance and contributes more to the historical dimension of the analysis. On the other hand, from national law as a source of inspiration, the tables have turned. The national legal systems became an area of ​​influence, and the so-called administrative contracts of the EU began to have a retroactive effect on national systems. This transposes the field of comparative legal analysis of administrative contracts to the field of comparative legal analysis of public contracts.

In the literature, attention has already been drawn to the lack of analysis that would deal with the comparative legal research of public contracts. The reasons given for this are such that they call into question the very expediency of the research. Namely, EU member states define public contracts in different ways, and there are no significant overlaps in the term itself. As the concept of public contracts of the law of the European Union already had a retroactive effect on the national rights of the member states, the influence was manifested through the corresponding changes in the regulations. The codification of public procurements and concessions, which are now expressly provided as administrative contracts in French law on the one hand, and the “publicization” of German contracts on public procurements and concessions, testify to the influence of EU law. Therefore, the understanding of public contracts is important not only for the effective application of EU law but also for observing trends in the development of national rights and presenting de lege ferenda proposals for more effective implementation of administrative contracts into national legal systems.

When it comes to the continental legal tradition which comprises all the member states of the European Union, the definitions of administrative contract significantly vary which is a statement that might be supported under the assumption that all the countries do recognize the autonomous concept of administrative contract in the so-called classical sense. Two principal streams of opinion can be observed, that are entirely opposed, when it comes to the perception and determination of administrative contracts. The first one originates from the French legal doctrine and the case law developed under the auspices of the State Council (Conseil d’Etat) and the Tribunal for Conflicts (le Tribunal des conflits), which in a few words may be characterized as recognizing administrative contracts as a contract of public law concluded by public body as one on the contracting parties, having extraordinary authorities regarding the performance and resolution of the contract thus containing so-called exonerate clause (clause exonerant), or contracts that are as such explicitly declared by the law. On the other side, there is a German concept within which the term administrative contract is not explicitly recognized. These are the contracts concluded between equal parties, irrelevant of their public or private status in the sense of law, where the principle of equality is consistently applied and these contracts are subject to the common law of contracts, so no specific legal regime is prescribed.

In the meanwhile, the administrative law of the European Union has significantly developed and the contracts concluded by the public bodies are widely present making it one of the significant and valuable markets in the European Union. The regulation of this contract has been strongly influenced by the French legal doctrine developed during the late 19th and 20th centuries until it obtained its conceptual autonomy, deprived of national legal influences.

First of all, it is relevant to say that none of the European legal instruments explicitly declares a certain kind of contract to be administrative. On the contrary, the EU legislation operates with the term “public contracts”.

In accordance with Article 272 of The Treaty on the Functioning of the European Union

The Court of Justice of the European Union shall have jurisdiction to give judgment pursuant to any arbitration clause contained in a contract concluded by or on behalf of the Union, whether that contract be governed by public or private law (underlined by the author).

It may be concluded that the European Union does acknowledge the existence of both public and private law. Secondly, the contractual liability of the Union shall be governed by the law applicable to the contract in question, pursuant to Article 340, paragraph 1 of the Treaty. These two articles in conjunction may be understood as although the European Union does recognize the separation of these two branches of law within the national legal systems, EU law does not recognize it as such within its own regulation. Since one of the cornerstones of the distinction between the contracts of private and administrative law within the national legal systems is the matter of the application of public or private law and the matter of jurisdiction of administrative or common courts, it is logical to conclude that the administrative contracts in that sense are not relevant to the European legislation, since it does not recognize the difference between public and private law. However, public contracts within the European Union do exist and they present anonymous concepts irrelevant to the perceptions of its member states. The question that might be raised refers to the potential of the term to take a unifying role and to have a wide scope that would apply to different types of contracts.

When it comes to the regulation that currently regulates the public contract, a few initial remarks should be made. The public contract as an institute has been introduced in the EU law by the set of directives adopted in 2014, with the aim to regulate and adapt public procurement to the main goals of the European Union in general. Namely, both the CJEU and the European Court of First Instance have multiple times declared that the general principles of the European Union are also to be applied to public contracts. These are the so-called primary sources of law within the European Union contained in the principal treaties on the foundation and on the functioning of the European Union. Furthermore, we may conclude that public contracts have to be regulated in accordance with the main principles of the European Union, including non-discrimination, equal treatment, transparency, mutual recognition, and proportionality, in order to enable the free circulation of persons, goods, capital and services on the unified European market.

As previously mentioned, the secondary regulation and the source of the law of the public contracts comes from the set of directives that were adopted in 2014: Directive 2014/24/EU on public procurement (which relates to public procurement in the so-called classical sector), Directive 2014/25/EU on procurement by entities operating in the water, energy, transport, and postal services sectors and Directive 2014/23/EU on the award of concession contracts. According to Article 2, paragraph 1, alinea 5 of Directive 2014/24/EU, public contracts are defined as:

contracts for pecuniary interest concluded in writing between one or more economic operators and one or more contracting authorities and having as their object the execution of works, the supply of products or the provision of services.

The exact same definition may be found in Article 2 paragraph 1 point 1 of the Directive 2014/25/EU, although it excludes the word “public”, only defining contracts. Inconsistency of the term “public contract” may also be noticed in Directive 2014/24 itself, as sometimes only the “contract” is used. However, the CJEU has established that when it comes to the usage of the term contract in these directives, it also refers to public contracts. It is the opinion of the author that this inconsistency may be attributed to the lack of attention of the authors of these directives and not to the specific ratio legis of the legislators.

Besides the general principles of law and the mentioned directives, the third source of law is the widely developed case law of the CJEU, which is in accordance with relevant legislation and entitled to interpret and give their legally binding opinion about the matters coming from the regulation that are incorporated within the national legal systems. For the concept of a public contract, this source is of particular importance, bearing in mind that other criteria for determining the scope of the concept of an administrative contract have been developed through extensive judicial practice. In conclusion, the main elements of the term of public contract are: 1) contract 2) written form (of contract) 3) act of acquisition, and 4) pecuniary interest.

Several conclusions can be drawn from the previously conducted analysis. First, it is difficult to successfully defend the position that European Union law recognizes the concept of an administrative contract, in the same way that any national law does. In contrast, EU law, under the influence of the doctrine of administrative contracts, developed the concept of public contracts, which, through rich legislation and judicial practice, gained the status of an autonomous concept. This term has great unifying potential, which can already be seen in the legislation of the member states. What significantly limits his further possibilities is the strict binding of the term to the matter of public procurement and concessions. Although it can be said that the term was coined for the purposes of public procurement, we consider it advisable that its conceptual definition goes beyond that. Therefore, the concept was naturally created under the influence of the needs that exist in public procurement and concessions, but the concept should be autonomous, and thereby its independent development should be ensured so that it can respond to the requirements of constantly developing EU law in which new forms of business and contracting may appear.

Ivana Radomirović is a PhD candidate in Civil Law and Law of Obligations at the Faculty of Law, University of Belgrade. Graduated from the Faculty of Law University of Belgrade in 2018, defended her master’s thesis in Law of Obligations (titled: “Form of the Power of Attorney for Conclusion of the Contracts of the Real Estate Transactions”), in 2020. Admitted to the Belgrade Lawyers Bar from 2018 to 2021. Passed the bar exam before the Ministry of Justice of the Republic of Serbia in 2023. Awarded the scholarship of the Ministry of Education as an exceptional young researcher in 2021. Also awarded by the Lawyer’s Bar Association of Vojvodina for a scientific article titled “Consent to Conclusion of the Contract” that has contributed the most to the dialogue between legal science and practice. She is currently employed as a Research Assistant at the Institute of Comparative Law in Belgrade.

Print Friendly, PDF & Email