I-Sete – Inovação, Soluções Económicas e Tecnologias Ecológicas Lda v. EDIA – Empresa de Desenvolvimento e Infra-estruturas do Alqueva SA

Automatic lifting of suspension

1. 1.

   Lifting without hearing: Whether legislation can require court to lift suspensive effect ‘without first hearing the unsuccessful tenderer that brought that action and without being able to weigh up all the interests at stake on the merits’ [20] under Article 2(3) to (5) of Council Directive 89/665/EEC, read with Article 47 of the Charter.

2. 2.

   Article 2d of Directive 89/665 inapplicable: Article 2d ‘relates, however, to contractual disputes since it is based on the assumption that a public contract has already been concluded.’ [17] Pre-contractual dispute governed by Article 2 [19]. SARPP, C-241/89 and Luxone & Sofein, C-403/23 and C-404/23.

3. 3.

   Article 2(3) to (5) of Council Directive 89/665/EEC (Remedies Directive) on interim protection interpreted: Action against award ‘must necessarily have automatic suspensive effects on the procurement procedure to which that decision relates.’ [29] Hence ‘the right to apply for interim protection is crucial in the context of a procedure for the award of a public contract.’ [30] EPIC Financial Consulting, C-274/21 and C-275/21.

   1. 3.1

      Remedies Directive interpreted purposively: Directive ‘is intended to protect economic operators against arbitrary behaviour on the part of the contracting authority’ [27]. Commission v. Germany, C-433/93, Star Storage & Ors, C-439/14 and C-488/14 and CROSS Zlín, C-303/22.

   2. 3.2

      Directive 2007/66/EC interpreted purposively: Legislature sought to prevent contracting authorities ‘from making the consequences of such a contested decision irreversible by proceeding very quickly to the signature of the public contract.’ [44]

4. 4.

   Article 52(1) of the Charter on limitation of right to effective remedy applied: Lifting ‘brings about a limitation of the right to an effective remedy’ provided for by law [34], with objective of general interest of swift procedures ‘in order to avoid a loss of financing from European funds’ [35]. Star Storage & Ors, C-439/14 and C-488/14 and CROSS Zlín, C-303/22.

   1. 4.1

      Applicant’s probatio diabolica: Conditions ‘the contracting authority may apparently easily satisfy’ [40]. Applicant must disprove them, ‘which amounts to imposing the production of a probatio diabolica on that person.’ [41]

   2. 4.2

      Court without discretion: ‘the body responsible for review procedures does not enjoy any discretion in deciding at that point in time whether or not to lift the automatic suspension.’ [42] Rule ‘distorts the principle of the automatic suspensive effect of an action against a decision awarding a contract by replacing it with a rule that is the exact opposite’ [43].

   3. 4.3

      Combinatie Spijker Infrabouw-De Jonge Konstruktie & Ors, C-568/08 on role of interim measures applied: Court hearing interim application ‘is not designed to rule definitively on the claims presented to it but to protect provisionally the interests at stake, possibly by balancing them’ [46]. It ‘cannot be bound by national legislation which would take its place in an abstract weighing up of those interests with final effect.’ [47]

   4. 4.4

      Loss of funding not overriding: Risk of losing European financing ‘cannot by itself constitute an overriding reason in the public interest which systematically tips the balance of interests in favour of the contracting authority.’ [51] Legislation ‘undermines the essence of the right to an effective remedy’ [52].

5. 5.

   Article 2(5) of Remedies Directive on weighing of interests applied: Provision ‘highlights the need for the court hearing the application for interim measures to carry out a specific assessment when weighing up all the interests at stake.’ [48]

6. 6.

   National legislation precluded: ‘it precludes national legislation which, for the sake of a general interest objective of speed in public procurement procedures, intended to avoid the loss of financing from European funds, requires the national court, on application by the contracting authority, provisionally to lift the automatic suspensive effect of an action against that authority’s decision to award a public contract, without first hearing the unsuccessful tenderer that brought that action and without being able to weigh up all the interests at stake on the merits.’