On 22 November 2017, Advocate General Campos Sánchez-Bordona (the "AG") gave his opinion in Case C-531/16 `iaulių regiono atliekų tvarkymo centras and Others (the "Opinion"). The Opinion is not binding on the Court of Justice of the European Union ("ECJ") but may serve to guide its reasoning in its upcoming judgment.

The case concerns the issuing by a Lithuanian local authority of a public tender for waste-disposal services. A number of bidders took part, including two who were members of the same corporate group. One of the related tenderers ultimately won the tender and a losing bidder challenged the procedure. The Supreme Court of Lithuania sought guidance from the ECJ in interpreting EU law, including the now repealed Directive 2004/18/EC of 31 March 2004 on the coordination of procedures for the award of public works contracts, public supply contracts and public service contracts (the "Directive").

The questions referred to the ECJ essentially concerned the duties of both the bidders and the tender issuer in such a scenario. First, must related tenderers which submit separate tender offers disclose their relationship? Second, how should the contracting authority proceed once it becomes aware of the links between two tenderers?

It was common knowledge that the two companies at the heart of the dispute were part of the same corporate group. One of the companies included in its bid a declaration that it was acting independently of its sister company. As a result of the company's declaration, the local authority was aware that the two companies formed, in the words of the AG, an "economic unit".

Unless the call for tenders specifically requires related companies to disclose their relationship, there is no obligation in EU law to do so. While the Directive provides that related tenderers must not submit a "mere variant or alternative" of a competitor's tender, the AG does not hold this to mean that there is a general obligation to disclose the nature of their corporate relationship to the contracting authority.

There may, however, be circumstances in which disclosing this relationship would be necessary on the grounds of competition law. In principle, the prohibition of anticompetitive agreements and concerted practices does not apply to companies that constitute an economic unit. Thus, article 101 TFEU does not apply to the case of two related tenderers.

Nonetheless, the ECJ's case law has made it clear that a contracting authority has an "active role" in applying the principles of public procurement and must act as the "guarantor of genuine competition between tenderers". As part of this role, a contracting authority is normally required to ensure that the tenders submitted are indeed distinct one from the other. This process of verification may necessitate the requesting of additional information from tenderers. At the same time, the contracting authority may already have sufficient information to make a decision. This will be the case if related tenderers voluntarily disclose the nature of their relationship and undertake to act in complete independence of each other for the purposes of the tendering process.

As a result, the contracting authority is required to ensure a fair and competitive process even though the competition rules on cartels do not apply to the situation of related tenderers. While the contracting authority is not specifically required to ask for information from related tenderers, it must nonetheless ensure that such information is available to it (such as on the basis of submissions already received) if it considers there to be a risk to transparency and fair competition between tenderers arising from the participation of related entities. If not, the fairness of the procedure may be called into question by other participants in the tender.

Although the AG delivered his opinion on the basis of Directive 2004/18/EC, the opinion is of future relevance because Directive 2014/24/EU of 26 February 2014 on public procurement and repealing Directive 2004/18/EC contains similar terms.

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