On the 8th

of June, 2017, the Court of Justice of the European Union (CJEU) reached an

important decision in the case Medisanus

d.o.o. v General Hospital Murska Sobota (C-296/15) concerning public

procurement procedures. The judgement is relevant from both the procedural

aspect - since the National Review Commission (DKOM) was acknowledged for the

first time as a “national court” for the purposes of Article 267 of the Treaty

on the Functioning of the European Union (TFEU), as well as from the

substantive point of view – due to the emphasis on the principle of equal

treatment and the prohibition of discrimination within public procurement

procedures.

Disputed Public Procurement

General Hospital

Murska Sobota reached a decision, on public procurement in 2015, concerning the

purchase of two types of drugs derived from plasma. The tender documentation

specified as a technical prerequisite that these drugs have to be obtained from

Slovenian plasma. This prerequisite was included in the tender documentation

based on the provision of the Law on Medicinal Products,[1]

which stipulates that supplies must come as a matter of priority from medicinal

products manufactured from plasma collected in Slovenia.[2]

According to the opinion of the contracting authority, this should not be

contravening EU primary law, since deviation from Article 34 of TFEU may be

justified on the grounds of public health protection. Consequently, such a

provision of the Law on Medicinal Products contributes to the national

self-sufficiency by encouraging Slovenian citizens to make voluntary blood

donations.

The only contractor

that could fulfil such a prerequisite was the Institute for Transfusion

Medicine of the Republic of Slovenia. The company Medisanus d.o.o., which was

offering drugs of the same type but from foreign plasma, after the rejection of

its tender application, challenged the decision before DKOM. The procedure was

subsequently stalled by the DKOM, since it made a request for a preliminary

ruling before the CJEU. Namely, whether the request for a plasma of Slovenian

origin is in accordance with the Public Procurement Directive.[3]

DKOM is Entitled to Request a Preliminary

Ruling before the CJEU

For the first time in

DKOM’s existence, the CJEU had the opportunity to assess whether the DKOM could

be considered as the “national court” for the purposes of Article 267 TFEU.

Considering the established case law on similar national revision bodies in member

states,[4] the

CJEU ruled that the DKOM fulfils all relevant criteria for the obtainment of

such status which entitles the DKOM to request preliminary rulings. The DKOM

has, namely, no connection with contracting authorities whose decisions it

reviews, its members enjoy the same safeguards as judges in relation to their

appointment, term of office and the grounds for removal. Its members are,

furthermore, independent and the jurisdiction of the DKOM is mandatory and

permanent. Also, the DKOM is established pursuant to a special law and the

procedure is inter partes.

Prerequisite on National Origin

of Plasma is Contrary to EU Law

The CJEU established

that the drugs derived from human blood or plasma are “goods” in terms of

Article 34 TFEU, and are as well “products” under the Public Procurement

Directive. CJEU furthermore states that the prerequisite for a national origin

falls under the scope of Article 34 TFEU, which prohibits obstacles to the free

movement of goods. This prohibition covers both the quantitative restrictions,

as well as measures that are capable of hindering, directly or indirectly and

actually or potentially, imports between member states.[5]

This prohibits all discriminatory practices that limit the free movement of

goods within the EU.

The paramount

conclusion of the CJEU is that the prerequisite on national origin of plasma is

discriminatory per se, since it does

not allow companies that collect plasma from other countries to successfully

participate in the tender procedures. It is true that the Public Procurement

Directive itself enabled references to certain origin, however only if this is

justified by the subject matter of the procurement and such reference is only

exceptional. It also derives from the CJEU case law that in such cases a specific

source stated in the tender documentation has to be accompanied by the words

“or equivalent” in order for the tender to be in compliance with EU law.[6]

There was no such wording in the case at hand.

Pursuant to the fact

that it is possible to deviate from the principle of the free movement of goods

in certain exceptional cases, the CJEU deliberated whether such deviation is

justified. The sole reason for justification could only be based on the grounds

of public health protection.[7]

The CJEU did note that the prerequisite for a national origin of plasma pursues

a legitimate objective. However, the priority principle for medicinal products

manufactured industrially from Slovenian plasma does not contribute decisively

to encouraging the Slovenian population to make voluntary blood donations.

Thus, the CJEU held that the priority principle is disproportionate.

Conclusion

The most important

conclusion for the practice on public procurements will be the fact that

neither the Public Procurement Directive nor the primary EU law forbid tender

documentation provisions which would require that drugs are derived from

Slovenian plasma, even if national legislation requires such a provision. A decision

like that, which further limits the scope of potential deviations from the free

movement of goods, will be beneficial for public procurement procedures, since

such practices are not uncommon. In light of enhancing the professionalism of

the DKOM, the decision on admissibility of its request should be welcomed.

Thus, we can anticipate further activity from parties which will surely more

often propose to DKOM to request preliminary ruling in cases where ambiguous

legal provisions are at play.

[1] Official Gazette of the Republic of Slovenia,

no. 17/14.

[2] The legal basis for this is Article 6 (71) of

the Law on Medicinal Products.

[3] Although the Directive 2004/18/EC was repealed

by Directive 2014/24/EU on the 18th of April, 2016, the same legal

reasoning applies also under the new Directive.

[4] For example, the judgement in case Consorci Sanitari del Maresme dated 6th

of October, 2015 (C-203/14) and there stated case law.

[5] For example the judgement in case Deutsche Parkinson Vereinigung dated 19th

of October, 2016 (C-148/15), and there stated case law.

[6] Judgement in case Commission v Ireland dated 17 June 1981 (45/87).

[7] Article 36 TFEU.