Public procurement: Commission sends formal request to Czech Republic regarding regional bus transport services

The European Commission decided to send a formal request to the Czech Republic concerning the procedure followed by the Czech Region of Usti nad Labem for the award of a contract to a private undertaking for the provision of regional bus transport services. This formal request takes the form of a "reasoned opinion", the second stage of the infringement procedure laid down in Article 226 of the EC Treaty. If there is no satisfactory reply within two months, the Commission may refer the matter to the European Court of Justice.
The Commission considers that the contract concluded between the Region and the private operator is a public service contract and that as such it should have been tendered according the detailed rules of Directive 2004/17/EC.

However, the Region awarded the provision of the transport services in the Region as a service concession and thus without a European-wide tender procedure.

In case of a service concession, the concessionaire receives the right to exploit the service and must assume the economic risk related to the performance of the service. In the present case the major part of the operator’s remuneration comes from the Region, because the income from passenger fares would not be sufficient for the provision of the service. This payment by the Region eliminates the exploitation risk. Consequently, the contract award does not concern a concession but a public contract, which requires the observation of the detailed rules of Directive 2004/17/EC.

The latest information on infringement proceedings concerning all Member States can be found at:

http://ec.europa.eu/community_law/index_en.htm

Published on: 2008-06-26

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