Opinion of Advocate General Medina delivered on 3 February 2022.

• Jurisdiction: European Union
• Court: Court of Justice (European Union)
• ECLI: ECLI:EU:C:2022:77
• Date: 03 February 2022
• Celex Number: 62020CC0436

Provisional text

OPINION OF ADVOCATE GENERAL

MEDINA

delivered on 3 February 2022(1)

Case C‑436/20

Asociación Estatal de Entidades de Servicios de Atención a Domicilio (ASADE)

v

Consejería de Igualdad y Políticas Inclusivas

(Request for a preliminary ruling from the Tribunal Superior de Justicia de la Comunidad Valenciana (High Court of Justice of the Community of Valencia, Spain))

(Reference for a preliminary ruling – Public procurement – Articles 49 and 56 TFEU – Freedom of establishment and freedom to provide services – Economic activity – Directive 2014/24/EU – Article 1(2), Article 2(1) and Article 4(d) – Conditions of applicability – Article 20(1) and Article 77 – Reserved contracts – Articles 74 to 76 and Annex XIV – Provision of social services – Public procurement in the field of social services – Simplified regime – Contractual action agreements to provide such services – Exclusion of profit-making entities – Principles of transparency, equality and proportionality – Tender condition – Geographical limitation – Directive 2006/123/EC – Scope ratione materiae – Article 2(2)(j) – Exclusion of social services)

Table of contents

I. Legal framework

A. European Union law

1. Directive 2014/24

2. The Services Directive

B. Spanish law

II. Facts, procedure and the questions referred for a preliminary ruling

III. Analysis

A. Preliminary remarks

B. The first and the second questions

1. The nature of the social services at issue

2. The conditions of applicability of Directive 2014/24

(a) The concept of ‘procurement’

(b) The characteristics of a public contract

(1) A contract concluded for pecuniary interest

(2) A contract concluded between an economic operator and one or more contracting authorities

(3) A contract for the provision of services

(c) The threshold criteria

3. Reserved contracts and the simplified regime under Directive 2014/24

(a) Reserved contracts

(1) Reserved contracts under Article 20 of Directive 2014/24

(2) Reserved contracts under Article 77 of Directive 2014/24

(b) The rules under Articles 75 and 76 of Directive 2014/24

4. Freedom of establishment

C. The third question

1. The compatibility of the selection criterion at issue with Directive 2014/24

2. Compatibility of the selection criterion with the Services Directive

3. Compatibility of the selection criterion with the fundamental freedoms

IV. Conclusion

1. The Asociación Estatal de Entidades de Servicios de Atención a Domicilio (State Association of Domiciliary Care Providers, ‘ASADE’, Spain) is a trade association for private undertakings. It is seeking before the referring court – the Tribunal Superior de Justicia de la Comunidad Valenciana (High Court of Justice of the Community of Valencia, Spain) – the annulment of Decree 181/2017 (2) adopted by the Comunitat Valenciana (Autonomous Community of Valencia, Spain), in so far as that decree prevents profit-making entities from entering into ‘contractual action agreements’ with public authorities. (3)

2. Under those agreements, public authorities entrust the management of certain social services to social initiative entities. In so doing, they are not required to follow the procedures laid down in EU public procurement legislation. However, because of Decree 181/2017, only private non-profit organisations may enter into those agreements in order to provide social services, which may include assistance to children, adolescents, young people, the elderly, the disabled, migrants, women in vulnerable situations, and members of the LGBTI (4) and Roma communities (‘the services at issue’). (5)

3. It is in that context that the Court is being asked, in essence, to clarify whether EU law, and, in particular, Articles 49 and 56 TFEU, Articles 74, 76 and 77 of Directive 2014/24/EU, (6) and Article 15(2) of Directive 2006/123/EC (7) (‘the Services Directive’), precludes national legislation that excludes profit-making entities from entering into contractual action agreements with public authorities in order to provide social services, whilst allowing non-profit organisations to conclude such agreements.

4. The complexity of the topic and the technical nature of the applicable rules, arising from various EU law instruments, should not conceal the undoubted importance of this question, since the Court is called upon to establish the relationship between economic activity and social matters, as well as that between EU law and national law.

5. In that regard, it is worth quoting Advocate General Tesauro, who more than 20 years ago stressed the fact that the social security sector does not constitute ‘an island beyond the reach of [EU] law’. (8) That was true back then and it is all the more so now. While Member States remain autonomous as regards the organisation of their social security systems, that autonomy does not prevent the application of the fundamental freedoms laid down in the Treaties, (9) of which public procurement rules are parts and parcel. (10)

I. Legal framework

A. European Union law

1. Directive2014/24

6. Directive 2014/24 lays down rules that seek to coordinate national procedures for the award of public contracts above a certain threshold amount so that they may be consistent with the principle of the free movement of goods, freedom of establishment and freedom to provide services, as well as ensuring the implementation of principles, such as equal treatment, non-discrimination, proportionality and transparency. That directive is also intended to ensure effective competition in public procurement.

7. Recitals 1 and 6 of Directive 2014/24 state:

‘(1) The award of public contracts by or on behalf of Member States’ authorities has to comply with the principles of the Treaty on the Functioning of the European Union (TFEU), and in particular the free movement of goods, freedom of establishment and the freedom to provide services, as well as the principles deriving therefrom, such as equal treatment, non-discrimination, mutual recognition, proportionality and transparency. However, for public contracts above a certain value, provisions should be drawn up coordinating national procurement procedures so as to ensure that those principles are given practical effect and public procurement is opened up to competition.

…

(6) It is also appropriate to recall that this Directive should not affect the social security legislation of the Member States. Nor should it deal with the liberalisation of services of general economic interest, reserved to public or private entities, or with the privatisation of public entities providing services.

It should equally be recalled that Member States are free to organise the provision of compulsory social services or of other services such as postal services either as services of general economic interest or as non-economic services of general interest or as a mixture thereof. It is appropriate to clarify that non-economic services of general interest should not fall within the scope of this Directive.’

8. Recital 114 of that directive clarifies the reasons for a specific simplified regime regarding certain services to the person, such as certain social health and educational services, and recital 118 thereof explains the regime concerning reserved contracts for services listed in Article 77(1) of the same directive.

9. Under Title I of Directive 2014/24, entitled ‘Scope, definitions and general principles’, Article 1(1), (2), (4) and (5) provides:

‘1. This Directive establishes rules on the procedures for procurement by contracting authorities with respect to public contracts as well as design contests, whose value is estimated to be not less than the thresholds laid down in Article 4.

2. Procurement within the meaning of this Directive is the acquisition by means of a public contract of … services by one or more contracting authorities from economic operators chosen by those contracting authorities, whether or not the … services are intended for a public purpose.

…

4. This Directive does not affect the freedom of Member States to define, in conformity with Union law, what they consider to be services of general economic interest, how those services should be organised and financed, in compliance with the State aid rules, and what specific obligations they should be subject to. Equally, this Directive does not affect the decision of public authorities whether, how and to what extent they wish to perform public functions themselves pursuant to Article 14 TFEU and Protocol No 26.

5. This Directive does not affect the way in which the Member States organise their social security systems.’

10. Article 2(1)(5) of Directive 2014/24 defines ‘public contracts’ 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’.

11. Article 2(1)(10) of that directive defines ‘economic operator’ as ‘any natural or legal person or public entity or group of such persons and/or entities, including any temporary association of undertakings, which offers the execution of works and/or a work; the supply of products or the provision of services on the market’.

12. Article 4 of the same directive, headed ‘Threshold amounts’, provides:

‘This Directive shall apply to procurements with a value net of value-added tax (VAT) estimated to be equal to or greater than the following thresholds:

…

(d) EUR 750 000 for public service contracts for social and other specific services listed in Annex XIV.’

13. Article 20 of Directive 2014/24, entitled ‘Reserved contracts’, states:

‘1. Member States may reserve the right to participate in public procurement procedures to sheltered workshops and economic operators whose main aim is the social and professional integration of disabled or disadvantaged persons or may provide for such contracts to be...