Although the question of the existence of a kind of preferential possibility of proving the supplier's qualifications through members of the holding has been resonating in the area of public procurement for a long time, the issue is not addressed at all in Act No. 134/2016 Coll., on the award of public contracts (hereinafter referred to as "ZZVZ"), as after all, it was not explicitly addressed even in the previous Act No. 137/2006 Coll., on public contracts or in other, older legal regulations regulating the field of public procurement.
The only guide is thus the decision-making activity of the Office for the Protection of Economic Competition (hereinafter referred to as "ÚOHS"), see e.g. decision no. ÚOHS-S2220/2009/-16376/2009/530/RKr, dated 3/3/2010, or decision of ÚOHS –S185/2012/VZ-11529/2012/550/Mla, dated 3/9/2012: " the applicant, or the subcontractor (in the event that the applicant proves the missing part of the qualification through a subcontractor), is entitled to use the reference orders of companies that form the same group with him when proving the qualification, if he proves that he will have the resources of other members of the group at his disposal when performing the order, and to the extent necessary for the completion of the order. It is therefore not necessary to submit a joint offer or to use other members of the concern as subcontractors according to § 51 paragraph 4 of the Act. This requirement to demonstrate authorization to dispose of the funds of the group companies provides the contracting authority with the assurance that other entities participating in the implementation of the contract, whose references the applicant (subcontractor) used, will indeed participate in the implementation of the public contract."
In its decision-making, the ÚOHS is mainly based on the judgment of the European Court of Justice, no. no. C-389/92 Ballast Nedam Groep NV and Belgian State, in which it was judged that for the purposes of evaluating the qualifications of suppliers, documents relating to persons forming a business group with the customer must also be accepted, provided that the supplier proves that he actually has the means of these persons, which are necessary for the implementation of the said contract,[1] as well as another ECJ judgment, no. No. C-176/98 Holst Italia SpA and Comune di Cagliari, in which this jurisprudence was further developed.
The conclusions of the cited jurisprudence of the Court of Justice of the European Union (or previously of the European Court of Justice) are of course still applicable, but it cannot be pretended that they have not yet been reflected in the Czech national legislation on public procurement. The authors Tejkal and Pruška reach the same conclusion, for example, in their article Demonstration of qualification fulfillment through members of business groups (substantiation and consequences of the current decision-making practice of the ÚOHS)[2]. One can fully identify with the views contained in their article. The cited jurisprudence of the European Court of Justice arose under a completely different situation and the effectiveness of completely different procurement directives. Both European legislation and, subsequently, Czech national legislation in the field of public procurement already responded to the given jurisprudence a long time ago by explicitly enshrining the possibility of proving part of the supplier's qualifications through third parties. For these purposes, the ZZVZ makes it possible to use the form of cooperation in the so-called association of suppliers, or to demonstrate qualification through a subcontractor (the same possibility was also offered by Act No. 137/2006 Coll.). At first glance, it seems completely pointless to create another category for proving qualification through third parties based on the jurisprudence of the ÚOHS, especially when the law explicitly addresses the issue of proving the supplier's qualification through third parties.
Nevertheless, we are convinced that members of the same business group can, under certain circumstances, be granted a more favorable position compared to other subcontractors or members of a supplier association for the purposes of proving qualifications. For this, however, it is necessary to interpret the relevant decisions of the ÚOHS in a way that will view the members of the business group as a single economic entity, i.e. a single competitor in the sense of European competition law.
It is necessary to realize that even the field of public procurement is nothing more than a special subcategory of competition law. In the context of European law, the term competitor must be viewed as a special economic entity connected by power relations pursuing a certain economic goal. For example, in its Shell decision in the Commission, the ECJ already ruled that a competitor is "a unified organization of personal, tangible and intangible components that pursues a certain economic goal in the long term"[3]. In the decision of Höfner & Elser in Macrotron Gmb, the ECJ defines a competitor as any unit performing an economic activity, regardless of legal form or financing.[4] The term competitor is a key term in Czech competition law[5], which must be interpreted in accordance with European law. After all, even the ÚOHS interprets the concept of competitor in the area of competition protection in accordance with European jurisprudence[6], i.e. it does not separate the parent company from the other members of the holding, but considers the competitor to be a comprehensive structure of power relations, i.e. for the purposes of competition law, the competitor is viewed as a single entity with power over all its parts that it controls.
With regard to the above, it can be stated that a single economic entity (competitor) can be spoken of even in situations where several legal or natural persons belong to the same business group[7], but belonging to the same business group is not sufficient in itself to establish the existence of a single competitor. As stated by the Supreme Administrative Court in its decision of 29 October 10, No. 2007 As 5/61-2005: "The manner of relations between entities in the group is decisive. Important criteria are, among other things, whether the parent company actually determines (in the form of instructions) the subsidiary's competitive actions, whether the subsidiary respects these instructions and actually implements them. However, it is sufficient to belong to a single economic unit if the parent company has a real possibility to give instructions to the subsidiary and to actually implement these instructions." The court also emphasized that an important criterion is the quality and quantity of control, i.e. whether the subsidiary is controlled by the parent company itself, or jointly with other enterprises, and whether it is controlled in whole or in part.'[8]
Therefore, if we apply the concept of competitor in a Euro-compliant manner to cases where a supplier demonstrates part of the qualification within the framework of the tendering process for a public contract through another member of the same business group, we will be able to state that in such a case (provided that the relevant conditions are met) it is not a question of proving qualification by a third party, as both entities form a single economic entity, a single competitor. With the given interpretation, the decisions of the ÚOHS in question will no longer be redundant or confusing in the context of the applicable legislation. On the contrary, granting a kind of preferential regime to the form of proving qualifications through a member of the holding compared to the cases of proving qualifications through other third parties, which the ÚOHS suggests in its decisions, would make sense in such an interpretation, because, as already said, both legal entities (entity proving qualifications and the entity through which the qualification is demonstrated) would be considered as a single entity, i.e. a single competitor, and for the purposes of the procurement procedure as a single supplier. In such a case, in addition to the documents proving the fulfillment of the missing part of the qualification, the contracting authority would probably not need to provide additional documents specified in § 82 and § 83 of the ZZVZ (in particular, documents to prove the fulfillment of basic competence and professional competence according to § 77, paragraph 1 of the ZZVZ). However, it should be pointed out that the above conclusion can be accepted without further ado only in situations where the parent company proves part of the qualification through a subsidiary. However, in other cases (i.e. in cases where the subsidiary demonstrates part of the qualification through the parent company, or when the sister company proves part of the qualification through another sister company), the aforementioned "favored" procedure cannot be used, and it is recommended to proceed fully in accordance with § 82 or § 83 ZZVZ
Source: www.epravo.cz/články
The team of the Vych & Partners, s.r.o. law office
[1] ECJ decision C-389/92 Ballast Nedam Groep NV and Belgian State: "... must be interpreted as meaning that they permit, for the purposes of the assessment of the criteria to be satisfied by a contractor when an application for registration by the dominant legal person of a group, provided that the legal person in question establishes that it actually has available the resources of those companies which are necessary for carrying out the works."
[2] Tejkal J., Pruška L., Demonstration of the fulfillment of qualifications through members of business groups (substantiation and consequences of the current decision-making practice of the ÚOHS), epravo.cz [online] 9/1/2014 [cited 22/3/2017], available at www, k available >>> here.
[3] Judgment of the European Court of Justice, T-11/89, Shell International Chemical Company Ltd. v. Commission, 1992, ECR II-757
[4] Judgment of the European Court of Justice, C-41/90, Klaus Höfner and Fritz Elser v Macrotron, 1991, ECR I-1979
[5] It is defined directly in the provisions of § 2, paragraph 1 of Act No. 143/2001 Coll., the Act on the Protection of Economic Competition and on the Amendment of Certain Acts (the Act on the Protection of Economic Competition), as amended: persons, their associations, associations of these associations and other forms of grouping, even if these associations and groupings are not legal entities, if they participate in economic competition or can influence it through their activities, even if they are not entrepreneurs."
[6] For this, for example, the Interpretative opinion on the functioning of collective systems from the point of view of economic competition dated 14 August 8, decision of the ÚOHS dated 2013 August 11, file no. ÚOHS-S8/2016/KD-590/2014/33798/PHa, decision of the chairman of the ÚOHS dated 2016 February 851, file no. UOHS-R 2, 2, 2009/20-21/22/2004/ADr…
[7] See, for example, the decision of the Supreme Administrative Court, dated 29 October 10, No. 2007 As 5/61-2005: "As is clear, the subject of competition law, i.e. the competitor, or an enterprise in the terminology of European Community law is an economic unit that may not be identical to an entrepreneur - a legal entity. On the one hand, various groups without legal personality can be considered as competitors (enterprises), on the other hand, some trading companies are not considered as independent competitors (enterprises). Business companies (subsidiaries) completely controlled by another company (mother) can be considered as the second mentioned example. Subsidiaries create a concern together with the parent company, which is considered a single economic unit, which as a whole is considered a competitor (enterprise), if the condition is met that the subsidiaries cannot really autonomously determine their actions on the market, but must follow the instructions of the parent company of the company that controls them (in this sense, autonomous from the concept of concern or holding in commercial law, the term concern will continue to be used). Actions within this economic unit are then not considered competitively relevant if they do not affect other competitors or consumers."
[8] Kindl, J., Munková J.: Act on the Protection of Economic Competition. Comment. 3rd, revised edition. Prague: CH Beck, 2016, p. 55
