Medicines for Europe recently published very specific figures in this regard: up to 84% of public procurement procedures use price as the sole award criterion; and up to 74% of Member States use single-supplier procedures. Although Directive 2014/24/EU advocated for the use of ‘MEAT’ (Most Economically Advantageous Tender) criteria, it is common for the prevalence of low price to overshadow a genuine balancing exercise aimed at selecting, as Article 145 of the Spanish Law on Public Sector Contracts establishes, “the best price-quality ratio”.

Review of the 2014 Directives: an upcoming opportunity

Brussels is considering whether the design of the 2014 Directives has helped to shift contracting authorities towards a value-based approach; and the institutional response to this question leans more towards the negative. This was reflected in October 2025, when the European Commission published the evaluation of the 2014 Directives package as a first step towards its revision, and the Commission itself announced plans to present a new revised framework in the second quarter of 2026.

The new legal framework will aim to (i) increase the efficiency of public investment; (ii) design tools to strengthen economic security and sovereignty (which is relevant in relation to ‘Made in Europe’ related commitments); and (iii) align public procurement policy with the EU’s strategic policies and objectives. In the field of medicinal products, all this raises a particularly relevant question: can and should public procurement safeguard continuity of supply, resilience of the production chain and sustainable competition, without being reduced to a purely budgetary approach?

For its part, the European Parliament, in its Resolution of 9 September 2025 on public procurement (2024/2103(INI)), insists that the future framework should simplify rules, promote genuine competition and allow for a more effective use of strategic criteria other than price. The resolution expressly links procurement to objectives of resilience, sustainability, economic security and European competitiveness. Public procurement also serves as a lever for industrial policy. It further adds a particularly telling statistic: in 2023, twenty Member States awarded more than 50% of their tenders based solely on price, and ten of them exceeded 80%. In the pharmaceutical sector, the message is clear: the future revision of the Directives is relevant not so much for the procedural reform itself, but for the possibility of finally recognising that, in the public procurement of medicinal products, the value of a tender is not limited to its price.

The situation in Spain

Although the new Law on Medicinal Products and Medical Devices will have to wait, it is worth noting that its April 2025 Draft Law is of particular interest because it also anticipates these issues. The text submitted for public consultation includes references to moving beyond “the traditional customer-supplier model” and recognising the role of institutions throughout the entire medicinal product value chain, from innovation to production and strategic autonomy. The text is also part of a policy expressly aimed at strengthening the supply chain and preventing shortages.

From the perspective of public procurement, the most significant contribution of the Draft Law lies in its fourth final provision, which amends Law 9/2017. Specifically, it proposes introducing special rules for the procurement of medicinal products, medical devices and healthcare services. Among other matters, it provides for joint framework agreements and dynamic purchasing systems; as well as joint procurement at national or European level where this is preferable to decentralised purchasing.

In our view, the key innovation is the provision that, in public procurement procedures for hospitals, it must be justified that the award criteria ensure the best value in terms of cost-effectiveness and strategic autonomy. In addition, price may not account for more than 20% of the award criteria, unless duly justified in the procurement file.

Also noteworthy are the provisions allowing the use of the negotiated procedure without prior publication for medicinal products protected by exclusive rights where no therapeutic alternative exists. This entails a certain simplification of current procedures, but it does not fully address the fundamental concern of those marketing exclusive medicinal products, namely the absence of any requirement to undergo a public procurement procedure. What is relevant is that an underlying logic of supply, agility and strategic management of healthcare procurement is beginning to emerge.

From the cheapest bid to the bid with the greatest value

The relationship between price and value is misrepresented when presented as a mutually exclusive alternative. The conflict arises when price is treated as the primary element when it comes to public interest in a sector where quality of care, health outcomes, incremental innovation, continuity of supply, organisational impact and, increasingly, industrial resilience, constitute the real value of the service. In healthcare, the cheapest offer is not always the most economical and probably will become less so over time.

At the same time, the transition towards value-based procurement should not be idealised either. The more the weight of price is reduced, the greater the need to objectify and justify the other criteria. The shift towards sustainability, resilience or strategic autonomy will only be legally robust if these concepts are translated into verifiable parameters, linked to the subject matter of the contract and applied with sufficient transparency so as not to undermine equal treatment or unduly expand administrative discretion.

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This judgment  directly addresses whether a competition authority (in this case, the regional authority) can directly determine the scope and duration of the prohibition on contracting with the public sector as a consequence of an anti-competitive infringement.

The decision is particularly significant for companies that regularly participate in tenders, as it clarifies the extent of the sanctioning powers of competition authorities and their interaction with the regime of prohibitions on contracting provided for in public procurement regulations.

Background

The dispute arose from a sanctioning decision issued by the Catalan Competition Authority (ACCO). The ACCO, after finding an infringement, not only imposed a fine but also ordered a prohibition on contracting with the public sector.

The sanctioned company challenged the decision, arguing that ACCO lacked the competence to directly impose the prohibition on contracting. In its view, the prohibition, including its scope and duration, had to be determined through the specific procedure provided for in public procurement legislation and by the competent body in that field. The sanctioned company argued that this prohibition could not be imposed by the competition authority in the exercise of its sanctioning powers.

The position of the Supreme Court

The Supreme Court analysed the regime of prohibitions on contracting provided for in Law 9/2017 on Public Sector Contracts (LCSP), noting that Article 72 distinguishes between two situations: one in which the judgment or administrative decision expressly determines the scope and duration of the prohibition on contracting; and another in which no such express determination is made. The possibility under the Public Sector Contracts Act (LCSP) for a judgment or administrative decision to expressly determine the scope and duration of a prohibition on contracting implies that the authority imposing the sanction has the power to rule comprehensively on the prohibition on contracting.

Moreover, the Supreme Court considers that a systematic and teleological interpretation of the rule supports this conclusion, since the prohibition on contracting is a legal consequence triggered by serious competition infringements, and it is reasonable for the body that has in-depth knowledge of the infringement, the market affected and the seriousness of the conduct to modulate the prohibition on contracting.

Finally, the Supreme Court clarifies that this national legal regime is not contrary to Directive 2014/24/EU. It argues so, as EU law does not prevent contracting prohibitions from being imposed by other authorities, provided that the contracting authority retains the power to decide whether exclusion is appropriate in the specific procedure.

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This is not the first time the CJEU has ruled on the use of companies within the same corporate group. However, the present judgment goes a step further, as it concerns a parent company relying on a subsidiary in which it holds 100% of the share capital.

Background

The dispute arose in the context of a public procurement procedure launched in Portugal for the award of a services contract. Two bidders participated in the tender, and the contract was initially awarded to PreZero Portugal, S.A. (PreZero), whose tender received the highest score.

The other bidder, Semural, challenged the award. Semural argued that PreZero should have been excluded from the procedure because it intended to perform the contract using facilities and resources belonging to a subsidiary (Valor RIB). PreZero owned 100% of the share capital of Valor RIB and had not submitted a subcontracting declaration, the European Single Procurement Document (ESPD) for that subsidiary, or a declaration of commitment from the latter. According to Semural, this omission infringed public procurement regulations and could not be rectified.

The Portuguese courts at first and second instance upheld the appeal and annulled the award. PreZero appealed to the Supreme Court, which decided to refer the matter to the CJEU for a preliminary ruling. In essence, the referring court asked:

• Whether the use, for the performance of the contract, of the capacities of a wholly owned subsidiary constitutes “reliance on the capacities of other entities” within the meaning of Article 63 of Directive 2014/24.

• If so, whether the failure to submit the ESPD for that subsidiary must lead to exclusion from the procedure.

The position of the CJEU

Regarding the first question, the CJEU starts from the wording of Article 63 of Directive 2014/24, which provides that an economic operator may rely on the capacities of other entities “regardless of the legal nature of the links which it has with them”. This makes it possible to conclude that reliance on a subsidiary’s capacities, even where the parent company owns 100% of its share capital, amounts to reliance on the capacities of “other entities” within the meaning of that provision.

In support of this interpretation, the CJEU also refers to the broad definition of “economic operator”, which explicitly includes subsidiaries, and rejects PreZero’s argument that this issue should be analysed in light of the concept of “economic unit” used in competition law. The Court considers that the objectives of competition law and public procurement law are different. In conclusion, even where a subsidiary is wholly controlled by its parent company, it remains a separate legal entity and is therefore another entity for the purposes of the Directive.

As a result, PreZero was required to demonstrate to the contracting authority that it would have at its disposal the capacities necessary to perform the contract, in particular by submitting a commitment from its subsidiary.

As regards the second question, the Court adopts a more flexible stance. It recalls that the ESPD is a form of preliminary evidence designed to reduce administrative burdens, but it is not the only possible means of proof. By virtue of the principle of freedom of evidence, an economic operator may demonstrate by other means that the entity on whose capacities it relies in fact possesses the necessary capacities and that no grounds for exclusion apply.

Furthermore, failure to submit the subsidiary’s ESPD does not automatically exclude the parent company’s bid. It is a rectifiable omission (provided that national law allows it) and subject to compliance with the principles of equal treatment and transparency.

Practical considerations

There are several reasons why a company may need to rely on another company within its group. This can entail significant documentary risks, particularly when non-Spanish entities are involved. Even within a framework of integration such as the European Union, national differences persist in the collection, translation, and submission of reliable administrative or corporate documentation (e.g. authorisations, certificates confirming the absence of exclusion grounds, registry documents, etc.).

Belonging to the same group does not negate the existence of separate legal entities. The CJEU reminds us that this must be considered from the tender preparation stage.  In practice, this requires forward planning, as post-submission rectification procedures are often strict and subject to short deadlines. Prior to submitting a tender, it is advisable to identify the capacities to be relied upon, the entity that will provide them, and the documentation required to demonstrate both the effective availability of the capacities and the corresponding commitment to the contracting authority.

La entrada When the Subsidiary matters: The CJEU clarifies the use of group resources in public procurement aparece primero en Faus Moliner.

Spanish Law on Public Sector Contracts (LCSP – by its Spanish acronym) provides that companies sanctioned for a serious breach of competition law may not enter into contracts with public administrations for the period and to the extent established in the decision of the CNMC or, where applicable, by the Ministry of Finance.

This prohibition on entering public procurement contracts operates as a sanction in addition to the fines established under Spanish Competition Law, and the CNMC has taken the view that it may be applied even where the penalised anti-competitive conduct is not related to public procurement.

Until now, the CNMC’s practice had been to include the prohibition on contracting in its decisions without determining its duration or scope. In such cases, the CNMC deferred the decision on these aspects to the Ministry of Finance.

The decision of 30 July 2025 to which this commentary refers was issued in a case where the CNMC considered that a company in the electricity sector had abused its dominant position. This is the first case where the CNMC has directly specified the scope and duration of the prohibition on entering public procurement contracts.

The prohibition on entering public procurement contracts can be avoided

The LCSP also provides for a mechanism that companies may use to avoid the application of the prohibition on entering public procurement contracts, even if they have been sanctioned for competition law infringements. These are known as self-cleaning measures.

In this respect, the LCSP provides that the prohibition on entering public procurement contracts shall not be declared when two cumulative conditions are met. First, when the company must prove payment or commitment to pay the fines imposed in the sanctioning decision and, second, when the company must have adopted appropriate technical, organisational and personnel measures to prevent future infringements.

Therefore, compliance programmes are extremely important, not only because they reduce the risk of competition law infringements but also because they mitigate the consequences if a breach occurs. However, not every programme qualifies to obtain this benefit. In 2023, the CNMC published a Communication on this matter, emphasising that, to avoid a prohibition on entering public procurement contracts, such programmes must demonstrate a genuine commitment to compliance that is integrated into the company’s daily decision-making processes.

La entrada Prohibition on contracting with the public sector due to competition law breaches aparece primero en Faus Moliner.

Background

The background of the case dates back to 2013, when the Slovak Football Association excluded a consortium, of which the company INGSTEEL was a member, from a tender procedure concerning works for the refurbishment and construction of football stadiums. The reason that they provided for the exclusion was that the consortium did not meet the requirements of the tender notice regarding its economic and financial capacity.

Following an earlier preliminary ruling (Judgement of the CJEU of 13 July 2017, Case C-76/16), the Slovak Supreme Court annulled the exclusion. Unfortunately, a framework agreement had already been concluded with the only remaining tenderer after excluding the Consortium.

As a result, the consortium sought compensation for the damages it suffered before the District II Court of Bratislava. After analysing the case, the Court decided to stay the proceedings and to refer the matter to the CJEU for a preliminary ruling about whether a national court refusing compensation for loss of opportunity acts in accordance with Directive 89/665. In its referral, it explained that INGSTEEL had sought compensation for loss of profit, since Slovak law provides that “compensation is to be paid for actual loss and loss of profit, unless otherwise specifically provided”, without explicitly recognising compensation for loss of opportunity.

Compensation for loss of opportunity

As a starting point, Article 2(1)(c) of the Directive 89/665 broadly provides that “Member States shall ensure that the measures taken concerning the review procedures specified in Article 1 include provision for powers to “(c)award damages to persons harmed by an infringement”.

As we have emphasised in previous Capsules, it is settled case-law of the CJEU that in order to interpret a provision of EU law “it is necessary to consider not only the wording of that provision but also the context in which it occurs and the objectives pursued by the rules of which it is part”. These three concepts, as understood by the CJEU in this case, are described as it follows:

• On the literal interpretation: the CJEU points out that Directive 89/665 is a broadly formulated provision and that, in the absence of any indication to distinguish different categories of damage, it may cover any type of damage.  This interpretation suggests, therefore, that the Union’s legislators did not intend to exclude the loss of opportunity to participate in a tender procedure as a compensable loss.

• On the contextual interpretation: the CJEU points out that it is settled case law that “individuals harmed by a breach of EU law attributable to a Member State have a right to compensation where three conditions are met: the rule of EU law infringed must be intended to confer rights on them; the breach of that rule must be sufficiently serious; and there must be a direct causal link between the breach and the damage sustained by those individuals”.

The highlight of this reading is that it is clear from the Directive 89/665 itself that the purpose of the appeal system is to ensure respect for the right to effective judicial protection, in accordance with Article 47 of the Charter of Fundamental Rights of the European Union.

• On teleological interpretation: the CJEU briefly points out that although the Directive 89/665 does not fully harmonise all possible remedies in the field of public tenders, it is clear that the legislator’s intention is to ensure that in all Member States the annulment of unlawful decisions as well as the compensation of injured parties is possible, without the legislator wishing to exclude any type of damage.

This objective would not be fulfilled if the Directive was interpreted as Member States being able to exclude, as a matter of principle, that compensation is obtained in case of loss of opportunity.

The CJEU’s reasoning is particularly clear when it ascertains that “while damage may result from the failure to obtain, as such, a public contract, it must be held that (…) the tenderer who has been unlawfully excluded to suffer separate damage, which corresponds to the lost opportunity to participate in the procedure for the award of a public contract concerned in order to obtain that contract”.

The quantification issue

The theoretical approach is clear. However, the CJEU notes that it will up to the legal system of each Member State to lay down the criteria for determining and quantifying the damage arising from loss of opportunity. On this point, the CJEU indicates that, although it is true that the Slovak courts have been interpreting that loss of profit must be compensated when it is “highly probable, or even close to certain”, the principle of primacy binds the courts to interpret their domestic law  in accordance with EU law “and that that obligation to interpret national law in conformity with EU law requires national courts to change established, and even settled, case-law if it is based on an interpretation of domestic law that is incompatible with the objectives of a directive”.

This can be interpreted as a recommendation to the Bratislava Court to cautiously review whether the narrow interpretation of “loss of profit” in Slovakia would, as a matter of principle, preclude the award of compensation for loss of opportunity because the threshold of proof requested (“highly probable loss of profit“) would be unattainable.

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At Faus Moliner we believe without a doubt that payment-by-results models are perfectly compatible with the LCSP. Reaffirming this message is very important, especially for advanced therapies whose public funding and/or purchase agreements at hospital/regional level are often linked to therapeutic outcomes.

The aspects of the LCSP that have generated debate in relation to payment-by-results  agreements are the prohibition of deferral of payment of the price (article 102.8 of the LCSP) and the maximum duration of continued supply contracts (article 29.4 of the LCSP).

No deferral of payments

A payment by results model would contravene the LCSP if it incorporated a payment deferral. In our opinion, there is no such deferral and, therefore there is no possible questioning in the light of the Article 102.8 of the LCSP. For there to be a deferral of payment there must be a payment obligation and its performance must be deferred in time. This is not the case in payment by results agreements since there is no initial deferred obligation; rather, the annual payment obligations arise periodically in the event that the results foreseen in the  price and reimbursement resolution are achieved (or, where appropriate, those foreseen in any agreement between the company and the hospital or with any other institution competent in the management of the healthcare provision).

Non-binding for a maximum term of 5 years

The LCSP provides for a maximum term of 5 years for supply contracts. It has been suggested that a payment by results model by which the company receives payments for a period longer than 5 years would be incompatible with the LCSP.

In our opinion, this view is not correct. Article 29.4 of the LCSP prohibits continued supply contracts with a duration of more than 5 years. Continued supply contracts are those in which the contracting entity purchases its product needs from a certain supplier for a determined period of time. In the case of medicinal products, this would be a contract in which the hospital/regional healthcare provider agrees to purchase its requirements for a medicinal product from a company for a certain period of time. The LCSP requires that these contracts have a maximum duration of 5 years to allow new competitors to enter the market at the end of each period. A duration of more than 5 years would prevent alternative suppliers from entering the public market for an excessive period.

The period in which the company receives payments if the expected results are achieved has is unrelated to the duration of the supply contract referred to in article 29.4 of the LCSP. This period is not limited by the LCSP and can be extended beyond 5 years. During this period, the contracting entity may acquire alternative supplies; therefore, there is no need to limit its duration to allow the entry of new suppliers into the public  market.

Conclusion

Payment by results agreements are compatible with public procurement rules. The period of time during which the company can receive payments if the expected results are achieved can be determined as deemed appropriate, without the LCSP imposing any restrictions in this regard.

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What do the new Guidelines say?

As a starting point, the Guidelines distinguish between joint bidding and bid rigging. The latter refers to agreements which aim to distort competition in public procurement procedures, pre-determining the tenderer to win, while creating the impression that the procedure is competitive. Bid rigging is a cartel and one of the most serious restrictions of competition. Joint bidding refers to a situation where two or more undertakings cooperate to submit a joint bid. The Guidelines identify a number of situations in which bidding consortia may be allowed or justified.

On the one hand, if the parties cannot individually participate in the tender and, therefore, are not competitors for the project performance, cooperation does not constitute a restriction of competition. A good example of this would a joint bidding agreement where two parties supply different products or services that are necessary to present an offer for the whole contract. However, the EC explicitly states that where parties are not able to bid for the whole contract, but to bid for one lot, they must be considered competitors. The EC also clarifies that the mere theoretical possibility of carrying out the project individually does not make the parties competitors; it is necessary to assess “whether each party is realistically capable of completing the contract on its own, taking into account the specific circumstances of the case”.

On the other hand, if the parties are capable of bidding individually and are, therefore, competitors, joint bidding might restrict competition. However, such joint bidding agreements between competitors may be justified under competition rules. As a general rule, cooperation may be justified if the joint bid allows the parties to submit a more competitive offer – in terms of price and/or quality – than the offers they could have submitted on their own, and the benefits for the parties and consumers outweigh the restrictions of competition. For example, where two competitors could individually bid for a lot, but only jointly could present an offer for the whole contract and realistically win the tender, joint bidding would be justified.

Finally, the Guidelines state that only the information strictly necessary for the formulation of the bid and the performance of the contract should be shared between the members of the consortium.

Our comments

We welcome these guidelines and believe they will facilitate collaboration, but it remains to be seen how the courts will interpret them. On the basis of the previous guidelines, our courts allow joint bidding where it is indispensable for the performance of the contract. However, some recent judgments have deviated from this position and justified cooperation on the grounds of economic reasonableness, a stance that appears to be more in line with these new Guidelines.

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The General State Budget Law for 2023 includes a final provision that introduces a series of amendments to the Spanish Law on Public Procurement (LCSP, according to its Spanish acronym). One particular amendment stands out: for the first time, the law regulates the procedure to be followed in the event that the contracting authority has well-founded indications of collusive behaviour in a public tender.

Article 150.1 LCSP, in its original version of 2017, already stipulated that if the contracting entity had well-founded indications of collusive behaviour, it had to inform the Spanish National Markets and Competition Commission (CNMC, according to its Spanish acronym) before awarding the contract so that the CNMC could issue the relevant report. However, the application of this provision was subject to the subsequent regulatory development of a procedure that had not yet been defined. For this reason, this provision of Article 150 LCSP had not entered into force.

Until now, the Central Administrative Court of Contract Appeals (see Resolution 60/2021) held that, although contracting authorities could request a report from the CNMC if they found evidence of collusive behaviour, such a report was optional and not mandatory. In practice, without a clear procedure, the application of this clause was very limited. From now on, the situation will be different: as from 1 January 2023, the procedure set out in Article 150.1 LCSP is in  place and contracting authorities will be obliged to follow it if there are indications of collusive behaviour.

The procedure

Broadly speaking, the procedure is as follows:

• The contracting authority notifies the CNMC (or equivalent regional body) of the reasonable grounds for suspecting collusion. The CNMC will issue a report within 20 working days. The tender procedure is suspended without informing the tenderers. If the report is not issued within such time-limit, the contracting authority may continue the tender procedure or initiate the adversarial procedure mentioned below.

• If the report concludes that there is no substantiated evidence of collusion, the procedure is resumed (without informing the tenderers). Conversely, if the report concludes that there is substantiated evidence of collusion, the suspension of the bidding process will be notified and published, and the parties will be given 10 working days to respond.

• Following this hearing, the contracting authority may, within 3 working days, request any reports it deems appropriate from the CNMC (or equivalent regional body).

• In the light of the allegations, evidence and reports in the file, the contracting authority shall decide within 10 working days whether or not there has been a collusive behaviour. It shall take into account the measures taken by the undertakings to avoid future infringements. If collusion is found, companies concerned will be excluded from the tender procedure and the file will be processed further. If no collusion is found, the bidding process continues as normal.

This notification to the CNMC may result in the initiation of disciplinary proceedings and the imposition of prohibitions on contracting for the companies concerned.

Collusion in public procurement: practical tips.

Finally, it is worth recalling the circumstances which, according to the CNMC itself, are indicative of collusive behaviour (see the CNMC’s own “Guide against fraud in public tenders of July 2020“):

• Low number of bidders, including competitors (possible market sharing).

• Inconsistent bids (the same company submits bids with unjustified significant differences compared to other tenders of the same type in which it has participated).

• Suspicious similarities between the financial and technical offers of several bidders.

• Suspicion of boycott (bidders unjustifiably refrain from bidding in order to obtain a change in the terms of the tender).

• Non-competitive bids (bogus or “side bids”, which that are clearly not intended to win the contract, but are made to appear competitive).

• Suspicious patterns of behaviour among bidders (one company being awarded the same contract, lots and/or territories or there is rotation among awarding companies).

• Unjustified subcontracting by one bidder to another competing bidder.

• Bids submitted by the same natural persons in respect of different companies.

• Financial offers with identical wording, identical format, wording or errors.

• Creation of joint ventures between competing bidders without apparent justification.

With the prospect of increased scrutiny of collusive behaviour in public procurement, these practices should be kept in mind in order to avoid engaging in such anti-competitive behaviour. The importance of having good regulatory compliance programmes is also reinforced. The same LCSP foresees that these programmes can be used to avoid contracting prohibitions, mitigate potential sanctions, and to be considered within the procedure set out in Article 150.1 LCSP.

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This judgment was delivered in the context of a dispute concerning the award of a public contract in Poland. One of the tenderers appealed against the award decision and requested access to certain information relating to the successful tender and a re-evaluation of all the tenders submitted. The contracting authority refused to grant access to this information on the grounds that it had been classified as confidential by the successful tenderer. According to the successful tenderer, disclosure of this information could harm its legitimate interests, given the commercial value of the information and the measures it had taken to keep it secret.

In the context of appeal against this decision, the Court held that the lack of complete information on the various tenders submitted could hinder a tenderer’s right to an effective remedy. The Court referred to the Court of Justice of the European Union (CJEU) a number of questions concerning the limits of confidentiality of information shared in the context of public procurement procedures.

Scope of confidentiality of information submitted in public procurement procedures

First, the CJEU examined whether European Directive 2014/24/EU on public procurement is compatible with a national law that requires the publication of all information provided by the tenderers in a public procurement procedure, with the sole exception of trade secrets.

Firstly, the CJEU considers that when Directive 2014/24/EU states that “the contracting authority shall not disclose information forwarded to it by economic operators which they have designated as confidential, including, but not limited to, technical or trade secrets”, it is protecting a wider range of confidential information than technical and trade secrets.

Secondly, the CJEU recalls that Directive 2014/24/EU also provides that “certain information on the contract award  […] may be withheld from publication where its release  […] would harm the legitimate commercial interests of a particular economic operator […]”. On these grounds, the CJEU found that national legislation which only allows trade secrets to be classified as confidential in the context of public procurement procedures is contrary to Directive 2014/24/EU.

According to the Court, information which does not fall within the concept of trade secrets may be classified as confidential under the Directive: (i) if it has commercial value outside the scope of the public contract in question, the disclosure of which might undermine legitimate commercial interests or fair competition or; (ii) if has no commercial value, the disclosure of which would be contrary to the public interest.

Under Spanish Law on public procurement (Ley de Contratos del Sector Público or LCSP), technical or trade secrets and information that could be used to distort competition may be considered confidential “amongst others”. According to the CJEU judgment of the CJEU, “amongst others” can be interpreted to include information the disclosure of which would harm legitimate commercial interests, beyond trade secrets.

Extrapolating the above to public health procurement, it could be argued that a “legitimate commercial interest” could include the price of a particular medicinal product, which is the is the result of a confidential analysis of economic information provided by the company to the Ministry of Health. Therefore, if this analysis were to qualify as a legitimate commercial interest under the criterion of the CJEU, it could be argued that it should be treated as confidential.

The possibility of treating all the information submitted by the tenderer as confidential

The CJEU also examines whether a provision which allows all the documents proving the technical capacity and the means of performing the contract to be treated as confidential is compatible with the principles of the Directive. The CJEU states that access to such information may be refused only if the contracting authority finds that (i) if such information has a commercial value outside the scope of the public contract in question, its disclosure might undermine legitimate commercial or fair competition; or (ii) if it has no such commercial value, its disclosure will impede law enforcement or would be contrary to the public interest. In any event, access to the “essential content” of such information shall be granted in such a way as to ensure compliance with the tenderers’ right to an effective remedy.

Where access to information submitted by the successful tenderer is refused on the grounds that it has been wrongly treated as confidential, the CJEU concludes that it is not necessary to adopt a new award decision if: (i) national procedural law permits measures to restore compliance with the right to an effective remedy, or; (ii) the unsuccessful tenderer is given the opportunity to bring a new action against the award decision. In the latter case, the time limit for bringing such an action shall start to run from the date on which the applicant has access to all the information.

Conclusion

This judgment helps to outline the scope of confidentiality obligations in public procurement, while confirming that the Directive protects a broader scope than trade secrets. According to this judgment, it could be argued that confidentiality in public procurement could also include other information, the disclosure of which would harm legitimate commercial interests. In the area of public health procurement, this would provide further grounds to argue that the unit price of medicinal products should not be disclosed, on the basis of legitimate commercial interests.

The judgment also explains the need to ensure access to the essential content of the information supporting technical solvency and the means by which the contract is to be performed. The remaining information may be classified as confidential if it is demonstrated that its disclosure could undermine legitimate commercial interests, fair competition or the public interest. All this while guaranteeing tenderers the right to an effective remedy.

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The Spanish Government lodged an appeal of unconstitutionality against Foral Law no. 17/2021, of 21 October, which regulates certain aspects of public procurement in Navarra, as per the Official State Gazette of 21 September 2022. This Law modifies the traditional system for the purchase of medicinal products for hospital use with the aim of making it more flexible.

In particular, this law excludes from the scope of application of public procurement rules the purchase of all medicinal products financed by the NHS and which price is set by the Ministry of Health.

Exclusion is expected to be implemented in the following way:

• In the first stage, the conditions to be met by potential suppliers (payment system, penalties, volume and quality of the product, etc.) would be determined and the existing credit would be justified. At this stage, no units of product would be purchased and companies could join the system on a voluntary basis.

• In subsequent stages, hospitals would purchase the necessary quantities of medicinal products from one of the companies that had adhered to the conditions set out in the first stage. These contracts would be subject to the provisions of Private Law.

The Spanish Government contends that this Foral Law infringes the State’s exclusive law-making powers in “basic legislation on administrative contracts and concessions” and “legislation on pharmaceutical products”. On the contrary, Navarra believes that the law complies with the applicable legal framework, as it governs a matter included within regional law-making powers in “administrative contracts and concessions”, which can be fully exercised while “respecting the essential principles of the basic State legislation on the matter“.

Recall that Navarra’s law-making powers differ from that of ordinary Autonomous Communities. Hence, it is able to enact its own rules on public procurement on the sole condition that it respects “the essential principles” of the basic State regulations. The Constitutional Court defines these “essential principles” as the ideas that characterise and constitute the basis of State regulation, but does not refer to any specific provisions. Therefore, we must wait for the Constitutional Court to define what are the essential principles of the Law on Public Procurement, and assess whether the Foral Law respects these principles by providing for this special system for the purchase of certain medicinal products.

This issue may have further implications at EU level. The Constitutional Court must assess whether the Foral Law’s special regime  is compatible with Directive 2014/24/EU on public procurement. As regards this matter, the Law of Navarra has relied on the ECJ judgment of 2 June 2016 (Case C-410/14) and on the purposive approach of the public procurement rules that prevails at European level.

European case law holds that the purpose of public procurement rules is to safeguard competition, and that the existence of a decision to select one economic operator amongst various is a basic element of the concept of public contract. Therefore, according to this judgment, public procurement law shall no longer apply if no such selection exists.

Regardless of the outcome of this appeal to the Constitutional Court, it is interesting to discuss the application of the Law on Public Procurement to the procurement of innovative medicines (which are exclusive to a single company, and have a funding resolution from the NHS and a price set by the Ministry of Health). Considering that selection does not take place (there is only one possible supplier) and that the main economic condition (price) has already been set by the administration, it could be argued that it is pointless to apply the Law on Public Procurement in order to safeguard competition. This perspective was presented in our contribution to the public consultation process of the draft bill amending the Law on Guarantees and Rational Use of Medicinal Products and Medical Devices.

La entrada Exclusion of the purchase of medicinal products from the Law on Public procurement aparece primero en Faus Moliner.