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2010

More Bad News from the ECJ in its recent ruling in Commission v Germany, C-271/08

Date Released: 23 Jul 2010

The European Court of Justice in another damaging ruling has held that above a certain threshold, the social partners in the public sector cannot, on their own accord, award service contracts for their occupational old age pensions. The case was taken by the EU Commission against Germany. The Commission argued that the practice whereby local authorities awarded contracts for pension services on the basis of the selection criteria agreed under the collective agreements violated EU public procurement directives. Despite substantial legislative underpinning for the practice the ECJ found that Germany had infringed the EU public procurement directive and ruled that in accordance with the public procurement Directives, a call for tender must be advertised at EU level.

Commenting on the ECJ Ruling, Esther Lynch, Congress Legal and Social Affairs Officer said, ‘It is never certain how far-reaching these judgments will be, but it is difficult to escape the impression that staff in the Commission’s DG internal market are actively pursuing procurement cases before the European Court to undermine collective agreements. They see collective bargaining as limiting competition but they forget that competition law was supposed to benefit consumers, citizens, workers and their families, not make their situation worse. Restricting the unions and employers possibility to select the pension provider could create uncertainty for the employees and in the end it is their money so itis difficult to see why the ECJ ruled that public procurement law should apply.’

This case is another in a line that is very negative for workers and it underlines the need for a social progress clause in the EU Treaties as has been demanded by the ETUC. It also highlights that it is time to amend EU public procurement rules so that they recognise collective bargaining, fair and ethical business and move the emphasis away from competition on price otherwise we will have a rat race to the bottom.





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