The EU's procurement regime sets out rules to achieve transparency and equal treatment for all tenderers to ensure that public contracts are awarded to the tender offering best value for money.
The package of amendments was proposed by the Commission in May 2000, but the Commission, Parliament and Council of Ministers then failed to reach agreement on the details.
Today, Internal Market Commissioner Frits Bolkestein praised yesterday's consensus among key representatives of the Parliament and Council of Ministers.
"Public procurement accounts for around 14% of the Union's GDP," said Bolkestein, "so modernising it and opening up procurement markets across borders is crucial to Europe's competitiveness, to giving taxpayers high quality and good value for money and to creating new opportunities for EU businesses."
Bolkestein endorsed the agreement reached on the circumstances in which contracting authorities could take social and environmental criteria into account in attributing contracts, which had been one of the major sticking points in the original proposal.
He said yesterday's compromise managed to avoid giving scope for "arbitrary and unfair contract awards based on issues unconnected with the works or services to be provided."
The legislative package, which was based on extensive consultations with contracting authorities and businesses, has two main objectives.
The first is to simplify and clarify the existing Directives. The second is to adapt them to modern administrative needs, for example by facilitating electronic procurement and, for complex contracts, by introducing more scope for dialogue between contracting authorities and tenderers in order to determine contract conditions.
The package also excludes telecommunications from the scope of the legislation, a sector it says is now subject to effective competition.
With the objective of enhancing transparency in the award process and of combating corruption and organised crime, the legislative package also includes measures designed to make for greater clarity in the criteria determining the award of the contract and the selection of tenderers.
It was principally over some of these measures and in particular the ways in which social and environmental criteria can be taken into account, that the conciliation procedure was necessary.
Conciliation procedures take place when the European Parliament, the Council and the Commission have been unable to reach full agreement on a Commission proposal for legislation, but where enough common ground exists to suggest that such agreement might be achievable.
The agreement reached by the conciliation committee will now need to be ratified by a plenary session of the Parliament and by the Council.
The text agreed takes current law as interpreted by the Court of Justice in a case known as the Finnish buses case as its starting point.
In that case, the Court ruled that the contracting authority must award a contract to the tenderer whose tender is the most economically advantageous, but that it may nevertheless take environmental criteria (in the Finnish buses case, exhaust emissions and noise levels) into account when deciding which bids to take into consideration (i.e. the award criteria).
However, those criteria must be expressly mentioned in the contract documents or the tender notice, must be connected with the subject-matter of the contract, must not give the contracting authority an unrestricted freedom of choice, and must comply with all the fundamental principles of Community law, in particular the principle of non-discrimination.
The text would also allow contracting authorities to require specific environmentally friendly production methods – such as organic production for foodstuffs for schools.
Under the compromise text agreed, similar conditions would be attached to the use of social criteria in practice, that would mean, for example, that contracting authorities could take into account, for the construction of a public building, accessibility criteria for people with disabilities.
The text would allow companies who have not complied with EU legislation in economic, social or environmental fields to be excluded from tendering processes.
The text agreed also encourages the use of electronic signatures and allows Member States to require that electronically transmitted tenders be accompanied by the electronic equivalent of handwritten signatures, that is, a "qualified electronic signature".
The integrity of data and the confidentiality of tenders are provided for elsewhere in the Directives and do not depend on the choice of whether to require electronic signatures and in which form.