Underground Car Park

March 26th, 2018

In Case E-4/17, EFTA Surveillance Authority v Norway, Judgment on 21 March 2018, the EFTA Court considered a tender procedure launched by the Municipality of Kristiansand for the construction and operation of an underground car park.  The issue was whether the contracts constituted a public works concession.  The Court concluded that the contracts were of pecuniary interest (paragraph 73), they were of direct economic benefit to the municipality (paragraph 74), and constituted a public contract (paragraph 75); that the construction of the car park constituted works (paragraph 76); that the titles given to the contracts cannot be decisive (paragraph 77); that the crucial objective of the contracts was the construction of the car park, but there was an element of services inherent in the contract, the services element could not be singled out in a separate procedure, and the works and services elements of the contracts formed an indivisible whole (paragraph 79); that when contracts include elements of both works and services, it is the “main object” of the contract which determines the body of rules to be applied (paragraphs 80-82); that the main object was the works (paragraphs 83-84); and that the contracts were public works contracts (paragraph 85).

It remained to be assessed whether the contracts constituted a public works concession. The Court stated that an essential characteristic of a concession is that the concessionaire bears the main or substantial operating risk (paragraph 86); and that the contracts constituted public works concessions (paragraphs 87-89, and did not merely grant a right to exploit land, rather than a right to exploit a work.

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