1. Public ownership and co-ownership arrangements
Public domain assets are those belonging to a public entity and “ which are either assigned for direct use by the public, or assigned to a public service, provided that in this case they are subject to development essential to the performance of the missions of this public service ”[1]. These assets are inalienable and imprescriptible[2].
In a decision dated October 7, 2024, the Tribunal des Conflits confirmed that the public domain regime does not apply to co-ownership.
This solution confirms the jurisprudence of the Conseil d’Etat[3], according to which a property can only fall within the public domain if it belongs “ in its entirety ” to the public entity[4]. In this respect, a public rapporteur more recently recalled the “ exclusive nature of public domain ownership ”[5]. In the absence of exclusive ownership, the public owner alone cannot exercise all the attributes of the right of ownership.
This is why the administrative judge considers that, when a public entity acquires real estate assets in co-ownership or joint ownership, the public domain regime does not apply. Indeed, it may be considered that “ from the moment an administration agrees to move into a jointly-owned building, it agrees to waive the protective rules of public ownership ”[6].
Adopting the solution adopted by the Conseil d’Etat and confirmed by the Cour de cassation[7], the Tribunal des Conflits ruled that “ the essential rules of the co-ownership system as laid down by law no. 65-557 of July 10, 1965 (…) are incompatible both with the system of public ownership and with the characteristics of public works ”. Indeed, these rules cannot be reconciled with public ownership, since they provide for “ undivided ownership of common parts, (… ) the presumed common ownership of partitions and walls separating private portions, the prohibition on co-owners opposing the execution, even within their private portions, of certain works decided by the general meeting of co-owners by majority vote, the guarantee of the syndicate of co-owners’ claims against a co-owner by a legal mortgage on his lot ”.
Consequently, property belonging to a public entity in a building subject to the co-ownership regime does not belong to the public domain and cannot be considered as constituting a public work, even if this property is assigned to the needs of the public service or for public use.
The Tribunal des Conflits also stated that “ damage arising from the development or maintenance of these premises does not constitute public works damage ”. The administrative judge is therefore not competent to hear public liability claims arising from damage caused by such property.
Under these conditions, it is up to the judicial judge to rule on damages arising from the development or maintenance of property belonging to a public entity and located in a building subject to the co-ownership system.
TC, October 7, 2024, Syndicat des copropriétaires de la résidence Saint Georges Astorg c/ Assistance Diagnostics Services et autres, n° C4319
[1] Article L. 2111-1 of the French General Code of Public Ownership.
[2] Article L. 3111-1 of the general code on public property.
[3] CE, section, February 11, 1994, Compagnie d’assurances Préservatrice Foncière.
[4] CE, sect. of March 19, 1965, Société lyonnaise des eaux et de l’éclairage, no. 59061.
[5] Concl. L. Cytermann on CE, November 7, 2019, Communauté urbaine Le Havre Seine Métropole, n° 431146.
[6] Concl. H. Toutée sur CE, sect. 11 février 1994, préc.
[7] Cass. civ. 1ère, February 25, 2009, Commune de Sospel, no. 07-15.772.
2. Withdrawal of a member of a temporary consortium during a procurement procedure
In a ruling handed down on September 26, 2024, the Court of Justice of the European Union (CJEU) held that national legislation cannot prohibit an economic operator from withdrawing from a Groupement Momentané d’Entreprises (GME) when the validity period for bids has expired and the contracting authority wishes to extend it.
Although this ruling was issued in application of the old Contracts Directive[1], the solution is perfectly transposable to the new Directive[2].
The Markets Directive (both the old and the new) allows several companies to respond to a call for tenders by forming a GME to meet the minimum capacity requirements set by the purchaser. In French law, this option is set out in articles R. 2142-19 et seq. of the Code de la commande publique for public procurement contracts, and articles R. 3123-9 et seq. for concessions.
However, the Procurement Directive does not lay down any specific rules concerning changes in the composition of a GME bidder. According to the CJEU, “ the regulation of such a situation falls within the competence of the Member States ”.
In this case, the dispute concerned Italian legislation prohibiting any changes to the initial composition of a GME bidder, on pain of exclusion of all GME members from the award procedure. The question of the conformity of this regulation with European Union law arose in the specific context of an expired bid validity period, for which the purchaser requested an extension.
The CJEU ruled that this regulation was contrary to both the Procurement Directive and the general principle of proportionality. According to the CJEU, the members of a GME must be able to withdraw from it when the bid validity period expires and the purchaser requests its extension, on the twofold condition that (i) the remaining members of the GME “ satisfy the conditions for participation in the procurement procedure ” initially defined by the purchaser, and (ii) the continued participation of the GME thus modified does not have the effect of granting it a competitive advantage to the detriment of the other bidders.
Under French law, article R. 2142-26 of the Public Procurement Code stipulates that “ the composition of the consortium may not be modified between the submission of applications and the date of contract signature ”[3]. It is also accepted that when the bid validity period expires, it may be extended provided that all candidates agree[4].
The question now arises as to whether this article complies with Community law. In application of these provisions, a purchaser may not exclude the candidacy of a GME from which one or more members have withdrawn when the GME’s offer has expired, if the two conditions set out above are met. The exclusion of a modified GME even though these conditions have been met could thus be sanctioned in the context of a pre-contractual summary procedure.
The CJEU’s solution thus demonstrates a certain pragmatism in recognizing the right to modify the composition of a GME during the course of the procedure, subject to certain conditions. However, the scope of the solution is restricted to a very specific situation, namely that of a modification of the GME following the expiry of the bid validity period.
CJEU, September 26, 2024, Luxone Srl, aff. C-403/23.
[1] Directive 2004/18/EC.
[2] Directive 2014/24/EU.
[3] The prohibition on changing the composition of a GME during the procurement process does not apply to procedures for awarding concession contracts (cf. article L. 3123-16 of the French Public Procurement Code).
[4] CE, April 10, 2015, Centre hospitalier territorial de Nouvelle-Calédonie, no. 386912.
3. Time limit for communicating reasons for bid rejection and buyer’s failure to comply
In a decision handed down on September 27, 2024, the Conseil d’Etat clarified the time limit for communicating the reasons for the rejection of an unsuccessful candidate’s bid.
Pursuant to Articles L. 2181-1 and R. 2181-1 of the French Public Procurement Code, the purchaser is required to notify unsuccessful candidates and bidders “ without delay ” that their application or bid has not been accepted. Article R. 2181-3 specifies that, in the context of a formalized procedure, the notification must mention the reasons for the rejection of the application or bid.
According to the Conseil d’Etat, the purpose of providing information on the reasons for rejection is to enable the unsuccessful candidate to challenge the rejection in a pre-contractual referendum. Consequently, failure to communicate the reasons for rejection constitutes a breach of the obligations of transparency and competitive bidding.
However, it considers that this communication of the reasons for rejection can, without constituting a breach, take place several months after the decision to award the contract (in this case 15 months), on condition that these reasons were communicated to the ousted candidate in sufficient time before the date on which the judge of the pre-contractual summary procedure rules (“ if the time that has elapsed between this communication and the date on which the judge rules has been sufficient to allow [the] candidate to usefully contest his ousting ”).
In other words, failure to comply with articles R. 2181-1 et seq. (“ without delay ” communication of the reasons for rejection) does not in itself constitute a breach by the purchaser of its obligations of transparency and competitive tendering. Even so, the unsuccessful candidate must not have been able to usefully contest his elimination by means of a pre-contractual summary procedure, in the absence of such information in good time.
In practice, this solution does not encourage buyers to spontaneously communicate the reasons for rejection. On the contrary, it encourages unsuccessful competitors to lodge pre-contractual applications to obtain the information stipulated in articles R. 2181-1 et seq. of the French Public Procurement Code.
CE, September 27, 2024, Région Guadeloupe, n° 490697.
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