C-331/92

1. This request for a preliminary ruling 3. By order of 17 July 1989 of the Presiden­ relates in substance to the classification of a tial Counsellor to the Government of the mixed contract for the purpose of determin­ Canary Islands, published in the Boletín ing whether Directive 71/305/EEC 1 con­ Oficial de Canarias of 19 July 1989, an open cerning the coordination of procedures for invitation to tender was issued concerning, the award of public works contracts is appli­ first, the award of the final concession for cable. the installation and opening of a casino in Las Palmas, the conditions of tender being set out in Annex I, and, secondly, participa­ tion in an open invitation to tender, to be launched on behalf of the municipality of Las Palmas, concerning the use of the build­ 2. The main action concerns the invitation to ing owned by the municipality and the oper­ tender for and the award of a project origi­ ation of the Hotel Santa Catalina, the condi­ nating in a cooperation agreement (of 14 July tions of tender being set out in Annex II. 1989) between the Government of the Canary Islands and the municipality of Las Palmas de Gran Canaria (hereinafter referred to as 'Las Palmas'). It was intended to open and operate a casino and to continue a hotel business in the premises of the Hotel Santa Catalina, which is owned by the municipal­ 4. The conditions of tender in Annexes I and ity of Las Palmas and is regarded as its II refer to each other. Prospective tenderers emblem. The invitation to tender was must submit their tender simultaneously for arranged by the Government of the Canary both parts of the invitation to tender (inter Islands, the competent authority for award­ alia, Article 2(i) of Annex I, and Article 2, paragraphs 1 and 3, of Annex II). Article 2 of Annex I, containing the conditions which * Original language: German. must be fulfilled by tendering undertakings, 1 — Council Directive of 26 July 1971 (OJ, English Special Edi­ states that the sole object of the undertaking tion 1971(11), p. 682), as last amended by Direc­ tive 93/4/EEC (OJ 1993 L 38, p. 31). must consist in operating casinos. A deroga-

tion from this condition is allowed in so far tract for the entire project to the commercial as additional services may be provided. The company Gran Casino Las Palmas, SA. list of examples of such additional services expressly mentions the operation of the Hotel Santa Catalina, which is ensured by means of an obligation on the part of the prospective successful tenderer. 7. The lessee of the hotel at the time, and plaintiff in the main action, Gestion Hotelera Internacional, SA, brought proceedings under administrative law against the invita­ tion to tender and against the award of the contract. It contended, inter alia, that the contract which is the subject of the invitation 5. The conditions of tender in Annex II to to tender is a public works contract within the invitation to tender for the award of the the meaning of Directive 71/305/EEC and operation of the Hotel Santa Catalina, which therefore the invitation to tender ought to is intended to house the casino as well as the have been published in the Official Journal of hotel business, lay down minimum require­ the European Communities. This was not ments for the award of the contract with done. regard to the installation and operation of the casino, the use of the buildings and the hotel business (Article 1, Annex II). Art­ icle 2, paragraph 2, of Annex II stipulates that the successful tenderer must invest at least 1 000 million pesetas in fitting out the 8. To clarify this point of law, the national hotel and in its surroundings, excluding the court has referred the following questions to installation of the casino, for the purpose of the Court of Justice: renovation and conversion so that the hotel can retain its five-star status. Furthermore, Article 2, paragraph 2, of Annex II contains an obligation to pay 1 000 million pesetas as consideration for the use of the entire archi­ tectural complex for a term corresponding to 1. Is a mixed contract for the performance of the initial 10-year term of the contract. The works and the assignment of property to consideration is then divided into two equal be regarded as included in the concept of parts for the use of the premises for the hotel 'public works contracts' set out in Art­ on the one hand and the casino on the other, icle 1(a) of Council Directive 71/305/EEC with different conditions of payment for the of 26 July 1971? two establishments.

13. To take the last argument first, it should be observed that the question of the plain­ tiff's right to bring proceedings is a question 11. As none of the parties has made an of the procedural law of a Member State application for an oral procedure, the Court which the Court is not competent to answer. will give its ruling on the basis of the written According to the Court's settled case-law, procedure. problems of domestic law fall within the exclusive jurisdiction of the courts of the Member States. 3The Court can only pro­ 4 vide an interpretation of Community law. The Court may not, under the preliminary B — Analysis rulings procedure, give a ruling on the appli­ cation of provisions of national law or on the relevance of the request for a preliminary 5 ruling. It is solely for the national court to

12. I. First it is necessary to consider the objections concerning admissibility which 2 — Judgment in Case 203/81 CILFIT v Ministry of Health the two defendants in the main action have [1982] ECR 3415, paragraph 16. raised against the request for a preliminary 3 — Sec judgment in Case C-343/90 Lourenço Dias [1992] ECR I-4673. paragraph 19; judgment in Joined Cases ruling. Both the first defendant, the Govern­ C-297/88 and C-197/89 Dzodzi [1990] ECR I-3763, para­ graphs 39-42. ment of the Canary Islands, and the second 4 — Judgment in Case 295/82 GIE Rhone Abes Hmles v Syndi­ defendant, the municipality of Las Palmas, cat National des Fabricants Rafßneitrs á Hmle de Graissage [1984] ECR 575, paragraph 12. claim that as Directive 71/305/EEC has 5 — Judgment in Casc 232/82 Băcani v ONEM [1983] ECR 583, already been transposed into national law, all paragraph 11.

15. The fact that a directive has been trans­ posed into national law does not preclude a reference for a preliminary ruling concerning its interpretation. After a directive has been 16. Consequently, if a national court 'is transposed into national law, individuals are required to interpret its national law in the 1 primarily affected by that law. 1 However, light of the wording and the purpose of that 14 the Court has consistently held that 'the directive', it is of course also permissible to request a preliminary ruling from the Court of Justice where there is any doubt as to the interpretation of the directive. 6 — See judgment of 27 October 1993 in Case C-127/92 Enderby v Frenchay Health Authority [1993] ECR I-5535, paragraphs 10 and 12. 7 — Judgment in Case C-83/91 Meilicke [1992] ECR 1-4871, paragraph 24. 12 — My emphasis. Judgment in Case 14/83 Von Colson and 8 — Judgment in Case C-83/91 Meilicke, cited above, paragraph Kamann v Land Nordrhein-Westfalen [1984] ECR 1891, paragraph 26; also judgment in Case 79/83 Harz [1984] 9 — Judgment in Case C-231/89 Gmurzynska-Bscher [1990] ECR 1921, paragraph 26; and, to the same effect, judgment ECR I-4003, paragraphs 22 to 24. in Case 222/84 Johnston, cited above, paragraph 53; judg­ 10 — See judgment in Case C-83/91 Meilicke, cited above, para­ ment in Case 80/86 Kolpinghuis Nijmegen [1987] graph 26, and judgment in Joined Cases C-320/90 to ECR 3969, paragraph 12; judgment in Case 31/87 Bentjees C-322/90 Telemarsicabrttzzo [1993] ECR I-393. v Netherlands [1988] ECR 4635, paragraph 39.

11.(A) First question Court agree on this point. The formulation of the question on which a preliminary rul­ ing is sought is therefore ambiguous in that the contract to be appraised is placed in a legal category, and the emphasis is laid on the contract for works that is to be per­ 17. The first question put by the national formed. Whether the obligation to carry out court asks in effect whether the invitation to building works characterizes the contract is, tender and the award of the contract in ques­ however, precisely the subject of the ques­ tion fall within the directive concerning the tion. I therefore propose to take the question award of public works contracts. in wider terms, in the light of the request for a preliminary ruling, as asking whether an open invitation to tender and the award of a concession to open and operate a casino, and a concession to operate a hotel in conjunc­ tion with a lease of the premises necessary 18. With regard to the interpretation needed for that purpose, in the framework of which for classifying the contract in question, it is an obligation must be entered into for carry­ necessary in the first place to proceed on the ing out conversion work, must be regarded basis that Directive 71/305/EEC in its origi­ as a public works contract within the mean­ nal version, i. e. before it was amended by ing of Directive 71/305/EEC. 15 Directive 89/440/EEC, is the relevant text. Directive 89/440/EEC was notified to the Member States on 10 July 1989, 16 the same day as that on which the notice of the invi­ tation to tender for the project at issue was published in the regional Official Journal. Article 3 of Directive 89/440/EEC gives the Member States one year in which to adopt the measures necessary to comply with the directive. Consequently at the relevant date, that of the invitation to tender, the provi­ sions of Directive 89/440/EEC were not yet to be taken into account. 20. In the final analysis, the answer to the question turns solely on whether the project at issue is to be regarded as a works contract within the meaning of Directive 71/305/EEC, and not on positive classi­ 19. It is common ground that the contract at fication in another category of legal transac­ 17 issue is of a mixed character. The findings of tions, in particular service contracts. the national court and the submissions of all Considerations falling within that perspec­ the parties to the proceedings before this tive are purely hypothetical and can only serve as criteria for demarcation.

22. The Commission considers that the con­ 23. Consequently it is necessary to ascertain tract is mixed in nature and consists, firstly, whether the works contract is the main of a service concession involving permission object of the contract or whether it is only to use buildings and installations owned by incidental and is therefore severable from the the municipality for opening and operating a other part of the contract. The Commission casino, and also for a hotel and restaurant takes the view that the works contract can­ business, for a consideration of 1 000 million not be severed from the remainder of the pesetas. Secondly, there is an assignment of contract. This follows, according to the works to be carried out by the tenderer, at Commission, from the object of the contract. his expense, to the value of 1 000 million The works are a necessary prerequisite for pesetas. According to the Commission, the the opening of the casino, but they are sec­ services in question are services within the ondary in comparison with the service. From 18 meaning of Directive 92/50/EEC, in accord­ the economic viewpoint the works are also ance with Annex I B, Nos 17 and 26. Direc­ secondary. Alternatively, if the objects are tives 92/50/EEC and 71/305/EEC are mutu­ found to be severable, the Commission sub­ ally exclusive. There can only be a works mits that the works are the consideration for contract if it forms an essential part of a con­ the concession, so that Article 3 of the orig­ tract, but not if it is incidental to the service inal version of Directive 71/305/EEC is contract. The Commission refers to the 16th applicable, which means that the directive recital of Directive 92/50/EEC, which reads does not apply to this concession contract. as follows: Finally, the Commission expresses reserva­ tions with regard to its classification of the contract as a public service contract within the meaning of Directive 92/50/EEC. It is indeed a service concession which would, according to the proposal for Direc­ tive 92/50/EEC, have fallen within its ambit, but the Council did not accept this wording when adopting the directive. 'Whereas public service contracts, particu­ larly in the field of property management, may from time to time include some works; whereas it results from Directive 71/305/EEC that, for a contract to be a public works contract, its object must be the

25. The Regional Government first enter­ tains doubts as to the initial classification of the contract by the national court when for­ 27. In its written observations the Spanish mulating the question referred to this Court Government reproduces the relevant parts of for a preliminary ruling. The true nature of the conditions of tender to illustrate the the contract consists in the use and manage­ mutual dependence of the various objects of ment of a building owned by the municipal­ the contract and their ranking with respect ity and in the award of the operation of the to each other. It takes the view that the part hotel business. The fact that the invitation to of the contract relating to the building works tender requires a secondary, incidental, ser­ has a supplementary, instrumental character. vice does not alter its object. The building The works are an indispensable condition for works are inseparable from the licence for attaining the main object of the contract. The the opening and operation of the casino, not fact that they are secondary to the other only because of the voluntary agreement of parts of the contract is shown by the provi­ the authorities concerned, but also because sion that the execution of the works can be of the special circumstances. The grant of the assigned to a third party. The definition of concession is characterized by the special the objects of the tenderer undertaking pre­ feature that the premises do not belong to cludes that undertaking from the outset from the tenderer but to the municipality. The carrying out the building works. The main agreement that the work is to be carried out object of the contract, the opening and oper­ at the expense of the lessee does not alter the ation of a casino, cannot be assigned. fact that the contract is in the nature of a lease. According to the specifications in Annex II, the works could be influenced by the licensing authority for gaming. The works entail adapting the premises for the proposed use. Furthermore, the building 28. The Spanish Government adds that the works are not extensive. The lessee can cer­ contract constitutes a lease, the obligation to tainly provide for additional structural alter­ carry out a minimum volume of building ations. works representing part of the consideration

31. However, it was not the primary con­ cern either of the municipality or the Regional Government to carry out the build­ ing alterations. The specifications annexed to 29. The project in question, for the classifi­ the invitation to tender indicate that, on the cation of which the Court of Justice must contrary, the intention was to find an opera­ provide the national court with the necessary tor for the casino and the hotel. It is ques­ guidance on interpretation, is characterized tionable whether the obligation to carry out by the fact that the administrations of vari­ building alterations is nevertheless a public ous regional and local authorities had to works contract within the meaning of Direc­ cooperate in implementing the proposed tive 71/305/EEC. plan. Neither the Regional Government nor the municipality could have carried out the project on their own account. The Regional Government alone has power to grant a con­ cession to operate the casino business. As the idea of the responsible authorities was to establish the casino in the Hotel Santa Cat­ alina which has symbolic status, the cooper­ 32. The starting point is the definition given ation of the municipality was indisputable. in Article 1(a) of the directive. According to Up to then, the municipality, as owner of the that provision, '"public works contracts" are building, was also actively involved as the contracts for pecuniary consideration con­ lessor of the hotel. cluded in writing between a contractor (a

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GESTIÓN HOTELERA INTERNACIONAL

2. The Directive shall not apply to ...'.

33. The Annex to the directive lists a num­ ber of activities which are classified under 36. No other criteria for demarcation can be the heading 'construction'. derived directly from Directive 71/305/EEC or Directive 71/304/EEC. On the other hand, the 16th recital in the preamble to Directive 92/50/EEC contains a clear state­ 19 — Council Directive of 26 July 1971 (OJ, English Special Edi­ tion 1971(11), p. 678). ment to the effect that a contract is a public

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OPINION OF MR LENZ — CASE C-331/92

works contract only if the building works site for the award of the concession. The are the main object of the contract. obligation to be undertaken is, in substance and by reference to its position in the struc­ ture of the conditions of tender, to be under­ stood as constituting partial consideration for the lease and the concession for commer­ cial use.

37. As already stated, the aim of the project for which, by the joint action of the two authorities, tenders were invited was to find a suitable operator for the casino and the hotel. The fact that this primary obligation is non-assignable also shows that it is the main object of the contract. In contrast, when drafting the conditions of tender, the author­ 40. However, in my opinion the decisive ities proceeded on the assumption that the factor is that the contract could not have conversion works were to be carried out by been severed without altering its legal struc­ another undertaking on behalf and at the ture. It was precisely not the authority's expense of the potential tenderer. intention to award a works contract on its own account, but to find a company which would have the building works carried out in the framework of its obligations to the authority.

44. In my opinion, the obligation to carry out building works is not a concession con­ tract within the meaning of Article 3. Apart from the fact that, according to the definition 42. As, in my opinion, this is not a public of the contract in Article 3, the public works contract within the meaning of the authority awards the concession and poss­ directive, the following considerations are ibly makes a payment by way of consider­ put forward only in the alternative. The ation for the building works, although in the Commission contends that, if the contract present case the building works form only were found to be a public works contract, part of what the concessionaire undertakes Article 3 of the original version of Direc­ to do, it seems to me that the decisive factor tive 71/305/EEC would apply. Article 3(1) is that the concessionaire has no direct obli­ was worded as follows: gation to carry out the building works.

II.(b) Second question

'In the event of the authorities awarding contracts concluding a contract of the same type as that indicated in Article 1(a) except for the fact that the consideration for the 45. In so far as an open invitation to tender works to be carried out consists either solely cannot be classified as a public works con­ in the right to exploit the construction or in tract within the meaning of Direc­ this right together with payment, the provi­ tive 71/305/EEC, it is unnecessary to comply sions of the Directive shall not apply to this with the publication requirements of the so-called "concession" contract ...'. directive.

2. Consequently there is no requirement for publication of the invitation to ten­ der in accordance with Directive 71/305/EEC.

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