Bolkestein accuses Greeks of playing Olympic contract games

By Peter Chapman

Date: 24/06/04

THE European Commission is to take Greece to the European Court of Justice over a €55 million transport tender, adding to Greece's mounting Olympic Games woes.

The Commission believes the Athens metro company (Attiko Metro) breached EU public procurement rules when it awarded the contract for trains linking the Athens underground system with the city's airport.

The contract was a key part of Athens' preparations for the Olympics which take place in August. It was awarded in 2002 to a Korean manufacturer, Hanhwa Koros, for supply and service of four trains.

European Voice has learned that Frits Bolkestein, the internal market commissioner, will ask his colleagues, at a 7 July meeting, to back court action against the Greeks on the grounds that the contract was awarded without a formal tendering process. This would have allowed other train suppliers, such as Spain's CAF, to table a bid.

"It looks like the Commission may decide to take Greece to court. At the moment that is the proposal," one Bolkestein aide said.

Members of commissioners' cabinets prepare the ground for the decision in the run-up to the 7 July meeting. A Commission source confirmed that Greek Stavros Dimas' team has not raised objections.

The Commission issued Greece with a "reasoned opinion" - the last stage before formal court proceedings - in December 2003.

The Greeks have retorted that they did not have time to conduct a lengthy tendering period for the airport link, which will allow thousands of visitors to the city to take a quick train into the centre rather than wait around for buses or taxis, an official explained.

However, the Commission points out that the Greeks took an option to buy the four airport trains in an earlier contract with Hanhwa Koros to supply 17 underground trains. This, it believes, suggests that the contracting authority considered such a development likely.

The Greeks argued that the extra contract was merely a supplement to the original deal, which was awarded to the best value-for-money supplier. EU procurement rules allow for such "partial renewals' of contracts.

But the Commission says it "does not accept that argument" because the airport trains were technically different from the other underground trains.

That is because they travel for part of their route above the surface and needed to have a different type of power system installed.

The procurement rules also let authorities off the tendering hook if they can show that only one company could possibly have supplied the trains.

"But anyone who can build trains like this could have provided them," added an official.

Athens Metro officials were contacted by this newspaper but were unable to comment.

Matthew Hall, a Brussels-based procurement law expert with law firm Ashurst, said an adverse court ruling is likely to cause acute embarrassment - but is not going to help aggrieved companies.

"They [the Greeks] are not going to set aside the contract, even if they could." He said the Commission was currently consulting on how it could beef-up protection to third parties.

The European Commission is likely to take Greece to the European Court of Justice for allegedly breaching EU public procurement rules over the awarding of a contract for the supplying of trains for the Athens airport-city link.

http://ec.europa.eu/comm/internal_market/publicprocurement/index_en.htm http://ec.europa.eu/comm/internal_market/publicprocurement/index_en.htm

---