site.btaEC Refers Bulgaria to European Court of Justice over Healthcare Public Procurement Legislation

The European Commission decided Thursday to refer Bulgaria to the Court of Justice of the European Union for failing to correctly transpose the EU Directive on public procurement. The Commission said it considers that Bulgarian legislation currently excludes certain privately owned medical establishments from the scope of EU procurement rules, even when they receive more than 50% of their financing from public funds.

This exclusion – set out in the Additional Provisions to the Public Procurement Act – is not in line with the EU-law definition of ‘bodies governed by public law' and therefore restricts the scope of application of the Directive. The Commission first launched the infringement procedure in January 2019 and has repeatedly called on Bulgaria to bring its legislation into line with EU rules, the press release notes.

Although Bulgaria has tabled amendments, the Bulgarian legislators have not yet formally adopted them. Moreover, even if adopted, it seems that they would still not cover all publicly funded medical establishments, potentially leaving the infringement unresolved. Considering this and the fact that no clear timeline has been provided, the Commission has decided to refer the case to the Court. 

"EU public procurement rules aim to ensure transparent, fair and competitive tendering procedures across the Single Market. They apply to contracting authorities, including bodies governed by public law, a category that covers entities which, although not public authorities, are financed for the most part by the State or other public bodies," EC's press release reads. 

Under EU legislation, privately owned entities must follow public procurement rules when they qualify as bodies governed by public law. This is the case when they are established to meet needs in the general interest, have legal personality, and are financed for the most part by public bodies or are subject to their management or supervision.

In Bulgaria, many medical establishments meet these criteria because they provide essential public interest services and receive most of their funding from the National Health Insurance Fund or other public sources.

The Commission's concerns were set out in a letter of formal notice in 2019, followed by a reasoned opinion in July 2023 and an additional reasoned opinion in April 2024, after Bulgaria failed to bring its legislation fully into compliance.

The case concerns the Public Procurement Act provisions excluding certain hospitals from procurement rules even when they are publicly funded.