The Federal Court of Justice (BGH) has declared the petition for review filed by a competitor of DB Regio NRW GmbH (DB Regio) to be well-founded in a review procedure under public procurement law pursuant to the Act against Restraints of Competition (GWB).
In 2004, the Rhine-Ruhr Transport Association (VRR) and DB Regio had concluded a transport contract. This contract obligated DB Regio to provide transport services in local rail passenger transport (SPNV) over an initial 44 million train kilometres. In the 2003/2004 timetable year, approx. 26 million train-kilometres were accounted for by regional express and regional rail services and approx. 18 million train-kilometres by S-Bahn services. Unlike the S-Bahn services, the RE and RB services were to be partially dismantled during the term of the contract and in this respect were to be awarded anew in competition in each case. By the beginning of 2009, around 7 million train kilometres had been removed from the contract. DB Regio had committed itself in the transport contract to renewing its vehicle fleet, in particular to procuring 84 new S-Bahn trains, the last of which were to be in service by the end of 2010.
According to the transport contract, DB Regio receives the ticket revenue. DB Regio also receives a subsidy per train kilometre travelled via VRR. VRR receives the funds required for this from the state of North Rhine-Westphalia on the basis of the North Rhine-Westphalian Local Public Transport Act (ÖPNVG NRW). On the basis of the Regionalisation Act, the state of North Rhine-Westphalia receives federal grants earmarked mainly for the financing of local public transport in this context. In the event that these funds are reduced, the transport contract contains a revision clause according to which VRR can demand an adjustment of the SPNV service in the event of corresponding funding cuts.
After the funds for grants to the federal states had been reduced on the basis of the Regionalisation Act 2006, a dispute arose between VRR and DB Regio about the mutual obligations, which led to the termination of the contract by VRR and to administrative court disputes, but also to settlement negotiations between the contracting parties. On 24 November 2009, VRR and DB Regio concluded an amendment agreement to the transport contract to settle their disputes. The provisions of this amendment contract include that DB Regio procures additional new S-Bahn vehicles and operates the S-Bahn lines S 1 to S 11 beyond the end of the original transport contract until December 2023.
Abellio Rail NRW GmbH (Abellio), a subsidiary of the Dutch state railways, which is interested in taking over the operation of primarily S-Bahn line 5 from December 2018, believes that the transfer of S-Bahn operations beyond December 2018 to DB Regio is invalid because the service contract should have been put out to tender. It has therefore initiated review proceedings with the Public Procurement Chamber at the Münster District Government. The Münster Public Procurement Chamber declared the amendment contract invalid.
The X. Civil Senate (Public Procurement Senate) of the Federal Court of Justice confirmed the decision of the Public Procurement Chamber in the decision announced today.
The dispute focused on the question of whether the ineffectiveness of the amendment agreement can be reviewed in a review procedure under public procurement law in accordance with the Act against Restraints of Competition (GWB) or whether Section 15 (2) of the General Railway Act (AEG), as a more specific law, precludes the initiation of such a review procedure in the event of a dispute.
The Federal Supreme Court has ruled that Section 15 (2) AEG does not take precedence over the public procurement law provisions of the ARC from the point of view of speciality, but is superseded by the ARC as the more recent law. In doing so, it followed its previous case law, according to which the scope of application of the provisions of public procurement law in the Act is in principle comprehensively determined according to types of contracts and subjects of contracts and the catalogue of exceptions in Section 100 (2) GWB - which does not cover the operation of the S-Bahn - is to be regarded as conclusive. A legislative intention to exclude the award of such services from the scope of application of the ARC cannot be inferred from the legislative history of the statutory provision.
The Federal Court of Justice further ruled that the amendment agreement does not concern a service concession, which would also be exempt from the review procedure under public procurement law, but a service contract. In doing so, it followed the case law of the Court of Justice of the European Union, according to which it is characteristic of service concessions that the concessionaire is exposed to the risks of the market in the exploitation of the service entrusted to it and assumes all or at least a substantial part of the operating risk. According to these criteria, a service concession does not exist essentially because a profitable S-Bahn operation is largely secured by the additional payments from the public sector, which, according to DB Regio, cover around 64% of the total costs and thus exceed the income from the ticket revenue quite significantly.
The Federal Court of Justice ruled that the admissible application for review was also well-founded on the merits because Abellio had objected to the conclusion of the contract in due time before the Public Procurement Tribunal and the requirements of Section 4 (3) no. 2 of the Public Procurement Ordinance (VgV) were not met. According to this provision, local passenger transport services may exceptionally be awarded by private treaty if a substantial part of the services ordered by the contract expires during the term of the contract and is subsequently awarded in competition. The term of the contract should not exceed twelve years. However, since the possibilities of this provision had already been exhausted with the conclusion of the original transport contract between VRR and DB Regio, they could not in principle be used again. The Federal Court of Justice left open the extent to which the fact that VRR and DB Regio wanted to settle their disputes by way of settlement would nevertheless have allowed the original duration of the contract to be modified to a certain extent in an amendment agreement. This would have been permissible at most if future competition had also been promoted at the same time by extending the transport services that would fall out of the contract during its term.
Order of the Federal Supreme Court of 8 February 2011 - X ZB 4/10
Lower court:
OLG Düsseldorf - Order of 21.07.2010 - VII-Verg 19/10
Source: Press release of the BGH
Attorney at Law Michael Ullrich, LL.M. (Information Law)
Specialist lawyer for information technology law (IT law)
E-mail: info@goldberg.de
