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Procurement Law: Constitutional Court revokes federal state laws

Pursuant to Austria’s constitution, legislative powers are shared between the federal state and the “Bundesländer”. Legislation in the area of public procurement is als split between the federal state and the Bundesländer, with the former being competent to pass provisions on substantive questions of public procurement as well as procedural provisions for contracting authorities of the federal state, while the Bundesländer are competent to pass laws on procedural provisions for “their” contracting authorities.

When Austria’s federal legislator failed to implement all aspects of Directive 2014/23/EU on the award of concession contracts, some Bundesländer, notably Carinthia, passed their own legislation to specify which decisions taken during a procurement procedure by a contracting authority may be challenged by a tenderer in a formal review procedure.

In a recent decision (G 205/2018), the Constitutional Court corrected the “over eagerness” of the Carinthian legislators and clarified that the determination of those decisions, which may be challenged in a formal review procedure, was part of the substantive procurement law. It falls within the legislative powers of the federal legislator to pass such provisions, not within the legislative powers of the Bundesländer.

The regulations of the Carinthian procurement protection law 2014 (“Kärntner Vergaberechtsschutzgesetz 2014”), which determined contestable decisions, were therefore revoked as unconstitutional.

Kerstin Holzinger and Melissa Neuhauser wrote a critical commentary on the Constitutional Court’s decision, which was recently published in the Austrian Journal for Business Law.


28. November 2019

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