10 Colum. J. Eur. L. 419 (2004)

Christopher Bovis, Professor of Law and Jean Monnet Chair in European and Business Law, Lancashire Law School; Visiting Senior Research Fellow, Institute of Advanced Legal Studies, University of London.

Recent developments in jurisprudence at the European Community level have revealed the pivotal position of public procurement in the process of determining the parameters under which public subsidies and state financing of public services constitute state aid. In the center of the debate regarding the relation between subsidies and public services, public procurement has emerged as an essential component of state aid regulation. The European Court of Justice has inferred that the existence of public procurement, as a legal system and a procedural framework, verifies conceptual links, creates compatibility safeguards and authenticates established principles applicable in state aid regulation. Public procurement in the common market not only represents the procedural framework for the contractual interface between public and private sectors, but also reflects on the character of activities of the state and its organs in pursuit of public interest. Public procurement regulation has acquired legal, economic and policy dimensions, as market integration and the fulfillment of treaty principles are balanced with policy choices.

The implications of the debate are important, not only because of the necessity for a coherent application of state aid regulation in the common market, but also because of the need for a legal and policy framework regarding the financing of services of general interest and public service obligations by member states. The significance of the topic is reflected in the attempts by the European Council to provide for a policy framework of greater predictability and increased legal certainty in the application of the state aid rules to the funding of services of general interest. The present article intends to define the correlation between public procurement and services of general interest and to ascertain the parameters of interplay between public procurement and state financing of public services within the regulatory regime of state aid.