Can public authorities procure fair trade products, or are they debarred from specifically referring to the fair trade qualities of those products under the public procurement directive (directive 2004/18/EC)? This is one of the issues underlying the judgment of the Court in Case C-368/10 Commission v. Netherlands.
In 2008, the Dutch province of North Holland announced in a tendering procedure that it wished to procure coffee machines and the products necessary to make them function (coffee, tea, sugar, milk, cups). It required that those products to be delivered to bear the Max Havelaar label, a private label that adheres to the rules of the Fairtrade Labelling Organisation. Considering that this tender was contrary to the public procurement directive (2004/18/EC) the Commission started an infringement procedure against the Netherlands.
Obviously, specifically requiring products to bear only that label is contrary to EU public procurement law, as it is way too over specific and does not allow for any form of competition for the contract. However, the Court made – for the first time – some interesting points on procuring fair trade products in general.
The two points I will discuss are:
- Fair trade requirements to products cannot be part of technical specifications but are conditions relating to the performance of the contract;
- Fair trade criteria can be used as award criteria for public supply contracts.