Strasbourg, 22 April 2004

Dear Mr X.,

On 19 March 2003, you made a complaint to the European Ombudsman, on behalf of the firm "Y", concerning the contract signed between this firm and the European Commission for the modernisation and the improvement of the application programme for the section "Small ads" in the Intranet of the Commission.

On 23 April 2003, I forwarded the complaint to the President of the European Commission. The European Commission sent its opinion on 9 July 2003. I forwarded it to you with an invitation to make observations, which you sent on 26 August 2003.

I am writing now to let you know the results of the inquiries that have been made.

I apologise for the length of time it has taken to deal with your complaint.

THE COMPLAINT

According to the complainant, the relevant facts are as follows:

The complainant is the executive director of the firm "Y". On 10 December 2001, the firm signed a contract with the European Commission for the modernization and the improvement of the application programme for the section "advertisement" in the Intranet of the Commission. Following technical problems, the English version was not installed. On 6 December 2002, the Commission informed the complainant that it would suspend the payment of the invoice, due to technical problems in the French version of the application programme and the absence of the English version. On 3 February 2003, the complainant sent a letter to the Commission requesting the payment of the invoice.

On 14 February 2003, the Commission informed the complainant that a meeting would be organised between the two contracting parties. The meeting took place on 5 March 2003 in the European Commission's premises in Brussels. In a letter dated 14 March 2003, the Commission confirmed its decision not to settle the invoice on the grounds that the French version of the application programme did not function properly and that the English version had not been installed.

On 19 March 2003, the complainant lodged a complaint with the European Ombudsman, on behalf of his firm. He complained about the fact that the European Commission had failed to pay invoice No 2002/211 of 27 November 2002 that had been issued in the framework of the contract signed on 10 December 2001 by the firm "Y" and itself.

THE INQUIRY

The Commission's opinion

The opinion of the European Commission on the complaint was in summary as follows:

The contract for the "Modernisation and the improvement of the loading and the dynamic managing tool of the contents of the section 'Small ads' in the Intranet of the Commission" was signed on 10 December 2001 between the Commission and the firm "Y" whose executive director is the complainant. This contract clearly foresees that "the work will consist into the setting up and the development of a tool which enable the Commission staff to fill in and to consult the section "Small ads" in the Intranet of the Commission, in French and in English, in a quick and user-friendly way". This contract also states that "the Commission undertakes to pay to the contracting party, in compensation of the services arising from the contract, the lump sum of 12 900€."

Three amendments to the contract were signed by the Commission and the firm "Y" respectively on 26 March, 24 June and 5 September 2002. These amendments only aimed to extend the duration of the contract, without any further modifications to the other conditions. The complainant did not contest his firm's contractual obligations when signing these amendments.

On 2 December 2002, the firm "Y" sent to the Commission's services the invoice, object of the present complaint, and a message informing the Commission of the impossibility to hand over the English version of the section "Small ads" in the Intranet within a two-week deadline, without mentioning any other deadline.

In accordance with Article 68 of the implementing measures of the Financial Regulation(1) which states that the invoice must "bear the endorsement 'passed for payment' signed by the authorizing officer or by the official to whom he has delegated authority, certifying that the service has been rendered properly and that all the items in the invoice have been checked", the Commission had to suspend the payment of the invoice.

Furthermore, the European Code of Good Administrative Behaviour states that "maladministration occurs when a public body fails to act in accordance with a rule or principle which is biding upon it". In the present case, the Commission's services acted in respect of the Code, namely of its Article 4 entitled "Lawfulness" following which "the official shall act according to law and apply rules and procedures laid down in Community legislation".

The reasons for the suspension of the payment were clearly and quickly communicated to the firm "Y" on 6 December 2002. They consisted in the absence of the English version of the section "Small ads" in the Intranet when the invoice was drawn up, and the presence of errors to be necessarily corrected in the French version already in the Commission's possession.

During a telephone call that took place on 8 December 2002, the Commission's services immediately informed the firm "Y" of the possibility of paying the invoice after receiving the application programme in the linguistic versions. The Commission's services subsequently informed the firm of the possibility of concluding a new contract which would repeat all the terms of the former one, and which would simply foresee a new deadline for the execution of the work. Despite the organisation of two meetings which took place on 13 December 2002 and 5 March 2003, the complainant stated that he was not interested in this proposal.

The complainant's observations

The European Ombudsman forwarded the opinion of the European Commission to the complainant with an invitation to make observations. In his reply, the complainant maintained his complaint and made, in summary, the following further comments:

His firm had not been given any exhaustive list of the new application features to be created. No inventory of the application programme to be modernised had been drawn up before the drafting of the document on the tender procedure.

The conditions of the contract had not been respected by the Commission. The object of the contract had been modified due to additional requests from the Commission which were not in the initial conditions of the contract.

The three amendments to the contract which had been signed between the Commission and the firm "Y" respectively on 26 March, 24 June and 5 September 2002 were the consequences of a lack of co-ordination from the Commission's services. The firm had accepted these extensions of the expiry of the contract, stating that it was not responsible for them.

THE DECISION

1 The allegation of failure of the European Commission to pay an invoice

1.1 On 10 December 2001, a contract for the "Modernisation and the improvement of the loading and the dynamic managing tool of the contents of the section 'Small ads' in the Intranet of the Commission" was signed by the Commission and the complainant's firm "Y". The complainant alleged that the European Commission had failed to pay the invoice No 2002/211 of 27 November 2002 that had been issued in the framework of the contract.

1.2 The European Commission stated that the payment of the invoice had to be suspended because of technical problems in the French version of the application programme and because of the absence of the English version.

1.3 The European Ombudsman notes that the present allegation concerns the obligations arising under a contract concluded between the Commission and the complainant.

1.4 According to Article 195 of the EC Treaty, the European Ombudsman is empowered to receive complaints "concerning instances of maladministration in the activities of the Community institutions or bodies". The Ombudsman considers that maladministration occurs when a public body fails to act in accordance with a rule or principle binding upon it. Maladministration may thus also be found when the fulfilment of obligations arising from contracts concluded by the institutions or bodies of the Communities is concerned.

1.5 However, the Ombudsman considers that the scope of the review that he can carry out in such cases is necessarily limited. In particular, the Ombudsman is of the view that he should not seek to determine whether there has been a breach of contract by either party, if the matter is in dispute. This question could be dealt with effectively only by a court of competent jurisdiction, which would have the possibility to hear the arguments of the parties concerning the relevant national law and to evaluate conflicting evidence on any disputed issues of fact.

1.6 The Ombudsman therefore takes the view that in cases concerning contractual disputes it is justified to limit his inquiry to examining whether the Community institution or body has provided him with a coherent and reasonable account of the legal basis for its actions and why it believes that its view of the contractual position is justified. If that is the case, the Ombudsman will conclude that his inquiry has not revealed an instance of maladministration. This conclusion will not affect the right of the parties to have their contractual dispute examined and authoritatively settled by a court of competent jurisdiction.

1.7 In the present case, the Ombudsman notes that the object of the contract signed by the complainant's firm and the Commission was the modernisation and the improvement of the application programme for the section "advertisement" in the Intranet of the Commission. The contract foresaw that "the work will consist into the setting up and the development of a tool which enable the Commission staff to fill in and to consult the section "Small ads" in the Intranet of the Commission, in French and in English, in a quick and user-friendly way".

1.8 The Ombudsman notes that the complainant does not appear to dispute the Commission's view that the English version was not installed. In these circumstances, the Ombudsman considers that the Commission has put forward a coherent and reasonable account of the reasons for which it decided to suspend the payment of the invoice.

1.9 The Ombudsman therefore concludes that there appears to have been no maladministration on the part of the Commission.

2 Conclusion

On the basis of the Ombudsman's inquiries into this complaint, there appears to have been no maladministration by the European Commission. The Ombudsman therefore closes the case.

The President of the European Commission will also be informed of this decision.

Yours sincerely,

 

P. Nikiforos DIAMANDOUROS

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(1) Commission Regulation no 3418/93 December 1993 laying down detailed rules for the implementation of certain provisions of the Financial Regulation of 21 December 1977.