Dear Mr X.,

On 23 May 2002, you made a complaint to the European Ombudsman against the European Commission, on behalf of your firm. The complaint concerned the alleged failure of the Commission to pay the complainant for the appraisal of an EC programme, despite the institution's formal undertaking of 31 October 2001. You sent me additional information on 24 and 25 June 2002.

On 27 June 2002, I forwarded your complaint to the President of the European Commission. The Commission sent its opinion on 25 September 2002, and I forwarded it to you with an invitation to make observations, if you so wished. You sent me your observations on 22 November 2002. I am writing now to let you know the results of the inquiries that have been made.

THE COMPLAINT

According to the complainant, the facts were as follows:

The complainant had concluded a contract with the Commission's services on behalf of his firm. The beneficiary was asked to carry out the assessment of a Community programme. On 9 November 2000 and 13 July 2001, the complainant submitted the invoices corresponding to the services performed. By email dated 31 October 2001, the Commission services explained that the payment was to be made shortly. Since no transfer was carried out, the complainant unsuccessfully contacted the institution on several occasions. In reply to his requests, the complainant pointed out that no reply had been received from the Commission. As for the final payment of the contract, this has not yet been made. In his complaint to the Ombudsman, he noted that the final payment should have been made, at the latest, 60 days after the acceptance of the relevant invoices, as set out in Art. 11 (4) of the contract.

In summary, the complainant alleged that the Commission had failed to reply to his requests for information, and to pay his association for the appraisal of an EC programme, despite the institution's formal undertaking towards him on 31 October 2001. He therefore claimed that the Commission make the payment for the services rendered by his firm.

THE INQUIRY

The Commission's opinion

In its opinion, the Commission recalled that following a call for tenders (OJ S 172, 4.09.1999), the complainant's firm, was selected to carry out the post-evaluation of a Community programme.

In line with the provisions of the contract, the complainant was granted a lump sum of 156.312 €, excluding travel and lodging costs. The evaluation report had to be completed and forwarded to the Commission by 15 December 2000.

The Commission pointed out that the performance of the work suffered continuous delays involving the signature of the contract, as well as the presentation of both the intermediate and final reports. The Commission acknowledged, however, that in this context the payments had also taken some extra time.

The institution referred to the procedure for the payment of the assistance foreseen in Art. 11 (4) of the contract. An amount corresponding to 30% of the lump sum (46.893,60 €) was due upon the signature of the contract. A mid-term 40% payment was then to be made at the presentation of the intermediate report, which was due on 15 May 2000. The rest of the assistance would be paid by 15 December 2000 upon completion of all tasks. As set out in Art. 4 (2) of the contract, both the intermediate and final payments required the previous submission of a invoice in which all expenditures had to be detailed.

The two invoices submitted by the complainant amounted to 185.680,04 €, and thus his request was well beyond the figure of 156.312 € foreseen in the contract. The institution also noted that these invoices had not broken down the expenses incurred by the complainant, as required in Art. 4(2). On 22 May 2001, the complainant's firm requested that the contract be amended, and thereby, that the total amount of assistance be increased, so that travel and stay costs could be taken into account. The Commission noted that the request did not respect the deadlines set out in Art. 11 (3) of the contract. The institution added that the complainant's request could not have been accepted since the contract established that the Community assistance could not include travel and stay costs.

The Commission recognized, however, that its services had not acted with due diligence. It stated that they should have formally informed the complainant that the assistance could not be modified and therefore that his expenditures could not exceed that amount, and reflect only the aspects reflected in the contract.

The Commission, however, agreed to carry out the final payment promptly should the complainant submit a total invoice in accordance with the previous criteria.

The complainant's observations

The complainant repeated the allegations made in his complaint. He responded to some of the statements made in the Commission's opinion.

The complainant explained the reasons for the delays encountered in the implementation of the project which, he insisted, were not caused by his firm. He pointed out that his firm was informed by the Commission's services that the bid had been selected only on 27 January 2000, having received the contract a day later. The complainant also explained that his firm requested on 19 January 2000 changes in the contract as regards its beneficiaries, which were only replied to on 18 May 2000. The complainant also referred to additional delays in the dispatching of documents resulting from the Commission's alleged lack of diligence.

As for the format of his invoices, the complainant pointed out that his final invoice was identical to previous ones, and noted that the Commission had not raised any objections at the time.

The complainant contested the Commission's account of his request for the amendment of the project's budget, and enclosed several exchanges with the Commission services which showed that his first request for a contractual amendment had been made on 19 December 2000. He therefore stated that his first demand had been made in proper time, namely 45 days before the final report was submitted. The Commission never replied in writing to the complainant's request, even though its services allegedly expressed their readiness to complete the payment. In none of his contacts with the Commission's services, was he informed that there could be a potential problem concerning his proposed budget amendment, or the payment of the project.

THE DECISION

1 Commission's failure to complete the payment of the complainant's project

1.1 The complainant alleged that the Commission failed to reply to his requests for information, and to pay his firm for the appraisal of an EC programme, despite the institution's formal undertaking towards him on 31 October 2001.

He therefore claimed that the Commission make the payment for the services rendered by his firm.

1.2 The Commission has responded that the two invoices submitted by the complainant amounted to 185.680,04 €, and thus his request was well beyond the figure of 156.312 € foreseen in the contract. The institution also noted that these invoices did not break down in detail the expenses incurred by the complainant.

The Commission noted that even if the complainant had asked for the amendment of the project's budget, his request did not respect the deadlines set out in Art. 11 (3) of the contract. It added that the complainant's request could not have been accepted since the contract established that Community assistance could not include travel and stay costs.

1.3 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 which is binding upon it(1). 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.

1.4 However, the Ombudsman considers that the scope of the review that he can carry out in such cases is necessarily limited. 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.

1.5 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.

1.6 In the present case, the general conditions applicable to the relationship between the Commission and the complainant's firm were embodied in the contract concluded by both parties on 30 December 1999, document which was submitted in the course of the Ombudsman's inquiry.

The amount of the Community's assistance referred to in Art. 4 (1) amounted to "a lump sum of 156.312,00 €". The same provision states that that amount "shall cover all expenditure incurred by the Contractor in the performance of this contract with the exception of travel & subsistence expenditure [...]".

As for potential amendments to the contract, Art. 11 (3) foresees that "[A]ny request for amendment to this Contract, duly justified, must be received by the Commission at the latest 45 days before the date of completion of the Contract". As set out in Art. 2, the contract had to be completed no later than 15 December 2000, and thus, any such request for amendments should have been submitted by the end of October 2000.

1.7 From the information gathered in the course of this inquiry, it appears that the requests for payment made by the complainant amounted to 185.680,04 €, and thus such amount was greater than the assistance foreseen in the contract (156.312 €). Furthermore, even if the complainant requested an amendment of that amount, the Ombudsman notes that his formal request was made on 19 December 2000, once the deadline for the submission of amendments to the contract had expired at the end of October 2000.

1.8 Thus, the Ombudsman considers that the position taken by the Commission in this case does not appear to be unreasonable. It would have been good if the institution had promptly informed the complainant of the reasons for both not accepting the requested amendment to the contract, and rejecting his invoices for the final payment of the assistance. The Ombudsman notes that the Commission has acknowledged that its services did not act with due diligence and has apologised.

In these circumstances, and bearing in mind that the scope of the Ombudsman's review is limited in such cases, the Ombudsman has concluded that the inquiry has not revealed an instance of maladministration as regards this aspect of the case.

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,

 

Jacob SÖDERMAN

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(1) See the European Ombudsman's Annual Report 1997, pages 22 et ss.