TABLE OF CONTENTS

RESEARCH TEAM .......................................................................................................................................... 4 LIST OF ABBREVIATIONS ........................................................................................................................ 4 1. EXECUTIVE SUMMARY .......................................................................................................................... 6

1.1. PRINCIPAL FINDINGS ................................................................................................................................ 6 1.2. CONCLUSIONS ......................................................................................................................................... 9

2. INTRODUCTION .................................................................................................................................... 11 2.1. TERMINOLOGY AND CONCEPTS USED ....................................................................................................... 11 2.2. AIM, SCOPE AND METHODOLOGY OF THE STUDY ...................................................................................... 12

3. MULTILEVEL GOVERNANCE AND BETTER REGULATION STRATEGY IN EUROPE .......... 16 3.1. WHITE PAPERS ON EUROPEAN GOVERNANCE .......................................................................................... 17 3.2. MANDELKERN REPORT ON BETTER REGULATION ....................................................................................... 18 3.3. “GOOD GOVERNANCE” AS A HIGH PRIORITY ............................................................................................ 19 3.4. LOCAL AND REGIONAL ASPECTS IN EUROPEAN GOVERNANCE AND BETTER REGULATION ............................. 19 3.5. INSTITUTIONAL PRACTICES, PROCEDURES AND INSTRUMENTS TO INVOLVE LOCAL AND REGIONAL AUTHORITIES .................................................................................................................................................. 20 3.6. IMPACT ASSESSMENTS: GUIDELINES FROM THE EUROPEAN COMMISSION ................................................. 21

4. ADMINISTRATIVE DIVISION AND MULTILEVEL COORDINATION IN THE COUNTRIES STUDIED .............................................................................................................................. 23

4.1 THE EU MEMBER STATES .................................................................................................................. 23 4.1.1. France ......................................................................................................................................... 23 4.1.2. The Netherlands ........................................................................................................................ 27 4.1.3. Sweden ....................................................................................................................................... 31 4.1.4. The United Kingdom ................................................................................................................. 34

4.2. THE EEA / EFTA MEMBER STATES .................................................................................................. 37 4.2.1. Institutional structure and competences of the EEA-EFTA .............................................. 37 4.2.2. EEA-EFTA States and the EU decision-making process .................................................... 39 4.2.3. Iceland ........................................................................................................................................ 41 4.2.4. Norway ........................................................................................................................................ 44

5. TWO DIRECTIVES UNDER SCRUTINITY IN THE FIELDS OF LANDFILL WASTE AND PUBLIC PROCUREMENT: OBJECTIVES AND IMPACTS........................................................ 47

5.1. THE 1999/31/EC LANDFILL WASTE DIRECTIVE .................................................................................... 47 5.2. THE 2004/18/EC PUBLIC PROCUREMENT DIRECTIVE ............................................................................ 49 5.3. THE LINK BETWEEN THE TWO DIRECTIVES .............................................................................................. 52

6. THE DECISION-MAKING PROCESS OF THE LANDFILL WASTE AND PUBLIC PROCUREMENT DIRECTIVES IN THE COUNTRIES STUDIED ..................................................... 56

6.1. THE 1999/31/EC LANDFILL WASTE DIRECTIVE .......................................................................... 56

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6.1.1. France ......................................................................................................................................... 57 6.1.2. The Netherlands ........................................................................................................................ 62 6.1.3. Sweden ....................................................................................................................................... 67 6.1.4. The United Kingdom ................................................................................................................. 72 6.1.5. Iceland ........................................................................................................................................ 77 6.1.6. Norway ........................................................................................................................................ 81

6.2. THE 2004/18/EC PUBLIC PROCUREMENT DIRECTIVE ............................................................... 85 6.2.1. France ......................................................................................................................................... 86 6.2.3. Sweden ....................................................................................................................................... 95 6.2.4. The United Kingdom ................................................................................................................. 99 6.2.5. Iceland ...................................................................................................................................... 104 6.2.6. Norway ...................................................................................................................................... 109

7. GENERAL TRENDS / GLOBAL ANALYSIS ................................................................................... 113 7.1. THE PRE-LEGISLATIVE AND LEGISLATIVE PHASES .................................................................................. 113 7.2. THE TRANSPOSITION PHASE ................................................................................................................. 115 7.3. THE IMPLEMENTATION PHASE ................................................................................................................ 117 7.4. GENERAL EVOLUTION OF SUB-NATIONAL ACCESS TO THE EU LEGISLATIVE PROCESS AND FUTURE POSSIBLE DEVELOPMENTS ............................................................................................................................. 119

8. KEY FINDINGS .................................................................................................................................... 122 9. CONCLUSIONS ..................................................................................................................................... 126 ANNEXES .................................................................................................................................................... 132

ANNEX I. GRAPHIC REPRESENTATION OF THE STUDY RESEARCH PROCESS, THE STAKEHOLDERS INVOLVED, AND THE ACTIONS CARRIED OUT .................................................................................................. 132 ANNEX II. QUESTIONNAIRE SENT TO THE COUNTRIES OCTOBER 2008 ........................................................ 133 ANNEX III. GENERAL STRUCTURE OF THE COUNTRIES STUDIED ................................................................... 135 ANNEX IV. PUBLIC PROCUREMENT VALUE IN THE EU ................................................................................... 138 ANNEX V. THRESHOLDS ESTABLISHING THE APPLICATION OF THE PP DIRECTIVES ....................................... 139 ANNEX VI. DEGREE OF IMPLEMENTATION OF THE 2004 RECOMMENDATION ON THE TRANSPOSITION OF INTERNAL MARKET DIRECTIVES IN MEMBER STATES – SOURCE EC ............................................................... 140

BIBLIOGRAPHY ........................................................................................................................................ 143

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RESEARCH TEAM Director of the study: Gracia Vara Arribas, Senior Lecturer EIPA-ECR, BARCELONA (ES) Deputy Director of the study: Koos van Dijken: Head of Trends & Monitoring, Nicis Institute, THE HAGUE (NL) Team covering the Landfill Directive: Martin Unfried & Maria Kleis, Senior Lecturer and Lecturer EIPA MAASTRICHT (NL) Team covering the Public Procurement Directive: Gracia Vara Arribas & Koos van Dijken, assisted respectively by Elena Pinto & Alexis Lubow, Researcher & Student Assistant EIPA-ECR, BARCELONA (ES) & Simone Pekelsma, Nicis Institute, THE HAGUE (NL) Reviewer of the study (July – September 2009): Delphine Bourdin, Expert LIST OF ABBREVIATIONS 4Ps: Public Private Partnership Programme UK AER: Association of European Regions ARF: Association des Régions de France BAO: Dutch Decree on Public Procurement for Works, Supply and Public Service Contracts BASS: Dutch Decree on Public Procurement for special Special Sectors. BNC: Dutch Working Group for the Assessment of New Commission Proposals BZK: Dutch Ministry of the Interior and Kingdom Relations CEEP: European Centre of Employers and Enterprises providing Public Services CEMR: Committee of European Municipalities and Regions CLWP: European Commission Legislative and Work Programme. CoCo: Coordination Committee for European Integration and Association Studies COM: European Commission CoR: Committee of the Regions COREPER: Permanent Representatives Committee CPV: Common Procurement Vocabulary DE: Germany DEFRA: Department for Environment, Food and Rural Affairs, UK Ministry of Environment DUIV: Dutch Coordination group between VROM, the Waterschapen (Waterboards), IPO and VNG. EC: European Community (the first pillar) ECJ: European Court of Justice EESC: European Economic and Social Committee EMU: European Monetary Union EPA: Swedish Environmental Protection Agency ESA: EFTA Surveillance Authority EU: European Union EEA-EFTA: European Economic Area-European Free Trade Association FEAD: European Federation of Waste Management and Environmental Services FHIR: Dutch Board of Facilities, Accommodation and Procurement FR: France GDP: Gross Domestic Product GLA: Greater London Authority HNP: House of Dutch Provinces

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IA: Impact Assessment IDea: Improvement and Development Agency for Local Government in the UK IPO: Dutch Inter-Provincial Council IS: Iceland IT: Information Technology JMCs: Joint Ministerial Committees KS: Norwegian Association of Local and Regional Authorities KOFA: Norwegian Public Procurement Complaint Board KOSTRA: Norwegian Municipality State Reporting LACORS: Local Authority Coordinators of Regulatory Services in the UK LATS: UK Landfill Allowance Trading Scheme LGA: Local Government Association covering England and Wales LGE: Local Government Employers in England and Wales LGIB: Local Government International Bureau covering England and Wales LRA: Local and Regional Authorities MEP: Member of the European Parliament MS: Member States MVO: Dutch Network of Civil Society NGO: Non-Governmental Organization NI: Northern Ireland NILAS: Northern Ireland Landfill Allowances Scheme NL: The Netherlands NO: Norway NOU: Public Procurement Board, Sweden OGC: Office of Government and Commerce in the UK PIA: Dutch Government Procurement Organization PIANO: derived from PIA, the Public Procurement Expertise Centre, PP: Public Procurement SALAR: Swedish Association of Local Authorities and Regions SE: Sweden SEPA: Scottish Environment Protection Agency SFT: Norwegian Pollution Control Authority SGAE: Secretary General for European Affairs in France. SOMO: Dutch Centre for Research on Multinational Corporations UCLG: United Cities and Local Governments at global level VNG: Association of Dutch Municipalities UK: United Kingdom VROM: Dutch Ministry of the Environment WG: Working Group WLGA: Welsh Local Government Association

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1. EXECUTIVE SUMMARY In the European Union of the 21st Century, local and regional authorities have become crucial actors in the implementation of EU policies, but also key partners, together with the national authorities, in ensuring compliance with European Law. Regions and cities are gaining substantial responsibilities for implementation of European legislation and policies, while no major move has been made towards increasing their participation in the EU decision-making process. The impact of EU legislation in several sectors, notably the Internal Market, affects not only the economic, social and environmental realities of the states, regions and cities in Europe, but its institutional settings as well. The findings of the study reveal that even early warning mechanisms are not always effective if those are not carefully considered by the decision-makers. In the same vein, the need for continued construal by the European Court of Justice (ECJ) of the vague provisions in a given piece of EU legislation, impacts the internal organisation of the administrative services at the state and the sub-national levels and hampers smooth compliance with European Law. Four components of possible institutional impacts are analysed: a) the establishment of new entities – bodies or restructuring the existing ones in the administration; b) the development of ad hoc coordination mechanisms and the operability of the latter; c) the capacity-building efforts conducted around a given new law and its subsequent interpretative rulings; as well as d) the effect on the overall functioning of the policy area vis-à-vis the institutional structure of an administration due to a given new rule. These four components are screened throughout the different phases of the policy-making cycle: pre-legislative, legislative, transposition and implementation. This report presents the results of an ex-post impact assessment study undertaken for six countries (four Member States – France, the Netherlands1, Sweden and the United Kingdom – and two EFTA countries – Iceland and Norway) in order to measure the institutional impacts at the state, regional, and local levels of the 1999/31/EC Landfill Directive and the 2004/18/EC Public Procurement Directive. The context of "Good Governance" and "Better Regulation" principles and instruments have furnished the general framework; the ultimate goal being to ensure that the institutional impacts of the EU legislation is properly assessed and understood. The study puts forward a number of questions regarding the existing mechanisms. It aims to identify gaps and opportunities for improvements. 1.1. Principal findings The pre-legislative phase Even fifty years after the signing of the EC Treaties, awareness of public entities on the preparation of new EU legislation often seems to be raised quite late; effective action being only taken from the moment of approval in Brussels. Although limited, the cases analysed show noticeable improvements. At the time of the Landfill Directive no structured consultation-participation

1 The Dutch Ministry of Interior has acted as management authority for this study.

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mechanism was set up to include actors outside of the negotiators and policy-makers during the preparatory phase. A decade later, we are witnessing a number of aspects that still need to be improved: in the EU decision-making process, early multilevel consultation and participation remain scarce and are not rationalised. In the case of the Public Procurement Directive, concerns raised at an early stage were not followed up concretely by the decision-makers, and no records are available to check the impact – if any – of these early warnings among the negotiators of the new legislation. Moreover, in the “old” Member States analysed, no practice of early impact assessment existed for both EU directives. However, improvements have been noticed in the light of the new 2009 European Commission Impact Assessment (IA) guidelines. Time is needed to evaluate how the implementation of those new guidelines will result in terms of effective early warning mechanisms against foreseeable side-effects. Several reasons explain that, unless the States apply the principles established by the European institutions, the conditions for good consultation, cooperation and coordination will not exist. Indeed, “the conditions for good multilevel governance actually depend on the Member States”2: signs of this assertion have been found in our research. If the Member States devote only time and capacities once the EU legislation is approved in Brussels, then it is much too late to carefully consider early voices raised or to avoid lack of consultation or coordination. The 2009 IA guidelines should be fully implemented and its methodology generalised to all levels of government, in order to ease exchange of information and better detect potential institutional impacts. The legislative phase The launching of a "Better Regulation" strategy within the EU coincided with the approval of the Public Procurement Directive. However, it was certainly too early to find this new strategy reflected in the latest policy on public procurement itself. It appears that the new public procurement rules have ultimately been perceived by many as complex and cumbersome. In general, European legislation continues to be complex and vague. Room for construal opens the door for ample use of soft law mechanisms: e.g. important questions in public procurement rules such as those governing low value contracts or the requirements for a green public procurement have been addressed by soft law tools. The ECJ acting in the role of the legislator is another consequence of the vagueness and complexities of the EU legislation. On the other hand, cultural differences such as informal procedures and non-detailed EU legislation should be taken into account in the negotiation and decision-making phases. The findings of our study reveal that some of the difficulties and feelings of lack of ownership around a given European rule is also related to the different legal culture (the case of the Nordic countries illustrates this example).

2 The White paper on Multilevel Governance, Committee of the Regions, CdR 89/2009 fin.

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The transposition phase In recent years, transposition has become an object of increased efforts by many Member States: therefore an improvement has been observed there. However, on the technical side, the quality of transposition can still be improved. Indeed, due to time pressure and the willingness to avoid future confrontations and ECJ judgement, Member States tend to transpose every provision literally, without any in-depth analysis of the room for flexibility offered. How the possible different options will impact internally is not sufficiently foreseen. For example, in the case of public procurement, the incorporation of the voluntary procedures was done with the intention to open up more options to the stakeholders. However, as a side-effect it has caused difficulties with misunderstandings and misinterpretations of the rules; high level training and specialisation were then made necessary. The transposition phase is clearly perceived in the cases analysed as a distinct process: once the EU legislation has been approved in Brussels, it is then the national duty to integrate the EU instrument into internal law. “Dossier teams”, or similar structures, are often being commissioned by the central government in order to timely transpose a new directive; coordination mechanisms for adequate consultation at all levels are established. Such national teams have often been witnessed to be dismantled as soon as the transposition duty is completed: this strict divide has proven to be counterproductive. While compliance with the transposition deadline has improved, Court cases related to non- (or inadequate) compliance are constantly increasing. Therefore, incorporating European legislation into national law should be seen as an extension of the negotiating process, and as a preamble of the actual implementation phase, rather than a totally disconnected process. All phases, from early negotiations to national integration and ultimate implementation should be envisaged as a unique and coherent policy process. Entities appointed to accompany such a process should enjoy more continuity and stability in order to follow this logic. The implementation phase Potential impacts derived from a given piece of EU legislation are difficult to detect at an early stage and often only show up during the implementation phase. Further exchange of experiences and building common knowledge during the process of negotiation, decision and transposition would help to trigger a debate on the obscure or difficult aspects of a directive. Although the institutional impacts also depend on the type of directive as well as the national preparedness, the fact that Member States choose to follow the EU legislation at stake literally in order to avoid Court cases, has a direct effect on the implementation and compliance difficulties encountered afterwards. Horizontal exchange of knowledge and concerns among the responsible civil servants in the different Member States would help to recognise common problems, and increase the possibilities of common solutions. The case of shared services in public procurement is a striking example of such innovative practices leading to noticeable improvements: the establishment of a general ban on inter-municipal cooperation (without tendering publicly) has directly affected local autonomy – a strongly rooted practice in some of the analysed States. The dangers derived from this general ban had been warned at a very early stage by regional European organisations as well as by the Committee of the Regions, but apparently no clear attention was paid to these warnings. After years of extensive discussions and abundant Court judgements, we are finally (in 2009) witnessing a shift in Court rulings towards more flexibility: in certain cases those shared services may now be allowed without public tendering. On the other hand, the new setting of different entities is often necessary in order to cope with the requirements of a given EU directive. In the case of the Public Procurement Directive, although being in theory a compilation of old rules and case-law, stakeholders have had to professionalize themselves and extensive training and guidance have been produced.

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1.2. Conclusions 1. – Ensuring global awareness It is important to ensure a global awareness of any new EU instrument by all the actors concerned, entailing that the potential consequences are understood and considered. The findings of our study reveal that although certain awareness has been put into place in recent years, we still lack sufficient mechanisms being able to raise alarms when some aspects of an instrument may have a non-desired effect in a given legal system. Taking better into account the work of the associations representing regional and local authorities, the work of the Committee of the Regions, as well as opening up better consultation and participation mechanisms within the State, would help the early detection of undesired impacts of EU legislation. 2. – Flexibility More time and resources must be invested in properly transposing EU directives. Correctness does not always coincide with the literal copy of the European legislation: taking full advantage of room left for adaptation and flexibility is advisable. Abruptly incorporating the wordings of the norms as they come from Brussels may complicate future compliance. Adequate capacities are needed at Member State level to consider all the options and select the best one(s). The decision to go beyond the requirements of the directive – although conceivable – should be taken with some caution. 3. – Early guiding teams In recent years several countries have established what we may call “transposition teams”: in principle, the central government commissions a group of administrators with the mission to manage and supervise the correct and timely transposition of a given EU directive. The study reveals that normally these groups are established once the term for transposing starts counting, and are dismantled once the EU legislation has been transposed. Notwithstanding the unquestionable positive effects of establishing such specialised teams, they should certainly be established at an earlier stage (legislative phase), thus intervening as a liaison interface between sub-national actors and the EU level3. Likewise, such a team should be maintained at a later stage, until actual implementation occurs. 4. – Careful use and consideration of soft law interpretative instruments, as well as of the ECJ evolving case-law It is always difficult to predict the potential impacts a proposed EU legislation might have, and therefore time and capacity investments are recommended, as well as broad consultation. The

3 The Netherlands has started this practice through the so-called "Dossier teams", a type of a more permanent group of experts working throughout the whole policy cycle.

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European Commission often issues interpretative documents to help clarifying obscure aspects of the piece of legislation concerned. Whenever it is not precise on a given topic, it will be for the ECJ to give common interpretation. Depending on the scope of the norms under interpretation, the Court might be placed in a co-legislator position, which often has a negative impact on the smooth compliance with European Law. In the same vein, the evolving case-law does not help the stakeholders affected by a given legislation to reach clarity and properly organise their services adequately to comply with the legal mandate of the norm.

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2. INTRODUCTION 2.1. Terminology and concepts used Clarity in the use of terms is vital to this comparative study. During our research, references to different – and in some cases even contradictory – definitions of the legal acts and legislative phases under analysis have appeared in various documents studied. In order to avoid confusion and misunderstandings, we have attempted to provide a clear set of definitions of the terms used for the purposes of this study. EU Primary Law: The Community Treaties and the Treaty on European Union. EU Secondary Law: All EU legal norms except the Community Treaties and the Treaty on European Union. The expression “EU implementing acts” is sometimes used to describe comitology directives issued by the Commission acting with delegated powers from the Council. Member State Legislative Act: national acts adopted by institutions holding legislative competences. When a sub-state institution holds legislative power, the name of the region should always be specified. For instance, an Act of the Scottish Parliament is likely to be a “Scottish legislative act”. Member State Executive Act: National act adopted by institutions with executive competences. When a sub-state institution holds power to adopt such acts, this should always be specified as such, for example, the Wales Executive Act. Incorporating EC Directives into domestic law requires going through different phases. The more this process is sequenced, the clearer subsequent analysis will be. In general terms, we differentiate between the following phases: Pre-legislative and legislative phases: These phases cover decision-shaping, the preparatory work in the Commission and Member States before a formal Commission proposal is officially presented. Once the proposal has been presented, the EU decision-making process begins. This so-called legislative phase comprises the period from the Commission proposal to the approval of the final legal act, when EU secondary legislation is adopted. Transposition: The legal process by which EU legal instruments are integrated into national law. The nature of the instruments that enable this varies according to the macro-level institutional arrangements and the distribution of competences. A sound knowledge of the transposition process is prerequisite to a reliable assessment of the second phase because “transposition predetermines

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the subsequent move” 4 . Implementation issues may, however, be dealt with by an institution, committee or through simple consultation held during the transposition phase. Implementation: Once the national legal transposing act has been published, or once a directive has direct effect (due to its delayed transposition), the implementation phase starts. Implementing EC directives requires a change in laws, behaviour, routines and procedures. Effective implementation may necessitate the creation of new entities and the development of new expertise. It may also simplify burdensome procedures and eradiate certain bodies, functions or intermediaries. This sort of consequence can be direct or indirect, intentional or inadvertent, positive or negative. Therefore, identifying all the concrete effects of a directive once it has been transposed may turn out to be a laborious mission. Both prior and subsequent to each phase, different authorities with differing competences, legitimacy and interests can be consulted. Such consultation and its follow-up, as well as the degree of involvement in policy-making can significantly impact the final outcome. All these aspects must be taken into account in a comparative assessment of the institutional impacts of law. The findings have enabled recommendations to be made with a view to improving law-making. The distribution of competences can vary from one political system to another. The executive authority may be stronger in one country than another, while the legislative authority may be more favoured under one Constitution than another. In describing the national transposition of legal acts, we will maintain the distinction between Acts of Parliament, and Acts of Government. In addition, the distribution of competences between central and sub-national authorities may differ from one State to another. The questions “What power to regulate? At what level? With what kind of instrument?” can be answered with a reasonable degree of certainty for each member state individually. However, in order to make a genuine comparison of constitutional systems, there is a need for exchange of practices and tools used by all participants. 2.2. Aim, scope and methodology of the study Aim This study sets out to investigate the institutional impacts of EU legislation at local and regional levels, focusing on the different elements that influence institutional settings. Working methods and coordination tools at European, national, regional, and local levels in the policy cycle will be regarded from the pre-legislative phase to the final implementing phase of a new European

4 HAVERLAND et al. 2007: 760.

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directive. In order to work on concrete cases, our study focuses on the Landfill Directive and the Public Procurement Directive5. In doing so, it should facilitate better identification of the types of questions that Commission departments should examine in their overall impact assessment approach. Such a comparative study also highlights possible improvements that can be made to domestic procedures involving local and regional agencies, from the early negotiation stage to the transposition and implementation stages. The study should also provide public authorities at local and regional levels with suggestions as to how they can better engage with the Commission policy-making and impact assessment processes. This should in turn ensure that the Commission is more aware of any potential institutional impact at these levels. Scope A deliberately broad approach has been chosen for this study. Institutional impact is understood in the widest possible sense, as polymorphic influences that the formation of EU policies may have on institutions, procedures and routines from the early stages to their final implementation. This includes the potential alteration of internal legislative frameworks, intergovernmental coordination, and the allocation of resources, the development of appropriate skills, public accountability, as well as respect for the allocation of competences at European, national, regional and local levels. Our focus is on the possible institutional impacts of EU legislation on local and regional governments. In order to understand the causes of institutional impact, we analyse each stage of the policy-making cycle: preparation of a new legislative proposal (pre-legislative phase), the decision-making procedure in Brussels (legislative phase), the incorporation of the new legislation into the national legal system (transposition phase) and the implementation of the rules (implementation phase). We also take account of discernable developments and recent trends in case-law, as they are central to the final outcome of a study that aims at having practical effects. We have narrowed the number of States down to six: four Member States (France, The Netherlands, Sweden and The United Kingdom) and two EEA States (Iceland and Norway). These countries decided to take part in this research project. As a result, we are faced with the fact that in general all the participating countries belong to the group of “compliant” countries. This of course limits the findings and recommendations to situations where a good level of compliance has already been achieved within the transposition time limits set by the Commission, as well as a good coordination mechanism system to implement the norms properly.

5 Official Journal of the European Communities L 182 of 16/07/1999, pp. 1-19 for the Landfill Directive 31/1999 and Official Journal of the European Union L 134 of 30/04/2004, pp. 114-240 for the Public Procurement Directive 18/2004.

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We have also narrowed the legal instruments to be studied to6: - The 1999/31/EC Landfill Directive; - The 2004/18/EC Public Procurement Directive. A considerable amount of literature has been written and extensive research has been carried out on both directives. For example, a study on the economic impact of procurement rules was released prior to the new legislative package. To our knowledge, however, a comprehensive study on the impact of the Public Procurement Directive on local and regional authorities is still lacking. In the case of Landfill Waste, the report published by the EU Committee of the Regions on the implementation of the directive at regional and local levels mainly focuses on the views and perspectives7 of environmental NGOs. The existence of previous research was considered as an asset in the selection of these two pieces of EU legislation. While such studies clearly raise similar questions, we aim at a wider analysis enabling to broader conclusions to be drawn and policy recommendations to be made. Furthermore, although dealing with diverse fields, they are linked for example by case law8, something that opens up potential findings with regard to the consistency and coherence of EU rules. Methodology The countries selected in this study have very different political and constitutional arrangements as well as decentralized administrative structures 9 . Only four of them are EU Member States. Furthermore, we analysed two directives that were discussed, created and transposed at very different times and in highly dissimilar contexts. The basic research methodology is qualitative. Therefore information has been gathered as follows10: Desk Research: the desk research has accomplished the following tasks:

• Identifying and taking into account the available knowledge on the institutional arrangements of participating MS, providing a brief introduction to each MS.

• Studying available materials on the implementation of selected regulations. • Identifying the institutional impacts that were anticipated when the regulation was

decided upon.

6 The two regulations have been chosen by the participating MS during the Barcelona meeting of 25 January 2008, together with the research team. 7 These studies were presented and explained to the representatives of the Member States in April 2007 in Barcelona, when discussing which Directives could be chosen as case studies. 8 E.g. C 382/05 of 18th July 2007 against Italy and the case Mödling (AT) of 10th November 2005 9 Studying the institutional impact of EU legislation from a comparative perspective is especially interesting when the “countries selected vary independently on macro-level variables”. (HAVERLAND et al. 2007:759) 10 see Annex I for a description of the methodology followed in table format.

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Questionnaires and telephone interviews: The appropriate contact point for the researchers was identified in cooperation with the participating MS HLG representatives. National, regional and local stakeholders were invited to answer the questionnaire. In-depth group interviews were carried out with representatives of each participating Member State after the questionnaire had been received and preliminary findings had been drawn. Relevant ministries, regional and local governments participated in the interviews. Meetings were held involving discussions with EC representatives, ministries, regional and local governments and sectoral-specific experts on the preliminary findings, as well as on the comparability and applicability of the collected data, and further feedback on the analysis by the research team. Identifying similarities and differences, based upon the findings, in the institutional impacts between participating Member States at the national, regional and local levels. Drafting of policy recommendations on processes and tools, addressed to all levels of government involved, adopting a view of shared responsibilities for institutional outcomes in the implementation of EU regulations.

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3. MULTILEVEL GOVERNANCE AND BETTER REGULATION STRATEGY IN EUROPE The European Union is becoming a continent where the challenges produced by a lack of borders are being addressed within the framework of traditional institutional boundaries. The great variety of European sub-state structures, together with the principle of institutional autonomy of the Member States vis-à-vis their regions, cities and municipalities, have placed multilevel governance at a cross-road: the allocation of competences, resources and processes between the central governments and the sub-state levels is being increasingly influenced by EU Law. The responsibility of the regional and local levels in the correct implementation of EU rules continues to grow. The scoreboards regularly published by the European Commission show that although the rates of timely transposition of new EU legislation by the Member States have notably improved, compliance with the new provisions remains weak. The Member States have undergone significant developments resulting in greater Europeanization, which has not however always been mirrored by greater domestic regionalization. This fact has led the European Union to a situation in which local and regional authorities are gaining substantial responsibilities for implementation while no major move has been made towards increasing their participation in the decision-making process. Greater European influence and the deepening of the transfer of competences to the regional and local levels in most Member States have reinforced the impact of EU Law in several sectors, notably the Internal Market and the Environment. These developments have not only made the local and regional authorities privileged actors in the implementation of EU policies, but also important partners, together with the national authorities, in ensuring compliance with EU Law11. To put the issues addressed in this study into context, it is useful to have an overview of how the role of the EU regions, cities and municipalities in the pre-legislative phase and the transposition/implementation phases has evolved over the years. In an attempt to bring the EU closer to its citizens at the local and regional levels, and to enable local and regional authorities to influence the development of EU policies, the 1993 Maastricht Treaty established the Committee of the Regions. The Treaty stipulates that the Committee of the Regions shall be consulted by the EU Council or the European Commission in policy areas specified by the Treaty. The Committee of the Regions may also be consulted by the European Parliament and can issue an opinion on its own initiative in cases where it considers this to be appropriate.

11 Although in pure legal terms, the State is the sole responsible.

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The Maastricht Treaty also contains a separate provision which significantly enhanced the role of regions in the EU decision-making process. It states that the EU Council shall consist of a “representative” of each Member State at ministerial level, who is authorized to commit the government concerned. This enabled regional ministers to sit in the Council for the first time. Since then, the procedure has matured and this direct participation nowadays allows the inclusion of regional representatives in Member States’ delegations, authorisation to lead a national delegation and, where necessary, assume the Presidency of the Council; Germany, Austria, Belgium and Italy foresee this possibility of the regional level representing the State in chairing Council negotiations 12 , either through constitutional provisions or internal agreements when regional matters are at stake 13. This political cooperation presupposes mutual trust, rather than confrontation between different political and democratic roles. It also presupposes a reinforced culture of consultation and coordination as well as the common control of EU legislation. The findings of our study show that this mutual understanding is not always sufficiently developed as to produce the expected results. 3.1. White Papers on European Governance Almost a decade later after the Treaty of Maastrich, the European Commission’s 2001 White Paper on European Governance 14 focused on improving the preparation and implementation of EU legislation and policies, and on establishing greater interaction between the Commission and regional and local governments. The White Paper states that, despite their increased responsibility for implementing EU policies, the role of regions and cities as “elected and representative channels” interacting with the public on EU policy was not being sufficiently “exploited”. It argued that the Commission should ensure that regional and local knowledge and conditions were taken into account in the policy-making process, and should organise a “systematic dialogue” with European and national associations of regional and local governments. The White Paper emphasized that the “principal” responsibility for involving the regional and local levels in EU policy “remains and should remain” with national administrations. But it added that there was often a perception that national governments were failing to involve regional and local actors adequately in EU policy-making. The White Paper therefore states that “each Member State should foresee adequate mechanisms for wide consultation when discussing EU decisions”. Eight years after the publication of the Commission White Paper, the debate has now resurfaced with the publication by the CoR of a new White Paper on “Multilevel Governance” : in the current

12 Regional interests in these negotiations cannot prevail over the national position already agreed upon. 13 Also in the Case of UK, Spain and Portugal, regional representatives may intervene at the Council together with the national representative but with no voting rights. 14 European Commission White Paper COM (2001) 428 final.

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time of change within the European institutions 15 , the new White Paper recaptures the ideas developed by the Commission in 2001 and develops new proposals to “build Europe in partnership” with two main objectives: encouraging participation of local and regional authorities in the European process and reinforcing the efficiency of Community action. It invites the Member States to set up internal coordination and consultation processes with local and regional authorities in order to take their know-how in the preparation of the national position into account16. 3.2. Mandelkern report on better regulation In the same year as the Commission White Paper (2001), the Mandelkern report on Better Regulation 17 stressed that high-quality regulation “forms a chain from the earliest stages of its preparation through to its implementation”. It argued that more attention should be paid to ensuring a higher level of global awareness when passing new legislation to guarantee that “full consequences are understood and considered”. The report also emphasized that incorporating European legislation into national law should be seen as an extension of the negotiating process, rather than as a distinct process. In addition, it stressed that cultural differences, such as informal procedures, should be taken into account in the negotiation and incorporation processes. Furthermore, the report underlined the importance of “effective structures” and specifically pointed to the need for coordination between intermediate levels of government (regional administrations and local authorities), and between the national and EU levels, in order to ensure a better regulatory structure. To sum up, by establishing the Committee of the Regions, the EU acknowledged the need to take regional and local concerns into account in European policy-making. At the same time, while the Commission’s White Paper on European Governance acknowledged that it was the responsibility of national governments to involve the regional and local levels, it stressed the need for a more systematic dialogue with these levels of government. The Mandelkern report then linked these issues to Better Regulation, and highlighted the importance of coordination between the local, regional, national and EU levels in order to ensure Europe-wide regulation of the highest possible quality.

15 Renewal of the European Parliament and Commission, the imminent entry into force of the Lisbon Treaty, the recast of the EU budget, and the continued global economic crisis. 16 At the time of closing of the report (1 September 2009) consultation is open on the CoR White paper, up to 30 November 2009. 17 Mandelkern Group, Final report, 13th November 2001.

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3.3. “Good Governance” as a high priority Within the framework of the Lisbon Strategy for Growth and Employment18, and a drive for ‘Good Governance’ within the EU institutions and Member States, the EU has given high priority to ‘Better Regulation’. ‘Better Regulation’ can be viewed in two ways. It can be seen in terms of the desired outcome of a programme of Better Regulation activities i.e. a simplified and improved regulatory environment for Europe’s citizens and businesses, where regulation is used only when necessary and in a manner proportionate to the policy challenge it sets out to tackle. However, it can also be seen as a process, whereby in which those responsible for examining the need for policy interventions, as well as; their design, implementation and management, apply Good Governance and Better Regulation principles throughout the policy cycle. Thus, ‘Better Regulation’ is also about ‘Regulating Better’ or good policy-making. 3.4. Local and regional aspects in European governance and better regulation When examining ‘Better Regulation’ from these interlinked perspectives, it is clear that the regional/local dimension must be fully considered. Sub-state levels of government can sometimes have significant regulatory powers in their own right, and ought to be alert to the role that they need to play in ensuring a better regulatory environment. In doing so, they should also apply the principles which underpin good policy-making. This could be achieved for example through broad consultation processes with stakeholders when considering a policy initiative. Additionally, regional/local levels often implement national policies and regulations. In their executive role they may apply specific and crucial knowledge as to the implications of new regulation in the field. This knowledge is ideally used in designing and implementing new regulation. Furthermore, the development of cross-border and interregional cooperation is highly encouraged by the European Union. Territorial cohesion is a new EU objective according to the Lisbon Treaty, legally supported by a Community legal framework since the adoption in July 2006 of Regulation (EC) 1082/2006 on the European Grouping of Territorial Cooperation. These developments reinforce the fact that regional and local actors have become privileged actors in the common objective of good governance. In line with this, in its White Paper on Multi-level Governance19, the Committee of the Regions distinguishes between institutional governance and partnership-based governance, stressing the second: local and regional authorities are genuine partners rather than mere intermediaries. Partnership goes beyond consultation, promoting a more dynamic approach.

18 Facing the Challenge. The Lisbon Strategy for Growth and Employment, Report from the High Level Group chaired by Wim Kok, November 2004. 19 The Committee of the Regions’ White Paper on Multilevel Governance, 17 June 2009, CdR 89/2009 fin.

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3.5. Institutional practices, procedures and instruments to involve local and regional authorities Although local/regional government involvement in Better Regulation needs further and substantial research, this study takes it in a slightly different direction, namely in terms of how to work within the context of Better Regulation principles and instruments to ensure that the possible institutional impacts of EU legislation are properly assessed and understood. The study asks a number of questions about existing mechanisms and aims to identify where gaps exist and/or where existing approaches can be improved. Clearly regional/local government have a responsibility to take a proactive approach and scan forthcoming legislative initiatives to identify which are likely to have an institutional impact, and then to feed this information to the European Commission, the European Parliament and/or their national representatives in the Council of Ministers. Furthermore, an important role can be played by the Committee of the Regions in drawing attention to issues where the local/regional impact will be of particular importance20 In recent years, important changes to the way in which the European Commission works have made it easier for regions, cities and municipalities to better anticipate the potential impact of a Commission proposal at their level of government. For example, the introduction of the Strategic Planning and Programming Cycle means that the European Commission provides early indications of its strategic policy priorities (in the so-called Annual Policy Strategy), which is subsequently followed-up by the publication of its annual Legislative and Work Programme (CLWP), wherein the Commission sets out all the major legislative and policy-defining initiatives it plans to consider in the coming year. Since 2005, the publication of the CLWP has also been accompanied by an annex of ‘Roadmaps’. These documents, which are now mandatory for almost all the items featured in the CLWP, provide an important indication of the work being undertaken by the Commission in preparing the integrated Impact Assessment. Sub-state levels of government can now examine these Roadmaps and better identify particularly relevant impacts, affording them some time to prepare and present their views directly to the Commission, either through the national administration, the Committee of the Regions or MEPs. The fact that so many sub-state levels of government now have representative offices in Brussels would certainly support the view that monitoring EU policy developments and proactively feeding views into the policy-making and legislative processes is considered to be an important element of the work of Europe’s regional and local administrations. There may be scope for further improvements to the mechanisms, instruments and procedures currently in place to facilitate the consideration of regional/local institutional impacts and to better incorporate the views of sub-state administrations into the policy-making, legislative and implementation processes. The conditions for good multilevel governance actually depend on the

20 E.G. Protocol on the cooperation arrangement between the European Commission and the Committee of the Regions, Brussels November 2005

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Member States21. The principles and mechanisms of consultation, coordination, cooperation and evaluation recommended at Community level must firstly be applied within the Member States. 3.6. Impact assessments: guidelines from the European Commission Perhaps the most important recent development in terms of opportunities to consider sub-state institutional impact at the time of preparing the initial legislative proposal is the introduction by the European Commission in 2002 of an integrated, ex-ante system of Impact Assessment (IA). Introduced as part of its overall Action Plan to simplify and improve the regulatory environment for Europe’s citizens and businesses, it replaced the Commission’s previous sector-based and partial analyses of the potential impact of proposed initiatives with an integrated approach whereby potential social, economic and environmental impacts would be examined as part of a single assessment exercise. This integrated approach is now systematically applied to all of the Commission’s major legislative and policy-defining initiatives, as set out in the annual Legislative and Work Programme, and is being progressively applied to a wider range of initiatives. Since its introduction, more than 300 impact assessments have been carried out by the European Commission. Other EU institutions – the Council of Ministers and the European Parliament – are also committed to carrying out integrated impact assessments on substantive amendments to European Commission proposals. Furthermore, the three institutions have committed themselves to ensuring the use of proper and coordinated impact assessments. The Inter-institutional Agreement of 2003 on Better Law-making between the European Parliament, the Council and the Commission Common Approach to IA of November 2005 represents the first steps towards the establishment of a common IA methodology. The basic purpose of an integrated ex-ante impact assessment is to prepare the best available evidence of the entire potential impact of a given course of action. The evidence is gathered, prepared and set out in an Impact Assessment Report, such that those responsible for taking political decisions on how to proceed may carefully consider the likely consequences for society, the economy and the environment. The Commission published its first IA guidelines in 2003. Revised versions followed in 2005 and 2006. This model should allow the relevant Commission department to calculate the total administrative costs associated with the proposed initiative. Since the model should be applied whenever a measure is likely to ‘impose a significant increase of administrative costs on business, the voluntary sector or public authorities’ [emphasis added], it ought also to examine potential costs for local and/or regional administrations After an external evaluation of the Commission IA system, new guidelines were published in 2009. The external evaluation concluded that the 2005/2006 guidelines needed to reinforce a number of important elements, among others the consistency of the proposals with the principles of subsidiarity and proportionality and “the impacts at regional and local level”. Although in the 2006

21 The Committee of the Regions’ White Paper on Multilevel Governance, 17 June 2009, CdR 89/2009 fin.

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Commission’s internal Impact Assessment Guidelines version, there were regular references to the regional dimension 22 ; these tended to refer to social, environmental or economic impacts on regions and not to how the implementation of EU legislation was likely to affect the institutional set-up at the local/regional level. The Tables of Impact in the 2006 Guidelines do make reference to the need for Commission departments to consider certain institutional questions which also relate to regions and local entities. For example, under the heading of ‘Public Authorities’ in ‘Table 1: Economic Impact’, Commission departments are asked to examine whether the option being considered has “budgetary consequences for public authorities at different levels of government, both immediately and in the long run”, and if it will “require establishing [sic] new or restructuring existing public authorities”. Furthermore, under the heading ‘Governance, participation, good administration, access to justice, media and ethics’ in ‘Table 2: Social Impact’, the Commission department ought to consider questions relating to the implementation of an EU measure and its effect on public institutions and administrations. References are consistently made to the regional and local level throughout the new 2009 IA Guidelines. They further stress the need to assess any additional governmental administrative burdens at regional and local level. After having considered the general framework set by the multilevel governance approach and the better regulation objective, a close look to the administrative structure and the Involvement of local and regional governments in the EU policy making will be paid to each of the countries studied.

22 e.g. in the Table of Impacts on page 29.

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4. ADMINISTRATIVE DIVISION AND MULTILEVEL COORDINATION IN THE COUNTRIES STUDIED The purpose of this section is to provide a specific account of the relevant administrative mechanisms linking sub-state authorities to European decision-making in each of the six countries studied23. Iceland and Norway are not EU Members, but they enjoy exceptional status in the realm of the Community as part of the EEA, and thus have to implement the Landfill and PP Directives. Within this context, the EEA’s specific involvement in the EC polity will be highlighted. Table: An overview of the countries studied Population Extension Political regime Entry in the EU France 62,000,000 674,800 km2 Republic 25-Mar-57 Netherlands 16,500,000 41,500 km2 Parliamentary

monarchy 25-Mar-57

Sweden 9,200,000 444,900 km2 Parliamentary monarchy

01-Jan-95

UK 61,600,000 244,800 km2 Parliamentary monarchy

01-Jan-73

Iceland 319,700 103,000 km2 Republic EEA / EFTA Norway 4,800,000 385,200 km2 Parliamentary

monarchy EEA / EFTA

4.1 THE EU MEMBER STATES 4 .1.1. France Inter-municipal cooperation and local self government Unlike other Member States France is characterized by a very large number of decentralised public authorities. Besides the decentralised authorities mentioned in the Constitution (municipalities, departments, regions, overseas decentralised authorities, New Caledonia), there are many local public organisations (hospitals, social housing associations), public-private joint-ventures (sociétés d’économie mixte), or organisations with an associated status related to a local public authority.24 The largest territorial division in France is the region (26 plus 4 overseas), which is divided into departments (96 plus 4 overseas overlapping with the 4 overseas regions), themselves divided into

23 More general information on the legal and administrative structures specific to each of the six countries covered in the study can be found in Annex II. 24 Conseil d’Etat, Collectivités territoriales et obligations communautaires, Paris, 2004, p. 19.

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communes. Despite many discussions, the principle is that there is no hierarchical relation between the different levels. Competences are distributed under two concurrent criteria. First, each level should deal with affairs of its interest. Second, a complex legal framework lists competences falling under one or another level of authority. A typical example of it is the distribution of competences related to the maintenance of education facilities. Primary schools should be managed by communal (municipal) authorities, secondary schools by departments and high schools by regions. This may be considered complex as, for example, curricula remain under state control and are thus uniform on the whole French territory. Some difficulties and shortcomings of sub-state structures have been widely debated. One of the difficulties is the large number of communes (municipalities). The sheer number of public LRAs increases the risk of non- compliance with and infringement of new regulations. In particular for public procurement and state-aid this risk is real.25 According to the French Ministry of Economy, Finance and Industry, there are approximately 200,000 persons in France carrying out the task of public purchaser.26 In France, there are more than 36,000 municipalities; this is about half of the total number of municipalities in the entire EU 15.27 Many think that such a large number of LRAs is no longer efficient for contemporary public policies. But until now most of the attempts to merge communes in order to reduce their number and broaden their scope have failed. The commonly accepted reason for that is a lack of political willingness coupled with a strong identification with this territorial level within the community. Cooperation is then the only remaining option that has itself given rise to other concerns related to, for example, diffusion of legitimacy within cooperative bodies. The second point of discussion is that budgetary dependence on state strategies is hindering genuine territorial autonomy. Decentralised authorities are supposed to be able to make policy choices for themselves. Critics however point to the lack of budgetary autonomy and to a deficit in the genuine capacity to use resources as decentralized authorities see fit. Indeed, there are a number of expenditures that are legally required by the State. And the mass of compulsory expenditures is undoubtedly more important than the total proportion of areas left to the free deliberation of local and regional authorities. Another difficulty and perceived shortcoming are the overlapping and concurrent competencies that undermine transparency and efficiency. In many areas, different decentralised levels finance the same projects. This so-called “cross funding” is said to undermine transparency and efficiency. Although, this kind of overlapping can often be observed, reports and policy analysts have

25 Conseil d’Etat, Collectivités territoriales et obligations communautaires, Paris, 2004, p. 20. 26 Ministère de l’Écologie, de l´Energie, du Développement durable et de la Mer, Plan national d’action pour des achats public durables, p. 19. 27 The number of municipalities in Spain and Italy is about 8.100 with a population that is comparable to that of France. Conseil d’Etat, Collectivités territoriales et obligations communautaires, Paris, 2004, p. 19, 20.

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repeatedly argued that only 2% of total expenditures can be seen as cross funding. But there still remains an acute shortcoming: an unclear distribution of competences and the alleged lack of efficiency. The fourth point of discussion is that cooperative bodies involving several authorities lack democratic legitimacy in specific policy areas. The legal framework governing the transfer of competences from communes to public cooperation bodies (Établissements Publics de Coopération Intercommunale) is extremely complex and lacks democratic legitimacy. Indeed, mayors benefit from such popular legitimacy that is allegedly defused when competences are transferred to cooperative bodies. In addition, there is a genuine system of multilevel cross-cooperation between different levels of decentralized authorities to manage specific public services. The ongoing debates regarding a prospective general reform of public administration have focused on the relevancy to suppress one or another level. But whether this level would be the region or the department remains unclear. In any case, it would seem that political conditions to launch such a far-reaching disruption are not met. Involvement of local and regional governments in the EU policy making The central government remains in principle entirely competent to conduct relations with the EU as it sees fit. Institutional representation of local and regional authorities at EU level is ensured through the forum provided by the CoR. Another channel used by sub-state authorities to voice their viewpoint is lobbying. Most French regions have opened offices in Brussels. The European House of French Local Powers - created by the five associations of elected representatives : Assembly of French Departments (Assemblée des Départements de France: ADF), Association of French Mayors (Association des Maires de France: AMF), Association of French Mayors of Big Cities (Association des Maires de Grandes Villes de France: AMGVF), Federation of Mayors of mid-sized French cities (Fédération des Maires des Villes Moyennes de France: FMVM), and Association of small cities in France (Association des Petites Villes de France: APVF) - plays an important role in representing regional interests at EU level. Also, official mandate has been given to the Association des Régions de France connected to the Association of European Regions. Since 1999, Article 88-4 of the French Constitution has improved the link between Parliament and European legislation. This is particularly the case for the Sénat that represents French local and regional authorities. At present, Article 88-4 obliges the French Government to present to Parliament and to the Sénat (Upper House) the proposals and the proposed European acts of legislation that could lead to a parliamentary resolution. A Prime Minister circular of 22 November 2005 stipulates that this obligation of submission to Parliament and to the Sénat extends also to Green and White Books of the European Commission. In the context of this procedure, the Prime Minister circular stipulates that the ministries have to prepare impact assessments (fiches d’impact) about the legal, budgetary, technical or

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administrative consequences of European projects and proposed legislation before negotiations take place in Brussels. These impact assessments have to take into consideration the impact on local and regional authorities. In practice, only the legislative consequences are taken into account. Since the beginning of the Article 88-4 procedure delegations of Parliament and Sénat have asked the central government and the European Commission to include in the impact assessments the costs for LRAs in implementing and carrying out European legislation. 28 In the studies of the Conseil d’État examples are given of how considerable these costs can be for local and regional authorities.29 Further involvement of sub-state authorities in EU affairs is increasing, notably through connections with the General Secretariat for European Affairs. Since 2003 measures have been taken to strengthen the role of local and regional authorities in the European decision-making process.30 These improvements were taken following a report from the Conseil d’Etat. 31 They reduced the administrative dysfunction and the delay in transposing directives.32 In this respect, the creation of formal consultation mechanisms and strengthening the links with the associations of elected representatives of local and regional authorities were of particular importance. The National Conference of Executives33 and the Advisory Committee for Appraisal of Standards34 have been created as formal consultation mechanisms following the report of the ‘Conseil d’Etat’. The National Conference of Executives, created in October 2007, is a political body that organizes under the presidency of the Prime Minister the presidency of the three major associations of elected local and regional authorities and the ministers concerned. Several institutional reforms were already discussed in 2008, in particular concerning local and regional authorities operating in the field of public finance, public functioning and environment. Besides, in the framework of the EPCI reforms, the National Conference of Executives took stock of the consequences of the infringements procedures regarding joint projects between two or more French communes opened by the European Commission. The Advisory Committee for Appraisal of Standards is a consultation body, set up in 2007 and operating since October 2008, consisting of representatives of national government and local and regional authorities. The Advisory Committee for Appraisal of Standards advises about any legislation that has a financial impact on local and regional authorities and their bodies. This

28 Sénat, L’impact des directives communautaires sur les collectivités locales françaises, 19 juin 2008. 29 Conseil d’État, Collectivités territoriales et obligations communautaires, Paris, 2004, p. 38 and 39. In particular the investments for waste water treatment are considerably for LRAs and do have an important impact on the tariffs for households and enterprises. 30 See for the ideas behind the reforms and the measures taken: Conseil d’État, Pour une meilleure insertion des normes communautaires dans le droit national, Paris, 2007, p.19 – 21. 31 Belliard Edwige et Catherine de Salins, Collectivités territoriales et obligations communautaires, Conseil d’Etat, étude adoptée le 23 octobre 2003 par l’Assemblée Générale, Paris, avril 2004. 32 Bienvenue au Sénat, La transposition des directives communautaires. 33 La Conférence Nationale des Exécutifs (CNE). 34 La Commission Consultative d’Évaluation des Normes (CCEN).

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Committee also examines those proposals of European legislation that have a technical and financial impact on local and regional authorities and their public bodies. In the context of this consultation procedure an impact assessment document (fiche d’impact) has to be prepared by the ministry concerned. These two new bodies do not consider only legislative texts that originate from the European Commission. They also consider all acts that have an impact on local and regional authorities. If such is the case, only the National Conference of Executives has the right to collect the opinions of local and regional authorities in the pre-legislative phase. The General Secretariat for European Affairs 35 works regularly together with the associations of elected representatives of local and regional authorities and let them participate in preparing the French position in the pre-legislative and legislative phases of European legislation. The same cooperation takes place in the transposition phase of European directives. The General Secretariat for European Affairs put together in November 2007 a technical working group of different experts of the associations to facilitate an exchange of opinions and cooperation about the main European dossiers. This has resulted in the link between national government and the associations of the elected representatives of local and regional authorities being strengthened. In contrast with the National Conference of Executives and the Advisory Committee for Appraisal of Standards, the said working group handles only European dossiers and makes it possible to exchange opinions with the local and regional authorities at all stages of decision-making (pre-legislative, legislative and transposition phase). The working group comes together at least once every quarter. It participated in the preparation of the French position about the energy-climate package, the reform of the common agriculture policy and the French report about the implementation of the Lisbon strategy. The associations of the elected representatives of local and regional authorities have been involved in the transposition of the Service Directive. The number of dossiers the General Secretariat for European Affairs has to handle forces it to make a selection of the most important ones. Nevertheless, there is no obstacle to create ad hoc working groups for certain pilot subjects. If necessary, the General Secretariat for European Affairs works together with the local and regional authorities on certain dossiers that are important at local and regional levels. 4 .1.2. The Netherlands A system of co-governance The Netherlands are divided into 12 administrative provinces placed under the authority of a Commissaris van de Koningin. Provinces are themselves divided into 441 municipalities 36

35 Sécretariat Général des Affaires Européennes (SGAE). 36 Figure September 2009, Ministry of Interior and Kingdom Relations

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(gemeenten). Water-districts constitute another territorial subdivision specifically devoted to water management under the responsibility of 27 water-boards (waterschap or hoogheemraadschap). Municipalities and provinces are general-purpose territorial governments, holding the right to take the initiative in conducting their own affairs. Politically, socially and in terms of executive functions, Dutch municipalities are the most important unit of ‘home administration’. As a form of integrated local government, municipalities perform a broad range of functions, from social affairs to spatial planning, and from education to public health and public housing. As in other countries, in The Netherlands one can see a trend towards local government enlargement as an effort to accrue economies of scale. This decentralising movement started in the 1970s, but has been particularly strong since the mid 1980s. Mostly scale enlargement is reached by inter-local cooperation. In 2005 there were 1,862 instances of such co-operation: 697 had public nature under the framework of the Law on Joint Provisions and the other 1,165 private, with foundations, associations and corporations, in the form of contracts, policy agreements or covenants. Mergers and amalgamations have dramatically decreased the number of municipalities over the years, from 1209 in 1850 to 441 in 2008 37 .In the last two decades new interactive forms of intergovernmental cooperation, such as covenants and policy agreements, have become increasingly important. They provide a way of reducing uncertainty and of coping, already at the pre-judicial stages of decision-making, with the administrative and intergovernmental interdependencies of the Dutch government system. An example of differentiation is the explicit policy towards the big cities (‘grote stedenbeleid’), established by the central government at the initiative of the four big cities, Amsterdam, Rotterdam, Den Haag and Utrecht. The separate status, which the big cities have traditionally claimed, has been made official through this policy. The 36 largest cities in The Netherlands now have a distinct relationship with the central government as to their financing and steering, and they also receive funding through the European urban policy programme. Involvement of local and regional governments in the EU policy-making Pre-legislative phase Both the Association of Netherlands Municipalities and the Interprovincial Assembly set up their own lobbying activities in Brussels. Every year the European department of the Association consults the European Commission Working Plan and makes a list of the planned proposals most relevant to Dutch municipalities. A lobby is then set up which tries to influence both the EU institutions and the national ministries. After all, the latter will make their final decisions in the EU Council of Ministers. The Association of Netherlands Municipalities has an office in Brussels but has no personnel permanently based there. They are only present when an important meeting

37 Reference: http://nl.wikipedia.org/wiki/Lijst_van_Nederlandse_gemeenten

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takes place. Cooperation with the Association’s experts based in the Netherlands is deemed to be too important for the European department not to be based in Brussels on a fulltime basis. The Association also seeks influence through European umbrella associations such as through its active membership of the CEMR. Such lobbying activity is frequent in the sphere of the European Parliament. The Interprovincial Assembly is also represented in Brussels through the ‘House of Dutch Provinces’ (HNP) which the Assembly set up together with the provinces in the year 2000. The HNP takes on all lobbying activities within the European institutions that concern the Dutch provinces. Just like the Association of Netherlands Municipalities, the Interprovincial Assembly makes an annual selection of all the dossiers mentioned in the European Commission working programme that are most relevant to the provinces. In December 2008, the Association of Netherlands Municipalities, the Interprovincial Assembly, the Minister of the Interior and the State Secretary of European Affairs signed an action plan for closer cooperation between the national government, provinces and municipalities in the field of European policy. The action plan came after the adoption of a national policy vision concerning the ‘Strength of Internal Governance’ by the Dutch Parliament in 2007. In this document the Minister of the Interior concluded that Europe has such a major influence on internal governance that the national government, provincial governments and local governments should cooperate more closely. Legislative phase The coordination procedure with the central level: five coordination phases In the Dutch system, the central government is responsible for the EU policy process. However, local and regional governments are also involved in the process of determining positions and the implementation process. There is a monthly forum where the Association of Municipalities (VNG), the Inter-Provincial Council (IPO) and the departments discuss developments regarding EU issues. Twice a year these developments are also discussed between the Minister of Interior, the Minister of Foreign Affairs and the political boards of the Association of Municipalities and the Inter-Provincial Council. Municipalities and provinces are also members of the National Assessment Board for New Commission Proposals. This board explores the possible impact of new legislation and formulates the first Dutch position concerning the proposals. The Dutch Code on Intergovernmental Relations governs the municipalities’ and provinces’ involvement in the formation and implementation of EU legislation with an impact on municipalities and provinces. This involvement can take several forms. Ministries and decentralized governments can choose for bilateral relations, but also for a more intensive intergovernmental dossiers team. In The Netherlands, the Ministry of Foreign Affairs has been responsible for negotiations on the transposition of EU rules since 1972. It has the main responsibility for the interdepartmental

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coordination structure of European policy. The coordination procedure is officially triggered whenever a new proposal is submitted by the European Commission, and consists of five interdepartmental coordination moments38: 1. Discussion of new EC proposals in the ‘Working Group for the Assessment of New Commission Proposals’ (Werkgroep Beoordeling Nieuwe Commissievoorstellen – BNC), formed in 1989 and chaired by the Ministry of Foreign Affairs. The Working Group meets on a weekly basis in order to exchange information about new European proposals and to appoint the responsible departments for the area that is the subject of the proposal. Dutch local governments and provinces also take part in this Working Group. Local governments are represented by the Association of Netherlands Municipalities (VNG), while the provinces are represented by the Inter-provincial Assembly (IPO). The meetings result in a so-called ‘BNC-fiche’, which contains:

o A note on the departments and government-levels involved in the matter; o A reflection on the influence of the EC proposal on Dutch policy; o An evaluation of the effects of the proposal on the national budget and the use of

personnel; o An overview of the demands of good (EU) legislation, subsidiarity and the method

of implementation in the Dutch legal framework; o A draft opinion of the Dutch government on the proposal forms the basis for

further negotiation in Brussels. Through the CoCo (Coordination Committee for European Integration and Association Studies), the BNC-fiches are approved by the Ministerial Council and sent to the Parliament to inform the Dutch parliamentarians. 2. An interdepartmental meeting of the departments involved in the proposal’s subject matter, at which the Council Working Groups (Raadswerkgroepen) in Brussels are prepared. At this stage, the departments play a relatively autonomous role. Generally the Dutch opinion on the proposal is fully drafted in this meeting. 3. A Permanent Representation instruction meeting, at which the Dutch contribution for COREPER (Permanent Representatives Committee) is formulated. 4. A meeting of CoCo in a sub-council of the Ministerial Council. The State Secretary of European Affairs chairs the CoCo. The sub-council meets once every two weeks to determine the new ‘BNC-fiches’ and it prepares the meetings of the European Council of Ministers. The CoCo coordinates the Dutch draft opinions on the EC proposals and prepares the decision-making process of the Dutch Ministerial Council.

38 Steur, B.F. de Goede, P.J.M & Schmeets, H.H.J (2004). Nationale coördinatie van Europees beleid, best belangrijk. In: Bestuurskunde, Vol. 13, No. 6.

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5. The weekly Ministerial Council, the forum in which CoCo conclusions are determined. Although this system seems a very formal means of involving all levels of government, part of the doctrine believes that the influence of local and regional governments on the European policy-making process is limited 39 . However, our interviews tend to reflect a relatively high level of satisfaction. In addition, the process seems to be improving regularly. Opinion of the Association of Netherlands Municipalities (VNG)40 The Association, as well as the Interprovincial Assembly (IPO) are both active members of the ‘Working Group on New Commission Proposals’. The director of the European department of the Association of Netherlands Municipalities indicated that the relevant documents for WG meetings are always sent to the Association on time and that there is sufficient room for them to give their opinion on the proposal in question. In general, satisfaction was expressed with the way they are consulted in the Working Group. 4 .1.3. Sweden Inter-municipal co-operation and local self-governance Sweden is divided into 290 municipalities and 20 county councils. The size of the municipalities and county councils, both in terms of inhabitants and geography, can vary substantially41. Sweden's municipalities and county councils enjoy a high degree of autonomy which enables them to organize their activities as they see fit, under the principle of local self-government. Most local government activities are run by local governments themselves through direct administration and own taxation. Other organizational forms are used alongside direct local authority administration. For instance, the municipality may decide to transfer the administration of a local issue to a limited company, voluntary organization or foundation. Explicit support by law is, however, required to transfer an administrative function that involves the exercise of public authority. Maintaining the competence and knowledge needed to perform the assigned tasks remains difficult and expensive for municipalities and county councils. Therefore, cooperation among municipalities or county councils is a common practice. The possible ways of cooperation are stipulated in the law. Limited companies that are jointly owned are a common way of organizing in areas such as refuse

39 Steurs, B.F., de Goede, P.J.M. & Schmeets, H.H.J. ‘Nationale coördinatie van Europees beleid, ‘best belangrijk.’ In: Blad Bestuurskunde, No. 13-6, pp. 255-262 40 Interview with the director of the European department of the Association of Netherlands Municipalities, Annemiek Wissink (April 2009) 41 Municipalities count 15,200 inhabitants in average while 73 municipalities count less than 10,000 inhabitants. Sweden’s smallest demography is Bjurholm, and represents 2,500 inhabitants. The largest one is the capital-city, Stockholm, with 800,000 inhabitants.

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collection and waste management. All municipalities cooperate with each other, regardless of their size. The municipalities and county councils are responsible for providing a significant proportion of all public services. No hierarchical relation exists between municipalities and county councils, since they all have their own self-governing local responsibilities regarding different activities. The mandatory tasks for the municipalities are social services, education, elderly care, planning and building issues, health and environmental protection, refuse collection and waste management, rescue and emergency services, water and sewage, housing and libraries. Voluntary tasks are culture, tourism, technical services, energy provision and street maintenance. The mandatory tasks for county councils are health care and dental care. Voluntary tasks for county councils are culture, education and tourism. Shared tasks for municipalities and county councils are regional and local public transport. Around 80% of the personnel employed in the public sector in Sweden are employed by the municipalities or county councils. Local self-government and the right to levy taxes are stipulated in the Instrument of Government, one of the four pillars of the Swedish Constitution. The Local Government Act regulates the organisation of municipalities and county councils and the conditions for work in the assembly and committees. Most local authority tasks are regulated in what are known as special acts. These special acts are framework laws that can be completed by ordinances issued by the Government or by administrative provisions issued by government agencies. Involvement of local and regional governments in EU policy-making According to the Swedish Constitution, the Government shall, in preparing its proposals, consult the public authorities concerned. This means that before the Government submits a proposal for a new law to the Riksdag, it has to examine the various alternatives available. This task is often assigned to a commission of inquiry comprising one or several people, which may include experts, officials or politicians from the Swedish Association of Local Authorities and Regions (SALAR) 42 representing the municipalities and county councils of Sweden. SALAR represents the governmental, professional and employer-related interests of Sweden's 290 municipalities and 20 county councils. It strives to promote and strengthen local self-government and the development of regional and local democracy. The operations of the Association are financed by the fees paid annually by members according to their tax base. The organisation is controlled by politicians from local and regional levels. SALAR aims to be the arena where local government policy shapes. It has its own international units in Stockholm and Brussels and aims at influencing European decision-making at an early stage. The office staff may assist the Swedish delegation in the Committee of the Regions.

42 SALAR is the Swedish Association of Local Authorities and Regions since 2004, created by merging the Swedish Association of Local Authorities and the Federation of Swedish County Councils. SALAR is the main forum of joint discussions between municipalities and county councils. It deals with key aspects at an early stage, and often provides information campaigns involving different players. They keep frequent contacts with other countries and the Commission. It has its own office in Brussels.

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Following the procedure, a commission of inquiry submits its recommendations in a report. The Government then refers the report to various public agencies, organizations and municipalities for consideration. It is also possible for organizations and even individual citizens to send in comments without being referred to. The standpoints of the referral bodies are taken into consideration by the Government when formulating the proposal for the new law. According to the ministries’ internal rules on EU matters, it is the Government’s responsibility to see that joint discussions with stakeholders are held throughout the process. The purpose is to increase the quality of Swedish positions and the implementation of the directives. The consultation process may vary, but reference groups and other referral processes are common. SALAR and other expertise agencies frequently participate in these reference groups. Informal contacts between different ministries and SALAR are also frequent at an early stage, when forming the national position before Commission proposals. This rather close cooperation is brought about by the small size of Swedish Ministries and due to the fact that sometimes government must rely upon external expertise43. It is mostly up to the Government to select the stakeholders who will provide input for the national position (either SALAR, environmental related agencies...) at early stage. In any case, local and regional interactions depend on each Ministry’s working method and transparency policy. Local entities are mainly represented by SALAR but sometimes they have individual contact with the government directly in the form of informal meetings. According to SALAR44, the Government takes these informal contacts into consideration, although they represent specific views that are not always representative of the general opinion. One pitfall is that such ad-hoc processes may become discriminatory, leaving some municipalities out of the process. At the same time, the Government claims that SALAR’s views do not systematically represent the interests of all of the municipalities. Among SALAR members – the government argues – there might be different (and perhaps confronting) opinions due to the different conditions of the diverse territories. These informal contacts do not lead to any binding commitment from the Government, though. The Government will decide which of the concerns expressed at sub-state level to take into account when preparing the national negotiating position in Brussels. Once in the Council, the national positioning is negotiated following so-called “instructions”. These documents are not public. Another channel for local and regional participation at EU level is the possibility to access Commission expert groups. However, this is restricted under tight conditions even when dealing with matters of special concern to municipalities and counties, such as the environment (Landfill) or

43 These conclusions were drawn up after the interviews directly held with Swedish experts, members from the Ministries and local associations, on March 2009. 44 Information gathered by means of structured interviews.

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public tendering. It is not only at national the means for SALAR to gain influence. SALAR will also contact other networks in Brussels such as CEMR and/or send its considerations directly to the Commission or to the Members of the European Parliament. 4 .1.4. The United Kingdom A multi-national state Each UK region enjoys its own powers, which are exercised through considerably different institutional systems. Devolution in the UK is thus said to be “asymmetric”. Northern Ireland, Scotland and Wales have their own Act of Parliament under which they hold devolved powers: - The Scotland Act of 1998 established the Scottish Parliament; - The Government of Wales Act of 1998 established the National Assembly for Wales; - The Northern Ireland Act of 1998 established the Northern Ireland Assembly. They remain, however, subject to the UK Parliament under the theory of Parliamentary Sovereignty (or Supremacy)45. Powers devolved by Acts of the British Parliament may be retrieved at the will of the Parliament that voted for this devolution. Thus, devolution is not an irreversible process. Contrary to federal systems, there is no superior constitutional rule to guarantee it. Despite the fact that the devolved administrations hold “legislative” powers in certain areas, the United Kingdom unquestionably remains a unitary state. The reversal of the devolution is however widely acknowledged as politically unlikely. Nevertheless, the Northern Ireland Assembly has been suspended in the past due to exceptional circumstances. <on these occasions its powers reverted temporarily to the Northern Irealnd Offcie of the UK Government.46 Northern Ireland and Scotland can make, repeal and modify primary and secondary legislation on matters coming under their respective spheres of competences. Their systems also formally distinguish between the legislative and the executive. Initially, in Wales, on the contrary, one single institution – the National Assembly for Wales – held power to make, repeal and modify secondary legislation in matters for which the region has been ascribed competence. In practice though, the National Assembly for Wales made early efforts to separate Executive from Legislative functions. The Government of Wales Act 2006 made provision to formally separate the legislative and executive functions and provided for the Welsh Assembly Government to acquire primary legislation competence in devolved functions.

45 This theory has been consolidated by Dicey in DICEY, A. V. An Introduction to the study of the Law of the Constitution, 1885. 46 In any case, Westminster remains competent for constitutional matters, including the crown, foreign policy, defence and relations with the EU, macro-economic policy and taxation, overseas trade, employment legislation, social Security, broadcasting. (LEEKE, M. SEAR, Ch. and GAY, O. An Introduction to devolution in the UK, House of Commons Research Paper 03/84, 17 November 2003, pp 21.)

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In principle, the Scottish Parliament is competent for primary and secondary legislation in matters that are not explicitly reserved to Westminster under the Scotland Act 1998.47 The UK Parliament can legislate for Scotland in devolved matters if asked to do so by the Scottish Parliament, in cases where it would be more convenient to have UK-wide legislation. By contrast, the Government of Wales Act 1998 explicitly listed the limited secondary legislative powers transferred to the National Assembly for Wales48. The Northern Ireland Act 1998 distinguishes between excepted, reserved and transferred legislative powers49. Excepted powers are those that remain in Westminster’s hands in any case. They include the Crown, parliamentary elections, Assembly elections and the franchise, international relations, defence of the realm, honours, nationality, national taxation, the appointment and removal of judges, registration of political parties, coinage, national security, nuclear energy and installations, regulation of sea fishing outside Northern Ireland, provisions dealt with in the Northern Ireland Constitution Act 1973, the subject matter of the Northern Ireland Act 1998 with specified exceptions. Reserved exceptions are areas that can be devolved by a subsequent Order to the Parliament or by cross-community consent. They are criminal law, policing, prisons, civil aviation, navigation, the Post Office, disqualification from membership of the Assembly, emergency powers, consumer protection and telecommunications. England is divided into 9 regions, in addition to the Greater London Authority (GLA). In addition, “there are Regional Development Agencies responsible to central government but monitored by Regional Assemblies”50 (now replaced by Leaders’ Boards). The English regions are themselves divided into a mixture of single and two-tier local authorities. In two-tier areas there are 28 upper tier (Shire County) authorities and 201 lower tier (Shire District) authorities. There are 119 Unitary Authorities (including 33 London Boroughs and 36 Metropolitan Districts). Wales is divided into 22 unitary authorities. In Scotland, there are 32 unitary authorities each managed by a chief executive with a budget and resource responsibility to deliver local services, they are responsible to independently elected Council Leaders and councillors. The Scottish Parliament is competent for

47 Subjects devolved to Scotland include: health, education, local government, social work, housing, planning, tourism, economic development and financial assistance to industry, some aspects of transport, including the Scottish road network, bus policy and ports and harbours, law and home affairs, including most aspects of criminal and civil law, the prosecution system and the courts, the police and fire services, the environment, natural and built heritage agriculture, forestry and fishing, sports and arts, statistics, public registers and records. 48 They are: agriculture and fisheries, culture, economic development, education and training, environment, health, highways, housing, industry, local government, social services, sport, tourism, town and country planning, transport, water, the welsh language. 49 The competences that are fully transferred are: finance and personnel, health, social services and public safety, education, agriculture and rural development, enterprise, trade and investment, environment, culture, art and leisure, learning and employment, regional development, social development. 50 “Study on the division of powers between the European Union, the Member States, and Regional and local authorities” Study commissioned by the CoR, to the European University Institute Florence.

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the local organization, like the Northern Ireland Assembly. The latter is divided into 26 district councils “of limited competences”.

Involvement of local and regional governments in EU policy-making: Asymmetric devolution As mentioned above, Westminster and the UK government remain competent for international and European issues. Nevertheless, regional authorities may intervene in EU affairs. They may also be responsible for implementing certain European policies. In any case, regional issues are “sartorial” portfolios within the UK Government. There has been one Secretary of State for Scotland since 1885, one for Wales since 1965 and one for Northern Ireland since 1972. UK regions can be involved in EU decision-making through different channels. Although the relation between central and devolved authorities are rather informal regarding EU matters, a Memorandum of Understanding and specific Concordats formally regulate the implementation of EU affairs in the UK. Local and regional authorities are also institutionally represented through the Committee of the Regions, which is consulted by the other European institutions in order to inform law-making and provide recommendations. In 1997, local governments came together and created the Local Government Association (LGA), to bring their voice to the national arena. It is a voluntary lobbying organization composed of 423 authorities covering every part of England and Wales. The Welsh Local Government Association (WLGA) is part of the LGA, but it retains full autonomy in dealing with Welsh affairs. The Convention of Scottish Local Authorities (COSLA) and the Northern Ireland Local Government Association (NILGA) are the representative voices of local government in Scotland and Northern Ireland respectively.

The LGA works alongside a range of partner organizations to promote better local government, such as the:

- Improvement and Development Agency for Local Government (IDea) - Local Government Employers (LGE) - Public Private Partnership Programme (4ps) - Local authority Coordinators of regulatory Services (LACORS) - The Leadership Centre for Local Government

These bodies form the LGA Group. The LGA European and International Unit carries out its policy work on behalf of English and Welsh local government and also represents the Northern Ireland Local Government Association. In addition, it acts as the UK Secretariat to European and International bodies such as the CoR, CEMR, the Congress of Local and Regional Authorities of the Council of Europe, and the United Cities and local Governments (UCLG) co-ordinating with COSLA and NILGA as appropriate. Nowadays the LGA European and International Unit closely follows the European Commission work programme, published yearly. At EU level, the Local Government Association for England and Wales negotiates with the UK and Welsh Governments while the relation between Scottish local governments and the UK central Government is not formally organized.

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Additionally, the devolved administrations of Northern Ireland, Scotland and Wales are permanently represented in Brussels. They have offices which closely cooperate with the UK permanent representation. A Concordat fulfils the role of devolved regions and makes provision for consultation when the Council of Ministers examines devolved matters. Devolved authorities may participate in establishing the UK position on new proposals51. The UK government may (since 1999) allow officials from the regional level to attend the Council of Ministers. In that event, Joint Ministerial Committees (JMCs) are used to develop the UK common position between devolved administration and the central Government, which has the final say. As a rule, JMCs are considered to be of special importance in European affairs. Since devolution is asymmetrical, the UK regional authorities are in charge of making, repealing and modifying legislation on subjects for which they hold devolved competence. Thus, Scotland, Wales and Northern Ireland may be responsible for adapting, implementing and enforcing directives within their areas of competences. Such responsibility varies depending on the power to make either secondary as well as primary legislation 4.2. THE EEA / EFTA MEMBER STATES 4.2.1. Inst itutional structure and competences of the EEA-EFTA Iceland and Norway, due to their membership of the European Free Trade Association (EFTA) and the European Economic Area (EEA), enjoy full access to the single market of the European Union. In turn, they must follow its internal rules. The European Economic Area Agreement, in force since January 1994, has extended the Internal Market legislation in the area of the four freedoms (free movement of goods, services, persons and capital) – with the exception of Agriculture and Fisheries – to Iceland, Liechtenstein and Norway. In addition, the Agreement covers co-operation within the so-called “flanking and horizontal” policies such as research and development, education, social policy, the environment, consumer protection, tourism and culture. It grants equal rights and obligations to every citizen and economic operator inside the EEA. However, the EEA Agreement does not cover the following EU policy areas:

- Common Agriculture and Fisheries Policies (although the Agreement contains provisions on various aspects of trade in agricultural and fish products);

- Customs Union; - Common Trade Policy;

51 The European University Institute, Florence, Study on the Division of Powers between the European Union, the Member States, and Regional and Local Authorities, European Committee of the Regions, pp 318.

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- Common Foreign and Security Policy; - Justice and Home Affairs (even though the EFTA countries are part of the Schengen

area) and; - Monetary Union (EMU).

Through the EEA Agreement, EFTA States participate - albeit with no voting rights - in a number of EU Agencies and programs and contribute financially to social and economic cohesion in the EU/EEA. Trade in fish products is governed by separate bilateral agreements. Within the EEA-EFTA institutional structure there are two legislative bodies, namely the EFTA Council of Ministers and the EFTA Joint Committee. They also have two advisory bodies: the EFTA Parliamentary Committee (with a democratic role as it is made up of national members of parliament) and the Consultative Committee (a sort of economic and social Committee specific to the EFTA States). These bodies meet at least once a year with the Council of Ministers, the so-called, EFTA Standing Committee, and also with their counterparts in Brussels 52 . This forum, divided into subcommittees, stands for the agreement on a common position on the internal market (bringing together the ambassadors of the EFTA countries and EFTA Surveillance Authority (ESA) representatives) before the EEA Joint Committee with the EU takes place. The EFTA decision-making system suffers from sub-national tier misrepresentation. They have neither a body equivalent to the EU Committee of the Regions (CoR) nor are they able to participate in this forum. This deficit is partly explained by the fact that the CoR did not exist when the EFTA-EU agreement was drafted.53 Once the EU provisions are approved and transposed into EFTA Joint Decisions and national legislation, another body appears on the scene, the EFTA Surveillance Authority (ESA). The ESA functions as the monitoring body for EFTA States; it controls the conformity of national transposition measures with the EEA Joint Decision Acts 54 , taking formal action whenever a deviation is detected55.

52 Information provided by the Norwegian experts after holding direct interviews in Oslo on the 8th March 2009. 53 According to point 2 of the Resolution on “Towards participatory democracy: The role of local and regional authorities in the EU and the EEA” issued on the 27th April 2004 during the 22nd meeting of the EEA Joint Parliamentary Committee, it is called on the EFTA states to establish an EFTA CoR as advisory body. However, it seems that no follow-up was done on this proposal. 54 Id. 55 This body acts as guardian of the internal market rules for EFTA states, as the Commission does with EU Members and adopts annual reports on the state of affairs.

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4.2.2. EEA-EFTA States and the EU decision-making process Influence during the pre-legislative and legislative phases Although the EEA-EFTA States must observe EU legislation on the Internal Market, their influence during the pre-legislative phase is intentionally limited. They can get involved to some degree through the works of the EEA Joint Committee, either in the preparatory work of the EU Council/ European Parliament or within the context of comitology). It is indeed useful to quickly highlight the fact that the decision-making procedure as set up by article 251 of the EC Treaty has considerably increased the legislative powers of the European Parliament. Co-decision was further strengthened by the subsequent Amsterdam and Nice Treaties. However, not all EEA-relevant acquis communautaire contains legislation adopted by the Council and the Parliament. An important amount of legislation derives from the legislative competences delegated to the Commission during comitology procedures for more technical and detailed provisions. Concerning comitology, the EEA Agreement 56 provides for the extensive participation of EFTA experts in the preparatory work of the Commission through so-called comitology committees. In the wording of article 99(1) of the EEA Agreement, the Commission “shall informally seek advice from experts of the EFTA States” when new legislation is being drawn up in a field covered by the Agreement. Against this background, the Commission may invite EFTA experts on the basis of their professional qualifications, not considered representatives of individual States, to gather expertise (art. 100 EEA Agreement). EFTA participation in EU committees offers two main benefits. Firstly, it ensures information exchange, detecting real needs and concerns in relation to up-coming pieces of legislation destined for incorporation into the EEA Agreement. Secondly, participation through committees may be seen as a means to influence the development of the acquis communautaire and of the EU programmes/policies. The so-called EEA-EFTA Comments are, together with the EEA-EFTA experts, another tool to influence the pre-legislative phase. These comments are issued during the EEA Joint Committee consultation process (Article 99 (3) EEA Agreement), drafted by working groups and handed over to the Commission at sub-committee level. To guarantee the correct and timely adoption of EFTA Comments, it is essential for EFTA States to keep a permanent flow of information on EU policy developments. Transposition of EU legislation into the EEA Agreement EFTA States are bound by EU Internal Market rules and have to transpose EU directives into their national legislation to ensure the equal treatment of all suppliers within the EEA area, reflecting in

56 The EEA Agreement entered into force on 1st January 1994 and brings together the 27 EU member states and the three EFTA countries (Liechtenstein, IS and NO) in a single internal market, granting equal rights and obligations within this area to every citizen and economic operator. The principle of homogeneity of the EEA calls for the implementation of EU legislation as closely as possible as EU Member States.

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that way one of the EEA’s cornerstones, the concept of homogeneity57. This is to be achieved firstly by timely incorporation of EU legislation into the EEA Agreement. This means that as soon as a relevant EU act is formally adopted on the EU side, the EEA Joint Committee takes a decision concerning the appropriate amendment of the EEA Agreement "with a view to permitting a simultaneous application" of legislation in the EU and the EEA-EFTA States (Art 102(1) EEA Agreement). This amendment is to be taken as closely as possible to the adoption of the corresponding EU legislation in order to allow for its simultaneous application in the EU and in the EEA-EFTA States. Therefore, the EU remains under obligation to inform the EEA Joint Committee whenever a legislative act affecting issues governed by the EEA Agreement is adopted58. The transposition phase in the EEA is initiated once a secondary EU act falling in the scope of the EEA Agreement is adopted or amended. The respective modification to the Annex of the EEA Agreement will follow. General principles for such adoption are laid down in Article 102(1) of the EEA Agreement. The EFTA Standing Committee agrees on a position, after which the EEA Joint Committee, composed of ambassadors of EFTA-EEA States, representatives from the European Commission and of the EU Member States, takes the necessary amendments through EEA Joint Decisions. More concretely, EFTA experts meet to prepare necessary technical adaptations for the implementation and send them to the Secretariat, which will decide whether this act is relevant, in which case a Joint Committee decision is drafted. The responsible desk officer in the EFTA Secretariat prepares a standard sheet concerning this particular act with all relevant feedback. The EFTA experts have to answer a number of questions, e.g. is this act of EEA relevance? Does it require technical adaptations for its incorporation into EFTA States’ national legislation? Is it likely to entail constitutionally-required procedures59 ? Upon receipt of the confirmation that an act is relevant, the Secretariat then drafts a Joint Committee decision. This decision is then submitted for revision by experts and further legal scrutiny, after which it is handed over by the relevant Subcommittee60 to the European Commission. Constitutional requirements for the EEA-EFTA States The EEA Contracting Parties have not transferred any legislative powers to the EEA Joint Committee. It is therefore, necessary for certain conditions to be met, in accordance with national

57 EFTA Surveillance Authority. Public Procurement. A database showing the implementation status of EFTA states is available at the following web link: http://www.eftasurv.int/fieldsofwork/fieldpublicproc/. 58 New regulation is to be found in the Annex XVI to the EEA Agreement, which adds the special adaptations to be made to the Directives for their transposition into the EEA Agreement. 59 See the Art. 103 EEA Agreement. 60 There are five Sub-committees; each of them is dealing with one topic, either free movement of goods, capitals and services, persons, horizontal policies or legal issues.

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constitutions, for an EEA Joint Committee decision to be binding on them, namely approval by Parliament or referendum61. Once constitutional requirements are met, the EFTA Secretariat must be notified and it forwards the information to the Commission and the other EFTA States. The Joint Committee Decision will enter into force the first day of the second month following the final notification.62 If such notification is delayed by more than six months after the adoption of the Joint Committee decision, the latter will be applied provisionally, pending the fulfilment of the constitutional requirements, unless a Contracting Party notifies that provisional application cannot take place63. In order to simplify and speed up procedures, EFTA States have introduced procedures to inform and consult their respective Parliaments at an early stage in order to favour the timely entry into force of legislation. EFTA States are also obliged to inform the ESA of their transposition measures, and whenever the latter detects an infringement, it may pursue formal infringements or even propose punitive fines before the EFTA Court64. 4.2.3. Iceland A highly sparse demography Iceland is divided into 77 municipalities65 and 6 constituencies which determine the subdivisions for parliamentary elections. There is no regional level of a political nature as described in other countries of this study. The main political layers are the national/ central government and the municipalities. This may be understood together with the size and distribution of the population on the Icelandic territory. Iceland covers an area of 103,000 km2 and is about 40 percent of The United Kingdom’s territory and three times the size of The Netherlands. With a total population of just 300,000 inhabitants the country is sparsely populated. The capital, Reykjavík, has 116,000 inhabitants. Besides Reykjavik there are five other municipalities with between 10,000 and 30,000 inhabitants, 27 municipalities with between 1,000 and 10,000 inhabitants and 44 municipalities with less than

61 Decisions with higher budgetary implications (more than one year) will, in principle, need parliamentary consent in Norway. In Iceland, the administration negotiates the total EEA budget which is then presented to the Parliament within the national budget as a single figure for approval. This process takes place every budget year. 62 See Article 103 EEA Agreement. 63 According to article 103 EEA Agreement. 64 The time-dependent effect of conflict in the council on delays in the transposition of EU Directives, Asya Zhelyazkkova and René Torenvlied, European Union Politics, 2009. 65 This number diminished from 124 to 77 in 2006 after merger campaign by the Government and the Association of Local Authorities.

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1,000 inhabitants each. The number of municipalities has substantially decreased in recent years, due to mergers and their scope has expanded. In 2009, the number of municipalities is 77, compared to 204 in 1990.66 Following the autonomy principle, local governments are granted with responsibilities67 in areas related to social welfare, education and local infrastructure development. The main competences are in the following fields:

- Social Services, - Primary education, culture, sports and recreation, - Public utilities (sewers, water, electricity), - Municipal planning and building inspection, - Public parks and open areas, - Monitoring public and environmental health, - Fire services, - Public transport, - Waste management and collection, - Harbours.68

Involvement of local and regional governments in EEA-EU policy-making: The Local Government Act of 1998 The special status of the Icelandic local authorities derives from their legal responsibility for their own affairs. This right of self-government is protected under Article 78 of the Constitution of Iceland. This article states that local authorities shall determine their own affairs in accordance with the law. Consequently, local authorities are bound within the legal framework enacted by the Icelandic Parliament. The right of self-government is reiterated in Article 2 of the Act on Local Authorities, which states that no matter involving the special interests of a local authority shall be finally determined without taking the local authority’s opinion into account.69 The Icelandic Association of Local Authorities (Samband íslenskra sveitarfélaga) has been the joint representation of local governments since 1945 (comprising all local authorities since 1973). It formulates common positions and works in close relation with the Government and the Althingi,

66 See for municipal statistical data: http//www.samband.is/files/910399512Enskur_bæklingur_2008.pdf 67 The official Gateway to Iceland, Government & Politics: http://www.iceland.is/government-and-politics/Government/Local Government 68 See for instance the official description of the local competences in Iceland on the CEMR website: http://www.ccre.org/islande_en.htm. 69 See Sigurdur Sverrisson and Magnús Karel Hannesson, Local Government in Iceland, http://wwww.samband.is/files/334468315SIS%20enska.pdf (without a date).

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functions that are regulated by the Local Government Act.70 A cooperation agreement covers the relations between the association and the central government. Its role has increased noticeably in recent years. The Association has had its own office in Brussels since 2006, and has intensified its work in EU-EEA matters. It is increasingly active within the debates of the Council of European Municipalities and Regions (CEMR). The Association works mainly as an information source for municipalities (such as guidance or other material), defending local interests at national and international levels. A national congress is held on an annual basis 71 and it also follows municipal elections every four years. Between national congress sessions, the executive board, the supreme authority of the body, represents the association and meets every month. Participation at an early stage of the EU pre-legislative phase appears aloof to Icelandic municipalities. They are not involved in EU decision-shaping nor do they participate in the preparation of the Icelandic negotiating position at the national72 or EU level.73 However, some level of participation is foreseen, through CEMR, or at some point in the preparation of the national positioning at EEA level dealing with policies of their special concern (Article 2 of the Local Government Act74 prescribes mandatory consultation on matters that concern the interests of the municipalities). Since the establishment of a Brussels’ branch of the Icelandic Association of Local Authorities, they receive much more information, are more aware and better involved of what is in the pipelines of the EU legislative processes. This makes it possible for the Association to inform the relevant ministries from time to time about important legislative developments at EU level which have an impact on Icelandic local authorities.75 When local authorities’ competences are at stake, local governments may influence the preparation of the national positioning via indirect channels. They make their voice heard, firstly through their representation in CEMR (like the other local and regional authorities from countries analyzed in the study), being able to comment on the outcome and possible impact of major EEA legislation, mainly through informal contacts with the European Parliament, this is particularly the case for environmental matters.

70 Website of the Association of Local Authorities in Iceland: http://www.samband.is/template1.asp?id=364. 71 Art. 5 of the Statutes of the Association. 72 As regards the results of the questionnaire sent tot public authorities, local and regional organizations and other stakeholders from the countries analyzed, enclosed in the Annex II. 73 As regards the results of the questionnaire sent tot public authorities, local and regional organizations and other stakeholders from the countries analyzed, enclosed in the Annex II. 74 Act. No 45/1998. 75 An example is the upcoming Directive on energy efficiency of buildings (the EPB Directive). An impact assessment of The United Kingdom - The Energy Performance of Buildings Directive (EPBD): improving the energy efficiency of the existing housing stock of 17.03.2005– made clear that enormous costs are involved for all level of administration to develop proper tools and mechanisms for certification, especially for the UK, whose carbon emissions are far from attaining the new goals.

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4.2.4. Norway A model of Nordic egalitarian values and distribution of responsibilities Local rights and responsibilities were established by the Elderman Act, issued in 1837, and in 1992 the Local Government Act defined the organization of municipalities and counties. Norway has a two-tier administrative structure with 19 counties and 431 municipalities (also divided into 5 major regions with mere administrative purpose). The County Governor represents the central level in the sub-national tiers. This authority is responsible for the control of the legality of local decisions. It is also central to administrative coordination between administrative levels, always respecting the sphere of autonomy of local entities. Distribution of competences is based on the general ‘local authority system’, which means that all counties and municipalities have the same responsibilities, regardless of their size. This system is rather similar to the Swedish distribution of competences and it is as follows: Central level: national Insurance, hospitals, higher education, employment, refugees and immigrants, national road network, railways, agricultural and environmental issues, defence, police, courts, foreign policy. Specialized social services. Counties: upper secondary education, regional development (county roads, public transport, regional planning, business development and culture). Municipalities – competences are not regulated in the Local Act but in separate laws: primary and lower secondary school, nurseries and kindergartens, medical care and social services, local planning, agricultural and environmental issues, roads, water supply and sanitation, culture and business development.76 Involvement of local and regional governments in EEA-EU policy-making: A locally decentralized democracy Norway as a signatory of the EEA Agreement is allowed access to the European Commission working groups and committees in the preparatory phase of the decision-making process. Much of the interface between the Government administration and the EU is at the technical and expert level. Since 1994, the Norwegian Government administration has had a system of special committees to coordinate the work related to the EEA agreement. Each Committee is lead and serviced by the Ministry most involved in its area. The Prime Minister’s office, The Minister of Foreign Affairs and the Finance Ministry have membership of all committees. The responsible department prepares framework notes. These notes structured by the Prime Ministers office include guidelines which are

76 Local Government in Norway, Norwegian Ministry of Local Government and Regional Development, 2008.

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the basis for working out Norwegian stances for the various stages of the EU decision-making process77. They outline: - the purpose and content of the case - an account of NO legislation in the area - an evaluation of the effect on Norwegian interests - a recommendation on the NO position Prior to the adoption of a Joint decision by the EEA Joint Committee, the decision-making procedure for EEA matters in Norway follows 3 steps, briefly summarized as follows78: 1. Firstly, the Government and cabinet raise different questions, where reference groups composed of different representatives participate: local and regional levels, NGOs and other organizations79. 2. At a second stage, at a high administrative level, an EEA coordination committee fixes the national positioning, issuing a position paper partly based on the comments received during previous public hearings. 3. Finally, an expert level committee (of a sectoral nature) is held, led by the respective Ministry. All the positions reached in these committees are made public through the EEA Database, which is an important consultative tool. Informal consultation between the central government and sub-national tiers is frequent at this stage: either through annual meetings or specific committees held with local and regional representations. Ministerial websites are also open to the public for any comments or for consultation in this regard, but no follow-up to or structured records of the contributions actually exist. Following the decision-making process of EU internal market provisions, once the joint Decision on whether and to what extent an EU act is to be incorporated into the EEA Agreement has been taken by the Joint Committee and approval for the act has been given, it also has to be incorporated into Norwegian legislation and, if it is deemed a matter of high importance, will require parliamentary approval. This entails either the amendment of existing legislation, or budgetary implications. Amendments will not be necessary if existing national legislation fully matches the new act (this is to be interpreted restrictively). Neither national consultation nor internal public debates are held to decide upon the national transposition phase: it is up to the ministries in charge. Norwegian municipalities and counties may seek influence and direct contact with the EU level through their offices and the representation of the associations of regional and local entities based in Brussels i.e. the CEMR, which also represents Norwegian municipalities and counties, in order

77 Clive Archer, Norway outside the EU: Norway and European Integration from 1994 to 2002, Routledge 2005. 78 Information provided during the interview held with Norwegian experts, ministries and local association’s representatives on the 8th of March 2009. 79 No follow-up is available from their contributions.

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to promote their interests during the EU pre-legislative phase, and to make them visible at earlier stages of legislative procedures. In the process of gradual Europeanization in NO, local authorities are learning to act transnationally and to relate to EU bodies separately from the Government in Oslo (Holm-Hansen 2000). In general terms, “EU adaptation has taken place with little active (Norwegian) involvement except in a few areas of confrontation such as salmon exportation, and oil and gas (Andersen 2000). The Norwegian Association of Local Authorities includes municipalities, counties and public enterprises under their control. Regular consultative meetings (4 per year) are held between the central level and the association. KOSTRA is the institution in charge of reporting local and regional activities on public services, finances or electronic tenders to the central government via electronic means. Sub-national participation in the preparation of the national position at the EU Council is not an issue in Norway as it has no formal access to the process of negotiating EU legislation. However as mentioned above, the EEA/EFTA States have some access to the preparatory work of new EU legislation at an expert level within the framework of comitology procedures. However, in Norway this work is conducted by state officers and local and regional authorities do not take part in it, but are invited to give their views on central EC proposals by way of dialogue with different ministry sub-groups concerning EEA issues and national public hearings on central EU directive proposals, policy documents, etc. At this stage, associations and other stakeholders (for instance, KS, local and regional representatives and the industry sector) tend to work closely to gain greater influence on the final decision. These hearings are open to relevant parties and sometimes particularly concerned stakeholders, such as local and regional actors, are personally invited to give their views. Conclusion From the administrative division in the Member States and EFTA countries studied, we can deduce that the institutional mechanisms to involve the sub-state tiers of government ranges from a set of rather formalised processes to a more informal and ad hoc system of consultation and participation. The mechanisms vary widely depending on the phase the legislative process is at. An assertion that has been made throughout is that there is an insufficient awareness of the importance of the pre-legislative phase, both at the central as well as at the regional and local levels. Countries are aware of the need to improve things (e.g. the action plan in NL or the early stage consultation with parliament in the case of the EFTA countries). But even then, improvements are not performed at the very initial stage of the process (e.g. in NL the new action plans run around new Commission proposals, therefore at the start of the legislative phase – instead of the pre-legislative phase). In the EFTA countries early information to the Parliament is on approved directives: therefore the possibilities for real early warning are absent. The Member States have understood that they need to cooperate better and coordinate more: what seems to be absent is the awareness of being alert at the very beginning and to count on that cooperation from the very beginning. The extent to which these differences in approach derive from the different types of countries analysed, will be reflected in the level of impact of the law in the sub-state levels of administration in those countries. How the cause-effect link will be constructed and the analysis of the causes of the major or minor impact will be the objective of the next chapters.

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5. TWO DIRECTIVES UNDER SCRUTINITY IN THE FIELDS OF LANDFILL WASTE AND PUBLIC PROCUREMENT: OBJECTIVES AND IMPACTS This chapter presents the objective and impacts of two directives under study: the Council Directive 1999/31/EC of 26 April 1999 on the Landfill of waste 80 and the Directive 2004/18/EC of the European Parliament and of the Council of 31 March 2004 on the coordination of procedures for the awarding of public works contracts, public supply contracts and public service contracts81. We also explain the connection between the two in order to analyse the consistency and coherence (or lack thereof) of both directives when implemented together. 5.1. The 1999/31/EC Landfill Waste Directive Aim of the directive The aim of the Landfill Directive is to reduce the negative effects of landfills of waste on the environment by reducing the amount of biodegradable waste going into landfills and by preventing or limiting, during the whole life-cycle of the landfill, the negative effects on the environment as well as any resulting risk to human health. The transposition deadline for this directive was 16 July 2001, and it required Member States to devise a strategy for the reduction of biodegradable waste going to landfills. This should include specific measures to achieve the targets listed in Article 5(2) of the directive: biodegradable waste going to landfills should have been reduced by 75% by July 2006, by 50% by July 2009 and by a further 35% by July 2016. The Member States had to notify the Commission of their strategy Basic legal concepts Under the directive, landfill contents are distinguished between hazardous waste, non-hazardous waste and inert waste. Article 6 lays down the type of waste to be accepted in the different classes of landfill and provides that, subject to certain exceptions, only pre-treated waste should be considered for landfill sites. The directive also indicates the measures Member States have to take to apply for a landfill permit, the conditions to be met before such a permit is issued, and the content of permit. Previous studies on the directive In order to assess the functioning of the directive, the European Commission and the Committee of the Regions respectively commissioned a study:

80 Official Journal of the European Communities L 182 of 16/07/1999, pp. 1-19. 81 Official Journal of the European Union L 134 of 30/04/2004, pp. 114-240.

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a) In 2005 the Instituto per la Ricerca Sociale in Milan carried out a study on the “Implementation of the Landfill Directive at Regional and Local level” on behalf of the Committee of the Regions82. The study aimed at providing an overview of the implementation of the Landfill Directive at regional and local levels and at “identifying some of the reasons for success and problems encountered by the regional and local authorities responsible for implementation of the Directive.” The study focused in particular on governance aspects of the implementation process and on the directive’s financial and environmental impacts. A questionnaire was sent to the regional and local authorities of the EU Member States, and the responses covered all Member States. The Study showed in the first place that regional and local practitioners had a rather positive opinion of the content and objectives of the directive, with however the distinction that regional officials have in general a more positive view than local officials. It was confirmed that both levels would have to play a major role in the implementation process, and the question of increasing costs would play a very important role in the course of implementation. The Committee of the Regions’ study is taken as a basis for our own assessment. b) The second study was carried out in 2005 83 by a consortium of consultants led by Golder Europe EEIG on behalf of the European Commission. It focused on the status of implementation within the “old” EU Member States84, and aimed at investigating developments in landfill treatment since the transposition deadline of the directive had expired; it included an assessment of the changes necessary in order to comply with the Landfill Directive and identified possible compliance problems; it also provided information for the evaluation of the extent to which its objectives had been achieved; assessed the quantity and types of illegal landfills; indicate how Member States should apply the Waste Acceptance Criteria; and provided an explanation of implementation of the prohibition on the land filling of used tyres. Unlike the Committee of the Regions’ study, the EC Report does not focus on the implementation process and the involvement of regional and local authorities, but rather concentrates on the effect of the implementation of the directive. The prevailing view of directive’s targets was that they were not excessively difficult and generally feasible, although sometimes costly. There was also a generally positive attitude towards the environmental benefits that may be achieved as a result thereof.

82 Committee of the Regions of the European Union, “Implementation of the Landfill Directive at Regional and Local Level”, Office for Official Publications of the European Communities, 2006. 83 European Commission, “Report on implementation of the Landfill Directive in the 15 Member States of the European Union”, October 2005. Golder Europe EEIG submitted to the Commission “Markets” team. Ref Env. A 2/ETU/2004/0016, October 2005. 84 A follow-up study was carried out in June 2007 including all of the 25 EU Member States; European Commission, DG Environment “Follow-up study on the implementation of Directive 1999/31/EC on the landfill of waste in EU-25”, Final report, June 2007.

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This Commission’s 2005 study also comes to the conclusion that the effectiveness of waste policies implementing the directive did not only depend on their correctness and enforceability but also on their timely implementation. Moreover, it concluded that a more differentiated approach to waste policy should be adopted and that regulatory approaches must be supported and improved by e.g. economic incentives, adequate policies, the provision of strategic information and the involvement of all stakeholders. Common implementation challenges Under many aspects waste policies are multi-level policies of which success largely depends on the involvement of all levels of government from its conception, through its implementation down to its concrete application. While regional and local authorities were well informed during the implementation process they were not always consulted by the Member States. Moreover, with regard to the setting of strategies to achieve the targets of the directive, regional and local administrations are not always convinced of the relevancy of centralised approach favoured in the directive. This is particularly true where, prior to the directive, such strategies were already in place at local or regional levels. The same kind of resistance has been observed when the issue falls equally within the jurisdiction of the national as well as the regional and local authorities. However, the implementation of the directive as part of the EU legislation on waste guaranteed a good level of coordination of waste planning. 5.2. The 2004/18/EC Public Procurement Directive Aim of the directive Europe-wide tendering procedures are an essential part of the completion of the internal market. Common rules for procuring parties and providers of services and products aim at ensuring best value for taxpayers’ money. At the EU level, Public Procurement is governed by two directives. In the 1990’s, the European Commission detected an urgent need to recast the old PP Directives. The process started with the drafting of a Green Paper85 in 1996, based on a lengthy consultation process. This phase ended in 2004 with the approval of the so-called new legislative package:

− Directive 2004/18/EC of the European Parliament and of the Council of 31 March 2004 on the coordination of procedures for the award of public works contracts, public supply contracts and public service contracts 86 : the so-called “Classic Directive”, hereinafter referred to as the Public Procurement Directive (PP Directive).

85 Green Paper: Public Procurement in the EU, Exploring the way forward. European Commission, 27th November 1996. 86 OJ L 134, 30.4.2004, p. 114-240.

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− Directive 2004/17/EC of the European Parliament and of the Council of 31 March 2004 coordinating the procurement procedures of entities operating in the water, energy, transport and postal services sectors87 : the so-called “Utilities Directive”

The new directives were designed to open up the EU’s public procurement market to competition, to prevent “buy national” policies and to promote the free movement of goods and services. It embraces not only former pieces of legislation88, but the consolidated case law as well. For the purpose of this study we will focus on Directive 18/2004, leaving the Utilities Directive aside. The Public Procurement (PP) Directive aims at simplifying, modernizing and making EU public procurement rules more flexible. Simplification is to be attained through the compilation and merging of the former three directives on works, supply and service contracts into one single directive, thereby facilitating the understanding thereof in addition to amending existing provisions and creating a set of new instruments tailored to the current needs of public procurement in Europe. Modernization is to be achieved through the extended use of IT tools, putting traditional and electronic tendering on the same footage. Within the countries analysed, some – such as Norway and Iceland – are already familiar with IT tools, while others are recently making efforts to include them. Furthermore the legislation reduces red tape and outlines how social and environmental goals can be pursued through public procurement. Finally, the aim to make rules more flexible relates to the idea of greater adaptability to the actual capacities of contracting authorities and stakeholders as well as to the existing practices in order to gain a general acceptance. A new awarding procedure, the competitive dialogue, facilitates the management of complex contracts where tendering requirements are difficult to determine without feedback from potential bidders. Framework agreements allow the public party to set up multi-annual arrangements with a number of providers, and central purchasing systems are also introduced by the directives.

87 OJ L 134, 30.4.2008. p. 1-113. 88 Public procurement legislation in Europe has been spread into different Directives from the 70’s to the 90’s:: the two 2004 Directives replace four pre-existing pieces of legislation, these being: Public Supplies Directive 93/36/EC as amended by Dir. 97/52/EC; Public Works Directive 93/37/EC as amended by Dir. 97/52/EC; Public Services Directive 92/50/EC as amended by Dir. 97/52/EC; Public Utilities Directive 93/38/EC as amended by Directive 98/4/EC.

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Basic legal concept The directives apply when three main conditions are met: 1. The procuring body is a “contracting authority” as defined in the rules. The definition is wide and includes central government, regional/local authorities, associations formed by one or more contracting authorities and other “bodies governed by public law”. 2. The contract is a public works, services or supplies contract. In case of a mixed contract (e.g. for the supply and maintenance of computers) the contracting authority must determine – in accordance with the rules – the predominant element of the contract in order to apply the appropriate rules (e.g. lower financial thresholds apply to services and supplies contracts than to works contracts). 3. The estimated value of the contract (excluding VAT) equals or exceeds the relevant financial threshold 89. The rules expressly prohibit deliberately splitting contracts to bring them below the thresholds. Although below-threshold contracts are not covered by the regulations, a Commission Communication (2006) and case law in the area have established that when a contract could potentially be of certain interest to suppliers located in other EU Member States, contracting authorities are bound to procure them in line with the general EC Treaty principles of non-discrimination, equal treatment, transparency, proportionality and mutual recognition. This implies in practice that the contract needs to be adequately advertised and some form of fair competition run thereafter. Members States had 20 months (until 31 January 2006) to transpose the directive. The morning after the deadline only eight Member States had complied with this requirement.90 Previous studies on the directive The European Commission commissioned an Impact Assessment on Electronic Public Procurement in 2004 91 . In 2005, the Commission also requested a study analyzing the effects of the new legislation on PP in fifteen Member States 92 . The aim of this study was to evaluate recent developments in the EU internal market in order to improve future policy-making. It specifically

89 See in Annex V a table with the thresholds of the countries under analysis 90 Austria, Denmark, Hungary, Lithuania, Malta, The Netherlands, Slovakia and the United Kingdom. France had transposed only one of the two acts (the Utilities Directive). 91 Ramboll Management study commissioned by the European Commission “ Impact Assessment: Action Plan on Electronic Procurement, December 2004 92 Evaluation of the Public Procurement Directives, Markt/2004/10/D, European Economics Chancery House, 15th September 2006.

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focused on the economic changes brought about by the directives in the procurement of goods and services. By the end of 2008, the Stoiber High Level Group of independent stakeholders on administrative burdens had issued an opinion on the area of public procurement and presented a set of recommendations to alleviate the administrative burden brought about, sometimes unintentionally, by the directive.93 So far, no study has been carried out at EU level on the institutional impact of the PP legislation. Common implementation challenges The new public procurement directives granted a certain degree of discretion to national legislators transposing the text. Most of the innovative elements were in fact not compulsory and did not need to be introduced at the national level. Nonetheless, as in many other cases, Community provisions have been transposed without significant modifications in the countries analysed. Differences between countries lie more in the actual use they make of the new instruments rather than in their formal acceptance thereof. The fact that the acceptance has been only theoretical is proven by the strong criticism expressed by most of the stakeholders interviewed for the purpose of this study of the complexity and rigidity of these voluntary procedures. The voluntary provisions for transposition relate to the Common Procurement Vocabulary (CPV), the use of framework agreements, of a centralised purchasing system, electronic auctions, dynamic purchasing systems and the competitive dialogue procedure. In some of the MS analysed (e.g. UK & NL) some of these options were already used before the approval of the directives. In others (SE) the debate on whether to transpose some of these new procedures has been hectic, and voices have been raised against the high level of complexity of the new rules, which derive from a completely different legislative tradition between the EU and those countries’ legislative culture (a case in point is described in the next paragraph). 5.3. The link between the two Directives The choice of the two directives of our study is not discretional. Both directives should respect and guarantee local autonomy under the principle of self-government, since they regulate areas in which sub-national entities play a key role in the performance of their tasks. Sub-national entities are assumed to draw up their own waste management plans, as well as to manage public funds by procuring best value for taxpayers’ money, in order to cover the supply of works, contracts and services within their field of competence. When seeking efficiency gains, local authorities might typically want to share services. Similarly a group of councils may want to work through a lead council to procure public services such as waste

93 Opinion of the High Level Group on independent stakeholders on administrative burdens, 10 December 2008

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collection. In these cases the EU tendering exercise might be required if the financial amounts involved are above certain thresholds. The reasoning for this is that the local authority is effectively purchasing the service from another local authority and the private sector may wish to have the opportunity to compete. This directly affects the way in which local authorities organise service provision vis-à-vis their common shared services practice, and under certain circumstances could prevent models of cooperation that could ensure better services. Previously these practices were not so controversial as previous directives did not deal directly with the issue, and it was for the European Court of Justice (ECJ) to determine their appropriateness and legality on a case-by-case basis. With the new wording of the PP Directive, and following consolidated case law, a general ban on inter-municipal practices caused major controversy, where the principle of transparency has been encouraged to the detriment of self-governance. Only in the cases where the Teckal criteria are fulfilled (the so-called in house contracts - see below) could – in principle – an inter-municipal agreement be excluded from the PP rules. The obligation to also respect the PP rules in the case of inter-municipal cooperation was established by the Green Paper on PP (1996). The Commission, in its role of guardian of the Treaties, was already at that time limiting exceptions to the compulsory procurement obligation. Against this tendency, the CoR raised its objection to this approach94 at an early stage, claiming the importance of excluding inter-municipal agreements and in-house contracts from the application of PP rules: “municipal cooperation is an administrative prerogative and therefore it has no market relevance”. In these first years, the “Teckal”95 case law established two criteria defining the scope for potential exceptions to the rule in cases of so-called “in-house” contracts 96: The PP Directive applies to contracts made by a public authority (or body governed by public law) for pecuniary interests for the supply of works, products and services, with an “autonomous” legal entity. Autonomous meaning that the contracting authority does not exercise a similar type of control over to that exercised over its own departments. At the same time, if such control exists, a certain character of exclusivity must be proven; the supplier must exercise its main activities for this contracting authority. Only if these two conditions are met may PP rules be exempted. In the preparation of the directive, the CoR again expressed its concerns with regard to inter-municipal cooperation since no clarification was made in the proposal for a directive97. Also the EESC contemplated98 the idea of delimiting the meaning of in-house activities in order to avoid

94 Opinion on the Green Paper on PP in the EU, CdR 108/1998 fin. OJ C 373 of 2.12.1998, p 13 95 Judgement Teckal, 18 November 1999, C-107/98. 96 through the interpretation of article 3.1 (a) and (b) of the PP Directive 92/50. 97 Opinion of the CoR of 13th December 2000 on the Proposal for a Directive on Public Procurement. 98 Opinion of the EESC on the Proposal for a Directive on PP, 26 April, 2001.

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breaches of the competition rules. In the same direction the European Parliament, expressing its view on a first reading, advised the codification of Teckal criteria in order to prevent abuses99. Some years later, the ECJ issued a ruled on a similar case, namely the Stadt Halle100 Judgement. This ruling narrowed the in-house derogation, delimiting the subjective scope of PP Directive 92/50, concerning a contract for waste treatment. The supplier of the public service was mainly managed by the public authorities with a minor private capital. No formal award procedure took place since it was deemed an in-house operation. However, the Court stated that cases excluding PP rules must be strictly interpreted. PP rules do not apply in a case where the contracting authority decides to undertake its conferred tasks with its own administrative/technical resources or if it exercises similar control over the provider as that exercised over its own departments. In this case, a minor percentage of private ownership led to the existence of a private interest and to the obligation to observe PP rules. The interpretative line followed by the ECJ has been to gradually narrow the concept of in-house and inter-municipal agreements. Later rulings came to delimit the scope of the exclusion of PP rules, when dealing with a concession 101 (a type of contract not covered by the directive). As a result the exclusion of PP rules has become a rare exception in these cases, and complaints from the municipalities have been growing. Nevertheless, a very recent case seems have to paved the way for a new kind of exemption, different to that of “ in-house provision”. In the ECJ decision of 9 June 2009, C 480/06, the Commission brought Germany before the Court for breach of procurement rules. The city of Hamburg was providing other districts with the same waste disposal body, following a contract it had previously concluded. No procurement procedure had been followed nor was it published. The Commission deemed it illegal as it did not meet the Teckal criteria: the requisite of equal control exercised by the contracting entity over the supplier (Stadtreinigung Hamburg) was not met. Not being an in-house agreement, procurement rules should be observed. However, the Court ruled in favour of Germany, since “EU Law does not require authorities to use any particular legal form in order to carry out jointly their public service tasks. And, furthermore, this inter-municipal cooperation does not undermine the free movement of services and the opening-up of undistorted competition” The European Court of Justice has therefore ruled that contracts with reciprocal commitments between public authorities are exempt from public procurement rules, clearing an EU hurdle in the

99 Justification to the amendment 38 of article 19 of the Directive. 100 C-26/03, Judgement of the Court of 11th January 2005, European Court reports 2005 Page I-00001. 101 The Parking Brixen case (Judgement C-458/03, Parking Brixen).goes even further.Subsequent ECJ rulings in Carbotermo (Carbotermo (C-340/04) and Tragsa (Judgement ECJ Tragsa, 19 April 2007. C- 295/05) have consolidated this doctrine.

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sharing of waste management responsibilities. We can conclude that the ECJ’s views have evolved since Stadt Halle and TRAGSA, where the ban on inter-municipal agreements, excluding PP rules, was consolidated, towards a position where the principle of self-government and local autonomy to carry out public tasks and freely perform their agreements are promoted. Conclusion We are confronted with two very different directives approved at very different times. The Commission practice on Impact Assessment started in 2002 and has since been revised several times. It is too early to fully predict and understand the impact of the new 2009 IA Guidelines. However, an analysis of the content of the directives and the links between the two sheds light on a few aspects: - It is difficult to predict the potential impacts a proposed legislation might have, and

therefore time and capacity investments are recommended, as well as is broad consultation.

- The voluntary literal transposition of the EU legislation may sometimes increase unnecessarily the burdens imposed on stakeholders in a non-desired way.

- Whenever EU legislation is not precise on a given topic, it will be for the ECJ to give common interpretation. Depending on the scope of the norms under interpretation, the Court might be placed in a co-legislator position, which often has a negative impact on the smooth compliance with European Law.

- In the same vein, the evolving interpretation of the Court does not help the stakeholders affected by a given law to reach clarity and achieve transparency.

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6. THE DECISION-MAKING PROCESS OF THE LANDFILL WASTE AND PUBLIC PROCUREMENT DIRECTIVES IN THE COUNTRIES STUDIED 6.1. THE 1999/31/EC LANDFILL WASTE DIRECTIVE The evolution of the Landfill Directive negotiations (1990-1999) is a rather unique example of a difficult decision-making process between the European Commission, the EU Council and the European Parliament. It took almost a decade to adopt the directive and it has been also difficult to develop implementing acts in the follow-up of 1999. This can be explained by the very different starting points of Member States in the field of waste management. Interests were divided according to the extent that landfills were used in the countries:

- High total recovery (i.e. landfill levels of <25%) (DK, DE, NL, SE); - High landfill (i.e. landfill levels of >60%) (IT, ES, EI, UK); - High incineration (i.e. incineration levels of >25%) (DK, SE, NL, FR); - High recycling (i.e. recycling levels of >25%) (SE, DE); - High composting (i.e. composting levels of >25%) (AT).102

An EU strategy for waste management was first adopted, in the form of a Communication, by the Commission in 1989 and reviewed in 1996, the European Commission publishing a first proposal for a Landfill Directive in 1991. After lengthy negotiations the Council adopted a common position in 1995. However, the European Parliament rejected the proposal in June 1996 as it did not find the level of protection in the common position sufficiently high. The Parliament complained in particular that there was too much derogation for large parts of the Community territory103. This rejection made the situation in the Council more difficult as some of the Member States agreed with the more ambitious positions of the Parliament. Therefore, the Council invited the Commission to produce with a new proposal (which does not happen very often). It shows the very different views between Member States and vis-à-vis the Parliament on the future landfill policy. In the meantime, in the Commission’s new Communication of 1996, the landfill of waste was regarded as the option of last resort. This was reflected to a greater extent in the new proposal for a Landfill Directive published in March 1997.104 During the negotiations on the first proposal, the 1995 enlargement had also strengthened the position of those Member States with a more ambitious view of landfill policies and a more environmentally progressive national background. In June 1998, the Council reached a Common Position on the new proposal. In the Parliament, the British MEP Caroline Jackson was the nominated dossier rapporteur. The Parliament, in line with its 1996 position, aimed at reducing derogations, and achieving stricter targets on the reduction of biodegradable waste and shorter

102 See: The Chartered Institutions of Wastes Management (CIWM): Lessons learned from Europe, 2005. 103 See also: Ludwig Krämer: EC Environmental Law, 2000, page 242. 104 See explanatory remarks in the proposal of the European Commission of 1997 (COM 97(105)).

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timeframes for existing landfills to comply with the new rules105. A final agreement was reached between Parliament and Council in 1999. In the follow-up, the drafting of legislation on the technical aspects of the annexes of the directive has also been very cumbersome. According to Article 16 of the Directive, the Commission shall set specific criteria and/or test methods and associated limit values for each landfill class, including – if necessary – specific types of landfills within each class, such as underground storage. In this regard, the Commission initiated a comitology procedure to adopt a Commission decision on the topic, but reached no qualified majority in the Committee. Therefore a Council decision was drafted and finally agreed upon by the Member States on 19 December 2002. Furthermore, comitology committees rarely fail to achieve a common position on Commission implementing acts. Thus, the Landfill Directive is a very special case where positions between Member States, the European Commission and the European Parliament varied considerably. It also shows that some unsolved political questions on the management of landfills were probably postponed and hidden until the concrete debate on implementing measures under comitology rules. 6.1.1. France National waste management context In France, the Ministry of Ecology, Energy and Sustainable Development is responsible for French national waste policy. It formulates the policy objective and develops the legal instruments. Two years after the adoption of the Landfill Directive, the National Waste Council was established (Conseil National des Déchets) with 33 members appointed by the Environment Minister. Inter alia, the Council publishes positions on Commission proposals. Due to the overall process of the ‘Grenelle Environnement’ in 2007 (Loi de programmation Grenelle issued in October 2008) new objectives in the field of waste policy were formulated by a round table of different State, civil society and industry stakeholders. The guidelines of the policy objectives included reducing household waste, increasing the recycling of household waste and reducing the waste going to incineration and landfill. Specific targets were confirmed in the national law that confirmed the results of the Grenelle. The responsibility for municipal waste collection and disposal lies with the municipalities or with groupings of municipalities, which are responsible for the collection and disposal of household and other similar waste. A key consideration is that France has over 36,000 municipalities (communes), many with under 1,000 inhabitants. This entails a higher level of complexity than in other Member States. The higher administrative level, the Departments, is involved in planning activities (departmental waste plan). The actual operations can be carried out directly by local authorities or

105 A list of the EPs negotiation positions from 1998/1999 and parts of the rapporteurs speeches can be found on http://www.europarl.org.uk/section/what-happens-next/landfill.

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by private companies contracted by the local authority106. The 1992 Circular on Waste (Act no. 646 of 13 July 1992) introduced the obligation for waste management plans at the “Département” level. In the past, France’s environmental infringement cases exceeded the EU average. In 2008 for instance, according to the Commission’s figures, there were 45 open infringement cases107. In the course of the transposition phase of the Landfill Directive, the European Court of Justice handed down a negative judgment to France for failing to adopt the provisions necessary to comply with the Directive (Case C-172/04, published in the Official Journal of 19.2. 2005) 108. However, the country had already reached the 2009 reduction target for biodegradable municipal waste going to landfills. According to European Environment Agency data from 2004, France was one of the Member States with comparatively high material recovery and incineration capacities109. Nevertheless, in the past France also had a high number of illegal landfills. According to the implementation study commissioned by the European Commission, (Golder Europe, 2005) around 1,000 illegal landfills were reported in France in 2004110. The 2004 figures issued by the relevant French Ministry were somewhat lower111. European Commission officials believe the real figures to be higher.112 The pre-legislative and legislative phases Pre-legislative phase According to representatives of the Ministry of Environment as well as of local and regional associations present during the Eipa-Nicis interview meeting in Paris (July 2009), there is no evidence that consultations took place between the central administrative level and representatives of local and regional authorities during the pre-legislative and legislative phase of the Landfill Directive. According to the Ministry’s representatives as well as those of the central and local

106 See a detailed description: European Topic Centre on Resource and Waste Management, Factsheet France, September 2006, www.eionet.europa.eu. 107 See the Presentation of Helmut Maurer, DG Environment, at the CEEP/Committee of the Regions Landfill Conference in Brussels on 16 July 2009, available on www.ceep.eu. 108 More details will be described in the section on the transposition phase. 109 See: The road from landfilling to recycling: common destination, different routes. European Environment Agency, 2007. 110 According to Golder (2005) the procedure for identifying illegal landfills is defined in the French Circular 23 February 2004. Illegal landfill is defined by sites that receive regular loads of waste to a site in activity usually managed by the municipalities. 111 See: « Donner un nouvelle élan à la politique des déchets », September 2005, press information given by the Ministry of Ecology and Sustainable Development. 112 See the report on the CEEP/Committee of the Regions Landfill Conference in Brussels on 16 July 2009 on Eureactiv.com (http://www.euractiv.com/en/environment/commission-eyes-tighter-enforcement-eu-waste-law/article-184191).

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authorities, this was due to the fact that no specific procedures were in place at that time for such a dialogue. However, it was also pointed out that the Landfill Directive includes many provisions relating to the technical elements of land filling. Although consultations did not take place at a policy level, some informal meetings and discussions were held with experts to discuss the technical issues of the directive. The Landfill Directive is a case in point of the rather weak coordination between the national and regional/local level of the pre-legislative phase in France at the end of the 1990s. Experience with this directive and other directive has led to some reforms. Nowadays, the territorial associations of France have their own bureau of representatives in Brussels which closely follows the developments in Brussels and informs them about new legislative developments at an early stage (see general part). Legislative Phase It has been pointed out that consultation with the regional and local level was weak at the time the Landfill Directive was presented in 1997 and negotiated in the Council. At that time no special national or official Commission impact assessment made. It has been said that even today, once the negotiations starts in the Council and a national position has been found in the inter-ministerial consultation process, it is difficult to keep the regional/local level involved due to the dynamics of the negotiation process. However, the recent waste framework directive has been negotiated with new elements. First of all, the National Waste Council wrote a position paper on the Commission proposal (21 December 2006). Based on this position paper and on the contribution of the Committee of the Regions, the “Maison européene des pouvoirs locaux francais”, published its own position paper in October 2006 as a joined exercise of all regional and local entities in France. The transposition phase The Landfill Directive was transposed into French law by different national pieces of legislation: the “Arrêtés” of 31 December 2001, 2 April 2003, 31 December 2004, 19 January 2006 and 15 March 2006 113 . Since France did not transpose the entire directive in time, the Commission filed a complaint with the European Court of Justice which subsequently decided that France had indeed not fulfilled its obligations with regard to the transposition of the directive114. In the interviews, it was mentioned that there were problems with the transposition of the Landfill Directive. Some were not caused by the Landfill Directive itself but were directly linked to existing

113 See EEA, European Topic Centre on Resource and Waste Management, Factsheet France, September 2006. 114 Case C-172/04, published in the Official Journal of 19.2. 2005.

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problems at national level. It was mentioned that the clash with other legislation was a significant obstacle to proper transposition. Another difficulty was the fact that the distinction made by the directive between non-hazardous and hazardous waste raised a question of the division of responsibility in France as French industry has responsibility for hazardous waste. The level of direct and formal consultations with regional and local authorities was also very limited at the transposition phase. As mentioned earlier, however, since the directive contains many technical details, informal meetings were held with experts on the technical components of the directive. A Ministry of the Environment representative stressed that from time to time committees were established which follow up the development of certain legislative proposals. However, these committees are established in a sporadic way, and only on certain topics. In cases where such a committee exists, it is also responsible for monitoring the transposition of the legislation in question. Since 2005, transposition is monitored more structurally. The service of the Prime Minister chairs a group of officials from different Ministries responsible for the monitoring of the transposition of EU legislation (see above). The implementation phase France met the Landfill Directive 2009 target for biodegradable waste back in 2005 115 and has reduced the amount of biodegradable waste going to landfills by 50% since then. On the other hand, in the past France had a high number of illegal landfills. According to the Golder Study (Golder Europe, 2005) around 1,000 illegal landfills were reported in France in 2004116. No special network was established after the transposition date in 2001 in order to monitor and control the implementation of the directive. According to the interviews, the lack of information at regional and local level has been described as a problem for proper implementation. The National Waste Council pointed out in 2005 that there were still many illegal landfills and non-compliance with the legislation was still a major problem for national waste policy, also vis-à-vis the citizens. The high cost of waste disposal, the difficulties of applying the polluter-pays-principle and the internalisation of costs all constituted significant obstacles to proper implementation as well. According to the National Waste Council local resistance to different infrastructure projects has also been a specific French problem. The Council stressed the need for the provision of better information between the different actors in the field: the Ministry, the Agency ADEME, the Regions, préfectures/conseils généraux and municipalities 117 . A general committee on monitoring the transposition and

115 See: The Chartered Institution of Waste Management: Delivering Key Waste Management Infrastructure: Lessons Learned from Europe, Final Report 2005. 116 According to Golder (2005) the procedure for identifying illegal landfills is defined in the French Circular 23 February 2004. Illegal landfill is defined by sites that receive regular loads of waste to a site in activity usually managed by the municipalities. 117 See: Conseil National des Déchets: Synthèse des travaux, January 2005. http://www.ecologie.gouv.fr/IMG/doc/SyntheseCND_060105_def-2.doc.

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implementation phase was only established in 2005 chaired by the Prime Minister’s office with correspondents from all ministries. The positive elements of capacity building are also pointed out by the National Council: the development of stronger inter-municipal organisation in the waste sector. Table: Characteristics of the French coordination networks for the Landfill Directive

Phase Characteristic Assignment Coordinator Members Information Pre-legislative and legislative phase

Inter-ministerial networks - weak involvement of other levels --------------- After 2005: Bodies to assess financial impact

No formal assignment --------------- Financial impact assessment of Commission proposals

- ad-hoc consultations/ No clear nomination of regional/local members

Ad-hoc information Top-down --------------- After 2005: Maison Européenne coordinates the pro-active input of the regional/local level

Transposition Loose inter-ministerial network (until 2005) Weak involvement of regional/local level ------------- After 2005: Working group dedicated to transposition

No formal assignment --------------- Establishment of Transposition Monitoring Group No direct involvement of regional/local level

- --------------- Prime Minister’s service

No clear nomination of regional/local members ---------------- Officials responsible for transposition from all Ministries No direct involvement of regional/local bodies

Ad-hoc information Top-down

Implement No multilevel monitoring team

No formal assignment

- No clear nomination of regional/local members

Ad-hoc information. Poor flow of information at the municipal level

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6.1.2. The Netherlands National waste management context The Netherlands was one of the Members States advocating a more progressive landfill policy during the 1990s, i.e. the reduction of waste going to landfills. This fitted well with the national strategy in the waste sector. Modern Dutch waste policy began in 1977 with the Waste Act. In 1987, the so-called Lansing ladder already described a similar concept of waste hierarchy to that of the EU today: reducing waste, preventing production, re-using and recycling, incinerating with energy recovery, and lastly resorting to landfills118. Back in 1990 a Dutch Government memorandum on Waste Prevention and Reuse formulated the ambitious target of reducing landfill waste to 10%. In the same year, the Waste Management Council was established strengthening the dialogue between local, regional and national tiers of government. The Council was composed of representatives of each administration level and was led by an independent chairman. In 1994, the Dutch also introduced a landfill tax in order to reduce the amount of waste going to landfills. In a comparative study from the UK, it was estimated that front-runner countries as the Netherlands began a legislation-driven cycle of new infrastructure development between 10 and 15 years earlier than the UK 119 . Reduction targets set by EU legislation for waste going to landfills were generally in line with national policies, legislation and objectives. This also means that a national debate had already taken place during the 1990s between the different levels of government on future landfill policy, with provinces and municipalities obliged to strive for ambitious national targets. The pre-legislative and legislative phases Against this background, the Dutch government was well-prepared for the European debate and was also able to formulate a comprehensive national position on the dossier. However, the regional and local levels were modestly involved in the pre-legislative and legislative phases of the Landfill Directive (as was the case for other directives at the time)120 . According to officials at all levels, during the 1990s there was less awareness of the need for proper vertical coordination of EU dossiers. Reflecting the answers from the experts, in the case of the Landfill Directive the following elements of coordination were missing:

− There was no guided and permanent flow of information between the national and regional levels;

118 See: Arthur Mol et. al : The voluntary approach to Environmental Policy, Oxford 2000, p.129. 119 See: The Chartered Institution of Wastes Management (CIWM): Delivering Key Waste Management Infrastructure: Lessons learned from Europe, Final Report, 2005. 120 As shown earlier, this does not mean that there was no involvement when the national waste policy and legislation were formulated.

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− The provincial level (and the municipalities) did not at that time have enough capacity to monitor independent ongoing processes in Brussels;

− One major difference compared with the current situation was the lack of a permanent representation of the provinces in Brussels; the joined House of the Dutch provinces was only established in 2000;

− There was not a stable network of officials from different levels (as a sort of permanent “dossier team”).

This means that there was no stable information flow from national representatives in EC expert committees and later in Council working groups. There is the assumption, formulated today by several officials at different levels, that this also meant that regional and local positions were not particularly well reflected in the national positions vis-à-vis the European Commission and later in the EU Council of Ministers. It was not possible to find further empirical evidence for that. Neither the national nor the regional and local administrations had greater problems with the objectives formulated in the Landfill Directive. Later on other directives were regarded as more problematic than the Landfill Directive and led to a broad debate in The Netherlands on how to improve the coordination of the different administrative levels in the pre-legislative and legislative phases of the EU policy-making, such as the daughter directives in the field of air quality the same year where The Netherlands were faced with major problems in meeting air quality standards. For this reason, the Landfill Directive was seen to a lesser extent as a problem of coordinating EU negotiations; the way the Dutch position was negotiated was less a subject of discussion and, as we will see, there were no crucial enforcement problems. Moreover, empirical evidence shows that, some years later, the situation had improved with respect to particular directives (REACH).121 The transposition phase In the Netherlands there is framework legislation for all environmental measures: the Environmental Management Act. The Landfill Directive was initially transposed by adapting the specific chapters (8 and 10) of this Act laying down rules for waste management, including landfills. The Act was amended in 2003 in order to integrate the new obligations under the Landfill Directive. More specific provisions are laid down in various decrees, provincial environmental ordinances and municipal waste ordinances122. In addition to the Environmental Management Act and the other provisions, the National Waste Management Plan came into force in 2003 (which has been amended twice since then). It lays down environmental objectives, for instance the reduction of

121 “De chemie van beleid. Lessen uit 10 jaar SOMS en REACH”, Ministerie van VROM, 2008. 122 Such as the landfill ordinance soil protection, the landfill and landfill ban ordinance, and the ordinance on environmental permits (inrichtigen en vergunningsbesluit milieubeheer). See the Ministry of Housing, Spatial Planning and the Environment, “Legislation. Waste in the Netherlands”, Factsheet, June 2001. Inter alia, the law on soil protection was changed and many more regulations in different fields of waste policy, see an overview on the governmental law site http://www.eu-milieubeleid.nl/print/ch05s05.html.

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waste going to landfills in the future. Both the Act and the Plan were elaborated at the national level. As will be seen further, the provinces and municipalities are responsible for their enforcement. Since the majority of the issues laid down in the Landfill Directive were already covered by the above-mentioned measures, only minor changes to the different pieces of the Dutch legislation were needed to implement the Landfill Directive in The Netherlands. Moreover, the implementation and enforcement at the provincial and the municipal levels did not trigger a broader debate on the quality of this piece of EU legislation. There are probably two reasons for that:

1) The Dutch government negotiated in the EU Council with a sound knowledge of the provincial and municipal needs due to the very early national debate on landfills;

2) The philosophy of the Landfill Directive was very much in line with national Dutch policy. However, it is surprising to note that The Netherlands had problems meeting the transposition deadline of the Directive. It has been said by the Government that this had less to do with its objectives but more with the difficult process of transposition into the different pieces of Dutch legislation. In 2004 a Report on the implementation of the Directive was sent to the European Commission. On 12 December 2006, a letter of formal notice for non-conformity was sent by the European Commission to The Netherlands as well as to several other Member States. Upon receipt of the notification to the European Commission of the national transposition measures, the infringement procedure for the Netherlands was closed. The implementation phase According to the general Environmental Management Act (Wet Milieubeheer), the Dutch Ministry of the Environment (VROM) has responsibility for developing a National Waste Management Plan every four years incorporating the objectives of the Landfill Directive. The plan for 2002-2012 (LAP) was adopted on 27 January 2003 and entered into force on 3 March 2003. The provinces grant and enforce licences for the land filling of waste. They are responsible for inspection, as well as the financial management of aftercare funds during the operational phase of landfill, as well as after closing a landfill site. The municipalities have important tasks with respect to local planning, the collection and separation of waste both for businesses and private households. This task has been dependent on the 1990s progressive Dutch policy with its own national targets. The objectives laid down in the Landfill Directive constitute one element of their practices. The municipalities formulate local objectives, and can also formulate rules for the local separation and prevention of waste123 . The general coordination of waste matters between different levels is described by the academics as good124 . As already mentioned, a national Waste Management Council was established in 1990 with members of all levels of government that played an important role in the debates on the Dutch

123 See Senternovem.nl. 124 See for instance: Hejjo Scharff: Implementation of the Landfill Directive, The Dutch Experience, power point presentation, 2006, (www.ec.europa.eu/environment/international_issues).

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national waste policy. This structure of coordination in the waste sector changed when in 2006 the Waste Management Council stopped its activities and its tasks were taken over by the DUIV, the periodic consultation and coordination body for all environmental matters bringing together the Ministry of Environment, the water boards, the Inter-provincial Assembly (IPO) and the Association of local communities (VNG). During our research, national level experts stated that after the transposition of the Landfill Directive the provinces were in regular contact with the Ministry of Environment on related enforcement and inspection issues. Due to past national waste management policy, a special working group was established consisting of landfill experts from the provinces and representatives of trade organisations. One of the working group’s tasks was to organise internal training and information events and to provide guidance on the implementation of the Landfill Directive. Against this background, over the last decade awareness programmes were organised with information campaigns on enforcement obligations. Up to now, fulfilling the different objectives of the Landfill Directive has not been a major problem in the Netherlands. For example, with respect to one of the major objectives, the share of biodegradable waste going to landfills, the Netherlands was one of the countries that had already met the objective for 2016 back in 1995. In total, the number of landfills decreased from 80 in 1991 to 23 at the end of 2006. The mainly positive outcome of the Dutch implementation of the Landfill Directive has been facilitated by the following:

− Very early in the 90s, the national government, provinces and municipalities started to work together within the national Waste Management Council;

− The ban on combustible waste was already a core philosophy of Dutch waste policy before the Directive was adopted;

− To some extent, the Dutch philosophy in the waste sector was exported to the EU level;

− Before EU legislation was in force municipalities had already started to work together to finance facilities for a much larger area;

− As a cultural element of the Dutch debate, the planning and construction of incinerators was not as conflictual as in other Member States;

Furthermore, so far the financing of the measures and aftercare for the protection of landfills have not been a major problem. However, according to the Dutch authorities, the landfill industry might in future not generate enough income to cover the costs. This may be due to an effective policy and legal framework to minimize land filling and redirect waste material to incineration and recycling plants.

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Table: Characteristics of the Dutch coordination networks for the Landfill Directive

Phase Characteristics Assignment Coordinator Members Information Pre-leg. and legislative phase

Informal Inter-ministerial networks ---------- - Inter-ministerial Group for the impact assessment of new Commission proposals - Coordination Council instructions by Commission for International Environment Policy (CIM) - Low involvement of other levels/ but high involvement in earlier national debate

No formal assignment -------- Impact assessment of new Commission proposal Coordination of Dutch position

- ------------ Ministry of Foreign Affairs Ministry of Foreign Affairs

--------- Nomination national officials from different Ministries Nomination of national officials from different Ministries No direct involvement of other levels ---

Ad-hoc information - top-down lead ministry National government benefited from the earlier national debates on waste policy reforms ----------------- After 2001: House of the Dutch Provinces coordinates the pro-active input of the regional/local level

Transp. No clear multilevel network Transposition in the hands of the Environment Ministry

Responsibility for the transposition in the hands of the Environment Ministry

Inter-ministerial process steered by the Environment Ministry Ad-hoc involvement of regional/local level

No nomination of network members No clear nomination of regional/local members

Ad-hoc information Top-down Normal legislative procedure with stakeholder involvement

Implement. No explicit multilevel monitoring team but coordination capacities for national waste legislation: National Waste Management Council with involvement of regional and local level/later DUIF

- National Waste Council as a platform for implementation problems

- Regional/local members Members of the national waste council

Information flow via the well-established vertical bodies in the waste sector

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6.1.3. Sweden National waste management context Since 1991, each municipality must have a waste plan covering all types of waste found in the municipal area and identify the actions necessary for their appropriate environmental management and their management as resources. Waste planning has brought about management improvements by encouraging the establishment of extensive systems for source separation and recycling125 . In 1996, the Swedish government introduced a landfill ban with a transition period of 6 years for combustible waste (to 2002) and 9 years for organic waste (to 2005), which gave municipalities time to develop the necessary infrastructure126. Moreover since January 2000, under the Landfill Tax Act, all material entering landfill facilities is taxed, while material removed from the facility qualifies for a deduction. It should also be kept in mind that during the years of the legislative developments of the Landfill Directive, Sweden was a new Member State that had recently entered the EU (1995) and was not in a position to play a major part in it, especially as it was not a priority on the agenda at that time. The pre-legislative and legislative phases According to the replies to the questionnaires sent for the purpose of our research, consultation on the Landfill Directive during the pre-legislative and legislative phases seems to have been rather weak in Sweden. It is not clear whether or not an ex ante impact assessment was carried out. Nevertheless, representatives of local and regional authorities, as well as of other interest groups, participated in the Ministry of Environment “reference group” dealing with the negotiations of the Directive. However, in the opinion of regional experts, the issues raised by the local and regional governments were not effectively put forward by the Swedish government. For example, the Swedish Association of Local Authorities and Regions (SALAR) pointed out that the Government did not take on board the geographical situation of Sweden, or at least not to the extent desired by local and regional authorities. It was also stressed that even though the Ministry of Environment had consulted local and regional governments and attempted to take their comments into account when preparing its national position, the consultation came too late. Moreover, SALAR representatives interviewed mentioned that some things had to be improved due to the fact that:

125 See Policy Instruments for sustainable waste management, Swedish Environmental Protection Agency, released on http://www.naturvardsverket.se/en/In-English/Menu/Products-and-waste/Waste/Objectives-strategies-and-results/Policy-instruments-for-sustainable-waste-management/. 126 See: CIWM Study: Delivering Infrastructure: Lessons learned from Europe, 2005.

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- The involvement was too late; - There was a lack of effectiveness since the information about the Ministry’s final position

came late, leading to a situation where it did not know in advance whether its opinions had been taken on board or whether it needed to continue lobbying.

In reaction to these comments, the Ministry of the Environment representative argued that information is given upon request. In some cases, where sensitive information could compromise its negotiating position, the Ministry may decide to keep it reserved. Very often, negotiations mean that the position has to be remodelled and that many considerations, which were not regarded previously, have to be taken into account. Nowadays, when this happens, SALAR confirms that at a later phase, after each Council meeting, the Ministry of Environment consults SALAR and other stakeholders about the different positions the Ministry is intending to take. National networks were neither consulted at that time nor were they able themselves to play any active role through the European networks or through a direct presence in Brussels (especially due to the recent membership of Sweden to the EU). Nowadays, according to opinions expressed by SALAR’s representatives, the Association is considerably involved in European networks and remains in contact with local and regional networks in other Member States. Additionally, being a large organisation, it is more effective than most of its European counterparts. Its size and budget allow for a greater awareness of European developments at an early stage. The members of SALAR interviewed also mentioned that it is important to learn, in terms of efficiency, how to use the European networks more effectively in order to maximise influence and secure a strong lobbying position. This may be of great importance when the Swedish position defended by the Government is not in line with the interests of SALAR. It seems that the situation has improved since then. At present, consultations with SALAR may already take place when a White or Green Paper is published. Since the Swedish ministries are smaller than most ministries in other countries, they rely on agencies in Brussels to gather the required information and expertise. In the opinion of SALAR’s interviewed representatives, this sometimes facilitates putting forward their position, or even raising a new topic when an “early warning” is made by other European networks and organisations. According to the Ministry of the Environment, impact assessments are now part of the “internal routine” of the Ministry when it comes to new proposals in this field. SALAR, however, pointed out that it is not sure whether the impact assessment is very efficient for three main reasons:

- It seems that the IA is started too late to be effective; - As the Swedish Environmental Protection Agency (EPA) is the sole author of the impact

assessment, the risk is that there is too great a focus is on environmental issues, and other relevant issues, like financial issues, could be overlooked;

- Lack of transparency of IA results: according to SALAR, they are presented at a very late stage.

The transposition phase The Landfill Directive was incorporated into Swedish law in July 2001 within the framework of the existing progressive legislation. Before the transposition of the Directive, a proposal for a national law was put forward by the Government and referred for consideration to the relevant stakeholders, including municipalities and regional authorities. According to SALAR, the discussions during the transposition phase were much better than before and certain issues, like the geographical situation of Sweden, were better taken into consideration.

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Yet, due to the fact that Sweden was still a new EU member in 2001, the support given by the Government to the local and regional authorities for the implementation of the legislation was not considered to be optimal. The implementation phase With respect to the important objectives of the Landfill Directive, Sweden had no general problem in reaching the targets. In 2007, only 4% of the overall household waste was going to landfills and Sweden had already fulfilled the obligation of the Directive for 2016. Sweden has also banned the landfilling of combustible waste and organic waste; exemptions can be granted if there is a lack of capacity; the amount of waste for which an exemption is granted is decreasing; most waste today is incinerated; and biological treatment is growing127. The following political measures, initiated prior to the transposition of the Directive, influenced this development:

- Producer’s responsibility for paper and packaging (1994) - Landfill tax (2000) - Ban on the landfilling of source-separated combustible waste (2002) - Ban on the landfilling of organic waste (2005) - Landfill directive implemented (2009) - Environmental target - source separation of food waste (2010)128

In Sweden, the main responsibility for waste lies with the municipalities, who are responsible for collecting and handling household waste and for planning waste management. According to the Ministry of Finance and SALAR representatives, waste management is “to a significant extent characterized as an act of municipal self-government”. Also, landfills are either managed or operated by the municipalities themselves or by private companies. However, since 1994 the majority of landfill sites in Sweden have been closed and the amount of household waste going to landfills has decreased, which can be explained by the following:

- 45% of the country’s municipalities have access to their own landfill sites and 55% engage contractors;

- The municipalities have been the driving force behind the expansion of Sweden’s waste facilities, and the infrastructure for the transmission from waste disposal to recycling. Only 4 of a total of 29 energy recycling facilities have private owners;

- Costs of handling waste are very high due to the demographic and geographical situation of Sweden, which results in small volumes of waste and transportation over long distances;

127 See: Swedish Waste Management, Report 2008. available under www.avfallsverige.se. 128 See: Landfill division from a Swedish Perspective, presentation given by Anna Hedenstedt, Swedish Waste Management, 2009, available under www.fead.be/uploads/Committee%206/Hedenstedt.pdf.

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- A large part of the total amount of household waste is handled through incineration with energy generation;

- It is advantageous for municipalities to purchase waste recycling services from the nearest possible facility. However, due to the long transport distances, the number of facilities which can be used by municipalities is limited. Therefore, cooperation between municipalities, for example in the form of a joint ownership of waste handling companies, is common in Sweden129.

The Swedish municipalities have played a significant role in the delivery of waste treatment infrastructure, stimulating the shift away from landfill to energy from waste, recycling and composting over the last 20-30 years. Non-household waste is mainly handled by the producers themselves who can pay the municipalities for taking care of their waste. In order to cover the costs arising from these activities, municipalities charge a waste collection fee for household waste, the amount of which is determined by the local government. In fact, the strong political and financial control over the landfills and the possibility of self-financing and inter-municipal utilities made it possible to implement national EU landfill objectives130

129 Further developed in chapter 5.3 of this report. 130 See also a similar assessment in the report of CIWM (Chartered Institution of Waste Management, UK: Delivering Key Waste Management infrastructure: Lessons learned from Europe, 2005, p.47.

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Table: Characteristics of the Swedish coordination networks for the Landfill Directive

Phase Characteristics Assignment Coordinator Members Information Pre-legislative and Legislative phase

- No structured involvement of the regional/local level - No impact assessment for the local level - Informal involvement of officials from other levels - Rather late consultation

Consultation on the negotiation position

Environment Ministry/inter-ministerial cooperation Environment Ministry

Reference group with officials from the regional/local level

Top-down information from the Council/ Environment Ministry

Transp. Better involvement than during negotiation Consultation

Involvement in national law making

Environment Ministry

Region/local officials

Top-down and bottom-up (e.g. geographical situation)

Implement. Self-financing of local level as a strong support for capacity building

Implementation as a major task for the local level

Environment Ministry and Municipalities

Strong national and local networks in the field of waste management

Exchange of information at the local and regional level/ no top-down information from Environment Ministry

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6.1.4. The United Kingdom The pre-legislative and legislative phases In the case of the UK, it was also not possible to find officials who had been actively involved in the pre-legislative and legislative phases of the Landfill Directive. However, with regard to some background documents and articles at that time, it is obvious that the high number of national landfills and the high amount of biodegradable waste going to landfills was a major concern with respect to the details of the 1999 compromise in the EU Council. Indeed, the UK belonged to the group of Member States asking for derogations and longer time limits. At the Environment Council under the British EU presidency in June 2008, the common position of the Council granted a longer period of time (4 years) to the UK by introducing the 80 % clause131. Moreover, the British MEP Caroline Jackson, rapporteur at that time, was in favour of greater subsidiarity and criticized the first EC proposal for its rigidity with regard to fully harmonized targets and timetables.132 The compromises reached between the EU Council and the European Parliament created a certain flexibility for countries that were still dependent on landfills. It can be assumed that in general, the outcome of the negotiations were regarded as rather positive for the UK, whereas this had been a second best option since the 1991 failed landfill proposal would have brought even more flexibility. But the result reflected the situation in the Council in 1998/99, where the UK was faced with the progressive positions of inter alia Germany, The Netherlands, Denmark, Sweden and Austria. However, ex post criticisms were expressed in 2004 by the Environment Committee of the House of Commons concerning the national negotiation of the Landfill Directive. The Committee was concerned about the problems in the waste sector and the lack of understanding of the national impacts of the EU Landfill Directive. On the basis of the lessons learned from the Directive, the Committee recommended that the Government engage with practitioners at the earliest possible stage to ensure that future EC proposals are “practicable, enforceable and capable of implementation”133 . The Government did not directly react to the criticism at the time but referred to its general coordination mechanisms that guaranteed proper consultation. In the case of the Landfill Directive, it is difficult to properly evaluate the involvement of regional and local authorities, as they had less capacity and there were fewer obligations for stakeholder involvement due to the different state structure compared to the situation after the devolution process, which has been a transformation process of governmental responsibilities and the making and early transposition and enforcement.

131 Since more than 80% of the waste was going to landfills at that time, the targets vis-à-vis biodegradable waste could be postponed by 4 years. 132 See: EU Ministers reached consensus on draft Landfill directive, United Kingdom Environment News, February 1. 1998. 133 See: Waste Policy and the Landfill directive: Government Response to the House of Common’s Environment, Food and Rural Affairs Committee Fourth Report of Session 2004-2005 (HC 102), p.6.

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Moreover it is important to stress that the Scottish Government, the Welsh Assembly and the Northern Ireland Executive did not exist at the time of the preparation and negotiation of the Landfill Directive. According to DEFRA, the Department for Environment, Food and Rural Affairs of the UK Ministry for the Environment, at present, local and regional authorities are now consulted to a greater extent during the pre-legislative and legislative phases. Their concerns and suggestions are included in the negotiating position. As far as possible, they are also informed of the way negotiations proceed in the EU Council. This has been also confirmed by the regional officials interviewed. The transposition phase England In England and Wales, the directive was transposed by the Landfill Regulations of 2002 134 . Amendments were made by the Waste Management Regulations of 2006135. Respective regional legislation was adopted in Scotland, Wales and Northern Ireland as described below. In addition, other crucial policy instruments to fulfill the requirements of the Landfill Directive in the entire UK are the Waste and Emission Trading Act of 13 November 2003 and the Landfill Allowance Trading Scheme. This is a unique approach in the EU since no other Member State is working with a trading scheme. Trading allowances first started in England and do not apply to Wales and Northern Ireland. Other pieces of legislation also refer to the objectives of the Directive. In England for instance, the Household Waste Recycling Act (2003) introduced recycling and composting targets. Scotland and Northern Ireland have their own specific provisions. With regard to the transposition process concerning England, according to the UK government, all tiers of local government were consulted on the draft transposing regulations. Moreover, interactions with other Member States took place through the Technical Adaptation Committee meetings, especially in respect to the waste acceptance criteria. There was also input from other organisations with links to other Member States (e.g. on sampling and testing methods). However, complaints were filed with regard to the question of whether the transposition fulfils the Landfill Directive requirements, thus further information was provided to the European Commission at its request on certain issues and on some particular landfill sites. Wales

For Wales, the Directive was transposed jointly with England through the Landfill Regulations 2002 (Statutory Instrument 2002 No. 1559). Amendments were done jointly with England by the Waste Management Regulations 2006 (2006 No. 937). Article 5 of the Landfill Directive was also transposed jointly with the rest of the UK via the Waste and Emission Trading act of 13 November

134 Statutory Instrument 2002 No. 1559. 135 2006 No. 937.

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2003. However, Wales had its own secondary legislation to run its own landfill allowances scheme, with no trading of allowances - the Landfill Allowances Scheme (Wales) Regulations 2004. The UK Waste and Emissions Trading Act (2003) Act established the National Assembly for Wales (now Welsh Assembly Government following the Government of Wales Act 2006) as the Allocating Authority for the landfill allowance scheme in Wales, with the Environment Agency for England and Wales as the Monitoring Authority in Wales. To ensure that Wales does not exceed its part of the UK’s target, the Welsh Assembly Government has allocated annual biodegradable municipal waste landfill allowances to each Welsh local authority until the 2019/2020 financial year. According to this Government, the Welsh Local Government Association, individual local authorities, the Environment Agency and other key stakeholders were extensively consulted at all stages during the development and implementation of the Landfill Allowances Scheme for Wales. Given the role of the Environment Agency as the Monitoring Authority for both England and Wales, and the use of a common data recording system and mass balance calculation to determine compliance with the respective regulations, the Assembly Government works closely with Defra to ensure common definitions of municipal waste and the production of common guidance for local authorities. At all stages Welsh local government is consulted closely.

Scotland The Scottish government is responsible for transposing the Landfill Directive into its own legislation. In 2003, the Landfill Regulations were adopted. A trading scheme was also introduced by the Landfill Allowance Scheme Regulations of 2005 which came into force in April 2005, which identified the Scottish Environment Protection Agency (SEPA) as the competent monitoring authority. To ensure that Scotland does not exceed its part of the UK’s target, the Scottish government allocated Annual Biodegradable Municipal Waste Landfill Allowances to each Scottish local authority until the 2009/2010 financial year136 . Scotland conducts its own consultation process with the local level. Thus according to the Scottish government, SEPA as well as other stakeholders at all levels in Scotland were consulted during the transposition process of the different pieces of legislation. Northern Ireland In Northern Ireland, the Landfill Directive was transposed into its own legislation through the Northern Ireland Landfill Regulation of 2003. Municipalities and other stakeholders were consulted and training sessions were also organised. According to the expert interviewed within the Department of the Environment (see below) the consultation process with the local level has been well-established over the years.

136 These allowances are set out in Annex B of the Landfill Allowance Scheme Regulations 2005 - Scottish Executive Guidance: March 2007.

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The UK Waste and Emissions Trading Act (2003) made the Department of the Environment in Northern Ireland the allocating authority for the landfill allowance scheme referred to as the Northern Ireland Landfill Allowances Scheme. As the allocating authority, the Department of the Environment is responsible for: allocating allowances, monitoring and reporting these allowances, delegating powers and responsibilities in relation to waste disposal authorities and landfill operators and developing a strategy for reducing the amount of waste that goes to landfill. In 2006, the Department of the Environment issued the Allocating Authority Guidance for district councils, which outlined the functions of the allocating authority and defined “collected municipal waste” and “commercial waste”. A revised version was published in 2009. The implementation phase Internally, in domestic UK politics, even with longer time frames allowed (four years), the implementation of the Landfill Directive objectives was regarded as a major challenge. It has been no surprise that in the first years after transposition of the Directive, the UK was one of the EU Member States that struggled to reach the first target of the Directive scheduled for 2010, whereas Austria, Denmark, Germany, The Netherlands and Sweden had already met targets beyond 2010 at an earlier stage137. The UK uses the possibility of the Landfill Directive to postpone the attainment of the targets by four years. In order to attain these targets, the waste disposal authorities were allocated allowances for the landfilling of biodegradable waste. The UK government has overall responsibility for landfill diversion (Art. 5), but domestic policies are heavily devolved to Scotland, Wales and Northern Ireland (except national tax measures such as landfill tax). It is interesting to note that Wales met the 2009/10 Article 5 target two years early ie:In 2007/2008. Regional authorities are responsible for regional spatial plans. Municipal waste collection and disposal authorities were devolved to the local government subject to the national regulation. At the end of 2008, the Head of the Environment Agency (an Executive Non-departmental Public Body responsible to the Secretary of State for Environment, Food and Rural Affairs and an Assembly Sponsored Public Body responsible to the National Assembly for Wales) said that it was likely that the UK would meet the 2010 main target for biodegradable waste 138 . However, according to the latter, the 2013 target of a 50% reduction is in doubt, especially due to financial problems. According to the Environment Agency, local authorities need to invest in anaerobic waste digesters which convert biodegradable waste into methane, to improve composting and boost recycling rates in order to reduce the amount of biodegradable waste going to landfill. This

137 See for instance an analysis of the problems in the UK: The Chartered Institutions of Wastes Management (CIWM): Lessons learned from the UK, 2005. 138 See for instance England making good progress according to the figures of DEFRA In 2006/07 11.5 million tones of biodegradable municipal waste went to landfill falling from 13.9 million in 2004/05. See: DEFRA, Key Facts about: Waste and Recycling, Land filling Biodegradable Municipal Waste in England, available on www.defra.gov.org.

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led to a disagreement between the Local Government Association (LGA)139 and the UK government on the amount of funds available140, resulting in a significant increase in the funding required by local authorities for managing waste. DEFRA (the UK Environment Department) stressed that the implementation process was accompanied by Government and Environment Agency guidance on the Landfill Directive. Moreover, UK regional government offices based in Brussels were invited to the Commission’s workshop in June 2008 on the implementation aspects of the Directive. The Directive led to the establishment of a national waste infrastructure delivery programme aimed at facilitating local authority procurement of major waste treatment infrastructure. Indeed, contrary to Sweden, few local authorities own their own waste management company, which resulted in the increased private sector ownership of infrastructure and a general privatisation trend in the waste sector. Moreover, studies show that the planning of waste infrastructure (incinerators) seems to be a major problem in the UK due to data problems and a lack of interaction with local communities. This might explain local resistance in many cases in this specific field141. This was confirmed by the experts interviewed. Action by local authorities to promote increased recycling and provide additional disposal infrastructure is often very controversial and has become the focus of national political debate. Against this background, the UK government provided extensive advice to local authorities on the best means of communication with local population. Another problem was that the re-permitting of landfill sites to meet the Landfill Directive requirements, required operators to publicise their applications, which attracted local opposition from those living nearby landfill sites. Ongoing changes favoured joint work between local authorities and provided them with new powers (e.g. variable charging). Today, the LGA is discussing with DEFRA, and other stakeholders, the possibility of setting-up an infrastructure monitoring group to gauge from the bottom-up, future recycling, composting and residual treatment infrastructure demand and supply.

139 The Local Government Association had already in 2004 noted that “the Government’s Spending Review 2004 did not provide the additional funding which will be needed to deliver Article 5 targets, and the LGA is still extremely concerned that the shortfall in funding remains a significant obstacle to delivery of Government targets.” Quoted from: House of Commons Environment, Food and Rural Affairs Committee, Waste policy and the Landfill Directive, Fourth Report of Session 2004–2005 Report, ordered by The House of Commons to be printed 9 March 2005. 140 Dr. Paul Leinster was quoted by the Telegraph online version of 9. November 2008, Council tax could rise if European Union targets are missed. In the same article Paul Bettison, chairman of the Local Government Association environment board, said that "Councils are pulling out the stops to deliver new technology to deal with waste. But the reality is the Government has hit the council taxpayer with a £1.5 billion bill over the next three years by going back on its undertaking to refund money raised through landfill tax to local authorities. This is cash that could be used to build the facilities that are needed to divert waste away from landfill." 141 See: Ibid,page 53.

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Table: Characteristics of the UK coordination networks for the Landfill Directive

Phase Characteristics assignment Coordinator Members Information Pre-legislative and legislative phase

No network between national/regional/local level/ just before the devolution process

- National officials monitoring - No local/regional impact assessment/ - No strong involvement of regional/local level

Environment Ministry (inter-ministerial)

-Inter-ministerial UK officials

No information for the regional/local level

Transp. Difficult involvement of local level due to changes in the state structure (devolution)

Information/ consultation

- UK Ministry of Environment top down - Regional Environment Ministries top down

National and regional networks for regional transposition

Top-down information , conferences on the effects of the new legislation/ awareness raising

Implement. - EU obligations not in line with - Tradition waste policy/ Regional and local - Decisions dependent on national funds

Implementation in the hands of the Municipalities

Environment Ministry/Agency

No specific implementation teams

Top-down guidance by UK government and in Scotland/ Wales/NI

6 .1.5. Iceland National waste management context It is obvious that the geographic particularities and the very low density of the Icelandic population do not compare with any EU Member State. The assumption is that this could lead to rather different problems and approaches with respect to waste management. Iceland had a waste policy with a focus on rather small municipal landfills and very different problems than for instance many industrialised countries of the EU (for instance NL). Moreover, existent national legislation on landfills was comparatively weak. The new EU Landfill Directive was seen by the Government as an opportunity to trigger a general reform in Iceland.

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The pre-legislative and legislative phases In general, the officials interviewed confirmed that the possibilities to influence the European policy development process in the middle of the 1990s and later during the Council’s negotiations of the Landfill Directive were very limited. Furthermore, the national government hardly had the possibility to actively follow the work of Commission expert committees dealing with draft proposals. According to the Icelandic expert on EU environmental issues, coverage of the committees’ work on the Landfill Directive during the pre-legislative phase was rather weak. At that time, the most important channel for the national government was the involvement of Icelandic experts in the Environment Group (and its subgroups) within the Nordic Council when the EU initiatives in the field of waste and landfills were discussed. Experts say that it is today difficult to assess the actual influence of the Nordic Council at that time. However, it should be noted that the Landfill Directive was still under discussion (1995-1999) when Sweden and Finland had just joined the EU. Thus the possibilities to influence EU policies via the EU members of the Nordic Council were certainly weaker. The local level of government was neither involved in preparing Iceland’s negotiating position nor did it communicate with the Commission or participate in EFTA debates. One explanation given by Icelandic experts was that, in the mid-1990s, the Association of local authorities in Iceland was not actively following dossiers in Brussels and did not have its own office there. Moreover, at that time, EU affairs were not among the association’s priorities. This resulted in a weak coordination mechanism between the national government and the municipalities vis-à-vis the ongoing process in Brussels. It was purely a national involvement with hardly any feedback to the municipal level. The lack of involvement of the municipalities in EU affairs and namely also in the very early phase of the landfill directive was one factor that triggered a reform vis-à-vis local capacities in EU affairs. Today, with regard to environmental matters, local authorities are more involved in preparing Iceland’s position on new legislative proposals at EEA level. However, due to the small size of the local and national administrations, this is less dependent on procedures and institutionalised processes but more on people. Accordingly, coordination between the two layers of government cannot be compared with systems in bigger states with hundreds of experts in one particular policy field. In Iceland, a few officials who have built up expertise in the field of EU waste policy make the difference. It was said that the few experts are very much dependent on their external networks where colleagues from the Nordic countries play an important role. In general, the capacity is today regarded as being much better than when the Landfill Directive was initially discussed and transposed. It was stated by national and local officials that municipalities have very much improved their EU expertise and capacity to be a partner in the monitoring and lobbying processes. For instance, the Association of Icelandic Local Authorities has been operating more actively in different European and International networks since 2006 through its own office in Brussels. The most important network, as already mentioned, is CEMR (by seeking influence on legislative outcomes mainly through the European Parliament, also representing a first-hand information provider shared amongst the partners, and permitting access to sources of the EU institutions). Today, the other important networks for the municipal actors in the field of waste are: the International Solid Waste Association (a useful network vis-à-vis EU legislative developments), the European Federation of Waste Management and Environmental Services, and the European Waste Industry Association.

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The transposition phase In order to transpose the Landfill Directive142 into Icelandic law, a commission was created by the Ministry of the Environment. One member of this commission was a representative of the Icelandic Association of Local Authorities. This commission consulted various actors in the waste management field. The commission finished its work with the proposal of a central law. With Law no. 55/2003 on waste management, the Landfill Directive was transposed into Icelandic legislation on 7 April 2003. The objective of the Law is to decrease the quantity of waste by preventing the generation of waste, increasing recycling and reducing the quantity of waste deposited in landfills143. Based on Law no. 55/2003, the following three new regulations were issued to implement the Landfill Directive (1999/31/EC), as well as the Incineration Directive (2000/76/EC):

- Regulation no. 737/2003 on treatment of waste; - Regulation no. 738/2003 on landfill of waste; - Regulation no. 739/2003 on incineration of waste.

During the transposition phase of the Directive, the EFTA Surveillance Authority sent a reminder letter to the Ministry of the Environment with respect to national transposition. This had no consequences since the transposition process went on according to plan only with a short delay. From today’s perspective, the transposition is regarded as a major reform of the Icelandic government’s landfill policy, which explains to some extent the delay. The transposition exercise was described by national and local experts as strictly in line with the text of the directive. The Government (and Parliament) has neither done a “gold plating” exercise, going much further than Community standards, nor has it tried to make use of the full flexibility of the directive. The strict transposition is only partly due to the requirements of the directive. However, greater flexibility would have been possible, as argued several experts. Moreover, there was not really a common understanding between the Government and the municipal level. Practitioners from the municipal level today doubt whether the EU approach focuses on reducing the amount of waste going to landfills is in-line with the very peculiar situation

142 In the field of environment, EFTA States follow the cooperation on “flanking and horizontal policies” of Chapter I to V from Annex XX of the EEA Agreement. 143 The main objectives are to reduce the total weight of organic household waste to be land filled by 25per cent by no later than 1 January 2009, by 50 per cent by no later than 30June 2013, and by 65 per cent by no later than 30 June 2020, to reduce the total weight of other organic waste, such as biodegradable organic waste to be land filled, by 25 per cent by no later than 1 January 2009, by 50 per cent by no later than 30 June 2013 and by 65 per cent by no later than 30 June 2020 and to recover packaging waste by between 50 per cent as a minimum and 65 per cent as a maximum by weight, to recycle between 25 per cent as a minimum and 45 per cent as a maximum by weight of the totality of packaging materials contained in packaging waste, with a minimum of 15 per cent by weight for each packaging material, all on a yearly basis. Source: Waste Management in Island, edited by the Environment Agency of Island, 2006.

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in Iceland144. In the Ministry, it was said that at that time, the Government wanted to do things “right”. Therefore, following the line of the directive was also to some extent the consequence of a very cautious approach, in addition to the time pressure to finalise the transposition exercise. The implementation phase As mentioned before, in Iceland there is no real political regional level. Therefore, the municipalities are the first counterpart of Government in discussing national and EU legislation. Municipalities also have in a political sense to deal with the consequences and implications of the enforcement of the EU directives. The Landfill Directive is a case in point since there are planning implications in particular for local authorities as well as financial implications that have to be borne by municipal companies. Former waste management requirements were of a rather general nature and thus, transposition entailed extensive changes in Iceland. The Landfill Directive called upon local authorities to create their own waste management plans. Several meetings between the national and the local level have been held in order to clarify this new aspect. Besides, no special local administrative body had to be created for these waste management plans. The involvement of local population or other stakeholders was not necessary since it was not required by the directive. However, all landfills are subject to environmental impact assessment. This requires both the local population living in the vicinity of the landfill as well as other stakeholders to be involved in the planning and building processes. The financing of the various changes in waste management was one of the major concerns of the Icelandic local authorities. As the first stages of major investments in new waste management solutions are just ahead, financing will become a very important problem. So far, no reallocation of funds has taken place for this task. Today, some experts consider that the content of the Icelandic policy reform was formulated in Brussels without a national master plan. In this sense, a more proactive approach was difficult and apparently a more adapted Landfill Directive for Iceland was not a political priority at that time. This is indicated by the fact that the Landfill Directive was simply incorporated into the EEA agreement without any derogation for Iceland145.

144 Since there is no paper industry in Iceland, there is for instance the need to ship paper for recycling purposes thousands of kilometres (example given by an expert). 145 The Landfill Directive can be found in the Annex XX under the heading Environment, point 32d. {196} 399 L 0031: Council Directive 1999/31/EC of 26 April 1999 on the landfill of waste (OJ L 182, 16.7.1999, p. 1).

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Table: Characteristics of the Icelandic coordination networks for the Landfill Directive

Phase Characteristics assignment Coordinator Members Information Pre-legislative and Legislative phase

- No clear network - National level involvement only via Nordic Council - Low capacity at municipal level

No Impact assessment New Commission proposal

Environment Ministry

National officials

- Ad hoc information - Top-down lead ministry - No capacity at the local level to monitor developments in Brussels

Transp. - No exemptions in the EEA agreements - No multilevel network - Time pressure - Strong political will to comply

Responsibility for the transposition in the hands of environment ministry

Environment ministry Normal legislative procedure with stakeholder involvement

No nomination of network members

Ad hoc information Top-down Local level dependent on national information policy

Implement. Network: Meetings between national and local level mainly on waste plans

Environment ministry

Small number of individuals due to the size of the country

After 2006: Start of capacity building of local level in Brussels, with own information channels

6 .1.6. Norway The principal legislative frameworks for handling waste are the Pollution Control Act (1981) and the Product Control Act (1976). The general lines for waste management are designed by the central government. Municipalities have primary responsibility for household waste, while industrial waste is the responsibility of the industry that generates it. Since the 1 July 2009, a general landfill ban exists for biodegradable waste. The pre-legislative and legislative phases The EEA Agreement ensures that EFTA States access Commission preparatory works and expert hearings preceding new EU legislation (only for comitology procedure). These works are generally conducted by state officers. According to a representative of Waste Management Norway, an umbrella organization covering 90 municipal or inter-municipal solid waste organizations (95% of Norwegian municipalities), local and regional authorities as well as stakeholders were neither informed nor consulted about the

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proposed Landfill Directive. In Norway, experts interviewed on the Landfill Directive were not aware of any impact assessment on the directive. Nowadays, and according to our interviews, it seems that the situation has improved. Informal meetings take place on a regular basis so that the relevant stakeholders can be informed and give their opinion. During these meetings, the Ministry remarked that the issue of Norwegian sub-national tier involvement in the EU legislative process is connected to the issue of national hearings and consultations within Norway. If legislative acts are not viewed as especially problematic or in line with Norwegian policies, the Ministry will not play a very active role. As a result, local and regional consultations will not be considered a priority. As a general rule, however, the Ministry normally organizes an open hearing with the relevant players. Contrasting with this, and although Waste Management Norway agrees that they are now better informed and involved, they feel that the issues raised during these consultations are often not taken up by the Ministry. Nowadays, Waste Management Norway is better and earlier informed about new developments thanks to its membership in European networks such as Municipal Waste Europe and the European Federation of Waste Management and Environmental Services (FEAD). Regarding national networks, regional and local authorities use umbrella and sector organisations at European level to get early information. Many Norwegian regional and local authorities are members of the European organisations participating in the structured dialogue146 held between the CoR and members of the Commission on annual and sectoral basis. In addition, the Norwegian Association of Local and Regional Authorities (KS), founded in 1972 has as its mission to “advocate the interests of its members towards central government, the Parliament, labour organisations and other organisations” and “conduct the central and collective bargaining on behalf of its members”. KS Brussels is responsible for raising their interests with the CEMR, the CEEP (the European Centre of Employers and Enterprises providing Public Services) and the EFTA consultative committee147. Together with KS, which embraces a broad range of issues, other organisations such as Waste Management Norway cover more specific topics. The transposition phase Norway transposed the directive by Regulation no. 375 of 21 March 2002 relating to deposition of waste. This regulation is part of a framework of different regulations relating to the recycling of waste (waste regulations) that entered into force in 2004. The landfill part is laid down in chapter 10, underlining especially:

146 CEMR (Council of European Municipalities and Regions); AER (Assembly of European Regions); EUROCITIES; CPMR (Conference of Peripheral Maritime Regions)... 147See www.ks.no.

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- Municipal responsibility for household waste; - Business and industry responsibility for dealing with the waste they generate, including the

collection and appropriate treatment of certain types of waste products, such as packaging, cars, tyres, batteries, lubricant oil and PCB-windows;

- Tax on the final disposal of waste (landfilling and incineration); - Waste management plans as a mandatory element of all building projects, as part of

municipal administrative procedures; - From 1 July 2009, the landfilling of biodegradable waste will be prohibited.

According to the Ministry for the Environment, guidance manuals and fact sheets were distributed to inform the relevant stakeholders of the content and the consequences of the new legislation. Moreover, the Norwegian Pollution Control Authority (SFT) held conferences and seminars on the topic. Waste Management Norway, however, points out that actual consultation with relevant stakeholders was very low, and that they were not really involved in the transposition process. The implementation phase As in Sweden, the main responsibility for the management of household waste is with the municipalities, while industry is responsible for its own waste. The central government sets out a legal framework within which the municipalities can operate and under which they are free to choose their methods for the handling of waste. With regard to landfill, Norway introduced a ban on the landfilling of easily degradable organic waste, which came into force in 2001, and has this year introduced a ban on biodegradable waste. Figures from the Environment Agency show that waste recovery increased by 69 per cent between 1995 and 2007, while the amount going to landfills declined by 31 per cent, meaning that Norway had met the target and will also meet future targets, since land filling of biodegradable waste will be prohibited from 2009 onwards. Concerning this aspect, the Norwegian government, like some EU Member States, is going beyond the standards of the directive in order to enforce a policy in line with their country’s situation. It would be inappropriate to call it ‘gold plating’ since especially for a non-EU Member State it is an advantage to have the flexibility to set higher standards, as is also laid down in Articles 175 and 176 TEC in the EC environment chapter. In fact, the general philosophy of the Norwegian waste management policy in the past was in line with the objectives of the directive. The enforcement of this policy is a challenge for municipalities in Norway, as the central government sets the general framework, leaving municipalities and industry with a relatively free hand to design local collection and treatment solutions.

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Table: Characteristics of the Norwegian coordination networks for the Landfill Directive

Phase Characteristics assignment Coordinator Members Information Pre-legislative and Legislative phase

No network between national/regional/local level

- National officials monitoring - No local/regional impact assessment

- - No information for the regional/local level

Transp. Weak involvement of regional/local level

Information/ consultation

Ministry of Environment top-down

No clear nomination

Top-down information , conferences on the consequences of the new legislation/ awareness raising

Implement. EU obligations in line with general national philosophy Regional and local autonomous decisions

Implementation in the hands of the Municipalities

Inter-municipal networks/ Environment Ministry/Agency

National networks waste management

Mutual information between the levels

Conclusion In this part we have analyzed the different phases of the Landfill Directive legislative developments from the preparatory works to the approval of the final legal act (pre-legislative and legislative phases), as well as the transposition and implementation phases. The diverse situation in the field is remarkable for the EU Member States. Focusing on the countries of our study, while NL and SE were in the block of the “green” countries aiming at a more progressive landfill policy for Europe in the 1990´s, the UK was negotiating for a less demanding directive, with more flexible targets and timetables, and FR was facing a situation of a high number of illegal landfills and delayed transposition that caused reactions on the part of the Commission. The success of the EU legislative process seems to rely on the countries concerned: their domestic policies, their priority policies and their internal organisation and institutional coordination mechanisms. The extent to which local and regional authorities will be involved in this process may depend on this. The influence of regional and local actors on the pre-legislative and legislative phases was very difficult to assess with hindsight due to lack of information and figures and it was not possible to trace back officials at the regional and local level who were dealing with the dossier 15-20 years (pre-legislative) or 11-12 years ago (legislative). What seems to be the case for all the Member States of the study is that regional and local involvement was considered to be weak at the time, even if the legislative phase shows a comparatively more significant sub-national involvement, but with major differences between countries. However in certain countries studied, disagreements arose between local and regional authorities and the central government at this stage of the

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legislative process. After intense legislative activity at the EU level in the environmental field around the year 2000, Member States were very aware of their deficiencies in this respect and started to built up capacity at lower levels in order to better cope with the pre-legislative and legislative phases. Therefore, the environmental discussions and challenges at that time permitted internal reflection, debate or reform that favoured the participation of local and regional authorities on the EU legislative process. Reinforced regional and local capacity for monitoring the early processes in Brussels has for instance been one of the major innovations. Already in the 1990s, the involvement/consultation of local and regional authorities seemed to be somewhat better during the transposition phase than the previous ones, which varied according to the country studied. Moreover, most governments developed guidance and provided advice to local and regional authorities, which in all countries are those who bear the main responsibility for the implementation of the national legislation transposing the EU Landfill Directive. However, the main challenge for most of them is to set up the appropriate infrastructure to respond to the directive’s requirements/targets, but the issue of lack of proper information/communication, available resources and finances was strongly underlined. 6.2. THE 2004/18/EC PUBLIC PROCUREMENT DIRECTIVE Since the adoption of the Green Paper in 1996, the aim to modernize public contracts aiming at a more efficient use of public expenditure, took, as in the case of Landfill Directive, almost a decade to materialize. The adoption of the Green Paper opened up a four-month period of consultation for European stakeholders. Interested parties such as the European Parliament, the Committee of the Regions, the European Economic and Social Committee and other suppliers and contracting authorities’ associations had their chance to express their views on the new Commission proposal initiated by Mr. Monti. The main Green Paper concerns were the interoperability and the facilitation of cross-border procurement exchanges stimulating competition; the shape of procurement policies such as environmental and social criteria and their compatibility of Member States’ markets. The CoR drafted its opinion in June 1997, only after the ESC had issued its own in May that year. The main points of concern were the low thresholds, which hindered flexibility for minor contracts. It also welcomed the innovative idea of adding environmental and social criteria in the awarding of contracts when they do not lead to unequal treatment of bidders. Views were expressed with regard to the inter-municipal agreements and the autonomy of regional and local entities to contract their own entities with no need to procure.

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Taking onboard some of the input from this consultation, the Commission drafted the Proposal for a Directive on Public Procurement148 in May 2000. Five months later, the Committee of the Regions, acting as optional consultative body at that time, issued its opinion, again stressing its previous assertions in the Green Paper. Member States inputs were not especially critical as they were keen that the former directives be merged into one, with there being no particular concerns about implementation obstacles. Even when regional and local associations expressed their views on certain topics (SALAR in Sweden), these were not heard either at national or EU level. For example, the Council of European Municipalities and Regions (CEMR) put forward detailed amendments to the proposed legislative package on public procurement. The main amendments had to do with strengthening environmental considerations in public procurement, incorporating social matters into public procurement contracts, defining framework contracts, introducing higher thresholds for European public procurement as well as more flexibility in the implementation of time limits and assisting SMEs and micro enterprises in acquiring public procurement contracts. The Council of European Municipalities and Regions also asked in its address to the European Commission to amend the concept Directive in such a way that procurement by contracting authorities from inter-municipal associations (e.g. a consortium established for waste proposal) is excluded from the scope of the new Directive. Also a transition period should be foreseen for procurement from companies established by a contracting authority, by a number of contracting authorities acting together, by a contracting authority in conjunction with a private partners (a joint venture company), or by former managers or employees of a contracting authority (e.g. management or employee buy-outs).149 Two years later CEMR also tried to influence with amendments the second reading of the European Parliament about public procurement package.150 Furthermore, using soft law to regulate very important aspects of the Directive is another important shortcoming: is not possible to foresee the institutional impact of soft law. In addition, at that time there was no obligation to carry out financial and institutional impact assessments, making it impossible to foresee some of the resulting effects of the new legislative package at regional and local level. 6.2.1. France Pre-legislative and Legislative Phase According to central government experts and representatives of local authority associations, there is no trace of LRA consultation in the pre-legislative and legislative phases of the PP Directive. Before 2004 there was no pro-active involvement of the local authority associations in the pre-

148 COM (2000) 275 149 CCRE/CEMR, Summary of the CEMR detailed amendments to the proposed legislative package on public procurement, April 2001. 150 CCRE/CEMR, Public Procurement Legislative Package: Local Government position in view of the Parliament-Council Conciliation, 20 August 2003.

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legislative or pre-pipeline stage of upcoming European legislation. Since 2004, central government and LRAs have become more aware of the importance of involvement in the early stages of upcoming legislation. Since 2007, the better cooperation between the Secrétariat Général des Affaires Européennes and the LRA associations and the responsibility of the ‘chef de file’ for the upcoming legislation is improving the involvement of LRAs. In general, the cooperation and coordination is rather informal The transposition phase In general there is in France no debate about the transposition of EU legislation. Sometimes, a European proposal of legislation gets wide coverage in the media (e.g. Bolkenstein Directive on Services and the Reach Directive). But these are just exceptions. Until 2004, France had a history of significant transposition delays. On 30 September 2000, France had 176 directives to be transposed, 136 of which were delayed. From 1998 several measures were undertaken to improve this situation which proved to be insufficient151. However, the situation has improved since 2004 due to the special actions of the Prime Minister152, the coordinating role of the Secrétariat Général des Affaires Européennes, and the change of culture in all public authorities who have become more aware of the importance of European directives and their upcoming transposition. The public procurement EU Directives nr. 2004-17/CE and 2004/18/CE have been transposed in France through the following texts:

− French Public Procurement Code (CMP or Code des Marchés Publics) – decree nr. 2006-975 of 1 August 2006. It applies to public contracts awarded by the central government, by its public bodies other than those with and industrial or commercial character, by territorial authorities and their public institutions. It also applies to contracts awarded in the form of mandates given by one of these public authorities, and to purchasing centres. It also covers contracts initiated by the above entities in the utilities sector.

− Ordinance nr. 2005-649 of 6 June 2005. It applies to some other entities that do not fall within the scope of the French public procurement code, but which must nevertheless observe publication and competition requirements settled by EU directives. It concerns for instance: certain industrial and commercial public bodies

151 Bienvenue au Sénat, La transposition des directives communautaires. 152 Journal Officiel de la Republique Française, Premier Ministre, Circulaire du 27 septembre 2004 relatieve à la procédure de transposition en droit interne des directives et décisions-cadres négociées dans le cadre des institutions européennes, 2 octrobre 2004.

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(e.g. Electricité de France, SNCF) and public interest groups, certain associations, as well as the Banque de France153.

The French Government has organised by internet a consultation among the citizens about the transposition of the Public Procurement Directive. The text of the new ‘Code des Marches Publics’ could be commented by each citizen. In the transposition phase, the level of formal consultations with LRAs was limited. Cooperation between LRAs and the Secrétariat Général des Affaires Européennes has considerably improved since 2004. Also, the different ministries have become more aware of the importance of cooperation with the LRAs. The same level of cooperation has not yet been realised in the pre-legislative phase. One of the problems highlighted by the French experts is that the knowledge, expertise and capacity of LRAs are limited to play an important role in the pre-legislative and legislative phase. The need to increase the involvement of territorial authorities can only be realised when means are made available to LRAs in terms of knowledge, expertise and capacity. Otherwise, this need for the greater participation of LRAs in the involvement of European legislation remains a dead letter. One of the problems in the transposition phase had to do with the legal concepts used in the European legislation which do not exist in French law. This was for example the case of ‘awarding entity of a contract’. Another problem is that the legal philosophy on which European legislation is based differs from the legal philosophy underlying French law. This is in particular the case for public procurement. In French law it was common to describe in detail the public procurement practices. In European law certain principles are to be respected (e.g. transparency, fair competition) without mentioning the means. If there is a legal dispute, the awarding authority has to prove before the court that he has respected those principles. The implementation phase For practitioners at local and regional level the implementation of the Public Procurement Directive is everything but easy. Therefore court rulings are needed to set up common practices and definitions. This is also due to the large number of LRAs in France and the legal tradition which gives detailed descriptions of the new practices needed. In the past France had conspicuous difficulties in public procurement of infrastructure projects. Ranging from economic issues (such as Orlyval and Eurotunnel) to issues surrounding the validity of the concession award (such as the Stade the France and the Lyon ringroad).154 Public authorities become more and more aware that fair competition and transparency are important and measures have been taken to improve the public procurement practice. To improve the transposition and implementation of European Directives de Conseil d’État recommends to anticipate, to adapt and to simplify European legislation and normalisation. Better

153 http://www.minefi.gouv.fr/themes/marchespublics/index.htm 154 Linklaters, PPP in France 2006, p. 3 and 4.

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anticipation means greater involvement in the pre-legislative phase of European legislation. Better adaptation means better cooperation between the different organisations and levels of government in transposing the European legislation. And simplifying means better translation into national norms and better consultation and cooperation with all players involved.155 The economic observatory of public procurement, created in 2005, makes it possible to follow the implementation of the Code des Marchés Publics. This observatory provides synthesized information for buyers and economic actors. In 2005 almost 200,000 contracts are inventoried with a total amount of € 52,740 billion of which 35% for works, 38% for goods and 27% for services. The LRA’s are the most important public buyer accounting for almost 68% of the total amount of public procurement.156 There are different thematic network groups of LRA´s in the field of public procurement. For example, nine networks of public procurement and sustainable development guided by the association of Eco Maires and with the support of ADEME), the network of ethical public procurement stimulated by the Cités Unies France, and an European Network ‘Buy it Green’ (BIG Net) stimulated by ICLEI and the programme Procura + to improve public procurement.157 There are also professional associations of public buyers, such as the association of buyers from territorial and local communities.158 6.2.2. The Netherlands National public procurement context In The Netherlands, there has been a growing interest in public procurement since 1999 when the discussion paper ‘Haal Pegels uit die Regels’ was published by the Ministry of Economic Affairs, which concluded that compliance with European public procurement legislation could still be improved. In the same year, the Parliament set up an Action Plan for Public Procurement (Actieplan Professioneel Inkopen en Aanbesteden – PIA) in order to encourage ministries to professionalize the public procurement practices of the (central) government159. This Action Plan was officially launched in 2001 and ended in 2006.

155 Conseil d’État, Pour une meilleure insertation des normes communautaires dans le droit national, Etudes du Conseil d’Etat, Paris, 2007. 156 Ministère de l’Écologie, de l´Energie, du Développement durable et de la Mer, Plan national d’action pour des achats public durables, p. 23. 157 Ministère de l’Ecologie, de l´Energie, du Développement durable et de la Mer, Plan national d’action pour des achats public durables, p. 21, 22. 158 Association des acheteurs des collectivités territoriales (AACT). 159 Bureau Bartels (2006). Meer Waarde met PIA. Evaluatie Project Professioneel Inkopen en Aanbesteden (PIA)

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In 2005 the new European public procurement regulations (2004/17 & 2004/18) were fully implemented in The Netherlands. They were transposed on a one-for-one basis in order to improve the recognisability and applicability of the procurement regulations. The options the European regulations offered in terms of flexibility and increased electronic procurement possibilities were fully incorporated. Although The Netherlands had been expecting the new legislation to increase compliance with the European procurement rules, this was marginal as compliance remained limited between 2000 and 2002160. The European Commission also indicated that The Netherlands scored below average when it came to the instances of procurement according to the European rules161. The pre-legislative and legislative phases In the case of public procurement, there is a lack of information on the participation of regional and local authorities during the pre-legislative phase. It appears very difficult to track down the people who were involved in the directive before 2004, since there is neither follow-up of sub-state intervention nor are we aware of any other contribution to the Green Paper. However, considering the limited involvement of local government in the legislative phase, one could expect their commitment to the pre-legislative phase to have been relatively small. In the legislative phase, the Association of Netherlands Municipalities prepared its reaction to the European Commission’s proposal within the national Public Procurement Committee (Ambtelijke Commissie Inkoop & Aanbesteden), which was sent to the Association’s Managerial Board (Bestuurlijke Commissie). Approximately fifty municipalities were involved in this process, through this committee. However, most of them were not very active in Brussels themselves162. The Association of the Dutch Provinces (IPO), did not have a very active role during the pre-legislative debates on public procurement163. Unlike the Association of Netherlands Municipalities, it did not publish its own reaction to the proposals. The transposition phase PP Directives 2004/17/EC and 2004/18/EC were transposed into Dutch legislation through two national decrees 164 (Acts of Government) in 2005. The first decree (called BAO) concerns the procurement of goods and services in general, while the second decree (called BASS) contains

160 Brinkhorst, L.J. (2004). Brief van de Minister van Economische Zaken. Aanbestedingsbeleid. Tweede Kamer, Vergaderjaar 2003-2004, 29 709, No. 1 161 European Commission (2001). European Indicators on Public Procurement. In: Brinkhorst, L.J.(2004) 162 Says Ann-Marie Kühler, senior legal advisor at ‘Europa Decentraal’. This is confirmed by Mr. Habets, head of the Public Procurement Office of the City of Utrecht and Mr. Lubbers, public procurement advisor at the Municipality of Groningen. 163 Says Ann-Marie Kühler, senior legal advisor at ‘Europa Decentraal 164 Namely Besluit aanbestedingsregels voor overheidsopdrachten, BAO (Public Contracts Tendering Rules) and Besluit aanbestedingen speciale sectoren, BASS (Tendering Special Sectors Decree).

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regulations for specific sectors, such as water and energy provision, transport and postal services. The Netherlands is one of the few Member States that transposed the directive on time. The transposition of the Directives took about a year following its approval, which, considering that the decrees had to be discussed by the Council of State (Raad van State) and the Dutch Parliament, and that the European Commission had to be notified, is relatively quick.165 In line with the goals of the directives – towards more flexible, modern, transparent and simplified procurement – The Netherlands adapted new EU legislation through non-statutory instruments rather literally. The Dutch decrees can be considered as copies of the EU public procurement directives166. No further specific national rule or guideline was added to this EU framework. A new framework law was drafted by the Dutch Parliament (the Lower House) in 2007 (the Aanbestedingswet), but rejected by the Upper House in July 2008. It was intended to introduce new requirements regarding companies’ integrity and renewed eligibility clauses, the implementation of electronic means reducing paperwork and the harmonisation of policies applicable to public contracts under and above the European thresholds. However, the main concerns about the new legislation expressed by the Upper House were its complexity and lack of clarity, overt administrative burdens and the fact that the law would not lead to better procurement practices or innovation in public procurement. The local level is becoming increasingly active when it comes to public procurement legislation. According to Ann-Marie Kühler167, municipalities are speaking up more today and becoming more independent. The implementation phase Once procurement rules are transposed at the national level, they are meant to be applied by different government levels and public actors, such as local entities. Several bodies have been set up to promote the uniform application of the public procurement legislation. PIA, the Dutch Government Procurement Organization, was set up in 2000 as a governmental organization168 aimed at improving public procurement practices at ministerial and local level. This body was re-lauched in 2006 as PIANOo, which was created for another period of at least 5 years. This organization was also meant to improve the compliance with the new PP Directive, delivering knowledge, information and experience to procurement officers. PIANOo has recently been

165 Opinion given by Thomas van Doorn working for the Ministry of Economic Affairs. 166 Hebly, J. M. & Wilman, F. G. (2009) ¨Netherlands¨ In: The International Comparative Legal Guide to Public Procurement 2009. Global legal Group 167 Ann-Marie Kühler, senior legal advisor at Europa Decentraal 168 Information provided during the interview with Manon van ‘t Wout, member of the Dutch Ministry of Interior, 20th January 2009.

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evaluated and favourable opinions have been expressed since its services are appreciated by end users. The Ministry of Economic Affairs wants PIANOo to become the most important knowledge centre for public procurement in the Netherlands169. The setting up in 2006 of a Directorate for Government Procurement (Regiebureau Inkoop Rijksoverheid) by the Ministry of Economic Affairs, aiming at the training on procurement practices among the Dutch officials, can be regarded as another institutional impact of the PP Directive. This body does not have any links to local or regional governments. In addition, the ‘Kenniscentrum Europa Decentraal’, a knowledge centre for local/regional governments which plays an important role at sub-national level was founded in 2002 as an informative body on European legal issues, including public procurement170. All tenders are now published on the “procurement calendar” (aanbestedingskalender). From 2009 onwards a new website “TenderNed” will be used to announce tenders. This new website will form the basis of a new system for e-procurement in the Netherlands. For local and regional governments, the implementation of the new decrees was relatively unproblematic, as they were very similar to the past Dutch legislation in this area. In 2006, 39,170 tenders were procured according to European legislation by Dutch governmental bodies. In comparison to 2004, this was a 51% increase. According to a study conducted by SIRA consulting, this increase can be explained by:

- The increased professionalization of public procurement; - An increase in the average purchasing value (opdrachtwaarde) because of cooperation in

the field of procurement and mergers of local governments and water boards; - The increased attention of accountants on whether European procurement legislation is

applied by public bodies. In 2004 the ‘rechtmatigheidstoets’ (legitimacy check) for accountants working for municipalities and provinces was introduced.

The Dutch Ministry of Economic Affairs recently 171 evaluated The Netherlands’ compliance with European public procurement rules in 2006. Therefore an ex post evaluation has been made in order to check the functioning of the directive. A similar study was also been conducted in 2002 and 2004, enabling a compliance comparison to be made between these different time frames. The study looked both at the amount of purchasing and purchasing by packages172 that should have been secured through European procurement procedures.

169 Dutch Ministry of Economic Affairs, 2008 170 www.europadecentraal.nl. 171 November 2008 172 Personnel related affairs; office design & supplies; automation, computerization & telecommunication; advisors & flexible employment; transport, packaging & insurance; purchasing & rental costs of buildings and installations; exploitation & management of buildings and installations; ground, road & water construction; health; social & welfare work; medical care, laboratory & technical assistance.

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Every year, governmental bodies (the national government, provinces, municipalities and water boards) spend more than 40 billion Euros on the purchase of goods, ‘works’ and services (Senter Novem). Table: Percentages of compliance with European public procurement regulations in The Netherlands 2006

Sector Compliance by volume

Compliance by packages

Core departments 78% 78% Municipalities (>100.000 inh.) 73% 55% Municipalities (50.000-100.000 inh.) 56% 34% Municipalities (20.000 – 50.000 inh.) 33% 21% Municipalities (10.000 – 20.000 inh.) 27% 21% Municipalities (<10.000 inh.) 24% 19% Provinces 90% 60% Water boards 66% 32% Academic hospitals 57% 50% Universities of applied sciences 33% 23% Universities 50% 40% Police regions 64% 47%

Source: Ministry of Economic Affairs November 2008 In 2006, the national government publicly procured 78 percent of all orders. In 2004 this was 74 percent. Local governments with fewer than 10,000 inhabitants publicly procured 19 percent of their orders as opposed to zero percent in 2004. The figure for local governments with more than 100,000 inhabitants the percentage is 55 percent, in comparison to 46 percent in 2004. Academic hospitals and universities have experienced declining public procurement numbers figures, from 57 to 50 percent and 43 to 40 percent respectively (Ministry of Economic Affairs). Since 2002, compliance with public procurement rules on purchasing volume has improved in most sectors, and particularly among the provinces, water boards and a large amount of Dutch municipalities. Generally speaking, public bodies have increasingly followed public procurement procedures. However, there are still certain concerns that are often heard in relation to public procurement rules in The Netherlands. Awarding authorities have to deal with European Directives, regulations, jurisprudence, public law, civil law and the BAO and BASS decrees, which make public procurement a highly complicated procedure requiring specific (legal) skills. The reason for poor compliance with public procurement rules might therefore lie in the complexity of the existing rules.

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According to our findings, purchasing authorities in The Netherlands frequently investigate how they can legally purchase goods and services without having to apply the European procurement procedures173 . Public bodies often lack this skill. They do not view procurement professionalism as a necessity. Rather they consider public procurement to be a complex and time-consuming procedure that outweighs the (potential) benefits. Critics say that public procurement is not an issue that receives a lot of political attention in The Netherlands, unless a minister makes a mistake (Van Weele, 2008). The fact is that public procurement procedures may be politically very sensitive (e.g. construction fraud – in Dutch known as ‘bouwfraude’), which causes civil servants and officials to fear failure (Van Weele, 2008). For example, according to Europa Decentraal174, general information on the directives after they had been accepted was rather poor. The Ministry of Economic Affairs normally publishes special blue booklets to inform professionals about new legislation, but they did not do that for the new public procurement regulations. In The Netherlands, the Ministry of Interior and the Ministry of Economic Affairs carry out general studies on the compliance of EU Internal Market rules every few years, however there is no single authority in charge of regularly monitoring compliance with public procurement rules, and in that sense, the Ministry of Economic Affairs recently decided against setting up a specialized National Public Procurement Authority in the coming years. Furthermore, there are no clear rules that govern non-compliance. These aspects may have contributed to the fact that overall level of non-compliance is still relatively high in The Netherlands. Large government bodies therefore tend to play it safe when it comes to their purchases, meaning that large and consolidated companies are therefore preferred. The result of this behaviour is that large companies tend to take over smaller ones and start dominating the market (Tanghe, 2007). These are exactly the kind of developments the European public procurement regulations were intended to counter. This issue was also addressed by a Member of Parliament175, who filed an official enquiry176 with the Minister of Economic Affairs in September 2008. He asked the minister about the fact that small (architecture) firms seemed to be unable to get access to large orders publicly procured by governmental bodies. In her answer, the minister indicated she is currently exploring the possibilities of improving this particular issue which obstructs the functioning of market forces. However, in April 2009, architects filed an official complaint at the ‘Complaints Office Architects’ Selection (Meldpunt Architectenselectie) about half of the published tenders. They mainly complained about the disproportional demands in relation to turnover and experience and the fact that they often needed an official statement from an accountant, something that is a problem for many architects because they are not legally required to have such a statement readily available at all times177 . It therefore seems that the national government has not yet been able to

173 Tanghe, P. (2007). Europees aanbesteden: onmogelijk, onnodig of…anders…?! MA Thesis Nyenrode Business University, pp. 34 174 Opinion given in an interview by Anne Marie Kuhler, Senior Legal Advisor at “Europa Decentraal” 175 Van der Ham (D66) 176 2 September 2008 177 www.gemeente.nu ‘Architecten klagen over aanbestedingen’, 8 April 2009

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solve these issues. Whether the complaints are due to the European legislation or the Dutch transposition of the legislation also remains unclear. The Complaints Office Architects’ Selection did not have any data available on any possible change in the number of complaints before and after the publication of the 2004 Directives178. PP regulations were also intended to deepen the European internal market, boosting the participation of companies from one Member State to another. However, in The Netherlands the percentage of foreign companies granted an order through a European public procurement procedure is very small – only 0.51% (Tanghe, 2007). Sustainability in public procurement has become an important issue in recent years as well179. In 2005, the Dutch government decided that all central government departments should use sustainability (environmental and social criteria) as a principal criterion in public procurement procedures by 2010. In 2007, the government redefined this aim and stated that provinces and water boards should include sustainability as a criterion in 50 percent of their tenders by 2010. Municipalities need to include sustainability as a public procurement criterion by 2015 (SOMO, 2008). The question remains however as to whether these targets will be met. Sustainable public procurement remains a vague notion. Private companies also question whether sustainable products will not necessarily imply higher prices. This is problematic, because in the end, the price of an order is often the decisive factor for public bodies (MVO Platform, 2008). The Dutch organisation ‘Senter Novem’ has formulated sustainable public procurement criteria, divided into different product groups (e.g. transport, water and hardware) which are available on the organisation’s website 180. These criteria were developed on the basis of public consultation meetings with organisations (e.g. ministries, local government) and individuals involved in the issue of sustainable procurement. In July 2009 the Knowledge Network for Sustainable Procurement was set up to improve sustainable procurement in governmental bodies. The network will officially be launched in September 2009 in Utrecht. 6 .2.3. Sweden National public procurement context The Swedish Public Procurement Act (LOU, SFS 1992:1528) came about as a result of Sweden becoming a member of the EEC and later the EU. The law came into effect on 1 January 1994. Therefore the Swedish rules on PP were based on the EC Directives from the beginning. After the approval of Dir. 18/2004 a new law was drafted which came into effect on 1 January 2008.

178 Telephone conversation with Complaints Office Architects’ Selection on 25 August 2009 179 Several Dutch organisations have devoted attention to this subject (e.g. SOMO, Senter Novem, and MVO Platform). 180 www.senternovem.nl/duurzaaminkopen

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Nevertheless, Swedish procurement rules are perceived by the experts involved in our research as difficult and cumbersome, not very much in line with the legislative tradition of this MS. As an institutional impact of the PP rules, the Swedish Competition Authority has, as of 1 September 2007, taken over the tasks previously assigned to the Public Procurement Board (NOU). NOU was created in 1993 as the monitoring authority on PP issues, with no rights to bring law suits. This inability has been a cause of concern from the beginning: NOU had already pointed out in 1995 in a letter to the Government that new legal recourse was necessary in order to deal more efficiently with the neglect of procurement regulations181: The recently-established Public Procurement Board is made up of experts representing different procurement entities, suppliers and the research community, as a forum for an exchange of experiences. This body is expected to be an important aid in the work of the Swedish Competition authority in monitoring PP. However, effective access to legal recourse is still vital for the Agency to react to the violation of the law182. The need to reinforce the legal recourse for the monitoring authority was proven by the fact that the number of cases when a supplier appeals public procurement decisions in Courts has increased dramatically in recent years. These developments have been analysed in a report of the Swedish Competition Authority183. The pre-legislative and legislative phases The role played by the Swedish municipalities and regions during the pre-legislative and legislative phases was mainly coordinated through their representation in SALAR. Swedish local and regional entities were involved in the preparatory works for the new Public Procurement legislative package from the very beginning. SALAR and county political representatives had already been consulted on the 1996 Green Paper on Public Procurement. They analysed potential implementation options, and some concerns were raised184 in a report sent

181 Extending and reformulating contracts, maintaining expired contracts without competition and the lack of clarity regarding which organisations were procuring entities were mentioned as serious lack of fulfillment of the rules. In “The strategy of the Swedish Competition Authority and its direction for procurement issues” September 2007, to be found in http://www.konkurrensverket.se According to this document, certain municipality owned companies did not regard themselves as procuring entities 182 The Government estimates that the Swedish Competition Authority should be replenished with 5 million Swedish crowns (approximate 500.000 Euro) per year from 2008 for investments aimed at making efficient public procurement and facilitating the participation of small companies in PP. 183 Administrative Court Judgements on Public Procurement, 2007:2. The conclusions of this report show that “the county administrative courts to a great extent judge the same legal matters in a completely different ways and that the judges are scantly motivated. The Swedish Competition Authority has recommended that the government initiate an overview of the Court structure as it pertains to procurements. 184 See chapter 5.3 of this Report

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to local and regional representatives, the Commission and the Swedish Ministry of Finance. Their main warnings centred on the problem of the ban on inter-municipal cooperation, as already explained in chapter 5.3 of this report. Regarding the legislative phase, the national position was prepared by a Reference Group composed of representatives from the Association of Swedish Enterprise, the Swedish Public Procurement Board and SALAR185. There were no formal and systematic meetings between the central government and sub-state entities, but contacts with this Reference Group were made regularly. At central level, and during this phase, contacts were carried out with the Commission and other Nordic countries (DK and FI), as well as BE, NL, AT and UK. Concerning the proposed new PP Directive itself, the provisions most discussed and which raised the greatest interest among local and regional entities were those related to social and environmental criteria, the extension of the new competitive dialogue procedure, the general exclusion of inter-municipal agreements from PP rules and the codification of the Teckal criteria. However, these criteria were ultimately not transposed into the national law186. The transposition phase In contrast to the Dutch choice, the transposition tool chosen by Sweden was an Act of Parliament (Riksdag) adopted on 27 November 2007. The new Law entered into force on 1 January 2008, amending the 1992 Act on Public Procurement 187 . The transposition was delayed due to the specific referral and consultation procedures provided by the Swedish legislative process. The consultative Commission of inquiry started its works quite late as well. Indeed, in the transposition preparatory work, the Government appointed a commission of inquiry in April 2004 (when the transposition deadline had passed), at which representatives from SALAR participated, to analyze what the best transposition technique would be. This commission published a report in March 2005, which the Government referred to state agencies, municipalities, county councils and related organizations. The Government consulted the Council of Legislation (constituted by judges of the Supreme and Supreme Administrative Court) on 24 May 2006, whose points of view were considered in the final draft of the bill. In the first instance, Sweden decided to go beyond the directive’s requirements and applied the rules to contracts below the EU thresholds. Sweden also decided to broaden the scope to health and social care services. But the difficulties encountered in this extensive approach led later on to the watering down of the gold-plating effects.

185 Information provided in the interviews with Swedish experts on the 8th March 2009. 186 The Teckal criteria are explained in chapter 5.3 of this Report 187 The Public Procurement Act (2007:1091) available in English at . http://www.konkurrensverket.se.

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In spring 2007, an Action Plan was established by the Government, by which the Swedish Competition Authority in cooperation with the Environmental Management Council, would produce informational materials about environmental requirements, procurement legislations and legal matters. After the adoption of the Swedish Law transposing the PP Directive, the Government and the Swedish Competition Authority issued some ordinances and guidelines, respectively, delimiting the scope of the rules and promoting a harmonized interpretation within municipalities and councils. There is nowadays a more structured system of consultation with local and regional authorities during the transposition phase in Sweden. The period of public consultations before transposing a given EU directive is followed by informal contacts between politicians and other officials at different levels:

- The matter is examined by an inquiry Commission (composed of experts, officials, politicians and SALAR representatives) which adopts a proposal.

- The Government then drafts a bill proposal, which may be sent to various organizations and public bodies for consideration and to the Council of Legislation for consultation to ensure legality and conformity.

- The bill might be redrafted if necessary and is sent to Riksdag for its adoption, becoming a law if considered appropriate. The Government will issue ordinances and the State Agencies will issue regulations and general advice in order to ensure the proper implementation of the national law.

The implementation phase Cooperation between municipalities is a vital part of the Swedish tradition and it enables them to exchange experiences. This is of major importance within the framework of the PP Directive, since municipalities are in charge of most of the public sector and the greater part of public contracts. However, the entry into force of new PP rules may undermine this mechanism and make it even more complex for smaller municipalities. The new regulation has followed the interpretation of the ECJ and the new legislative package188, and therefore establishes that municipalities have to procure among themselves (with municipalities and municipal companies), which can be regarded as a restriction of local autonomy. Contrary to the new rules, municipalities aim at attaining a broader choice with respect to the economic operators they hire. Thus the “in-house” concept has been highly limited and inter-municipal agreements do not justify the exclusion of procurement rules, giving rise to several misinterpretations and infringements. This somehow reflects a potential lack of adequate training and guidelines provided to the local authorities in these complicated areas.

188 Explained in chapter 5.3 of this Report

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Swedish politicians at county council and municipal level already expressed their concerns when consulted about the green paper and the draft proposal of the EU Directive. SALAR reported that the proposal would involve the need for municipalities to procure with their own companies. The institutional and operational impacts linked to the implementation of EU directives is a topic examined within the Commission of Inquiry report and also discussed in the reference groups. The municipalities furthermore examined how to solve these practical institutional challenges. Despite the delayed transposition of the PP Directive due to internal consultation procedures, no letters have been received from the European Commission regarding poor implementation. However, many cases of infringements of the PP legislation have been brought to national courts. In 2007, 1,500 public procurement cases were received by the administrative courts189. This is of particular concern to the small municipalities due to the prohibition of inter-municipal agreements. In addition, the fact that the Teckal criteria (for in-house contracts) have not yet been transposed into the Swedish Law creates legal uncertainty. Unlike in other Member States (e.g. NL or UK), not all the new (optional) PP procedures were transposed into the Swedish Law. While framework agreements are traditionally widespread and well established in Sweden, the legislator decided not to transpose the negotiated dialogue procedure. On the other hand, Sweden has been one of the most advanced countries regarding the provisions on green PP. Four out of every five public bodies in Sweden have guidelines on considering the environment in the procurement of goods and services190. 6 .2.4. The United Kingdom National public procurement context The new PP Directive was perceived by the UK Government (OGC) as a re-enactment of the existing provisions of old directives, which should not involve any additional risk 191 . They considered the impact of the directive to be limited because:

- Many of the provisions and rules are already in place in the existing directives. - Many of the new provisions are permissive: they allow contracting authorities to choose

whether to make use of them. - Many of the new provisions are best practice and are already being made use of (e.g.

framework agreements and e-auctions)

189 1,100 by the County Administrative Court, 334 by the Administrative Court of Appeal and 100 cases by the Supreme Administrative Court. 190 This is revealed by a survey commissioned by the Swedish Environmental Protection Agency (2007) among 21 county councils, 290 municipalities and 216 government agencies. 191 Office of Government Commerce, Consultation Document, “The approach to implementation of the new Public Sector Procurement Directive” May 2004

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- The requirements of this Directive are on contracting authorities and not on the private sector.

Whilst all this is true in theory, the practice has proven how misleading these considerations might have been: e.g. participating in tenders means that enterprises have to meet certain conditions. While article 51 of the Directive foresees the “possibility” for the Member States to ask for clarification in relation to the certificates that enterprises have to submit, this possibility has unintentionally paved the way for additional requirements at the national level. Another example relates to the last bullet point considered: fulfilling the general information obligations “costs” 5 to 6 hours per company per tender192 . The UK government decided to avoid unnecessary elaboration or any elaboration which risked being at odds with the meaning of the directive. Furthermore, they decided to transpose all new optional provisions to open up the opportunity for stakeholders to use them. After receiving the responses to the consultation process, and based on the results, some elaboration on the choices at hand and their impact was made: a partial assessment drafted by the OGC at the time of transposition determined that the new directive did not impose any additional burdens on purchasers than the previous legislation had. Northern Ireland and Wales decided to implement together with England, while Scotland used its own legislative tool for transposition and therefore launched its own consultation process. The Scottish position was very much in the same line as the UK government position. The pre-legislative and legislative phases As is the case in other countries, no records on sub-national input during the pre-legislative phase have been found, nor does this influence officially exist. The sub-national approach may have been exercised through informal lobbying activity (its offices in Brussels or umbrella associations contacting the Parliament). In the UK, public procurement is a devolved matter, therefore, regions’ concerns must be represented in the Council through the national position, either by sending regional level ministerial delegations to accompany the central level negotiator within Council Working Groups, or by keeping the regions informed through the regular provision of information. Following the Concordat on Coordination of European Policy Issues on PP of 1999, consultations between the Procurement Policy Unit and the Scottish Executive are regularly held to guarantee cooperation. The fact that only the central level will chair negotiations does not exclude Scottish Ministers from implementing the Directive separately, as they actually did.

192 Opinion of the High Level Group of independent stakeholders on administrative burdens, Area of Public Procurement, European Commission, December 2008

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The Office of Government and Commerce (OGC) is an independent body of the British Treasury. It is meant to support the achievement of best value for money and to foster sustainability policies in government expenditure. The OGC therefore deals with economic policies such as public procurement. In order to conform the national position on the PP Directive, the OGC held wide consultations with stakeholders and sub-national level representatives, including the Scottish Executive, the Welsh Assembly Government, Northern Ireland and heads of Procurement in other departments”193 . No records have been found of these informal contacts, the concerns these entities had at that time or whether they were further considered. According to the OGC, the first formal contacts with sub-national representatives only took place after the adoption of the Directive, during two specific periods of consultation194. The first was in May 2004, during the national transposition phase. The responses received in this first period of consultation195 were taken into account in the shaping of the national transposition measure, regarding the implementation of certain voluntary points of the directive. A remarkable point is the reference to the implementation of the Teckal criteria in this set of responses. According to these criteria, equivalent control of the contracting authority (such as that exercised over its own departments) over the provider excludes PP rules. The term of equivalency, consolidated through case law, was considered to be of rather open interpretation, and therefore giving room to uncertainty and having to be judged on a case-by-case basis. In order to shape this position, just before the approval of the UK and Scottish regulations, another period of consultation was launched in June 2005196. This time the answers received in December 2005197 raised the most complex issues of the directives, such as criticism of new procedures or other innovative aspects. However, this time, concerns about the Teckal criteria had apparently vanished and no question on in-house contracts was raised. Stakeholders seemingly stressed the principle of transparency and the fostering of SMEs, a fact which had possibly hindered self governance and local autonomy principles. Despite the transparency of an optimal degree of input and the publicity throughout these periods of consultation, no real modification was possible at that time since they were only held after the adoption of the directives. No real margin of manoeuvre was therefore available anymore in terms of influencing the decision-making process in Brussels (the legislative phase). Consultations were merely there to clarify the scope of the directive and to delimit certain aspects of voluntary

193 http://www.ogc.gov.uk/ 194 Office Government Commerce, Consultation Document: The Approach to Implementation of the New Public Sector Procurement Directive, May 2004 195 Response to Consultation on the New Procurement Directives, dated on the 27 October 2004, are available on the OCG website as well. 196 Consultation Document: Draft Regulations implementing the new Public sector and Utilities Procurement Directives, June 2005, Office of Government Commerce 197 Response to Consultation. Draft Regulations implementing the new Public Sector and Utilities Procurement Directives, December 2005, Office of Government Commerce.

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implementation. The main points of consultation, available on the OGC website, were on new procedures (competitive dialogue and e-Auctions), reserved contracts, framework agreements, and new social and environmental awarding criteria. The transposition phase In the UK (covering England, Wales and Northern Ireland) two Regulations were voted on in the Parliament. The Public Contracts Regulation (SI 2006/05) and the Utilities Contracts Regulations (SI 2006/06) completed the timely transposition of the legislative package. In Scotland, where public procurement relates to devolved competences, the two directives were implemented independently by means of two Regulations voted on in the Scottish Parliament, which entered into force on 31 January 2006. Both legislators (Westminster and the Scottish Parliament) were and are in contact and maintain close working relations, informing and consulting each other of their developments198. The UK interpreted the new legislative package as largely a consolidation of previous EU legislation together with clarifications derived from ECJ case law and the answers received in the consultation process. It was understood that the new package was mostly addressed to the public and utility sectors and for contracts above the thresholds settled in the directive and not much ado was made of it. The Office of Government and Commerce (OGC) did not foresee major difficulties resulting from the directive. Some of the so-called optional provisions of the directive were already applied in UK, such as eAuctions and framework agreements. The compilation of these practices into a legal text improved the legal certainty and the delimitation of its scope. Within a relatively easy transposition, it was also foreseen to implement the criteria of the Alcatel case199 regarding the standstill period which could favour an effective review of awarding decisions (issue of a recent EU Directive on Remedies). The implementation phase The UK was one of the few Member States to transpose this legislation on time, and the OGC maintained regular contacts with the European Commission during the whole process. No letter of notice for inadequate implementation was received. After the transposition of the directive and during the implementation phase the Local Government International Bureau (LGIB) published “A guide to EU legislation affecting local authority

198 According to the Concordat on Co-ordination of EU, International and Policy issues on Public Procurement, signed between Westminster and Scotland, published on the 25th November 1999 in the Scottish Government official website. http://www.scotland.gov.uk/Publications/1999/11/procurement 199 ECJ Alcatel Judgment (C-81/98) against Austria, 1998

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services”200 in 2006 which devotes some pages to an analysis of the PP rules. It calls attention to several important issues that have been also a topic of discussion in other States in our study, namely: 1. - Shared services (or inter-municipal agreements): They question to what extent the sharing of services between public bodies has to follow EU public Procurement rules. The LGIB believes cooperation and the sharing of services within the public sector should not necessarily be subject to the rules. According to them, these rules prevent modes of cooperation that could be more efficient. Lobbying of the European Parliament has resulted in the support of the Parliament for the clarification of the EU rules to potentially exclude such inter-communal cooperation from the scope of the PP directives. However, according to the LGIB publication, the Commission is reluctant to amend the Directives until all MS have more experience with the new rules. 2. - Competitive dialogue procedure: 4Ps (Public Private Partnership Programme) has developed a new “skills package” for local authorities to address implementation difficulties. 3. - Publishing lower value contracts: In August 2006 the European Commission through a Communication gave guidance as to how to ensure that even lower value contracts (below the directive’s thresholds) are still sufficiently advertised. According to the LGBI, and IDea (Improvement and Development Agency for Local Government) the Commission was lobbied in order to avoid a situation whereby lower contracts needed to be published in the Official Journal or in several languages, since this would have placed too great a burden on local authorities. The LGBI recommends that local authorities should advertise contracts more systematically through IT tools. 4. - Public Private Partnerships: the UK is considered to be amongst the most progressive countries in Europe in using PPP’s. Local entities closely follow the project of the European Commission to propose a new directive on Concessions. They welcome the idea, and LGBI is lobbying to promote local autonomy. 5. - Challenging the awarding of a public contract: In May 2006 the Commission proposed a new EU Remedies Directive foreseeing the establishment of a standstill period between the awarding and the performance of a contract in the light of existing ECJ judgements (Alcatel). The UK is advanced in this area, having established a standstill period of ten days in the 2006 transposition of the PP Directive. Nevertheless, interests are seemingly opposed in this topic, while bidders’ interests are satisfied, the LGBI stresses that this could lead to undue delays for legitimate public contracts. In January 2009, the Local Government Association published a guide on the European public procurement initiatives and the impact they may have at local level201.

200 www.lgiib.gov.uk 201 See www.lga.gov.uk.

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The UK (via the OGC), as with all other Member States, has received letters of formal notice from the European Commission with regard to specific infringements by contracting authorities. Several cases have been issued and reached the early stages of infraction proceedings. However, all such cases have been resolved to date without further reference to the European Court of Justice. 6 .2.5. Iceland National public procurement context From 1994, the EU legislation on Public Procurement has been incorporated into the Icelandic legislation. For the first time in 2001, the Icelandic parliament approved the Joint Committee decisions passing the three former EU Directives 202 into one consolidated national framework in 2004.203 This was the first important step of the Icelandic legislation due to the EU legislation on public procurement, as the Public Procurement Act of 2001 204 gave fresh impetus to the State Committee on procurement, gave the Complaint Board its independency, increased the transparency, gave more equal rights to the bidders and decreased the political influence in selecting the best offer. The Ministry of Finance invited seven interested parties 205 , one of them being the Icelandic Association of Local Authorities, to put forward their opinions and views about the new legislation. It should also be kept in mind that Iceland is a small country with limited resources or staff dealing with public procurement, for instance only the five largest municipalities in Iceland are large enough to have specialist procurement staff. Public Procurement in Iceland, as in the EU Member States, constitutes a dominant factor of national expenditure, making it vital to shape a transparent and coherent legal framework. The main discussions in Iceland about the 2001 legislation had to do with increasing the transparency of public procurement. These discussions were not directly linked with the transposition of the EU legislation on Public Procurement. But one could say that its transposition triggered these discussions. The main issue at stake were the different local practices and whether to introduce thresholds at municipal level below the EU-threshold. In the new general law of public procurement of 2001 there was an objective to harmonize and standardize the thresholds for the different types

202 Council Directive 93/36/EEC of 14 June 1993 coordination procedures for the award of public contracts; Council Directive 93/37/EEC of 14 June 1993 concerning the coordination of procedures for the award of public works contracts; Council Directive 92/50/EEC of 18 June 1992 relating to the coordination of procedures for the award of public service contracts. 203 http://eng.fjarmalaraduneyti.is/Minister/GHH/nr/3915. 204 Icelandic Public Procurement Act No. 94/2001 205 Reykjavíkurborg, Ríksikaup, Samband íslenskra sveitarfélaga, Samorka, Samtök atvinnulífsins, Samtök ionaoarions, Samtök verslunarinnar FÍS.

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of public procurement. This would also bind the municipalities, if they could not or would not comply with this standardization of thresholds they had to make their own public procurement rules. This stimulated many municipalities to create their own rules about public procurement below the EU-thresholds. These steps – indirectly triggered by EU legislation - forced municipalities to think about their practices and get acquainted with the rules on public procurement. The pre-legislative and legislative phases None of the experts interviewed remembers any participation of the Icelandic government or of the local authorities in the opinion forming and exchange of information in the pre-legislative phase of the PP Directive. There were neither opinions put forward about the Green Paper, nor active involvement in the work of CEMR. This might be partly explained by the small number of staff of the Icelandic Ministry of Finance, the Icelandic Association of Local Authorities and municipalities. Iceland being a small country, all stakeholders have to focus only on the most important developments in the EU for their country. As the PP Directive was not high on the list of priorities, no impact assessment was made to explore the possible (institutional) consequences for local authorities. Awareness of the importance of EU-legislation started to increase only since 2000. It became clear that EU-legislation becomes more important for municipalities and that there is a possibility to have some impact. In 2006, the Icelandic Association of Local Authorities opened a branch in Brussels and in 2008 it recruited an expert on waste and environmental issues. In the public procurement field, awareness is rising gradually, especially as inter-municipal cooperation in relation with public procurement (e.g. in waste management, landfills, the production of electricity and heat, and public transport)206, the public procurement of services and green procurement are important issues for local authorities. Given the fact that the 2004 PP Directive was only a gradual change from the existing national practices, since 2001 there was no particular involvement of the Icelandic government or local municipalities in the EU decision- making process. In Iceland, there is the consideration that being an EU member facilitates more direct involvement in the EU decision-making process, as well as direct contact with the CoR and early screening of important topics in the pre-legislative phase. Focusing at an early stage on a few policy priorities is for a small country (with its limited resources and staff) even more important than for a large country.

206 See the recent judgment of the European Court (Grand Chamber), case C-480-06 of 9 June 2009, about the failure of a Member State to fulfil the obligations of Directive 92/50/EEC to tender for waste treatment services as a cooperation between local authorities. The Commission of the European Communities against The Federal Republic of Germany, supported by The Kingdom of the Netherlands and the Republic of Finland.

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The transposition phase The Ministry of Finance prepared the Icelandic opinion for the EFTA Working Group on Public Procurement. The Ministry is responsible for the transposition and implementation of EU-directives. It decides what has to be transposed and implemented and evaluates what could be the effects on the national law. The Ministry is also responsible for organizing consultations with the stakeholders. In March 2005, the Ministry of Finance invited 20 stakeholders, including the Icelandic Association of Local Authorities, to put forward their opinion concerning the transposition of the 2004 PP Directive. Another important round of consultations took place in June 2006 when the draft Public Procurement Act was ready. During these consultations no special requests were put forward by the local authorities with the exception of the city of Reykjavik, which made the following comments:

- more standardisation and harmonisation of public procurement rules and thresholds is needed among the municipalities in the Reykjavik area;

- direct transposition of the articles of the PP Directive about concessions into the Icelandic Act was too complicated, and the standstill period is too long 207 ; the working of the Complaint Board was presenting some defaults.

This did not have any influence on the Ministry of Finance when drafting the bill or during the discussions in Parliament. Moreover, some issues were not put forward by local authorities regarding the transposition (and implementation) of the EU Directive on Public Procurement, such as the inter-municipal cooperation, which, unlike in other Member States, was not a controversial issue in Iceland . Nevertheless, this might be of crucial importance for the Reykjavik area concerning, for exapmle, waste treatment, electricity and heat production and public transport. Nevertheless, as major novelties were introduced into the Icelandic legislation by the Law of 2001 revising and updating former national practices, the 2004 PP Directives did not raise many interpretative doubts. However there were new important elements brought by the PP Directive such as the competitive dialogue, dynamic purchasing and electronic procurement. In Iceland, the Public Procurement Directive was transposed through an Act of Parliament allowing the entry into force of the Act no. 84/2007 of 18 April 2007 on Public Purchasing and the adoption of the correspondent thresholds through the Regulation No. 807/2007 (for which consultations were needed). The PP Directive was duly transposed within the set deadline.

207 In a country were you can build only four months a year, because in the other months the permafrost in the ground is limiting construction, the minimum standstill period you have to respect can have as a consequence that you have to wait another year building the school or the hospital.

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However, due to the small size of most Icelandic municipalities, the number of contracts not covered by the Directives remains high as most of them do not reach EU threshold values. The EEA legislation adapted the EU thresholds (as of 18 April 2007 - to be revised on an annual basis), applicable in the EEA pursuant to the EEA Agreement208 209. In Iceland, the legal environment in the field of public procurement has been under constant review over the past years; several guidelines and training on special issues of concern have been delivered to help the implementation of the new legislation. The implementation phase The Icelandic local authorities have the obligation to fulfil the requirements of the PP Directive. No special actions were undertaken to increase the regional and local competences to implement the Directive. Whereas around 2001 the main discussion was about standardization and harmonization of procurement thresholds below the EU-thresholds among all public authorities (including municipalities), nowadays there are discussions about the importance and possibility of using framework contracts. Traditionally, the focus of public procurement was on works. More recently awareness is rising that it concerns also services and goods. However, many contracts do not exceed the EU thresholds given the small size of the municipalities. Moreover, due to the booming economy, the private sector did not give much attention and scrutiny to public procurement contracts. Experts think that due to the current economic crisis the attention of the private sector towards public procurement of services and goods will increase and intensify, which would stimulate further awareness, professionalism and transparency of public procurement at local level. More evaluations and monitoring of public procurement at national and local levels would also enhance professionalism with regard to public procurement. According to the Icelandic Ministry of Finance, public procurement in Iceland has become increasingly professional in recent years due to the specialized knowledge of lawyers practicing in the field as well as the skills of the staff working on procurement, both within government institutions and local governments. Moreover, Iceland has taken advantage of new technologies which make it possible to send orders and receive invoices electronically. Further improvements can be considered concerning: public procurement of services, procurement of cooperating municipalities, more monitoring and evaluation, increased awareness, knowledge and skills and a greater use of the expertise of the Ríkiskaup210 (The State Procurement Office).

208 Points 2 and 5b of Annex XVI to the EEA Agreement. 209 See annex II. 210 www.rikiskaup.is.

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Today, a comprehensive policy on public procurement has been issued to this effect. Different ministries work now together - especially in the field of framework contracts, electronic procurement and procurement of goods and services. Municipalities can use the experience, know-how and services of the Ríkiskaup. However, this possibility is not often used yet. The Ríkiskaup is specialised in public procurement of goods and services for the State. Public procurement of works is often carried out by specialised departments in charge of infrastructure (traffic, roads, harbours, telecommunication etc.). The Ministry of Finance and the Ríkiskaup issued, according to the implementing legislation Act No 84/2007, a comprehensive guide on public procurement (handbook) which was distributed to players at all levels. A small seminar was also conducted on the issues of the new PP directives. Also a template of possible public procurement rules containing thresholds above and below the EU-thresholds for the different types of procurements was made available to all municipalities by the Icelandic Association of Local Authorities. This template was revised in January 2009.211 There is thus, general awareness and acceptance in the public administration of the changes resulting from the 2004 PP Directive and no special complications at enforcement level have arisen so far. However, some concerns arose from the fact that the Icelandic Association of Local Authorities receives annually only 5 to 10 phone calls about EU public procurement (mostly the question: ”do I have to call for tender for this kind of procurement?”); since 2004 only two complaints were brought forward 212 ; no Icelandic cases were brought forward to the EFTA Complaint Committee. There are also a few complications linked to:

• The small amount of tenders above the EU-thresholds, • the lack of awareness that also some service contracts have to be procured at EU-level, • and the lack of attention from the private sector for public procurement because of the

booming economy and the small population (in informal contacts much information is exchanged and many potential problems are solved).

The new legislative package does not have specific consequences with respect to different capacities of administration, neither at central nor at local level. The implementing legislation, to this effect, is more or less in line with the previous legislation. What can be noticed is that there has been a significant evolution towards more electronic public procurement after the transposition of the 2004 PP Directive. The Ríkiskaup now uses electronic procurement as a main rule. In general, the new legislation has improved the public procurement process and its results. Nevertheless, the training of procurement officers, the quality of procurement services, skills, procurement knowledge and the public procurement of services can still be improved. Also there

211 Instructions for public procurement and the template for public procurement rules: http://www.samband.is/logfrædisvid/utgafa-frodleikur 212 One about waste disposal of municipalities and one about a power plant partly owned by municipalities.

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are yet – with the exception of the city of Reykjavik - no evaluations done of public procurement and the compliance with local and national public procurement rules. Also in many municipalities the administration does not make it possible to assess compliance with the public procurement rules systematically. 6 .2.6. Norway National public procurement context The Act on Public Procurement of 16th July 1999 (no. 69) has been later complemented and partially ammended by the EU Directives on PP. The Act already drafted the main principles of public procurement practices and foresaw the creation of a separate body in charge of monitoring these rules, the future Klagenemnd for offentlige anskaffelser (KOFA). It was in January 2003 213 when the Public Procurement Complaint Board (KOFA) started functioning in order to make the enforcement of former procurement rules more efficient. Consisting in a central non-binding body for arbitration on PP issues, KOFA was launched as an advisory body to solve disputes and to increase the level of expertise as well as to set up some common definitions for the blurred areas of the existing rules. The pre-legislative and legislative phases Following the participation granted on the EEA Agreement, sub-national tiers could give already their views, although no record or follow-up of their inputs was produced. According to the interviews held, since PP was of great importance for local entities, they were consulted but on an informal basis. The website of the Ministry of Government, Administration and Reform was also open to inputs coming from different stakeholders at that time. The interviewees did not know about the sub-national involvement in the Green paper on PP of 1996. The recentness of the entry into force of the EEA Agreement was also another ground for this lack of coordination at that time. Nowadays, the consultation and information mechanisms are seemingly better since the local tier is being very active towards the Remedies Directive. Contacts through CEMR and the Local Association (KS) are now frequent. The transposition phase In Norway, the PP Directive has been transposed by the Anskaffelsesforskrift regulation of 7 April 2006, amending the Public Procurement Act. These provisions are divided into three parts. The regulation of basic principles in Part I, makes no difference between contracts below and above

213 Created by Royal Decree of 15 November 2002 number 1288

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thresholds214, being of compulsory observance in all public contracts. Part II deals with contracts above EU thresholds which must fully comply with EU rules. And Part III deals with sub-thresholds contracts, those not reaching the minimum value of 500.000 NO krone for which there is no need to be published in the EU official journal. The new Norwegian PP rules apply to contracts below EU thresholds 215 up to the national threshold (fixed at 500.000 NO krone). This gold-plating effect is aiming at a stricter regulation of small contracts in view of increasing transparency. Resulting too demanding at first instance (thresholds were fixed at 200.000 NO krone), Norwegian thresholds were, a posteriori, decreased. This shift in the criteria resulted from the complaints received from small enterprises and municipalities which were obliged to follow costly and complex procedures even for minor contracts. A consultation paper (høringsbrev in Norwegian) was submitted in relation to the transposition of both directives into domestic law. In connection with the preparation of this consultation, the Ministry of Government established a reference group of experts, in which the Norwegian Association of Local and Regional Authorities and the Confederation of Norwegian Enterprises were represented. However, regional and local authorities have no specific competences with respect to the transposition of the EU Directives in general, other than being entitled to comment on the consultation paper. The implementation phase At sub-state level, inter-municipal cooperation is in Norway of vital importance since small municipalities are, in some cases, not able to cope on their own with the new technologies and resources demanded by the PP rules. The uncertainty derived from the prohibition of inter-municipal agreements has raised the concern of local entities and this has been, in a certain way, solved, resorting to the exception of in-house agreements or to exclusive rights216. The issue of inter-municipal cooperation is considered by Norwegian experts interviewed the one that has caused the major impacts at regional and local level. Since the creation of KOFA, several cases have been brought before this body for review regarding alleged infringement of public procurement rules. The number of cases reaching the European Surveillance Authority (ESA) or the EFTA and national courts has, therefore, decreased. KOFA resolutions have been originally, not of legal nature, nor its statements are binding. However, it constitutes a consolidated reference since its proposals for fines and statements can initiate legal procedures if no prior conciliation was reached. The main advantages of this body are costs and

214 Public Procurement in Norway, ETIS, October 2006, AGDER Research Foundation. 215 Information obtained from the interviews held with Norwegian local and regional associations and members of government on the 9th March 2009. 216 Information provided by the experts during interviews held on the 9th March 2009.

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time saving217. After the entry into force of the new Regulations, KOFA has now the capacity to impose sanctions for illegal direct awards. Prior to the entry into force of the new PP Directive, the ESA issued a reasoned opinion on 22 July 2003218 regarding a breach of the principle of equal treatment of tenderers by the Norwegian Road Administration and another one regarding the lack of proper information given to tenderers. Such a reasoned opinion issued by ESA forces EEA members to bring back to legality the situation in a period of three months, otherwise, the ESA could bring proceedings against the EFTA Court. Following the approval of the new legislation, the Ministry of Government sent a letter to contracting authorities (governmental offices, municipalities, etc) and to professional bodies, informing them about the new regulation, together with a comprehensive guidance (made of the contributions from different stakeholders during informal public hearings). In addition, professional bodies and private conference organizers arranged a great number of courses/seminars on the new legislative package. Some complexities related to the new procedures had to be clarified such as the use of competitive dialogue, only for contracts above EU thresholds, or the negotiated procedure, for contracts whose values are between the national and the EU thresholds. These obscurities were mainly due to the use of gold-plating (lowering down the threshold values) in the transposition tools. Innovations such as IT tools in the tendering procedures are completely implemented in Norway, already before the entry into force of the Directive. Not only all notifications are now issued electronically but IT tools are also put into practice by the public sector during the whole procurement procedure. Other infrastructural consequences are the allocation of more personnel within the Government to the department of the Ministry of Government in charge of PP and also the creation of a department on PP within the newly created Agency for Public Management and eGovernment. Conclusion The Directive 18/2004 on Public Procurement suffered from a generalised transposition delay. Although being mainly a recast exercise of old Directives, once transposed into national legislations it implied in many cases major changes, even affecting institutional structures and internal administrative cooperation. In general, drawing on our investigation, there was no unanimous acceptance of the new Directive. Over-complex and rigid procedures lead to strong criticism; although the claimed objective was to design a more flexible and simpler public procurement in Europe, the pursued reduction of administrative costs and burdens seems far from being achieved.

217 Information provided during interviews held in Oslo, on the 9th of March. 218 PR (03) 19 and PR (03) 18.

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Major questions in the Directive, like the regime of low value contracts, had to be clarified through later Communications published by the European Commission. This entails in itself potential risks for late detection of specific implementation difficulties. The new PP Directive has had a clear impact on local authonomy: the introducton of a ban on non procured inter-municipal agreements, has resulted on a significant body of case law. The evolution of this jurisprudence has not contributed to reach clarity and smooth compliance with the Directive (a detailed description of the case-law evolution is provided in chapter 5.3 of this study).

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7. GENERAL TRENDS / GLOBAL ANALYSIS Table: Multilevel governance in the different phases under analysis

7.1. The Pre-legislative and legislative phases European regions and local entities have always been keen to intervene in the pre-legislative phase of EU policy-making when an issue of their interest or even competence is being discussed in Brussels. Normally this participation is rather of an informal nature, although a shift towards a more formalised and structured participation is growing. The influence of regional and local actors at that stage is from today’s view very difficult to assess. Informal ex-ante law-making participation takes place with different levels of institutionalisation from country to country. This participation can be handled either directly or indirectly: directly, at EU level through contacts with the Commission and other institutions (mostly through umbrella associations and regional offices in Brussels); and indirectly, at national/ regional level, with a view to influence EU decisions through pressure brought to the responsible central ministry already at the time of the informal drafts of the Commission legislative proposal. Once the official proposal from the Commission is launched, the legislative process starts. The level of involvement of the sub-state level in the preparation of the national position varies from country to country. What seems to be a common feature is the lack of records at national level, to allow a clear follow up of the in-house negotiation shifts. These records would facilitate a better understanding of what happens with the conflictual aspects of a piece of legislation: what happened during the negotiation process with specific problems detected during the multilevel preparatory works conducted at national level. The following table presents a scheme of the coordination and consultation steps followed by the States under research during the legislative phase.

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Concerning the EEA-EFTA countries, an early involvement in the pre-legislative phase is very important to take effectively into consideration the points of view of municipalities and regions. Having information from European associations representing local and regional authorities (especially CEMR), being part of the Brussels networks and obtaining information from impact assessments of other countries (in which the consequences at local and regional levels are taken into consideration) are of utmost importance to ensure participation at an early stage in the EU decision-making process. The EEA-EFTA countries are entitled to send a representative to the European Commission's Expert Committees. It comes out from the discussions in Iceland that being an EU member will increase the possibility to influence at an early stage the EU decision-making process, especially as more experts from local authorities could participate in the preparation and decision-making of the EU legislation. For a EEA-EFTA small country, it is of great importance to select at an early stage the most important upcoming legislation accordingly due to its scarce capacity and resources. Getting information at an early stage facilitates this prioritization exercise; that is why exchange of information between countries, local authorities and experts is for small countries even more important than for large countries. The influence of small countries and their local authorities in the pre-legislative and legislative phases could be increased by an enhanced cooperation between

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countries (and local authorities): priorities of legislation could be shared and impact assessments could be pooled and exchanged. 7.2. The Transposition phase Players engaged in the transposition process may vary from one State to another, since the distribution of competences derives from national arrangements. Depending on the type of State and the subject matter of the Directive, it will be for the central and/ or the regional level to transpose EU rules. The transposition process may also involve more than one Ministry depending on the scope of the law. Additionally, legal instruments used to transpose EU law may differ depending on the policies at stake as well as national specific arrangements. Directives can be transposed into national law, through statutory or, more frequently, through lower-level instruments, namely executive measures, such as government decrees or ministerial orders219. The combination of several factors, either internal or related to the Directive, is likely to explain a delayed transposition, namely coordination procedures, extensive consultation, inter-ministerial cooperation, administrative efficiency, level of decentralization and the involvement of sub-national levels220 or other internal factors such as electoral periods221. In addition, the characteristics of the Directive (complexity, opening up a new field of regulation, misfit level...) may alter transposition timing. 16 July 2001 and 31 January 2006 where the marked dates for meeting the transposition deadline in our case studies. As reflected in the table below delays in transposition are remarkable in the case of the Landfill Directive compared to the later Public Procurement Directive. Although the improvement is remarkable, when we compared the different periods in time, still important delays have been happening in the 2006 transposition deadline. Indeed, in the case of the Public Procurement Directive, only eight – out of the then 25 - transposed it on time, including the Netherlands and the United Kingdom. France managed to transpose only one of the two EU instruments on time 222 and Sweden launched internal consultations a bit too late to be able to get things done in time.

219 A study was developed showing the higher rates of non-statutory transposition within Member States, figures on The Netherlands, Austria and Spain, show the following results: only 13% of Directives were transposed by statutory law (in 2005) in the NL and similar rates showed Spain (being executive measures applied to transpose more than 80% of EU Directives, including government decrees and ministerial orders), while Austria transposed 59% of the Directives through government decrees, page 24. A Policy Solution to the European Union’s Transposition Puzzle: Interaction of Interests in Different Domestic Arenas, Bernard STEUNENBERG, January 2007, West European Politics, Vol. 30 n.1. 220 Id. Above. 221 However, it should be noted that consultations alone are unable to explain delays, since that very kind of process did not lead to postponing implementation in the UK, for example. 222 France transposed on due time the Utilities directive (17/2004/EC).

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In relation to the EFTA countries, Norwegian Regulation No. 402 of 7 April 2006 and Icelandic Act on PP 84/2007 17 April 2007 transposed PP Directive, through the amendment of Annex XVI of EEA Agreement. Most of the Member State used legislative instruments to transpose these two directives, as reflected in the tables below.

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7.3. The implementation phase Even in the case of “in time” transposition, the methodology followed by a country when drafting its transposing national rule, may have a direct impact in the implementation phase. The findings of our study reveal a clear cut division between the two phases. Expert teams commissioned by the Government work to comply with the transposition time limit. But often the expert team will be dismantled upon compliance with the deadline, and will not operate anymore during the implementation phase. Records show that the compliance rate with transposition deadlines has improved. On the contrary, compliance records with the contents of the law remain low, proving that proper implementation has not been achieved. One could conclude that the separation of the two phases at expert level is not producing the desired results. Being difficult to assess how much improvement in the compliance records we could witness if we would keep the same expert team in the two phases, it is presumable that at least the transition would be improved. It is a fact that practical implementation can raise several problems, that may be foreseen already during the transposition phase. The main factors which explain this decroché can be: Attributable to the Directive: - Secondary / primary legislation for transposition - Existent / new field of legislation - Implementation pressures, depending on the EU relevance of the sector - Big / small room for interpretation (level of discretion) Attributable to the State/ transposition method: - Decentralization - Enforcement at national/ sub-state level - Literal transposition/ going beyond - Involvement of stakeholders and social actors - Administrative capacity Consequently, authorities should consider the transposition and implementation phases as a continued process instead of making an artificial division between the transposition deadline obligations and those of the implementation phase. It is a common practice to establish guidelines to facilitate good implementation and different mechanisms to promote the exchange of experience and good practice among public authorities. Guidelines, monitoring bodies and some other complementary tools aim at simplifying the interpretation of the directive, delimiting and unifying its scope. They control and guarantee the compliance by public authorities of the new rules. These tools may be of European nature (Communications, ECJ case law), or of national, regional and/ or local nature (Guidelines, training courses, expert advise). These helpful mechanisms are mostly provided at national level while proper international exchange of mutual learning and different experiences is lacking. Cross-border cooperation and the experience-sharing among civil servants coming from national, regional and local administrations of different countries would be desirable. Difficulties may arise at the time of adjusting prior legislation to the new EU Directive. Therefore, the EU new legislation should be relatively flexible and leave certain room for interpretation and adaptability to special needs. A contrario, too much margin for interpretation could favour insecurity and arbitrariness in implementing EU legislation on the EU territory and EFTA-EEA countries.

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At national, regional and local levels, monitoring mechanisms created on an ad hoc basis have helped to face these difficulties and to find common solutions before the European Commission detects any infringement. However, municipalities may lack resources to apply the new rules efficiently, namely lack of IT tools, insufficient training or awareness. Therefore, they should be provided with the adequate tools to achieve an optimal implementation of the EU legislation. Concerning the EEA-EFTA countries, the conclusion, for example, that the implementation of the EU PP Directive in Iceland went smoothly and that hardly any infringements are a sign of good implementation should be drawn with prudence. On the one hand, the small scale and the few experts in the field of public procurement make it easy to iron out all kind of potential problems at an early stage, and the small scale of municipalities result yearly in only a few tenders above the EU-thresholds. However, if there is a lack of information about the tenders by type (works, goods, services) and amount, a lack of tradition of tendering services, if the private sector is not a countervailing power and if there are no systematic evaluations, monitoring systems and ex-post assessments, conclusions about good compliance might be premature.

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7.4. General evolution of sub-national access to the EU legislative process and future possible developments In 2001, the European Commission established the new concept of good governance with five big principles, which were the basis of the so called “good governance” and further developments of the concept of “multilevel governance”. In 2003 an informal inter-ministerial discussion took place on the role of local and regional authorities in the EU. In 2007, in the Berlin Declaration, a further step was taken in that direction by the Member States recognising the multi-level governance approach by stating that "There are many goals which we cannot achieve on our own, but only in concert. Tasks are shared between the European Union, the Member States and their regions and local authorities". Other important changes might be realised in the years to come especially the entry into force of the Lisbon Treaty, and the implementation of the White paper on multi-level governance of the Committee of the Regions. The EU multi-level governance approach will be reinforced through the following novelties provided for by the Lisbon Treaty:

− Mention of territorial cohesion among the objectives of the Union; − Respect for minorities and protection of linguistic and cultural diversity; − Recognition of regional identities; − Respect for local and regional self-government; − Explicit reference to regional and local levels in the provisions concerning the

subsidiarity principle; − Recognition of the specificity of certain areas and regions; − Right of the Committee of the Regions to bring a case in front of the European Court

of Justice for protecting of its own prerogatives as well as the respect of the subsidiarity principle;

− Consultation of the Committee of the Regions for new areas, such as energy and civil protection.

However, considering the need to develop an early warning system, to be established at an early stage of the EU legislative process rose in this study, the provisions of the Protocol on the application of the principles of subsidiarity and proportionality accompanying the Lisbon Treaty would be of great importance. Indeed the latter foresees that

− The regional and local actions planned or taken into account during the stakeholder consultation;

− The European Commission, when it motivates its proposals, including an impact analysis with a regional and local levels, particularly in financial terms;

− The early warning system involving the (Chamber of) Parliament national consultation allows indirect regional parliaments with legislative powers.

Moreover a new provision on participatory democracy, guarantees a "broad consultation" of stakeholders, including associations representing the local and regional authorities. The CoR White Paper on multi-level governance, adopted during the CoR plenary session of June 2009, proposes and foresees different actions to be undertaken to reinforce the involvement of local and regional authorities in the EU decision-making process, favouring successful achievement of the EU policies implemented at the local and regional levels. Some of its considerations and proposals could be mentioned here:

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− "Launching a consultation process with a view to drawing up a European Union Charter on multilevel governance; (p 9)

− Drawing up "a regional action plan" for each major Community strategic reform agreed between the EC and the CoR, setting out the political mechanisms to facilitate the ownership, implementation and evaluation of the policies adopted, and including a decentralised communication plan; (p 9)

− Strengthening the representation and influence of local and regional authorities in the Community decision-making process must be encouraged both within the Committee of the Regions and in the activities of the Council of the European Union; (p 10)

− The processes of consultation, experimentation and territorial impact analysis, the open method of coordination and the legal instruments for establishing contracts, such as regional pacts or the European Grouping for Territorial Cooperation, must be developed in order to counteract the negative effects of the concentration of decision-making power, dispersal of action and dilution of results. These mechanisms and instruments form new ways of achieving the strategic goals of the European Union; (p 19)

− Inviting the Member States to set up a mechanism for consulting local and regional authorities with a view to facilitating the transposition of European legislation; (p 28)

− setting up, with the support of the European Commission’s impact analysis committee, a technical “high level group” responsible for evaluating the territorial impact of major Community policies in order to adopt measures likely to improve legislation, simplify administrative procedures and increase the acceptance of Community policies by the citizens; (p 29)

− Defending the prospect of concluding contracts of agreed objectives, as envisaged in 2001, by proposing to readjust the political and legal terms of implementation, particularly with the aid of flexible and diversified tripartite instruments. In doing so, it is especially important to fully respect the Member States' institutional and procedural autonomy in transposing and above all implementing Community law; (p 32)

− Recommending establishing European territorial pacts capable of bringing together, on a voluntary basis, the different competent tiers of government in order to adapt the implementation of the major political priorities and objectives of the European Union on a partnership basis with the local and regional authorities; as well as planning for European territorial pacts to include the commitment of an institution or agency of the European Union, the commitment of national authorities and one or more local and regional authorities, the identification of the European political objectives to be achieved, their breakdown into concrete aims in the region in question, a monitoring system and, finally, the definition of a budgetary structure bringing together the contributions of the various parties needed to achieve this". (p 33)

Concerning the ex-ante Impact assessments, the CoR considers that "It is very important (…) that the territorial aspect of new legislation should have a key position in the Commission’s current

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impact assessments. In order to assess this territorial aspect properly, the Commission’s departments should explain the consequences of new legislation for the regions and municipalities in good time".223 The CoR especially recommends:

− "that the territorial impact analysis should become standard practice through the involvement, upstream of the policy decision, of the various actors concerned in order to understand the economic, social and environmental repercussions on the regions of Community legislative and non-legislative proposals;

− reinforcing the territorial impact evaluation mechanisms ready for when substantial modifications are proposed to the original proposals during the legislative process;

− developing the conditions for an ex-post evaluation in order to examine the local and regional impact of certain directives, or even the implementation at local and regional level of European legislative acts and have the findings incorporated by the Commission into its evaluation report;

− that European and national statistics should reflect the diversity of the territorial situation in order to more accurately understand the impact of policies on the regions".224

The novelties to be introduced by the Lisbon Treaty concerning local and regional authorities, as well as the CoR White Paper proposals, will have to be considered with regard to the work of the Council of Europe, and especially the Congress of Local and Regional Authorities on this matter225, in order to create a consensus on the multi-level governance approach. In the light of these considerations, some ways of reflections could be developed in order to revise the existing Memorandum of Understanding between the Council of Europe and the European Union226 to work in synergy for the achievement of a proper implementation of a real multi-level governance in Europe. In the CoR White Paper on multi-level governance, it is mentioned that "The Committee of the Regions is also helping to implement the Memorandum of Understanding between the European Union and the Council of Europe, with a view to establishing a pan-European consensus on multilevel governance based on democratic values and principles and the constitutional set of fundamental rights."227

223 CdR 89/2009 fin, p.26. 224 CdR 89/2009 fin, p.29. 225 See the Kiviniemi Report, The European Committee on Local and Regional Democracy (CDLR), 2009. 226 Memorandum of Understanding between the Council of Europe and the European Union, 2007. 227 CdR 89/2009 fin, p.8.

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8. KEY FINDINGS Pre-legislative and Legislative Phases 1. The pre-legislative phase still does not receive sufficient attention at State and sub-state levels for both the landfill and PP directives Although the available data on the involvement and participation of the sub-state level in the pre-legislative phase in the cases under analysis is fragmented and incomplete, the involvement of sub-state authorities does appear weak. Moreover, the follow-up of internal procedures, consultations and contributions at sub-national level varies considerably. For example, within the context of the PP Directive, the consultation process planned by the green paper was not followed up in a systematic way: except in the case of SE, there is no clear indication of coordinated sub-state participation, and even in the case of the Swedish contribution to the green paper there are no written records of the questions raised by municipalities. This leads to difficulties in identifying the input and contributions made by the local and regional levels to the pre-legislative procedure, as well as in evaluating the extent of their involvement. Although the interviews conducted have highlighted improvements in this area, the State and sub-state levels seem to pay less attention to this crucial phase of the policy-making process than the others. 2. No ex-ante impact assessment was made during the preparation of the two directives, although important warnings were made In the case of the PP Directive, warnings were made and concerns were expressed by some regions, umbrella associations as well as the CoR, about the risk that certain provisions of the directive would hamper local autonomy by limiting the possibilities to establish inter-municipal cooperation agreements (an widespread practice in most countries). The warnings made were not taken into account during the decision-making process, which has resulted in a significant body of case-law228. Whilst it is hardly possible to analyse whether a proper ex-ante impact assessment (see key finding 4) would have improved matters, it is however legitimate to postulate that such concerns could have been more carefully analysed. 3. Nowadays new mechanisms are in place to facilitate the detection of particularly relevant impacts which need to be supported by a better multilevel exchange of information The publication of green papers (since 1984), the annual legislative and work programme (CLWP), roadmaps as well as the establishment of an integrated ex-ante impact assessment by the European Commission (IA Guidelines 2009) all constitute tools that the State and sub-state levels of government can use in order to better identify particularly relevant impacts, giving them time to present their views. However, further efforts need to be made in order to make full use of these mechanisms, to conduct a systematic exchange of information, to ensure the adequate follow-up of local and regional authorities' concerns raised at that phase, in order to properly analyse the institutional impacts foreseen.

228 For detailed information on this, please see chapter 7 of the report.

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4. As yet the 2009EC impact assessment (IA) guidelines have not been sufficiently mirrored at State and sub-state levels to enable the effective detection at an early stage of regional/local institutional impacts Nowadays carrying out this type of ex-ante evaluation is of common practice in any policy-making process. The 2009 EC IA guidelines have recently been improved with greater emphasis being given to the possible impact of European legislation at regional and local levels. Attention is being paid to States’ level of preparedness to cooperate and contribute to this exercise, which was initiated by the EC. In line with this trend, the current work of the CoR aims at involving local and regional authorities in the IA of certain EU policy and legislative initiatives through its different networks (the Subsidiarity Monitoring Network, the Lisbon Monitoring Platform and the EGCT Expert Group), providing in this way a direct communication channel between the local and regional levels and EU policy-makers at an early stage of the EU decision-making process229. 5. The low level of involvement of sub-national authorities in the EU decision-making process may also be explained by other factors These factors can take the form of insufficient capacity at the regional/municipal level (IS), ad hoc or mainly informal contacts between regional/local and national levels (NL), or a late awareness of the importance and necessity of early involvement (UK). Moreover, a lack of sufficient resources at local and regional levels and the recentness of EU membership (SE) seem to be major factors in the low level of coordination/participation at the pre-legislative phase. Overall, major improvements have been noticed over the years. However, sub-state-level satisfaction with its involvement remains weak. This might be due to high ambitions with regard to the type of participation, or inadequate information provided by the State level on the use of the input from regions/cities Transposition and Implementation Phases 6. The transposition deadlines of the two directives were exceeded by the majority of the countries analysed, although an improvement is shown between the two230 Compliance with transposition deadlines has markedly improved in recent years. Scoreboards analysed on the implementation of internal market rules (PP) show a serious commitment on the part of Member States to comply with the EU transposition targets. Best records have recently been met, but some countries still lag behind. In the analysed countries, the “Implementation Teams” (UK, SE) or “Dossier Teams” (NL) commissioned by their respective Governments to

229 A first pilot exercise was conducted in cooperation with the EC in the field of EU action to reduce health inequalities which is of particular interest for local and regional authorities and the CoR. The consultation lasted approximately 4 months. A second pilot exercise might be launched in autumn 2009; the possible domains are currently being scrutinised. 230 See table in chapter 7

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coordinate the national position and to comply with the transposition time limit, have proven to be effective tools for achieving good records. 7. Several factors prevent States from achieving flexible transposition Finding the right balance between proper transposition and the adequate use of the flexible and optional clauses of the EU legislation is not an easy task. In our case studies, certain transposition difficulties seem to be related to:

− The level of experience of the country transposing EU legislation into its national legal system;

− The willingness to comply well and quickly in order to avoid any legal infringements and court cases;

− The lack of time for proper analysis of the possibilities contained in the directive.

This might result in a literal transposition of all the directive’s provisions, even the voluntary ones, which could even lead to a strict interpretation of the EU legislation. For this transposition exercise Member States therefore require the assistance of highly trained and experienced experts in the field concerned at national level, as well as EC experts. Most of the countries studied had contacts with the EC during and after the transposition of the two directives. Concerning the local and regional levels, EC contacts were either made directly or less formally, through networks. 8. Major improvements in consultation and coordination practices during the transposition and implementation phases In the countries studied there were notable improvements in consultation and coordination practices from the time of the Landfill Directive to the PP Directive. More information is available on the PP Directive. The new PP legislative package triggered a wide consultation process during the implementation phase: e.g. in the case of the UK, the OGC and the Scottish Procurement Directorate used IT facilities to collect views on their respective implementing laws. The participation of the regional and local levels as well as coordination at all levels seem to have been efficient. This extensive consultation contrasts with the informal and less structured consultation conducted during the pre-legislative and legislative phases. This situation was repeated with different variables in the other countries under research. 9. Institutional impacts are linked to the type of directive as well as national preparedness. In the case of landfill, in some cases, the national legislation went beyond the directive requirements. In NO, NL and SE, for example, no major changes were made as the national law in force already contained most of the directive’s provisions. The situation was different in UK (Scotland, Northern Ireland, England and Wales adopted a new Landfill Regulation), as well as in IS. As the existing requirements in Iceland on waste management were of a general nature, it was decided to follow the text of the Landfill Directive very closely. This sometimes results in the feeling that the Government could have been more flexible to properly adapt the directive to the specific situation of the country (IS). In the case of the PP directive, the complexity of the new procedures resulted in, at least at the beginning, major investment in the professionalization of the staff working in the field of public procurement and in developing IT tools. 10. The PP Directive has a clear impact on local autonomy. Local autonomy is a feature of most of the countries studied. Although inter-municipal agreements were a long-standing practice in most European municipalities (especially the Nordic ones), the new PP Directive introduced a ban on such cooperation, with limited exceptions. The subsequent construction of an important case-law compounded these impacts and created the need for a greater professionalization of the contracting authorities.

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11. The dilemma: to copy or go beyond the directives? Some countries established systems that went beyond the Landfill Directive minimum common denominator, using the so-called "gold plating" mechanism. The opposite can be said of the PP Directive: as it constituted a compilation of older ones, it was initially thought to be of minor impact, with some countries (NL and UK) mainly copying the Directive during the transposition exercise. However, other countries (SE and NO) used "gold plating" when transposing some aspects of the Directive 231 . This later resulted in significant compliance difficulties during the implementation phase: in this case, "gold plating" proved to be counter productive. 12. Investments in training and guidance are positively considered by regional and local implementing actors In terms of capacity development, the complexity of some of the new procurement procedures under the PP Directive meant that authorities at different levels had to provide training and guidance to ensure a proper implementation of the rules. This is confirmed by the UK and SE. In general, statistics show that proper training and capacity-building initiatives may tackle difficulties in implementing legislation by favouring general awareness and thus good compliance. Considering the link between training/guidance and compliance with legislation, it would appear that decentralized States need stronger guidance and training tools for implementation, as well as better institutional coordination.

9 9999(some optional procedures or requirement made compulsory in national legislation, such as electronic means in NO) or new conditions set up by central government output (application of PP rules below to contracts below thresholds in SE).

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9. CONCLUSIONS This study has assessed the institutional impact of the law at the national, regional and local level. Institutional impacts are understood in the widest possible sense, as polymorphic influences that the formation of EU policies may have on institutions, procedures and routine from the early stages to final implementation. This embraces the potential alteration of internal legislative frameworks, intergovernmental coordination, and the allocation of resources, the development of appropriate skills, public accountability as well as respect for the internal allocation of competences at European, national, regional and local levels. An attempt has been made to provide a significant basis for comparative discussions with a view to formulating recommendations that are believed to bring improvements to the overall process. The first methodological step has been to define as precisely as possible the different phases of the policy and decision-making processes from the early informal discussions to the concrete implementation of given policies. A sequential approach as been preferred, with a distinction being made between the following four phases: pre-legislative, legislative, transposition and implementation. It has clearly made it possible to identify the main points that can be improved in terms of the procedure and inclusiveness necessary in order to detect the potential institutional impacts of a given new norm. The study has also taken into account recent developments. Overall, our observations centre around three core points: first, the importance of well-coordinated and cooperative impact assessments, second, the real and effective inclusion of stakeholders and LRAs, third, the preponderance of the pre-legislative phase. Although clear improvements have been demonstrated when comparing the past situation with the current one, major institutional and cultural changes are still needed. The perceived degree of improvement in the overall institutional decision-making cycle depends to a large extent on how clearly the objectives of each phase are defined. Ideally, a well-driven policy-making cycle would include an in-depth ex ante assessment at all levels of any new legislative proposal, a proper decision-making procedure including all stakeholders, timely transposition and finally the accurate implementation of the law. This would result in better compliance records and would result in successful policy making in all four phases described. But the study has shown that progress is not evenly distributed: the transposition phase is closer to the ideal situation whereas the others - especially the pre-legislative phase - lag behind. Proper ex ante impact assessment, with the participation of all levels of government, would ensure better compliance records. The study identifies certain deficiencies in the various phases of the policy cycle and at different levels of administration. Over a long period of time, such as is needed to complete the cycle, people change and priorities shift. Sustainability of the generated knowledge throughout the decision-making process, the legacy and continuity of the experts involved and changes in government are natural but major shortcomings. Undoubtedly, these difficulties increase the probability of EU legislation having non-desired or unexpected effects at both national and sub-

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national levels. It also opens the door to the proliferation of red tape, the duplication of efforts and non or incorrect compliance with the law. According to the CoR White Paper on Multilevel Governance, the conditions for good multilevel governance strongly depend on the actual engagement of the Member States themselves. “The principles and mechanisms of consultation, coordination, cooperation, and evaluation recommended at Community level must firstly be applied within the Member States”232. This can only be achieved through the provision of the necessary tools at all levels in order to build up an “early warning system”, devoted to detecting the “potential problems or dangers” of a given European legislative project. It has been demonstrated that sufficient attention is still not paid to the pre-legislative phase at State and regional/local levels. If the EU is to achieve a better regulatory/law environment, it should, first and foremost, ensure a high-quality Impact Assessment (IA) system. According to the 2007 Evaluation of the Commission’s IA System233, the three main objectives of the EC are to improve the quality of its proposals, to provide an effective aid to decision-making and to serve as a valuable communication tool. None of those can be concretely achieved without the full commitment of each State, regional and local entity. And none of those will be effective if the institutional impacts at regional and local levels are not properly taken into account. Since 2002, the efforts made by the Commission, through the introduction of an integrated ex ante system of IA, and its 2009 subsequent revisions for improvement, have so far not been effectively mirrored at State and local levels. Many inconveniences could be avoided at an early stage but, unfortunately, these problems are very often managed at a later stage of the decision-making process. This implies a need for better consultation procedures within the States in order to build up proper “national” ex ante impact assessments, which would necessitate an accurate study on the consequences and effects of the implementation at sub-state level, providing for an optimal approach and adaptability to their needs through their continuous participation. This would be best achieved through coordination with the EC services in charge of IA. These assessments should be carried out during the pre-legislative phase, and be transparent and authoritative. The expertise of the responsible ministries at State level and their staff in dealing with local government is an important added value for a successful consultation process. In this way local and regional authorities’ capacity to make their point would be increased as well as their own awareness of EU tools and policies. As a result, EU legislation could benefit from their inputs, which may favour better implementation at a later stage. Good cooperation and coordination represent other important aspects of policy-making. We have identified some requirements for improved cooperation and coordination between the different actors of the EU policy-making process at all levels:

232 White paper on Multilevel Governance, Committee of the Regions 233 Prepared by The Evaluation Partnership Limited

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− a steered and permanent flow of information between the European, national and

regional/local levels through all policy phases; − pro-active independent monitoring of ongoing processes in Brussels by the

regional/local level (with the respective administrative capacities); − a permanent representation in Brussels benefiting from first-hand information and

contacts; − a stable vertical network of officials from different levels (as a sort of permanent

“dossier team”) with an obligation to report on Commission expert groups and the Council working groups.

Furthermore, the findings of the study reveal a significant process of Europeanization (although at a varying pace) in the six countries analysed. However, encouraging a bottom-up approach, whereby regional and local concerns could better influence policy shaping, could effectively counter the identified difficulties. However, whilst it is not possible to foresee all the potential problems a new piece of legislation may entail, it is clear that an awareness of the importance of the preparatory works would enhance the capacity to discover them. Another issue was also raised when drafting this study: should directives be more flexible, or do rigid instruments better ensure legal certainty? Opinions expressed during the preparation of the study do not provide a clear answer to this question. On one hand, some advocated that the PP Directive was clearly too rigid. Despite this, most of its new elements were left to the Member States' discretion. On the other hand, the idea that the scope of the directives should be as precise as possible is widely accepted. A contrario, if the delimitation of the scope is too broad or vague, more problems will arise in interpreting, transposing and implementing the directives. Future research might also attempt to further reflection on such a crucial issue for EU policy making by exploring the results of this study with other EU legal instruments (such as regulations or decisions) in order to have a complete picture of the Community legal framework and its impact on the different levels of government.Recent Directives (Services, Soil directive etc) could be the focus of future research in line with this study. In view of these considerations, the following recommendations are suggested. 1.- TO IMPROVE AWARENESS AND PREPAREDNESS OF POTENTIAL INSTITUTIONAL IMPACTS AT NATIONAL/REGIONAL/LOCAL LEVELS - Early mechanisms for participation and inclusiveness to detect institutional impacts An awareness of the potential institutional impacts of EU legislation at regional and local levels is still lacking during the policy-making process. As a consequence, ex ante analysis is important in order to ensure careful transposition at national level and avoid an unnecessary burden on the regional and local levels. - Strengthening records and follow-up of consultation of LRAs There is a clear lack of records and evidence of consideration given to consultation of local and regional authorities. Efforts could be further done on that point. For example, Member States may provide their territorial entities with better and more comprehensive feedback following the consultation process during the preparation of their respective national positions. - Taking the work of the associations of LRAs and the CoR better into account There is a need at national and European levels to listen harder to the warnings raised by the regional and local levels and its representative bodies.

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a) Member States may confront LRA recommendations and CoR opinions in a more systematic way with the inputs/contributions from their own regional/local levels, making it possible to shed light on the specific concerns of local and regional authorities at an early stage. In adition, more attention could be also paid to the current work of the CoR on the regional impacts of EU legislative and policy initiatives according to the EC revised 2009 IA guidelines. b) The European Commission could strengthen its cooperation with the CoR and representative associations. The 2005 cooperation agreement between the EC and the CoR provides for a proper follow-up by the EC of the CoR opinions. The EC might consider building up the CoR’s ability to identify potential difficulties raised by new EU legislation proposals at an early stage. All in all, a better follow-up and communication of these key recommendations may enhance both the CoR’s political role and the efforts towards better law-making. - Enhancing administrative capacities Proper expertise and suffient time are necessary to counter the identied difficulties. Even when one tries to foresee the institutional impacts of a new legislative proposal, the complexity and development of the legal instrument (both through soft law and case law) may hamper such efforts, and new, unforeseen impacts may arise. The four phases of the policy-making cycle are interconnected and create a process in which the actors involved vary continuously. The creation of expert teams (or “dossier teams” according to the Dutch term) working during the whole policy-making cycle might be further explored. - Readiness to respond Response capabilities have improved in most of the countries studied, particularly through greater compliance with transposition deadlines; however, there is still room for improvement. The improvement so far is due to the enhanced attention given to the pre-legislative phase and adequate human resources, with “implementation teams” being established in a more regular way. Nevertheless, there is still the need for an earlier establishment of such teams, as the continuity of their work throughout the whole process with a good mixture of experts from the different levels of administration can ensure the effective multilevel coordination of work. - Focusing on challenges Building on progress made so far will require ongoing commitment both from the European institutions and the national, regional and local bodies concerned. This study has served as a platform for analysis and research commissioned by the national ministries responsible for regional and local affairs: this work has afforded the national experts on local government in different countries the opportunity to exchange and share common problems resulting from EU legislation which were raised at regional and local levels. Some of the experts suggested that the HLG network could help in the early warning mechanisms set-up by different European institutions in an informal way in order to improve their capabilities in the early detection of potential institutional impacts.

2.- TO CONDUCT A CAREFUL ANALYSIS OF THE LEGISLATIVE INSTRUMENTS FOR GOOD TRANSPOSITION

- Investing more time and resources in transposing directives Member States might invest more time and resources to identify the flexibility left to their appreciation when transposing EU directives. They should ensure they have a clear understanding of the EU legal instrument. Indeed, it seems, at least in the case of the PP Directive, that some countries did not invest enough resources and/or efforts to analyse the possible transposition options. In line with this, permanent contact between the EC and the Member States will help to facilitate the transposition of EU legislation.

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- Avoiding administrative routine Administrative routine may hamper active involvement in transposition. Member States could consider the potential risks of relying only on a formal procedure to ensure proper transposition. It is also important to monitor the actual effectiveness of the procedure. Certain Member States tend to develop very effective and precise procedures for transposing EU directives while not being able to detect specific difficulties. The whole process be made more efficient if highly-skilled bureaucratic systems can rely on personified identifiable responsibility, as well as specific attention and original development for each new piece of legislation. Other studies indicate that Member States tend to avoid major difficulties when addressing highly complex directives. - Going beyond minimum directive requirements: a double-edged tool Caution should be taken in any decision to implement beyond the minimum requirements of directives as it may give rise to non-compliance risks and the awkward interpretation of EU directives. Albeit not ruling out such action, Member States may further analyze the reasons for exceeding minimum requirements and take their decision having meticulously evaluated the concrete benefits of such an opportunity. The landfill case shows that the directive was not as ambitious as the policy of some Member States. As such it was necessary to go beyond the requirements in order to comply with the national standards. In these countries, implementation problems were not so much linked to EU policy problems but related to national enforcement questions between the administrative levels.

3.- TO DEVELOP ADEQUATE TOOLS TO COMPLY WITH EU LEGISLATION AND TRANSPOSITION DEADLINES

- Developing and strengthening the “implementation teams” or “dossier teams” throughout the policy-making cycle The countries studied are complying quite well with the EC transposition deadline. This might be linked to the fact that the implementation teams were commissioned with the task of timely transposition and proper implementation of a given directive234. Despite this, compliance with the legislation remains rather low in the same countries analysed 235. The implementation teams that are created are often dissolved after transposition deadline, which could have a cause-effect relation on proper compliance. Therefore some countries (including NL with the “dossier teams” in the environment area) are going a step further by establishing a permanent ad hoc team created at a very early phase (pre-legislative) which will continue to exist after the transposition deadline and until the effective implementation of the legislation. Specific attention needs to be paid to new provisions of “soft law” or “Court judgements” published during the implementation phaseto ensure proper compliance.

234 The EC Recommendation of 12 July 2004 on "Transposition into national law of Directives affecting the Internal Market"234 helps to identify the best tools for better compliance with the Commission deadlines. 235 Infernal Market Scoreboard 2008

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- Developing benchmarking and scoreboards The Internal Market scoreboard is proven to be a valuable tool to detect legal infringements. The Commission may consider further the use of instruments like the scoreboard. Comparative analysis and benchmarking could be further developed, since identifying common problems across regions and borders is a key challenge. Countries can exchange their national impact assessments and in this way improve and enlarge the common understanding of the consequences of EU legislation. Comparative analysis together with stronger benchmarking and dialogue between authorities concerned will help to improve the regulatory/legal framework. 4.- TO MAXIMISE CAPACITY-BUILDING EFFORTS FOR PROPER IMPLEMENTATION

- Guidance and training Guidance is always needed either from the central or from the regional level, and helps proper implementation. The enforcement of ECJ case-law should be a very substantial part of it. In case-law infringements, all kind of problems that local and regional authorities are facing with EU legislation can be analysed. The insights from this meta-evolution of law infringements can be used to improve practice. - Maintaining implementation team There are signs of the lack of timely establishment and the early dismantlement of the group, which hampers both the effective ex ante analysis and the proper implementation of the legislation. It has been noticed that once the Member State has complied with the deadline for transposing a directive, the expert team is often dissolved and commissioned with other priority tasks of the government236. This practice could hamper the smooth implementation of the legislation within the State and should be avoided. - Exchanges of experience and good practice between LRAs The Member States may consider the idea of an "Erasmus programme" as mentioned in the CoR White paper on multilevel governance, stressing that "The CoR undertakes to support the pilot initiative of an “Erasmus programme for local and regional elected representatives” and cooperate to this end with the European Parliament, the Council and the European Commission on its conceptual and operational development, and encourage the introduction of training programmes and experience and good practice exchange programmes intended for local and regional elected representatives".

236 This is the case for the implementation teams of the Services Directive in UK, SE and NL. (Interviews held at the occasion of the Eipa Seminar on the Services Directive, June 2009).

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ANNEXES ANNEX I. Graphic representation of the study research process, the stakeholders involved, and the actions carried out

Desk Research

Questionnaire

Discussion on Preliminary Findings + Recomen-

In-depth interviews

Editing and presenting the Report

European Commission

Consult

Identify

Participating MSs

Answer

Co-write

Participate

Research Team Process Stakeholders

Regional & local governments

EIPA-ECR/ EUKN-Nicis Institute

Consult

EIPA-ECR

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ANNEX II. Questionnaire sent to the countries October 2008 FOR BOTH DIRECTIVES - PREPARATION OF EUROPEAN LEGISLATION 1. To what extent and in which ways did local/regional levels of government involve themselves in highlighting their position to the Commission in the preparation of the legislation? 2. To what extent and in which ways did local/regional levels of government involve themselves in the preparation of Member State negotiating positions on the legislation? 3. What, if any, institutional, formal, or ad hoc arrangements exist for local/regional levels of government to involve themselves in the preparation of Member State negotiating positions on the legislation? CONSULTATIONS FOR TRANSPOSITION INTO NATIONAL LAW 4. Was there or not a period of public consultations with the different actors involved before transposing or was there a central law? What was the date of transposition of the directive in your MS? In case of delayed transposition, explain the reasons. 5. How did you involve municipal and regional administrations in the transposition process? Was there a specific contribution from the regional municipal level towards the content of the legislation? Did you contact other MS to hear about other experiences? 6. Please describe the regional and municipal competences with respect to the implementation of the Landfill Directive and Public Procurement Directive. IMPACT ASSESSMENT PRE AND POST 7. Did the Member State carry out a separate impact assessment on the European Commission proposal? 8. If so, did this take place during the negotiations of the legislation or at the time of transposition? 9. Did any impact assessment carried out at national level consider the institutional and/or operational impacts of implementing the directives covered in the case studies? 10. Did any impact assessment take place at the local/regional level? 11. If so, who was responsible for this impact assessment? 12. Did it consider the institutional impacts? Or was it focused on the operational impacts (investments, new procedures, training of staff etc.) REACTION OF THE EUROPEAN COMMISSION ON YOUR TRANSPOSING ACT 13. Have you been in contact with the European Commission during the transposition period? Is the European Commission in conformity with your transposition or have you received any letter of notice regarding bad implementation? 14. Are there any (pending) national or European cases regarding infringements of the Landfill Directive and or Public Procurement Directive in your country? FOR PUBLIC PROCUREMENT ONLY 15. Which articles of the directive mean a major and important change with your regular Public Procurement practice? Do the objective and subjective elements of the directive bring changes to your practice and what are these changes? What about the right of appeal to unlawful decisions? What about the use (or non-use) of the new public procurement contracts? 16. Is there any academic article published on the problematic of the transposition of the directive in your country? If yes, please provide. 17. What are the consequences of the new legislative package with respect to different capacities of the administrations and the regional and municipal level? Have you evolved after the

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transposition towards a more electronic procurement? By what means? Did the new Directive improve the procurement process or the results of the procurement? 18. Is there awareness and acceptance in your public administration of the changes the directive has imposed? Are there complications of enforcement and what are the types of complications? FOR LANDFILL WASTE ONLY 19. Do you have national standards for the management of landfills going beyond the standards of the Landfill Directive (using the possibilities in Article 176 EC Treaty). 20. Implementation strategy: which steps have been taken to raise awareness for the implementation of the Landfill Directive at the regional and municipal level? (Handbooks, networks, conferences, etc.) 21. To what extent did you have to adapt your existing legislation? Was there already an appropriate framework in place? Did you have to make extensive changes? 22. What are the consequences of the Landfill Directive with respect to different capacities of the administrations and the regional and municipal level? Did you have to establish new administrative bodies (establishment of new coordination mechanisms, revision of distribution of competences)? Did you experience these administrative requirements as a major obstacle to the implementation? 23. What kind of problems did you encounter with regard to the requirement to involve the local populations as well as stakeholders? 24. Is the financing at the regional and municipal level an important problem? Was there reallocation of funds for this task?

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ANNEX III. General structure of the countries studied EU MEMBER STATES FRANCE The general legal framework distinguishes between laws (Lois) – voted in Parliament – and regulations - which fall into executive’s hands. The government may also use delegated powers to legislate in parliamentary areas through ordinances. The Constitution (art. 34 and 37) limitedly defines the areas in which laws are required, while any other area must be regulated by executive acts. Albeit evolutions, the Conseil Constitutionnel’s original mission was to protect the reglement against intrusion from the Parlement. At central level, bicameralism implies that two chambers, elected under different conditions, unequally share legislative powers. The Assemblée Nationale, the lower chamber, holds popular legitimacy. The Senat, the upper chamber, is indirectly elected. It represents decentralised interests as well as French citizens established outside France. A recent reform also introduced this latter representation in the Assemblée Nationale. Regarding the concept of decentralisation in France, The national administrative tradition is too often thought of as one of the most state-centred among Western democracies. However, the cliché of an over-centralised bureaucracy no longer reflects the reality of the balance of power between the central government and peripheral authorities. Millstones in the field of French sub-state structures are the reforms dating back to 1982, 1983 and 2004. A profound change in the basic distribution of competences is presently being discussed in France. Although it is almost impossible to predict what a reform would look like at the end of the process, this aspect must be incorporated in subsequent discussions. THE NETHERLANDS Since 1848, the Netherlands has been a full bicameral parliamentary democracy. Dutch politics and governance are characterised by an effort to achieve broad consensus on important issues, both within the political community and society as a whole. Executive powers are in the hands of the Ministerraad, the deliberative council of the Dutch cabinet. The cabinet consists of thirteen to sixteen ministers plus a varying number of state secretaries. The Prime Minister is Head of the Government and, most often, leader of the largest party of the coalition, as it has continuously been so, since 1973. However, he is only primus inter pares, meaning he has no explicit powers beyond those of the other ministers. SWEDEN Sweden is a Constitutional Monarchy with a Parliamentary system of government. King Carl XVI Gustaf is the Head of State. Since 1971, The Riksdag is the sole national legislative body (characteristic of unicameral systems). It is responsible for designating the Prime Minister who appoints the members of the Government. Norms can be issued by the Riksdag – as laws – or by the Government – through decrees. The Government can issue ordinances in areas that are not specifically described as the competence of the Riksdag. The Riksdag can also delegate normative competence to the Government in different areas.

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Up to a certain extent, the Government may also delegate normative competence to a State Agency. The Agency can then issue regulations. The political weight of the issue at stake determines whether or not it has to be delegated. However, this mechanism is more common on detailed concerns. General advices are non-binding rules aiming to foster a uniform application of norms. Despite their voluntary nature, general advices constitute a substantial aspect of State Agencies’ norm-making. THE UNITED KINGDOM The United Kingdom is a multi-national unitary constitutional monarchy, governed by a Parliamentary system. It consists of four regions: Northern Ireland, England, Wales and Scotland. Queen Elizabeth II is the Head of State. The British legislative power is shared by the House of Commons and the House of Lords, which do not constitute territorial representation. Members of Government belong to one of these Chambers. Any legislative bill must follow Royal Assent in order to be adopted. Scottish and Welsh Assemblies are granted with devolved Legislative powers depending on the issue at stake (the so-called devolution system of competences, as it will be later described), but these powers are not absolute since they may be retrieved by Westminster. This lack of certainty is due to the fact that devolution is not constitutionally guaranteed. UK democracy and political structures are not based on a written constitution. The legal system distinguishes between two main categories of legislation: PRIMARY LEGISLATION is law passed by Parliament (also called “statutes”). Amendments are usually incorporated in the same text. There may be:

− Acts of the UK Parliament − Acts of the pre-UK Parliaments (acts in force before the UK existed) − Acts of the Scottish Parliament − Measures of the National Assembly for Wales − Acts of the Northern Ireland Assembly − Church of England Measures − Prerogative instruments (under royal prerogative)

SECONDARY LEGISLATION is delegated legislation made by a body (Minister, Crown...) submitted to primary legislation (“subordinate legislation”). There may be:

− Statutory Instruments − Scottish Statutory Instruments − Welsh Statutory Instruments − Statutory Rules of Northern Ireland − Church Instruments − Bylaws

EEA/EFTA STATES ICELAND

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Iceland is constituted as a parliamentary Republic. As the Head of State, the President of Iceland may block a law passed by Parliament (the Althingi) and submit it to referendum. The Prime Minister is Head of Government, and responsible before the Legislature. Iceland has a tradition of written civil law. Main sources of law include237:

− The Constitution as the supreme legal norm. − Statutory legislation enjoys primacy as a source of law. The increased economic and

social complexity goes hand in hand with proliferating legislation. Legal Acts are published in the Legal Gazette.238

− Regulatory statutes are issued by administrative authorities holding relevant executive competences. They are also published in the legal Gazette and relevant Ministry website.239

Other legal sources are customary law and judicial precedent. In a variety of contexts, the recognition of “tradition and culture” (eðli máls) bears significantly on Icelandic law. Despite its civil nature and clearly different from Common Law tradition, decisions held in the Supreme Court may have considerable authority on subsequent cases in matters of identified legal uncertainty. Additionally, certain areas that are deprived from extensive statutory legislation – such as tort law – may allow the Supreme Court to emerge as a decisive regulator. NORWAY Norway is a constitutional monarchy with a parliamentary system of government. King Harald V is the current Head of State. He theoretically holds important executive powers, granted by the 1814 Constitution. However, these royal powers are merely symbolic and are actually exercised by the Council of State (Prime Minister and Cabinet). The Norwegian Parliament (Stortinget) is a unicameral body constituted by 169 representatives elected from the 19 Norwegian counties. Apart from the Basic Law, the Norwegian Constitution of 17 May 1814, there are two different sources of legislation: Statutes (Acts) and Regulations Circulars are interpretative pieces coming from Ministries to involved actors.240 The principles of rule of law, equality, efficiency and accountability inform public administration.

237 http://en.sff.is/rulesandregulations/legalsystem/. 238 Official and unofficial translations can be found on relevant Ministries’ internet portals. See www.government.is. 239 Ibid. 240 http://www.regjeringen.no/en.html?id=4.

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ANNEX IV. Public procurement value in the EU Value of public procurement which is openly advertised, as a percentage of GDP Year 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006EU (25 countries) : : : : : : : : : 2.65 2.92 3.27

France 0.93 1.17 1.43 1.79 1.90 2.37 2.71 3.12 3.71 2.76 2.98 3.44Netherlands 0.98 1.03 1.10 1.02 1.15 2.10 2.47 1.82 1.71 1.75 1.62 2.33

Sweden 2.28 2.19 2.25 2.33 2.48 3.40 4.56 3.81 3.58 3.33 3.19 3.07 Source: Eurostat 241 Short Description: Data on public procurement are based on information contained in the calls for competition and contract award notices submitted for publication in the Official Journal of the European Communities (the S series). The nominator is the value of public procurement, which is openly advertised. For each of the sectors - works, supplies and services - the number of calls for competition published is multiplied by an average based, in general, on all the prices provided in the contract award notices published in the Official Journal during the relevant year. The denominator is GDP, gross domestic product.

241 http://epp.eurostat.ec.europa.eu/portal/page/portal/government_finance_statistics/data/main_tables.

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ANNEX V. Thresholds establishing the application of the PP Directives

* Norway has double threshold values, at national level (NOK 500,000 aproximate €62,500) and the hereby represented, at EU level. Source: Own elaboration and European Commission242

242 Threshold values established by the Regulation No. 1422/2007 of 4th December 2007 amending Directives 2004/17 and 2004/18 in respect of their application thresholds for the procedures for the award of contracts. Information from the Commission on the corresponding values of the thresholds of Directives 2004/17 and 2004/18. Website: International Comparative Legal Guide Series http://www.iclg.co.uk/index.php?area=4&kh_publications_id=84.

Type of Contract

Dir. France Netherlands Sweden UK Iceland Norway*

Supply/ Services (central)

EUR 133,000

EUR 133,000

EUR 133,000

SEK 1,233,901 EUR 133,000

GBP 90,319 EUR 133,000

ISK 5 MIL. (EUR 28,200)

NOK 1,050,000 EUR 131,250

Supply/ Services (other)

EUR 206,000

EUR 206,000

EUR 206,000

SEK 1,911,155 EUR 133,000

GBP 139,893 EUR 133,000

ISK 10 MIL. (EUR 56,400)

NOK 1,650,000 EUR 184,650

Works EUR 5,150,000

EUR 5,150,000

EUR 5,150,000

SEK 47,778,869 EUR 5,150,000

GBP 3,497,313 EUR 5,150,000

ISK 10 MIL. (EUR 56,400)

NOK 41MIL EUR 5,125,000

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Annex VI. Degree of implementation of the 2004 Recommendation on the Transposition of Internal Market directives in Member States – Source EC243 Practices referred to in the Recommendation FR NL SE UK

1.1. One senior member of government responsible for coordination of EU affairs • • •

1.2. Regular report on the transposition records on the Cabinet or government level • • • •

1.3. Allocation of sufficient resources • •2.1. One ministry responsible formonitoring and coordinating transposition • • •

2.2. Designated officials in each ministry or government body • • • •

2.3 Guidelines on transposition • •2.4. A central national database • • •2.5. Reminders before the deadline • • •2.6. Reminders after deadline • • •2.7. Proactive in seeking Commissionassistance •

3.1. A planning schedule for transposition prepared • •

3.2. Drafting of national implementingmeasures starts at latest when Directive is published in OJ

• •

3.3. Correlation table • • • •3.4. Goldplating is avoided • •3.5. National officials responsible for negotiating a Directive are involved in its transposition

•

3.6. Representatives of federal/regional levels are kept informed during negotations •3.7 Electronic notification of implementing measures to the Commission • • • •

4.1. Parliament involved since proposal stage and kept informed during negotiations • • •

4.2. Parliament informed on progress in transposition •

4.3. Together with draft national implementing measures, the Parliament receives timetable for transposition4.5. Government encourages Parliament to provide necessary time to transpose directives • •

5.1. Measures are taken that 'late'transpositions are speeded up • •

5.2. Parliament encouraged to givepriority treatment to late transpositions • •

5.3. Publication of late transpositions5.4. Fast track procedure •5.5. Use of alternative legal instruments N/A

TOTAL 6 14 13 19

Actio

ns ta

ken

in

case

of l

ate

trans

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tion

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spos

itio

n as

prio

rity

Perm

anen

t mon

itorin

gPr

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243 Commission Recommendation of 12 July 2004 on the Transposition into national law of Directives affecting the Internal Market, OJ L98 of 16.04.2005, p. 4. The answers under points 1.3, 2.7, 3.6 and 5.5 have not been counted towards the total either because the answer is not verifiable or the question does not apply in many MS

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ANNEX VII. List of contact details ADVISORY BOARD Jens Nymand-Chrisensen, European Commission Marc Wenner, Adjoint au chef de bureau des services publics locaux DGCL. (FR) Severine Reymund, Services publics locaux DGCL (FR). Leandro Montello, Legal Studies Officer. French Home Office. PARIS (FR) Tom Leeuwestein, Head of Department. Region and Local Government and Europe Ministry of the Interior and Kingdom Relations. THE HAGUE (NL) Thomas Zandstra, Senior Policy AdvisorLocal & Regional Government and Europe Ministry of the Interior and Kingdom Relations. THE HAGUE (NL) Ms Hanne Torkelsen, Lawyer. The Norwegian Association Of Local and Regional Authorities, NALRA. OSLO (NO) Ms Signe Pape, Special Advisor. The Norwegian Association of Local and Regional Authorities (NO) Henrik Källsbo, Ministry of Finance. STOCKHOLM (SE) Christina Rydberg, Democracy and Governance Swedish Association of Local Authorities and Regions. STOCKHOLM (SE) Victoria Jones, Local Governance, European and International. Dep. of Communities and Local Government LONDON (UK) Clive Kingman, Policy Adviser. Local Democracy and Empowerment. Dep. of Communities and Local Government. LONDON (UK) Paul Rowsell, Local Governance, European and International Dep. of Communities and Local Government. LONDON (UK) CONTACT POINTS ON PUBLIC PROCUREMENT AND LANDFILL WASTE Marnix Dijkman, Public Procurement expert, Ministry of Economic Affairs (NL) Anne-Claire Collee, Landfill Waste expert, Ministry of Envioronment (NL) Manon Van’t Wout, Deputy Director “Regiebureau Inkoop”. Ministry of the Interior (NL) Thomas Van Doorn, Policy Officer. Ministry of Economic Affairs (NL) Joaneke Balfoort, Ministry of Foreign Affairs (NL) Annemiek Wissink, Director European Department of Association of Netherlands Municipalities, VNG. (NL) Ann-Marie Kühler, Senior Legal Advisor. Europa Decentraal (NL) Pål Hellesylt, Expert on Public Procurement. (NO) Ragnhild Børke, Expert Landfill Waste. (NO) Åsa Edman, Division for public procurement. Ministry of finance (SE) Rickard Falkendal, Ministry of Finance (SE) Theresa Kjell, Ministry of Environment (SE) Johan Höök, director, Division for Local Governmental Affairs, Ministry of Finance (SE) Bo-Per Larsson, Swedish Association for Local Authorities and Regions, SALAR (SE) Erika Nygren, the Swedish Environmental Protection Agency Ulf Palm, Expert on Public procurement. SALAR (SE) Eva Sveman, Expert on Public procurement. SALAR (SE) Lena Svensson, Expert on Public procurement. SALAR (SE) Peter Wenster, Expert on Landfill Waste. SALAR (SE) Caroline Wehlander, Legal Adviser SALAR (SE)

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Lee Digings -local government- (old). National Adviser Procurement, Improvement and Development Agency, IDeA. (UK) Rob Hann, local goverment- (old) (UK) Kerry Wilson, Head of Policy, Value Wales, Welsh Assembly Government (UK) Ashley Gould, Head of Procurement Highland Council. Scotland (UK) Melvin Hughes, Local Government, England (UK) Jane Ikeaqwu, Local Government, England (UK) Daniel Instone, Head of Waste Strategy Division, Department for the Environment, Food, and Rural Affairs (DEFRA) (UK) Anna G. Björnsdóttir, Icelandic Association of Local Authorities Gudjon Bragason, Head of Division Legal Advice, Icelandic Association of Local Authorities Gudmundur I. Guomundsson, Chief Lawyer. Rikiskaup, State Trading Center (IS) Júlíus S. Ólafsson, executive director Rikiskaup, State Trading Center (IS) Ingvi Már Pálsson, Lawyer. Ministry of Finance (IS) Jónína B. Bjarnadóttir, Economist. Ministry of Finance (IS) Helgi Bogason, Head of Procurement. REYKJAVIK. (IS) Eypóra Kristín Geirsdóttir, Lawyer. Reykjavik (IS) Sigurdur Óli Kolbeinsson, Former Head of Legal Affairs (IS) Ludvík Eckardt Gústafsson, Project Manager, Association of local authorities in Iceland (IS) Sigurbjörg Saemundsdóttir, Expert, Ministry of the Environment (IS) Sigrún Ágústsdóttir, The Environmental Agency (IS) Gunnlaug Einarsdóttir, The Environmental Agency (IS) Björn H. Halldórsson, Director. SORPA, Company in the field of waste management owned by the capital of Reykjavik and neighboring municipalities (IS) Bernard Theuillon, Directeur de la Commande et de l' Achat (FR) Philippe de Longevialle, Adjoint au Maire de Grenoble – Urbanisme Président de la commission "Politique de la Ville" à Grenoble Alpes Metropole Président de la SEM SAGES. (FR) M. de Manheulle, Ministry of interior affairs (no reaction till now) (FR) Marc Wenner, Adjoint au chef de bureau de services publics locaux (FR) Gérard Saint-George, Bureau de services publics locaux. Service d’elimination de déchets (FR) Thibaud Courtiol, Bureau des Structures territoriales (FR) Benoit Banzept, Sécretariat Général des Affaires Europénnes. Chargé de mission pour le collectivités territorial (FR) Nicolas Debaisieux. Sécretariat Général des Affaires Europénnes (FR) Julien Rossi, Sécretariat Général des Affaires Europénnes (FR) Véronique Fourquet, Sécretariat Général des Affaires Europénnes (FR) Carole Prevot. Association des Maires de France (AMF). Chargée des Affaires Européennes et Internationales (FR) Sylvianne Oberle, Responsable du service Environnement et Développement Durable (FR) Annick Pillevesse, Responsable du service Conseil juridique (FR) Eszter Patay, Association de Petites Villes de France (APVF) (FR) Jean-Sebastién Sauvourel, Fédération del Maires de Villes Moyannes de France (FMVMF) Chargé d’études (FR) Sarah Abric, Association des Maires de Grandes Villes de France (AMGVF). Chargée de mission Europe, Coopération décentralisée (FR) Pascal Gruselle, Association des Régions de France (ARF). Délégué aux Affaires Europénnes (FR) Sabine Martorell, Association Française du Conseil des Communes et de Régions d’Europe (AFCCRE). Chef de projets, direction des Politiques territoriales (FR) Montaine Blonsard, Maison Européenne des Pouvoirs Locaux Français (MEPLF). Chargée des Affaires Européennes et Internationales (FR)

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