Contents
Judgment of the Court (Fifth Chamber)15 January 2026note(Reference for a preliminary ruling — Public procurement — Directive 2014/24/EU — Article 12(3) — Public contract awarded directly to a legal person jointly controlled by the contracting authorities — Conditions — Threshold of the activities of the controlled legal person carried out in the performance of tasks entrusted to it by the contracting authorities — Article 12(5) — Consideration of the turnover of the subsidiaries of the group of which the controlled legal person is the parent company — EU accounting legislation — Directive 2013/34/EU — Articles 22 and 24 — Preparation of consolidated financial statements)In Case C‑692/23,REQUEST for a preliminary ruling under Article 267 TFEU from the Gerechtshof Den Haag (Court of Appeal, The Hague, Netherlands), made by decision of 14 November 2023, received at the Court on 17 November 2023, in the proceedingsAVR-Afvalverwerking BVvNV BAR-Afvalbeheer,Gemeente Barendrecht,Gemeente Albrandswaard,Gemeente Ridderkerk,NV Irado,Afvalsturing Friesland NV,THE COURT (Fifth Chamber),composed of M.L. Arastey Sahún, President of the Chamber, J. Passer, E. Regan (Rapporteur), D. Gratsias and B. Smulders, Judges,Advocate General: A. Rantos,Registrar: A. Lamote, Administrator,having regard to the written procedure and further to the hearing on 5 February 2025,after considering the observations submitted on behalf of:– AVR-Afvalverwerking BV, by P.F.C. Heemskerk and E.L. Vos, advocaten,– NV BAR-Afvalbeheer, Gemeente Barendrecht, Gemeente Albrandswaard and Gemeente Ridderkerk, by L. Bozkurt, advocate,– NV Irado, by D.B. Zieren, advocaat,– Afvalsturing Friesland NV, by L.E.J. Korsten and M. van Wanroij, advocaten,– the Italian Government, by S. Fiorentino and G. Palmieri, acting as Agents, and by M. Cherubini and C. Colelli, avvocati dello Stato,– the Austrian Government, by A. Posch and J. Schmoll, acting as Agents,– the European Commission, by A. Biolan, L. Malferrari and G. Wils, acting as Agents,after hearing the Opinion of the Advocate General at the sitting on 30 April 2025,gives the following
Judgment
1This request for a preliminary ruling concerns the interpretation of point (b) of the first subparagraph of Article 12(3) and Article 12(5) of Directive 2014/24/EU of the European Parliament and of the Council of 26 February 2014 on public procurement and repealing Directive 2004/18/EC (OJ 2014 L 94, p. 65).
2The request has been made in proceedings between AVR-Afvalverwerking BV (‘AVR’), on the one hand, and NV BAR-Afvalbeheer (‘BAR’), Gemeente Barendrecht (Municipality of Barendrecht, Netherlands), Gemeente Albrandswaard (Municipality of Albrandswaard, Netherlands), Gemeente Ridderkerk (Municipality of Ridderkerk, Netherlands) (together, ‘the BAR municipalities’), NV Irado, and Afvalsturing Friesland NV (‘AF’), on the other hand, concerning public contracts for the collection and processing of residual household waste in the BAR municipalities which were directly awarded to legal persons jointly controlled by the contracting authorities.
Legal context
European Union law
Directive 2013/34/EU
3Recital 31 of Directive 2013/34/EU of the European Parliament and of the Council of 26 June 2013 on the annual financial statements, consolidated financial statements and related reports of certain types of undertakings, amending Directive 2006/43/EC of the European Parliament and of the Council and repealing Council Directives 78/660/EEC and 83/349/EEC (OJ 2013 L 182, p. 19) states:‘Consolidated financial statements should present the activities of a parent undertaking and its subsidiaries as a single economic entity (a group). Undertakings controlled by the parent undertaking should be considered as subsidiary undertakings. Control should be based on holding a majority of voting rights, but control may also exist where there are agreements with fellow shareholders or members. In certain circumstances control may be effectively exercised where the parent holds a minority or none of the shares in the subsidiary. Member States should be entitled to require that undertakings not subject to control, but which are managed on a unified basis or have a common administrative, managerial or supervisory body, be included in consolidated financial statements.’
4Article 22 of Directive 2013/34, entitled ‘The requirement to prepare consolidated financial statements’, provides:1.A Member State shall require any undertaking governed by its national law to draw up consolidated financial statements and a consolidated management report if that undertaking (a parent undertaking):(a) has a majority of the shareholders’ or members’ voting rights in another undertaking (a subsidiary undertaking);(b) has the right to appoint or remove a majority of the members of the administrative, management or supervisory body of another undertaking (a subsidiary undertaking) and is at the same time a shareholder in or member of that undertaking;(c) has the right to exercise a dominant influence over an undertaking (a subsidiary undertaking) of which it is a shareholder or member, pursuant to a contract entered into with that undertaking or to a provision in its memorandum or articles of association, where the law governing that subsidiary undertaking permits its being subject to such contracts or provisions.A Member State need not prescribe that a parent undertaking must be a shareholder in or member of its subsidiary undertaking. Those Member States the laws of which do not provide for such contracts or clauses shall not be required to apply this provision; or(d) is a shareholder in or member of an undertaking, and:(i) a majority of the members of the administrative, management or supervisory bodies of that undertaking (a subsidiary undertaking) who have held office during the financial year, during the preceding financial year and up to the time when the consolidated financial statements are drawn up, have been appointed solely as a result of the exercise of its voting rights; or(ii) controls alone, pursuant to an agreement with other shareholders in or members of that undertaking (a subsidiary undertaking), a majority of shareholders’ or members’ voting rights in that undertaking. The Member States may introduce more detailed provisions concerning the form and contents of such agreements.Member States shall prescribe at least the arrangements referred to in point (ii). They may subject the application of point (i) to the requirement that the voting rights represent at least 20% of the total.However, point (i) shall not apply where a third party has the rights referred to in points (a), (b) or (c) with regard to that undertaking.2.In addition to the cases mentioned in paragraph 1, Member States may require any undertaking governed by their national law to draw up consolidated financial statements and a consolidated management report if:(a) that undertaking (a parent undertaking) has the power to exercise, or actually exercises, dominant influence or control over another undertaking (the subsidiary undertaking); or(b) that undertaking (a parent undertaking) and another undertaking (the subsidiary undertaking) are managed on a unified basis by the parent undertaking.3. For the purposes of points (a), (b) and (d) of paragraph 1, the voting rights and the rights of appointment and removal of any other subsidiary undertaking as well as those of any person acting in his own name but on behalf of the parent undertaking or of another subsidiary undertaking shall be added to those of the parent undertaking.4.For the purposes of points (a), (b) and (d) of paragraph 1, the rights mentioned in paragraph 3 shall be reduced by the rights:(a) attaching to shares held on behalf of a person who is neither the parent undertaking nor a subsidiary of that parent undertaking; or(b) attaching to shares:(i) held by way of security, provided that the rights in question are exercised in accordance with the instructions received, or(ii) held in connection with the granting of loans as part of normal business activities, provided that the voting rights are exercised in the interests of the person providing the security.5. For the purposes of points (a) and (d) of paragraph 1, the total of the shareholders’ or members’ voting rights in the subsidiary undertaking shall be reduced by the voting rights attaching to the shares held by that undertaking itself, by a subsidiary undertaking of that undertaking or by a person acting in his own name but on behalf of those undertakings.6. Without prejudice to Article 23(9), a parent undertaking and all of its subsidiary undertakings shall be undertakings to be consolidated regardless of where the registered offices of such subsidiary undertakings are situated.…’
5Article 23 of that directive provides, in accordance with its title, for exemptions from the requirement to prepare consolidated financial statements and a consolidated management report, referred to in Article 22 thereof.
6Article 24 of that directive contains, in accordance with its title, a set of rules governing the preparation of consolidated financial statements.
Directive 2014/24
7Recitals 31 and 32 of Directive 2014/24 state:(31) There is considerable legal uncertainty as to how far contracts concluded between entities in the public sector should be covered by public procurement rules. The relevant case-law of the Court of Justice of the European Union is interpreted differently between Member States and even between contracting authorities. It is therefore necessary to clarify in which cases contracts concluded within the public sector are not subject to the application of public procurement rules.Such clarification should be guided by the principles set out in the relevant case-law of the Court of Justice of the European Union. The sole fact that both parties to an agreement are themselves public authorities does not as such rule out the application of procurement rules. However, the application of public procurement rules should not interfere with the freedom of public authorities to perform the public service tasks conferred on them by using their own resources, which includes the possibility of cooperation with other public authorities.It should be ensured that any exempted public-public cooperation does not result in a distortion of competition in relation to private economic operators in so far as it places a private provider of services in a position of advantage vis-à-vis its competitors.(32) Public contracts awarded to controlled legal persons should not be subject to the application of the procedures provided for by this Directive if the contracting authority exercises a control over the legal person concerned which is similar to that which it exercises over its own departments, provided that the controlled legal person carries out more than 80% of its activities in the performance of tasks entrusted to it by the controlling contracting authority or by other legal persons controlled by that contracting authority, regardless of the beneficiary of the contract performance.The exemption should not extend to situations where there is direct participation by a private economic operator in the capital of the controlled legal person since, in such circumstances, the award of a public contract without a competitive procedure would provide the private economic operator with a capital participation in the controlled legal person an undue advantage over its competitors. However, in view of the particular characteristics of public bodies with compulsory membership, such as organisations responsible for the management or exercise of certain public services, this should not apply in cases where the participation of specific private economic operators in the capital of the controlled legal person is made compulsory by a national legislative provision in conformity with the Treaties, provided that such participation is non-controlling and non-blocking and does not confer a decisive influence on the decisions of the controlled legal person. It should further be clarified that the decisive element is only the direct private participation in the controlled legal person. Therefore, where there is private capital participation in the controlling contracting authority or in the controlling contracting authorities, this does not preclude the award of public contracts to the controlled legal person, without applying the procedures provided for by this Directive as such participations do not adversely affect competition between private economic operators.It should also be clarified that contracting authorities such as bodies governed by public law, that may have private capital participation, should be in a position to avail themselves of the exemption for horizontal cooperation. Consequently, where all other conditions in relation to horizontal cooperation are met, the horizontal cooperation exemption should extend to such contracting authorities where the contract is concluded exclusively between contracting authorities.’
8Article 12 of that directive, entitled ‘Public contracts between entities within the public sector’, provides, in paragraphs 3 and 5 thereof:3.A contracting authority, which does not exercise over a legal person governed by private or public law control within the meaning of paragraph 1, may nevertheless award a public contract to that legal person without applying this Directive where all of the following conditions are fulfilled.(a) the contracting authority exercises jointly with other contracting authorities a control over that legal person which is similar to that which they exercise over their own departments;(b) more than 80% of the activities of that legal person are carried out in the performance of tasks entrusted to it by the controlling contracting authorities or by other legal persons controlled by the same contracting authorities; and(c) there is no direct private capital participation in the controlled legal person with the exception of non-controlling and non-blocking forms of private capital participation required by national legislative provisions, in conformity with the Treaties, which do not exert a decisive influence on the controlled legal person.…5. For the determination of the percentage of activities referred to in point (b) of the first subparagraph of paragraph 1, point (b) of the first subparagraph of paragraph 3 and point (c) of paragraph 4, the average total turnover, or an appropriate alternative activity-based measure such as costs incurred by the relevant legal person or contracting authority with respect to services, supplies and works for the three years preceding the contract award shall be taken into consideration.…’
Netherlands law
9Articles 22 to 24 of Directive 2013/34 were transposed into Netherlands law by provisions set out in Book II of the Burgerlijk Wetboek (Civil Code), which is entitled ‘Legal Persons’.
10Directive 2014/24 was transposed into Netherlands law by the Aanbestedingswet (Law on public procurement) of 1 November 2012 (Stb. 2012, No 542), in the version applicable to the dispute in the main proceedings (‘the Law on public procurement’).
The dispute in the main proceedings and the questions referred for a preliminary ruling
11In 1995, the municipalities of the province of Friesland (Netherlands) established AF, a joint waste processing organisation. After that date, other Dutch municipalities, which are not located in that province, also became shareholders of AF.
12The referring court states that AF is the parent company of a group of subsidiaries, some of which operate in a field other than the performance of the tasks entrusted to AF or to its subsidiaries by its shareholder municipalities.
13In accordance with the national legislation transposing Articles 22 to 24 of Directive 2013/34, AF prepares consolidated annual accounts which, in accordance with that national legislation, include its own financial information and that of its subsidiaries, other companies of the group and other legal persons over which it can exercise control or which it manages on a unified basis. One element of those consolidated annual accounts is the profit and loss account in which AF includes, on the revenue side, the consolidated turnover of those entities, excluding transactions carried out between them.
14Furthermore, AF itself operates a waste disposal site (‘the landfill’) on behalf of the municipalities of the province of Friesland. The landfill receives non-domestic residual waste, including industrial waste and waste from municipal projects, such as soil remediation in connection with building construction and asbestos removal.
15In 2000, three municipalities in the province of South Holland (Netherlands) founded Irado to carry out, inter alia, their waste management. In 2017, Irado became a shareholder in AF and, since 1 January 2017, has had AF process the residual household waste that it collects in those three municipalities in the province of South Holland.
16The BAR municipalities are also located in that province. In 2015, they founded BAR to carry out their waste management.
17Until 31 December 2019, each of the BAR municipalities had an agreement with different waste processing companies and, on the basis of those agreements, AVR, a commercial company specialising in that sector, processed the residual household waste of those municipalities, partly as a subcontractor.
18In 2019, the BAR municipalities decided that BAR would acquire a stake in Irado, which would be responsible for collecting and processing their residual household waste.
19On 13 December 2019, Irado and AF concluded an agreement for the delivery, transport and processing of residual household waste from the BAR municipalities with effect from 1 January 2020.
20On 20 December 2019, BAR and Irado concluded a service agreement which also covered the processing of residual household waste from the BAR municipalities.
21On 31 December 2019, BAR became a shareholder in Irado.
22AVR brought an action with the rechtbank Den Haag (District Court, The Hague, Netherlands), seeking, primarily, the annulment or, in the alternative, the termination or non-performance of the agreements referred to in paragraphs 19 and 20 of this judgment between BAR and Irado, on the one hand, and Irado and AF, on the other hand, on the grounds that the conditions under which a contracting authority may, when exercising jointly with other contracting authorities control over the legal person concerned, directly award a public contract to that legal person, were not met. That action also sought an order for a call for tenders for those contracts to be launched if the BAR municipalities still wished to award them.
23Following the dismissal of its action by the rechtbank Den Haag (District Court, The Hague), AVR brought an appeal before the Gerechtshof Den Haag (Court of Appeal, The Hague, Netherlands), which is the referring court.
24That court states that it is common ground between the parties that the contract awarded by BAR to Irado and that awarded by Irado to AF fall, in principle, under the obligation to call for competitive tendering provided for by Directive 2014/24, unless they can be awarded directly due to the control exercised by the contracting authority, jointly with other contracting authorities, over the legal person to whom the contract is awarded.
25Consequently, that court considers that, for the purposes of deciding the dispute pending before it, it is necessary, inter alia, to assess whether, in its relationship with the controlling contracting authorities, AF meets the condition laid down in point (b) of the first subparagraph of Article 12(3) of that directive, read in conjunction with the first subparagraph of Article 12(5) of that directive, according to which more than 80% of the activities of the controlled legal person must be carried out in the performance of tasks entrusted to it by the controlling contracting authorities, that percentage being, in the present case, determined according to the criterion of turnover.
26In that regard, the referring court states that the defendants in the main proceedings claim that, since those provisions expressly refer to the activities of the legal person to which the public contract is awarded, the relevant turnover can only be that of that legal person itself.
27On the other hand, AVR argues that it is the turnover of the group to which that legal person belongs that should be taken into account, since it is the only way to take into account the economic reality. Otherwise, a legal person controlled by contracting authorities could circumvent the requirement laid down in point (b) of the first subparagraph of Article 12(3) of Directive 2014/24 by artificially separating its activities, so that that legal person itself carries out within the group more than 80% of those activities for the benefit of those contracting authorities, while having one or more undertakings in that group operate on the free market.
28The referring court therefore raises the question of which turnover should be taken into account where the percentage of activities referred to in those provisions is determined on the basis of the turnover criterion and the controlled legal person is at the head of a group, in order to assess whether the condition laid down in point (b) of the first subparagraph of Article 12(3) of that directive is met.
29In that regard, that court states that, in the context of the pending litigation before it, that condition is met if only AF’s turnover is taken into account, but is not met if it is assessed in the light of the consolidated turnover of the group headed by AF.
30That being said, the referring court also notes the possibility, as argued by AVR, of considering, where appropriate, the relevant turnover to be that of the entities with which that legal person constitutes an economic unit, within the meaning of the concept of ‘undertaking’ under EU competition law.
31Secondly, that court considers that, if the Court were to rule that only the turnover of the controlled legal person should be taken into consideration, it would then be necessary to determine whether, in the present case, the defendants in the main proceedings were correct in taking into account the turnover achieved by AF in respect of its operation of the landfill.
32In those circumstances, the Gerechtshof Den Haag (Court of Appeal, The Hague) decided to stay the proceedings and to refer the following questions to the Court of Justice for a preliminary ruling:(1) Should the activity criterion set out in point (b) of the first subparagraph of Article 12(3) of Directive [2014/24], read in conjunction with Article 12(5) of that directive, be interpreted as meaning that,where the percentage of activities referred to in those provisions is determined on the basis of turnover and the controlled legal person is part of a group,only the turnover of the controlled legal person itself should be taken into consideration, or also the turnover of affiliated or non-affiliated companies within the group, such as:(i) the consolidated turnover in which the turnover of the relevant legal person is to be added to that of other group entities pursuant to the national transposition of Articles 22 and 24 of Directive [2013/34]; or(ii) the turnover of the entities with which the controlled legal person constitutes an economic unit within the meaning of the concept of “undertaking” under EU competition law?(2) If the answer to Question 1 is that only the turnover of the controlled legal person itself should be taken into consideration, should the activity criterion referred to in that question be interpreted as meaning thatthe turnover derived from third-party users who dispose of waste in a landfill which the controlled legal person operates on behalf of controlling contracting authorities is to be regarded as turnover achieved in the performance of tasks entrusted to that legal person by those controlling contracting authorities, having regard to the fact that the controlled legal person competes, inter alia, with private parties in operating the landfill?’
Consideration of the questions referred
The first question
33By its first question, the referring court asks, in essence, whether point (b) of the first subparagraph of Article 12(3) of Directive 2014/24, read in conjunction with the first subparagraph of Article 12(5) of that directive, must be interpreted as meaning that the condition that more than 80% of the activities of the controlled legal person must be carried out in the performance of tasks entrusted to it by the controlling contracting authorities, where that condition is determined according to the turnover criterion and that controlled legal person is the parent company of a group, requires that the turnover of the other entities belonging to that group must also be taken into account, where appropriate on the basis of the consolidated turnover which that legal person is required to establish under Articles 22 and 24 of Directive 2013/34 or, alternatively, on the basis of the combined turnover of the entities with which that legal person constitutes an economic unit, within the meaning of the concept of ‘undertaking’ under EU competition law.
34Article 12(3) of Directive 2014/24 relates to the situation in which a contracting authority exercises, not alone, but jointly with other contracting authorities, control over a legal person governed by private or public law, and specifies the conditions which must be met in order for that contracting authority to be able properly to award a public contract directly to that legal person.
35Of the cumulative conditions on which the possibility of such an award depends, the referring court requests the Court’s interpretation only with regard to that relating to the percentage of activities which the controlled legal person must carry out in the performance of tasks entrusted to it by the controlling contracting authorities, in the light of point (b) of the first subparagraph of Article 12(3) of that directive, read in conjunction with the first subparagraph of Article 12(5) thereof.
36Consequently, in order to answer the referring court’s questions, it is necessary, in the first place, to determine whether the assessment of whether such a condition is met requires account to be taken not only of the turnover of the controlled legal person but also of that of the other entities forming part of the group of which that legal person is the parent company.
37In accordance with settled case-law, when interpreting a provision of EU law, account must be taken not only of its wording but also of its context and the objectives pursued by the rules of which it forms part (see judgments of 17 November 1983, Merck, 292/82, EU:C:1983:335, paragraph 12, and of 22 December 2022, Sambre & Biesme and Commune de Farciennes, C‑383/21 and C‑384/21, EU:C:2022:1022, paragraph 54 and the case-law cited).
38First, as regards the wording of the provisions at issue, it should be noted that point (b) of the first subparagraph of Article 12(3) of Directive 2014/24 requires that more than 80% of the ‘activities’ of the controlled legal person must be carried out in the performance of tasks entrusted to it by the controlling contracting authorities or by other legal persons controlled by the same contracting authorities.
39Thus, it does not follow from the wording of that point (b) of the first subparagraph of Article 12(3) that the condition laid down in that provision must necessarily be assessed on the basis of only the activities of the controlled legal person itself.
40The criterion provided for in that point (b) of the first subparagraph of Article 12(3) relates not to that legal person as such, but to the activities carried out by that person. Thus, it is possible that the relevant activities for the purpose of assessing whether the condition laid down by that provision is met may cover both those carried out directly by that legal person, and those carried out through the other entities belonging to the group of which that legal person is the parent company.
41Moreover, the first subparagraph of Article 12(5) of Directive 2014/24 provides that the percentage of activities referred to in point (b) of the first subparagraph of Article 12(3) of that directive is, in particular, determined on the basis of the average total turnover, and does not require that the turnover which is able to adequately represent such activities must be limited to that resulting from the activities of the controlled legal person.
42The wording of that provision therefore confirms that, in order to assess whether the condition provided for in point (b) of the first subparagraph of Article 12(3) of that directive is met, the relevant criterion is not limited to the activities of the controlled legal person itself, but also extends to those which may be more broadly linked to it. Thus, if, as permitted by the first subparagraph of Article 12(5) of that directive, the criterion of average total turnover is used for the purposes of such an assessment, that turnover must be such as to adequately represent such activities. It follows that the turnover of the other entities belonging to the group of which the controlled legal person is the parent company is also relevant for the purposes of such an assessment.
43Secondly, that interpretation is supported by the context in which those provisions are found. Under the cumulative conditions on which the application of Article 12(3) of Directive 2014/24 depends, that provision provides, in its first subparagraph, under point (c), that there must, in principle, be no direct private capital participation in the controlled legal person.
44In that regard, recital 32 of that directive states that, in particular, where a contracting authority exercises, jointly with other contracting authorities, control over the legal person concerned, the exemption from the application of the procedures provided for by that directive should not extend to situations where there is direct participation by a private economic operator in the capital of the controlled legal person since, in such circumstances, the award of a public contract without a competitive procedure would provide the private economic operator with a capital participation in the controlled legal person with an undue advantage over its competitors.
45It thus follows that the EU legislature intended that the possibility of directly awarding a public contract must be assessed taking into account the economic context of all the entities concerned by such an award. Consequently, in addition to the question of the relationship between the controlled legal person and the contracting authorities which jointly exercise control over it, account must be taken of the broader economic context in which that legal person itself operates. In this context, the existence of a group headed by that legal person cannot be overlooked.
46Thus, a contextual interpretation of point (b) of the first subparagraph of Article 12(3) of Directive 2014/24, read in conjunction with the first subparagraph of Article 12(5) of that directive, tends to confirm that, for the purposes of applying those provisions, it is necessary to take into account the turnover of the entities forming part of the group of which the legal person concerned is the parent company.
47Thirdly, the foregoing considerations are confirmed by the origin of Article 12(3) of that directive.
48In Article 12, that directive codified and made clear the case-law developed by the Court on direct awards of public contracts (judgment of 22 December 2022, Sambre & Biesme and Commune de Farciennes, C‑383/21 and C‑384/21, EU:C:2022:1022, paragraph 44 and the case-law cited).
49As is apparent from recital 31 of that directive, whilst noting that there is considerable legal uncertainty as to how far contracts concluded between entities in the public sector should be covered by public procurement rules and that it is therefore necessary to provide clarification in this regard, the EU legislature considered that such clarification should be guided by the principles set out in the relevant case-law of the Court and, therefore, did not intend to call that case-law into question (judgment of 22 December 2022, Sambre & Biesme and Commune de Farciennes, C‑383/21 and C‑384/21, EU:C:2022:1022, paragraph 66 and the case-law cited).
50In that regard, it should be recalled that, prior to the adoption of that directive, the Court held that, for the purposes of the direct award of a public contract to a controlled entity, that entity had to perform the essential part of its activities for the benefit of the contracting authority or authorities which control it, which had to be assessed taking into account all the facts of the case, both qualitative and quantitative (see, to that effect, judgment of 8 December 2016, Undis Servizi, C‑553/15, EU:C:2016:935, paragraphs 31 and 32 and the case-law cited).
51Consequently, by setting, in point (b) of the first subparagraph of Article 12(3) of that directive, at 80% the percentage of activities to be carried out by the controlled legal person in the performance of tasks entrusted to it by the controlling contracting authorities, the EU legislature intended to clarify the criterion appearing, in this respect, in the case-law of the Court. However, it does not appear from the provisions of that directive that the EU legislature considered that the assessment to be made in that regard was no longer to be made taking into account all the facts of the case.
52Such facts include the circumstance that the controlled legal person is the parent company of a group, with the result that, in order to assess the activities of that legal person, it is necessary to take into account the activities which it carries out through the other entities belonging to that group and, consequently, their turnover when, under the first subparagraph of Article 12(5) of Directive 2014/24, it is the criterion used to determine whether the condition set out in point (b) of the first subparagraph of Article 12(3) is met.
53Fourthly, that interpretation of point (b) of the first subparagraph of Article 12(3) of that directive, read in conjunction with the first subparagraph of Article 12(5) thereof, is supported by the objective pursued by those provisions.
54In that regard, as the Advocate General stressed in point 52 of his Opinion, those provisions aim to prevent distortions of competition, in that they are designed to ensure that Directive 2014/24 remains applicable in the event that a controlled legal person is active in the market, and therefore liable to be in competition with other undertakings. Such a legal person is not necessarily deprived of freedom of action merely because the decisions concerning it are controlled by the controlling municipal authority or authorities, if it can still carry out a large part of its economic activities with other operators. By contrast, where that legal person fulfils the conditions of those provisions, it is not subject to the restrictions of that directive, since they are in place to preserve a state of competition which, in that case, no longer has any raison d’être (see, by analogy, judgment of 8 December 2016, Undis Servizi, C‑553/15, EU:C:2016:935, paragraph 33 and the case-law cited).
55The fact that the economic activity of the controlled legal person carried out with such operators is carried out directly by that legal person, or through other entities belonging to the group of which it is the parent company, is not relevant with regard to the achievement of the objective of preventing distortions of competition. Consequently, in order to determine what proportion of the controlled legal person’s activities are devoted to the controlling contracting authorities, the activities of the other entities belonging to the group of which it is the parent company must be taken into account and, consequently, the turnover of those entities, when this is the criterion used to determine whether the condition set out in point (b) of the first subparagraph of Article 12(3) of Directive 2014/24 is met.
56That finding is confirmed by the fact that, as noted by the Advocate General in points 56 and 57 of his Opinion, first, it is possible that entities belonging to a group may indirectly benefit from public contracts awarded to the parent company of that group without a competitive procedure, which, similarly to the considerations set out in paragraph 44 of this judgment, would have the effect of providing them with an undue advantage over their competitors. Secondly, the achievement of the objectives referred to in point (b) of the first subparagraph of Article 12(3) of Directive 2014/24, as recalled in paragraph 54 of this judgment, cannot depend on the structure of that group, which would be the case if the activities of the other entities belonging to the group of which the controlled legal person is the parent company were not taken into account. Indeed, this would mean that that controlled legal person could easily circumvent that provision and the condition it imposes by artificially splitting its activities and entrusting some of them to the companies in the group of which it is the parent company.
57In the second place, it is necessary to answer the referring court’s questions relating to the methodology for determining the turnover of the group of which the controlled legal person is the parent company in order to assess whether the latter meets the condition laid down in point (b) of the first subparagraph of Article 12(3) of Directive 2014/24, and, in particular, as to the relevance that may be accorded to the consolidated turnover established pursuant to Directive 2013/34.
58In that regard, it is apparent from recital 31 of Directive 2013/34 that consolidated financial statements should present the activities of a parent undertaking and its subsidiaries – these being the undertakings controlled by the parent undertaking – as a single entity.
59To that end, Article 22 of that directive sets out the circumstances in which Member States are obliged to require certain undertakings governed by their national law to prepare, in particular, consolidated financial statements, subject to the exemptions provided for in Article 23 thereof, such preparation being the subject of Article 24 of that directive.
60In that regard, as the Advocate General essentially pointed out in point 62 of his Opinion, when a company is required to draw up consolidated financial statements under those provisions, the consolidated turnover established for that purpose gives a true and fair view of the activities carried out by a parent company within the group headed by that parent company and, therefore, makes it possible appropriately to assess whether, in the event that a public contract is directly awarded to that parent company, that company fulfils the condition laid down in point (b) of the first subparagraph of Article 12(3) of Directive 2014/24, read in conjunction with the first subparagraph of Article 12(5) of that directive.
61In the present case, the referring court states that AF is at the head of a group of subsidiaries and that, in accordance with the requirement to prepare consolidated financial statements to which it is subject under the national legislation transposing Directive 2013/34, it establishes, in particular, a consolidated turnover which includes that of its subsidiaries.
62It follows that, in order to provide a useful answer to the referring court, it is not necessary to address the relevance that other criteria may have, such as the existence of an economic unit, within the meaning of the concept of ‘undertaking’ under EU competition law, to which the referring court also refers, since, in the light of the information provided by that court, it may be noted, on the basis of such consolidated turnover, that the condition laid down in point (b) of the first subparagraph of Article 12(3) of Directive 2014/24, read in conjunction with the first subparagraph of Article 12(5) of that directive, is not met.
63In the light of the foregoing, the answer to the first question is that point (b) of the first subparagraph of Article 12(3) of Directive 2014/24, read in conjunction with the first subparagraph of Article 12(5) of Directive 2014/24, must be interpreted as meaning that the condition that more than 80% of the activities of the controlled legal person must be carried out in the performance of tasks entrusted to it by the controlling contracting authorities, where that condition is determined according to the turnover criterion and that controlled legal person is the parent company of a group, requires that the turnover of the other entities belonging to that group must also be taken into account, where appropriate on the basis of the consolidated turnover which that legal person is required to establish under Articles 22 and 24 of Directive 2013/34.
The second question
64In view of the answer to the first question, there is no need to answer the second question.
Limitation of the temporal effects of the judgment
65At the hearing before the Court, AF requested that the Court limit the temporal effects of this judgment if it should find that point (b) of the first subparagraph of Article 12(3) of Directive 2014/24, read in conjunction with the first subparagraph of Article 12(5) of that directive, must be interpreted as meaning that the condition relating to the activities of the controlled legal person is to be assessed by also taking into account the turnover of the other entities belonging to the group of which that legal person is the parent company.
66In support of its request, AF argued that that interpretation was, in its view, unforeseeable and that it was not required to anticipate such an interpretation.
67It should be recalled in this connection that, according to settled case-law, the interpretation which, in the exercise of the jurisdiction conferred upon it by Article 267 TFEU, the Court gives to a rule of EU law clarifies and defines the meaning and scope of that rule as it must be, or ought to have been, understood and applied from the date of its entry into force. It follows that the rule as thus interpreted may and must be applied by the courts to legal relationships arising and established before the delivery of the judgment ruling on the request for interpretation, provided that in other respects the conditions for bringing before the courts having jurisdiction an action relating to the application of that rule are satisfied (judgment of 16 March 2023, Towercast, C‑449/21, EU:C:2023:207, paragraph 56 and the case-law cited).
68It is only quite exceptionally that the Court may, in application of the general principle of legal certainty inherent in the EU legal order, be moved to restrict the opportunity, open to any person concerned, of relying on a provision which it has interpreted with a view to calling into question legal relationships established in good faith. Two essential criteria must be fulfilled before such a limitation can be imposed: those concerned must have acted in good faith and there must be a risk of serious difficulties (judgment of 16 March 2023, Towercast, C‑449/21, EU:C:2023:207, paragraph 57 and the case-law cited).
69In that regard, it must be stated that AF has not provided any specific information that would show that its request is well founded, merely asserting the allegedly unforeseeable nature of the interpretation referred to in paragraph 65 of this judgment.
70In those circumstances, there is no need to limit the temporal effects of this judgment.
Costs
71Since these proceedings are, for the parties to the main proceedings, a step in the action pending before the referring court, the decision on costs is a matter for that court. Costs incurred in submitting observations to the Court, other than the costs of those parties, are not recoverable.
Operative part
On those grounds, the Court (Fifth Chamber) hereby rules: Point (b) of the first subparagraph of Article 12(3) of Directive 2014/24/EU of the European Parliament and of the Council of 26 February 2014 on public procurement and repealing Directive 2004/18/EC, read in conjunction with the first subparagraph of Article 12(5) of Directive 2014/24,must be interpreted as meaning that the condition that more than 80% of the activities of the controlled legal person must be carried out in the performance of tasks entrusted to it by the controlling contracting authorities, where that condition is determined according to the turnover criterion and that controlled legal person is the parent company of a group, requires that the turnover of the other entities belonging to that group must also be taken into account, where appropriate on the basis of the consolidated turnover which that legal person is required to establish under Articles 22 and 24 of Directive 2013/34/EU of the European Parliament and of the Council of 26 June 2013 on the annual financial statements, consolidated financial statements and related reports of certain types of undertakings, amending Directive 2006/43/EC of the European Parliament and of the Council and repealing Council Directives 78/660/EEC and 83/349/EEC.
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