The liability of a contracting authority for an infringement of public procurement rules leading to contractual ineffectiveness – a Finnish approach

The remedy of contractual ineffectiveness, based on the article 2 d of the Remedies Directive 2007/661, was implemented in Finland by the Act on Public Contracts (laki julkisista hankinnoista 30.3.2007/348, later referred as “APC”) in June 2010. The Remedies Directive 2007/66 left it to the Member States to decide whether the contractual ineffectiveness has retrospective (ex tunc) or prospective (ex nunc) effects. Unlike Sweden, Finland chose the latter. According to section 96.4 of the APC, a contract may be declared ineffective solely concerning the unperformed contractual obligations. The remedy of prospective contractual ineffectiveness applies only to contracts above the EU thresholds in Finland.2
Since the implementation of the Remedies Directive 2007/66 (and by the end of June 2015) the ineffectiveness remedy has been imposed only twice in Finland.3 One of the reasons for the sparse application of this remedy may be found within the Finnish Court system. The lengthy court proceedings seem to prevent the effectiveness of the ineffectiveness remedy. Even though interim measures are made available also after the contract has been signed, they are very rarely claimed together with the ineffectiveness remedy. Thus, there might not be any contractual obligations unperformed at the time of the court ruling.

Kirsi-Maria Halonen
no 3
s. 227