A case regarding a norm of the Public Procurement Law has been initiated
The First Panel of the Constitutional Court has initiated a case “On Compliance of Section 39 (1) (6) of the Public Procurement Law with Article 91 and Article 105 of the Satversme of the Republic of Latvia”.
Article 91 of the Satversme provides for equality of persons before the law and the courts, whilst Article 105 of the Satversme guarantees the right to own property.
The contested norm establishes provisions for exclusion of candidates and applicants from participation in a public procurement procedure by providing that a candidate or applicant shall be excluded from participation in a public procurement procedure if average monthly wage of the candidate or applicant during a particular period of time is less than 70 percent of the average salary of employees of the respective field in the State.
The applicant SIA „HansaWorld Latvia” indicated that the contested norm infringes its right to own property because the contested norm restricts economic interest to perform economic activities and gain profit in the procurement market of the State and local governments. Likewise, the contested norm establishes, without reason, unequal attitude towards certain service providers that participate in public procurement procedures.
The norm has been adopted with the view to combat the so-called “envelope salaries”. According to the applicant, however, not all companies average wages of employees of which do not reach 70 percent of the average salary of the respective field, pay “envelope salaries”. There are different reasons for such salary, for instance, a company has been recently founded and it cannot afford paying the same wages as those paid by leading companies; a company has part-time employees, a company practices outsourcing, for example, specialists provide their services as self-employed persons.
The Saeima [Parliament] was asked to provide, before 16 May 2011, a reply on the facts of the case and legal justification thereof. The term of preparation of the case is 16 August 2011.
Linked case: 2011-15-01