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Procurement law and development agreements: case law update Cyrus Mehta, Partner Nabarro LLP Update • OGC Procurement Policy Note (16 October 2009) – guidance on development agreements • AG’s opinion in Helmut Müller (case C-451/08) U0296.3/58829130 OGC guidance • • • • • • Definition of “works contracts” Outline specifications Specifications relating to land use planning policies “Mixed” land/works contracts – e.g. covenants to refurbish Need for legally binding contract Building licences U0296.3/58829130 OGC guidance Problem areas: • Section 106 Agreements • Developer-led projects: – para 24 of Guidance – development agreements “to safeguard Council’s interests as freeholder” – Müller provides some support • Regulation 14(1)(a)(iii) exemption – “For technical or artistic reasons, or for reasons connected with the protection of exclusive rights, a public contract may be awarded only to a particular economic operator” U0296.3/58829130 AG - Müller • Limits to “functional” interpretation of procurement law in defining works contracts • Need for a “direct link” between the public authority and the works: – acquisition of ownership/use – using public resources – e.g. cheap land – initiative taken by public authority • New use of planning powers does not suffice • Need for contractual obligations to develop U0296.3/58829130 AG Müller • Works concessions – “ownership” test – limited duration – conflicts with City of York/Osbaldwick – implications for PFI/PPP contracts • Separate but related “land” and “development” transactions must be aggregated U0296.3/58829130 Procurement law and development agreements case law update Cyrus Mehta, Partner Nabarro LLP