By its judgment of 5 February 2026, in Case C-810/24, the Court of Justice of the European Union declared that the right of pre-emption conferred upon the promoter within the framework of project financing procedures is incompatible with Union law, thereby marking a turning point for public-private partnerships in Italy. The ruling necessitates a thorough revision of the relevant legal framework and produces immediate effects on pending procedures.
1. Background to the Ruling
The case originated from a project financing procedure initiated by the Municipality of Milan for the design, supply, installation and management of 110 automated public sanitary facilities, the consideration for which consisted in the economic exploitation of 97 advertising installations to be converted to digital format, with an aggregate value exceeding EUR 34 million and a duration of 24 years.
Following the procurement procedure launched on the basis of the promoter’s proposal, a different economic operator (Urban Vision S.p.A.) submitted the most economically advantageous tender and was provisionally awarded the contract. The promoter consortium then exercised its right of pre-emption pursuant to Article 183(15) of Legislative Decree No 50/2016, aligning its tender with the winning bid and thereby obtaining the definitive award of the contract.
Urban Vision challenged that decision. The Council of State, by order of its Fifth Section of 25 November 2024, No 9449, referred a question for a preliminary ruling to the Court of Justice, questioning the compatibility of the mechanism with Directive 2014/23/EU on the award of concession contracts and with the principles enshrined in the TFEU.
2. The Legal Principle Established by the Court
The Court held, in unequivocal terms, that Article 3(1) of Directive 2014/23/EU, read in conjunction with Article 49 TFEU and Articles 30 and 41 of the same Directive, precludes national legislation which grants the promoter in a project financing procedure a right of pre-emption enabling that promoter, where the contract has not initially been awarded to it, to align its tender with that of the successful tenderer and thereby obtain the award of the contract.
The Court’s reasoning is grounded in the principle of equal treatment: allowing only the promoter to amend its tender after the expiry of the time limit for the submission of tenders and after the establishment of the ranking fundamentally distorts the competitive balance. The right of pre-emption confers a selective and structural advantage, inasmuch as the promoter is able to calibrate its tender on the basis of rival proposals, thereby neutralising the outcome of the competitive process.
The Court further identified a restriction on the freedom of establishment (Article 49 TFEU), observing that the mechanism is liable to dissuade economic operators from other Member States from participating in Italian procedures. The justifications advanced by Italy – horizontal subsidiarity, the acquisition of know-how from the private sector – were rejected, as they do not fall within the overriding reasons in the public interest recognised by Article 52 TFEU.
3. Effects on the Legislation in Force
Although the ruling formally concerns Article 183(15) of Legislative Decree No 50/2016 (since repealed), the principles established therein directly affect Article 193 of Legislative Decree No 36/2023 (the new Public Contracts Code), which reproduces a substantially identical pre-emption mechanism. The Court traced the incompatibility back to the fundamental principles of Union law, which apply irrespective of the specific wording of the national provision.
By virtue of the primacy of Union law, contracting authorities and national courts are required to disapply incompatible domestic provisions. Article 193(12) of Legislative Decree No 36/2023, insofar as it provides for a right of pre-emption, must therefore be regarded as no longer applicable with immediate effect, even in the absence of formal legislative intervention.
4. Consequences for Pending and Concluded Procedures
The first concrete applications of the judgment followed promptly. The Court of Auditors, Regional Division for Emilia-Romagna, by Decisions No 14/2026 and No 15/2026 of 26 February 2026, held that the right of pre-emption may no longer be recognised in favour of promoters, including in procedures already initiated. The auditing judges clarified that the CJEU judgment, as an interpretive ruling, produces effects erga omnes and retroactively: the national provision must be regarded as inapplicable ab initio.
The tempus regit actum principle was held to be subordinate to the primacy of EU law: the submission of the proposal on a date preceding the judgment does not crystallise a right to pre-emption, since the declaration of public interest constitutes an intra-procedural act and the procedure is structurally bifurcated. The legitimate expectations of the promoter, whilst worthy of consideration, are not of an absolute character.
The administrative courts have likewise given effect to the ruling: the Regional Administrative Tribunal of Naples, by judgment of 3 March 2026, No 1508, held that, in the re-opening of the procedure, it is not possible to apply domestic legislation in a manner inconsistent with the judgment delivered by the Court of Justice of the European Union.
The situation is more complex with regard to concessions already awarded through the exercise of pre-emption and for which a contract has been concluded. The administrative courts will need to determine whether the requirements of legal certainty and protection of legitimate expectations prevail, or whether the restoration of European legality takes precedence. Procedures based on the exercise of pre-emption may be the subject of legal challenges, the outcome of which will depend on a case-by-case balancing exercise.
5. Outlook: Project Financing After the Abolition of the Right of Pre-emption
The judgment does not mark the end of privately-initiated project financing, but necessitates a thorough revision thereof. The CJEU did not censure the structural framework of the project financing procedure, nor the procedure for the selection of the promoter, nor the right of the unsuccessful promoter to reimbursement of the costs incurred in the preparation of the proposal (within the limit of 2.5% of the investment value).
Among the alternative incentive mechanisms that may be envisaged – consistent with the principle of equal treatment – the following are noteworthy: the award of bonus technical scores in favour of the promoter within the tendering procedure, as well as the strengthening of the compensation payable. A timely intervention by the legislature is desirable in order to fill the resulting legislative gap and to establish a framework which continues to incentivise private initiative in compliance with European principles.
6. Conclusions
The Urban Vision judgment constitutes a systemic turning point for project financing in Italy. The promoter’s right of pre-emption, a legal institution which has characterised project financing in the Italian legal order for over twenty years, must now be regarded as definitively superseded. Contracting authorities are required to disapply the relevant rules with immediate effect, including in pending procedures, in accordance with the principles established by the CJEU. The ensuing legal uncertainty, particularly with respect to concessions already awarded, requires contracting authorities and economic operators to carry out a careful case-by-case assessment, pending the desirable clarifying intervention on the part of the legislature and the courts.
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This note has been authored by Giuseppe Fuda, Attorney-at-Law.
For further information or clarifications on the matters addressed herein, please contact Attorney Giuseppe Fuda at the following email address:
Todarello & Partners provides legal assistance on all matters addressed in this article. The firm’s professionals have significant expertise in this field, regularly advising some of the leading operators active on the market and representing them in proceedings before all competent jurisdictions.
