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In-house providing refers to the situation in which a public authority, instead of calling for a competition, executes itself (that is, in-house) a service, by assigning it to a determined company.

Article 5 of the new Italian Public Procurement Code (Decreto Legislativo no. 50 of 18th April 2016) regulates such a situation. The said article provides for the exclusion of the obligation of calling for a competition if the public authority has a strong influence on the company at issue; more than 80% of the activities of such a company consists of services entrusted to it by the contracting authority; and direct participation by private economic operators in the capital of the controlled legal person is very limited.

With judgment of 8th December 2016, in case C-553/15, the European Court of Justice, even if taking into account the old Italian Public Procurement Code (Decreto Legislativo no. 163/2006), has nevertheless deemed applicable the aforementioned provisions. The Court has stated that, where the said requirements are satisfied, the contracting authority makes de facto use of its own instruments and that the controlled company belongs to the contracting authority itself.

Therefore, in-house providing is admitted both by the national and the European legislation, provided that there exists a strong bond between the contracting authority and the company at issue.