Transcript www.hok-cba.hr

Introduction to Public
Procurement
Julie Nazerali
Partner, Beachcroft LLP, Brussels and London
5 June 2009
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Today’s Menu

1. EU Procurement Regime

2. Public Private Partnerships
and Competitive Dialogue

3. Key issues

4. Trends
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1. EU Procurement Regime
So why procurement rules?
 EC Treaty: Common Market between all Member States
 Breach of public procurement rules acts as a barrier to trade
 Total public procurement estimated at about 16% of EU GDP
or £1000 billion
 Increase of cross-border competition and improvement of
prices
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1. EU Procurement Regime
The General Regime

Directive 2004/18/EC (Works, Supply and Services)

Directive 2004/17/EC (Utilities)

Directive 2007/66/EC (Remedies)
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1. EU Procurement Regime
What thresholds apply?
Type of contract
Threshold
Supplies
Central Authorities
Other Authorities
€133,000
€206,000
Services
Part A Central Authorities
Part A Other Authorities
Part B All Authorities
€133,000
€206,000
€206,000
Works
Works/Concessions
€5,150,000
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1. EU Procurement Regime
Procedures
 Open = All bidders invited
 Restricted = Only certain bidders invited
 Negotiated = Allows discussion/negotiation
 Competitive Dialogue = Allows discussion
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1. EU Procurement Regime
Common principles
Transparency / Equal treatment





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Advertise intention to procure
Hold a competition between interested firms
Exclude firms only for justified reasons
Respect minimum time-limits for all participants
Award contract based on results of the competition
Provide information on decisions to interested parties
10 day standstill period between award decision
and conclusion of contract
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1. EU Procurement Regime
Rules applying to Part B services or below threshold
contracts
Part B services: Health, education and cultural services
Full procurement rules don’t apply
When a contract is of “cross-border interest”:
 EC principles apply: non-discrimination and equal
treatment, transparency, proportionality
 Sufficient degree of advertising, eg. Internet
 Fair competition must be respected
Relevant factors to be considered: value/subject matter of the
contract, size/structure of the sector concerned
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1. EU Procurement Regime
What happens if things go wrong?
Complaint to the Commission
 Informal procedure – “a friendly
settlement”?
 Formal procedure:
 Letter of infringement to
Member State
 Reasoned opinion
 Proceedings before ECJ
 Complainant does not receive
damages
Proceedings before a
national court
Now
 Injunction proceedings
 Damages
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2. Public Private Partnerships (PPPs)
 PPPs deliver a project/service traditionally provided by the public
sector
 How?: Through concessions, JVs and partial privatisations
 Contract awarded to a PPP vehicle does not need to be tendered, if:
 The private partner was chosen in a fair and transparent tender
exercise
 The nature and scope of the contract was covered when tendering
for the private partner
 PPPs often used for road and rail infrastructure projects
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2. Competitive Dialogue (CD)
Used for “Particularly Complex Contracts”
 Came into operation in 2006
 Negotiated procedure can only be used in limited cases and
not for CD

Used where open/restricted procedures not available; and
 Not possible to define technical specifications; or
 The legal and/or financial make up of the project
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2. Competitive Dialogue
How does it work?
OJEU
Notice
Pre-qualification
Questionnaire
Select/shortlist
participants
Invitation to
tender
All procedures apart from open procedure
Evaluation of tenders
End Dialogue and
invite final Tenders
Dialogue Phase –
Successive stages
possible
Competitive Dialogue/Negotiated procedure
Award contract
Observe 10 day standstill
Contract
Signature
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2. Competitive Dialogue
 Allows for discussions on all aspects of the contract during the
dialogue stage

Authority can discuss each bidder’s individual solution
 Allows for flexibility as to the setting/disclosure of evaluation
criteria
 Allows for limited post-tender discussions with preferred
bidder
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3. Key issues
The new Remedies Directive: four areas of reform
 Introduction of “ineffectiveness”: contracts may be set aside for
serious breaches of procurement rules (eg. contract notice not
published in the OJEU)
 Harmonisation of standstill provisions:
 10/15 days before the conclusion of the contract
 Contracting authorities must send reasons with the award decision
 New time limits for seeking ineffectiveness in Court: 30 days for
published award decisions / 6 months if bidders were not notified of
the award decision or where OJEU contract award notice not
published
 New rules bring in a defacto injunction procedure
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3. Key issues
The new Remedies Directive: some further info
 Court may not render a contract ineffective if it finds that there are
good reasons for doing so, ie. reasons relating to a “general interest of
non-economic nature”
 Alternative remedies: contract shortening and fines applied as
 An alternative to using the ineffectiveness principle, and/or
 In addition to prospective ineffectiveness
 Does not apply to Part B services or below threshold contracts
 To be implemented by December 2009
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3. Key issues
Disclosure of Award Criteria/Weightings - what must be
disclosed?
 Award criteria and respective weightings: +
 Sub-criteria and respective weightings: (+) if they could
have had an impact on the preparation of bids
 Other evaluation elements (scoring matrix etc.): (+) if they
could have had an impact on the preparation of bids
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3. Key issues
Exception to procurement rules: In-house contracts
 A Contracting Authority (CA) can award a contract to another
public body without holding a tender exercise, if:
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The CA exercises control over the entity that is similar
to the control it exercises over its own department, and
The entity carries out the essential part of its activities
for the CA
Eg. the ECJ ruled that the transfer of the operation of a
local authority’s cable TV network to a co-operative
could be done without a tender exercise since the latter
was controlled by a Board composed of representatives
of the public authority (Coditel Brabant, Case C-342/07)
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4. Trends
 Watch out for the Remedies Directive!
 Bidders are becoming much more litigious
 CAs must ensure robust procurement compliance
 Still many grey areas in procurement law (eg. in-house awards,
land transactions, change of award criteria in CD procedures,
social award criteria, post-contract changes).
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Q&A
Please don’t hesitate to ask questions!
Julie Nazerali,
Partner, Beachcroft LLP, Brussels
+32/ (0)2 541 85 82
[email protected]
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