new EU directive on public procurement
20 December 2011
The European Commission has today issued a proposal for a
directive of the European Parliament and Council on public
procurement. This is the first wholesale revision of public
procurement law in the EU since 2004 and represents a substantial
change in approach in a number of significant areas.
Set out below are some of the proposed headline changes.
1. Distinction between “A” and “B” services will be
abolished
2. Social, health and education services have a higher threshold
of €500,000 and only the basic principles of transparency and equal
treatment are required. Contracts below this value are to be
presumed to have no cross-border interest.
3. Potentially shorter timescales.
4. The choice of procurement procedure revolves around the two
basic forms, open and restricted. It also provides that the
negotiated procedure with publication and competitive dialogue
remain with the addition of a new “innovation partnership”. The
intention is that the negotiated procedure and competitive dialogue
can be used more easily than at present.
5. A lighter regime for sub-central contracting authorities.
6. Mandatory transmission of notices in electronic form,
mandatory electronic availability of the procurement documentation
and imposition of fully electronic communication within a
transmission period of two years.
7. The distinction between selection and award criteria will be
more flexible.
8. Contracting authorities will be able to exclude bidders which
have shown significant or persistent deficiencies in performing
prior contracts.
9. A more pragmatic solution for dealing with unforeseen
circumstances requiring adaption of public contracts during their
term.
10. Life cycle costing will now be possible through MEAT
criteria or lowest cost which replaces the “price only”
criterion.
11. Contracting authorities may refer to all factors directly
linked to the production process for determining the MEAT, but not
requirements unrelated to the production process, such as general
corporate social responsibility requirements.
12. Contracting authorities may require that works, supplies or
services bear labels attributed by specific certification schemes
(e.g. eco labels), provided that they also accept equivalent
labels.
13. Innovation partnership is a new special procedure for the
development and subsequent purchase of new, innovative products,
works and services. It can be used provided that they can be
delivered to agreed performance levels and costs.
14. For SMEs, contracting authorities will be required to accept
self-declarations of certain pieces of information as prima-facie
evidence for selection purposes (the PQQ stage). Contracting
authorities will be invited subdivide public contracts above €500
000 into homogeneous or heterogeneous lots. If they choose not do
so they will be required to explain their reasons.
15. An exhaustive list of possible conditions for bidders and
conditions shall be restricted “to those that are appropriate to
ensure that a candidate or tenderer has the ... capacities and ...
abilities to perform the contract to be awarded”.
16. Turnover requirements will be limited to three times the
estimated contract value, except in justified cases.
17. Member states can provide that subcontractors may in certain
circumstances, request direct payment by the contracting
authority.
18. Preliminary contacts with market participants must not
result in unfair advantages and distortions of competitions.
Provision on safeguards against undue preference to participants
who have advised the contracting authority or been involved in the
preparation of the procedure.
19. Member States must designate a single national authority in
charge of monitoring, implementation and control of public
procurement. In an attempt to fight corruption, it is proposed that
there is a requirement to send copies of all contracts over
€1million (in the case of goods and services) and €10 million (in
the case of works) to this body so they can be scrutinised for
suspicious patterns.
A significant amount of work has gone into these proposals, some
of which have been hotly debated prior to their release today, and
others have seemingly come out of left field. The proposals
represent substantial changes in the area of public procurement
some of which will be welcomed by both the public and private
sector, others seem to represent new administrative burdens which
on the face of it seem cumbersome and potentially costly to
implement.
Browne Jacobson is producing a special report presenting in more
detail the changes that are proposed by the commission. If you
would like a copy please email Sharon Jones, Rachel Whitaker or
Peter Ware.
The content of this bulletin is provided for the purposes of
general interest and information. It contains only brief summaries
of aspects of the subject matter and does not provide comprehensive
statements of the law. It does not constitute legal advice and does
not provide a substitute for it.