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EU PROCUREMENT LAW

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EU Procurement Solicitors

One of the founding principles of the European Union (EU) is the creation of a single market free from barriers to trade. The opening up of public procurement has been facilitated by a succession of European Directives, designed  to uphold the requirements of the Treaty of the Functioning of the European Union – TFEU, in particular, to ensure non-discrimination on grounds of nationality.

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Fisher Scoggins Waters are a London based law firm who are experts in construction, manufacturing and engineering matters.  We act for both public bodies and individuals when advising on EU procurement matters.  If you would like to discuss any points raised in this article, please phone us on 0207 993 6960.

Procurement in the EU is concerned with:

  •  Public procurement, which is procurement by the State, regional or local authorities and other public bodies          

  • Utilities procurement, i.e., procurement in the 'utilities' sectors, such as water, energy and transport  

 

For the full regime of the EU Public Procurement law to apply, a particular contract must exceed certain financial thresholds, which are set by the European Commission every two years.

 

From 1st January 2016, the new thresholds are:

 

Public Contracts Regulations 2015 (PCR 2015)

 

Supplies

Services

Works

Central Government bodies

£106,047

(£111,676)

£106,047

(£111,676)

£4,104,394

(£4,322,012)

Other contracting authorities

£164,176

(£172,514)

£164,176

(£172,514)

£4,104,394

(£4,322,012)

 

The threshold for light touch (social and similar) services procured under Public Contracts Regulations 2015 remains unaltered. However, the European Commission has confirmed from 1st January 2016 that the new Sterling threshold shall be £589,148.

 

Utilities Contracts Regulations 2006 (UCR 2006)

 

Supplies

Services

Works

All Sectors

£328,352

(£345,028)

£328,352

(£345,028)

£4,104,394

(£4,322,012)

 

The EU procurement regime not only directs how companies from each member state can tender for central and local government contracts, anywhere in the EU, but it permeates every area of how the UK public sector manages the purchasing of goods and services.

So how does it achieve this? 

All Tenders for Public Procurement Contracts are Treated Equally and are Transparent

The current public sector Directive is 2014/24/EU, and there is a separate Directive covering works and services concession contracts (2014/23/EU). Both of these Directives were published in the Official Journal of the European Union (OJEU) on 28th March 2014.

Directive 2014/24/EU was implemented into UK law through The Public Contracts Regulations 2015.

The over-arching principle of EU procurement law is that all tenderers are treated equally when competing for a public service contract, regardless of which member state they reside in. 

The process by which a tender application is judged must also be transparent, allowing all tenderers understand the basis in which their tender will be scrutinised.

All Public Sector Contracts must be Published

If a public sector contract is deemed to be covered by one of the Directives, then it must be published in the Official Journal of the European Union (OJEU).  This journal can be accessed online, and anyone can search for particular tenders or opportunities within specific industry sectors.

Publishing a notice is known as a ‘call for competition notice’.  There is a required format which must be followed when submitting a call for competition notice, and all notices must be submitted via an approved e-sender.

After publication of the notice, a contracting authority must offer unrestricted access, free of charge and by electronic means, to all relevant procurement documents.

There are Key Steps Common to all EU Public Procurement Procedures

Following the requirement to publish any tenders, public bodies must follow three further steps when going through the selection process.  Every EU country must abide by the same procedure, which leads to transparency as individuals and/or organisations submitting tenders for an EU public service’s contract know what to expect from the process.

The three steps are:

Selection Stage

Before evaluating serious contenders, the contracting authority has the right to reject tenders if they find the tenderer would prove unsuitable due to bankruptcy, criminal conviction, professional misconduct, misrepresentation or failure to pay taxes. Tenderers who have been convicted of organised crime, corruption, fraud or money-laundering face mandatory exclusion.

Evaluation/Shortlisting Stage

Suppliers can be further excluded from the list of potential tenders on the grounds of technical capacity and ability and their economic situation.  Rejected suppliers have the right to ask for the reasons why they were excluded at this stage.

Assessing a Tender and Selecting a Contractor to Work With

The award of a public contract must be based on the tender most ‘economically advantageous’ to the authority (MEAT). When conducting the final assessment, the contracting authority must evaluate how the supplier will perform the contract.  The contracting authority has the right to evaluate the following when considering a supplier (note, this is not an exhaustive list):

  • Price          

  • Follow-up service          

  • Delivery dates          

  • Cost-effectiveness          

  • The quality of the staff          

  • Time-period of delivery

The criteria used to evaluate the tenders and the weightings applied to each criterion must be disclosed to the tenderers.

Once the contracting authority has made a decision, a ‘standstill’ period of 10-15 days must be applied before the contract is signed.  This is to allow the selected supplier time to evaluate the details of the contract and provide unsuccessful bidders’ an opportunity to seek remedies if they feel the procurement process was unsatisfactory.

The Directive contains provisions to ensure that member states’ contracts allow termination in circumstances where there has been a breach of EU law on public procurement, particularly where this results from a change in an awarded contract.

The contracting authority is entitled to terminate a contract should any of the following three grounds occur: 

  • Where the contract has been subject to a substantial modification that constitutes a new award;          

  • Where it is discovered after contract award that the supplier should have been excluded on mandatory exclusion grounds;          

  • Where the Court of Justice of the European Union (CJEU) has declared a serious infringement by the contracting authority of its obligations, meaning the contract should not have been awarded to the supplier.

To protect both contracting authorities and suppliers, The EU Remedies Directives impose common standards to ensure that rapid and effective means of redress are available in all EU countries when bidders believe that contracts have been awarded unfairly.

Fisher Scoggins Waters are a London based law firm who are experts in construction, manufacturing and engineering matters.  We act for both public bodies and individuals when advising on EU procurement matters.  If you would like to discuss any points raised in this article, please phone us on 0207 993 6960.

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Charlotte Waters
Email Charlotte Waters
0207 993 6960
 
Mark Scoggins
Email Mark Scoggins
0207 993 6960

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