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Procurement - What Does It Mean To You?

WHAT IS PUBLIC PROCUREMENT?

It is the purchase of goods, works and services by the Government and other public bodies (such as Academies, Housing Trusts, NHS, CCGs and any other Government funded projects).

HOW IS IT CONTROLLED?

The EU Directive was implemented in England and Wales in February 2015 under the Public Contracts Regulations 2015 (Procurement Regulations 2015).

The purpose of the directive was to allow EU wide competition for all public procurement.

The directive provides a framework for all Contracting Authorities to follow to ensure the free movement of goods and services.

Other directives were also implemented to deal with public procurement; the State Aid Regulations 2015 (EU)*, the National Health Service (Procurement, Patient Choice and Competition) (No.2) Regulations 2013 and the Public Services (Social Value) Act 2012 and are regulations to be aware of.

*This has not been enacted in to the law of England and Wales and therefore could be affected by Brexit.  It is possible that it may not form part of the English Law post Brexit.  An update on this point will be issued when the position has been clarified.

WHAT DOES THE PROCUREMENT REGULATIONS 2015 DO?

The purpose of the Procurement Regulations 2015 provide that:

  • contracts are fairly awarded without discrimination on grounds of nationality;
  • all bidders are treated equally; and 
  • suppliers of goods and services have the right to take action if contracts are not advertised or awarded on an open and fair basis.



WHO MUST COMPLY WITH THE PROCUREMENT REGULATIONS 2015?

Public Bodies, including central government and local authorities that are listed in Schedule 1 of the Procurement Regulations 2015 (including but not limited to Academies, Housing Trusts, NHS, CCGs and any other Government funded projects), are required to comply with the Procurement Regulations 2015 on the basis that they are Contracting Authorities.

WHAT CONTRACTS ARE COVERED?

The Procurement Regulations 2015 apply to all contracts awarded after 26 February 2015.  This includes:

  • new contracts, 
  • renewal of existing contracts; and 
  • extensions of or variations to contracts; and more specifically: 
  • A proposed public supply contract
    (Catering, Training or Educational Course for Pupils, Seminars, Hotels and Restaurant Services)
  • A proposed public works contract
    (Buildings, Renovations and Development Works)
  • A proposed public services contract
    (Cleaning Services and Coach Travel)
  • Framework Agreements or Dynamic Purchasing Agreements
    (e.g. Eastern Shires Purchasing Organisation (ESPO) or Crown Commercial Services (CCS))

unless they are exempt, excluded or the estimated net value falls below the relevant threshold.

WHAT ARE THE EXCLUSIONS?

Excluded Contracts

Below the Threshold

Exempt Contracts

WHAT DO CONTRACTING AUTHORITIES NEED TO DO – THE PROCESS

The obligations apply for all procurement of contracts worth over £25,000. However, the requirements differ for the Light Touch Regime and all other Services and Goods.

PROCEDURE 

The Regulations provide that Contracting Authorities must follow one of the following five contracting procedures:

  • Open
  • Restricted 
  • Competitive Dialogue 
  • Competitive Procedure with negotiation
  • Innovative Process

REMEDIES

Disappointed tenderers may be able to bring an action against the contracting party under the procurement rules should a breach of the rules occur.

If an interested party is excluded within the rules, it will not be able to bring a claim. In addition, those bodies or persons who are not economically operative (for example, trade unions) will not have standing to bring any action under the Procurement Regulations 2015.

Pre-Contact

Before the contract has been entered into, the remedies available are: 

  • Setting aside a decision to award a contract (not available to Framework Agreements)
  • An order requiring tender documents to be amended and reissued
  • Automatic suspension of the tender process 
  • Damages

Post Contract

After the contract has been entered into, the remedies awarded are:

  • Ineffectiveness: any obligations under the contract will be cancelled by the court (not available to Light Touch Regime)

            o   Note that the contract must be entered into before the end of the Standstill Period

            o   It is more likely that ineffectiveness will apply when a contract has been renewed as new
                 obligations under a tender process are triggered. 

            o  It is recommended that parties make provision for ineffectiveness in their contract should a
                declaration by the court be made.

  • Damages

Time Limits

There are time limits in place for an economic operator or potential supplier to bring a claim against the contracting party. This depends on the specific remedy.

  • Ineffectiveness

            o   6 months from date on which contract was entered into

            o   30 days from the date the contract award was in the Official Journal of the European Union
                 (OJEU) (without prior publication of contract notice) 

  • All other remedies

            o  30 days from when the economic operator knew or ought to have reasonably known.

Exclusions
Obligations If The Rules Apply - The Process
Procedure
Light Touch, Framework Agreements, Concession Contracts and Reserved Contracts
 

 


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