Public Procurement - Europe
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Golden Book of e-Procurement Good Practices - European Commission

There are currently around 300 e-procurement systems in Europe. Certain systems have achieved excellence in performance, reliability, security. However, some systems are not easily accessible to foreign users, who may need to use country-specific tools to access them. Moreover, the proliferation of user interfaces makes it difficult for companies to respond to calls for tenders run on multiple platforms. Companies often have to learn how to use various platforms which are far from reaching a common "look-and-feel", unlike other e-commerce tools such as airline booking websites.

The EU e-Procurement single market is therefore facing two barriers: lack of cross-border interoperability and interface complexity. The Commission launched two projects to address these issues:

The Golden Book of e-procurement practices. The study, carried out by a consultant, analyses in depth around 30 electronic platforms used for public procurement in the EU. The report, the "Golden book of e-procurement", presents good practices in the area of e-procurement but also practices that should be avoided. These practices are aimed at helping to improve e-Procurement systems. Good and bad practices take into account, amongst other criteria, the needs of SMEs and cross-border suppliers when using an e- procurement platform.

[ Enter Golden Book of e-procurement practices ]

The e-Tendering expert group (eTEG).The eTEG developed a “blueprint” for an ideal pre-award e-Procurement system. Using this blueprint as a model, the Expert Group presents recommendations targeted at contracting authorities, policy makers or software developers that aim at simplifying the way e-procurement is conducted, particularly for SMEs and cross-border suppliers. The eTEG report is currently being finalised and will be published within a few weeks.

The two projects are complementary and take different perspectives. The eTEG recommendations are forward looking, as they are meant to influence the way e-procurement systems could be designed so as to reach an ideal situation. The Golden Book is identifying and analyzing only existing good practice, which was actually experienced by the consultant while using 30 e-procurement platforms. However the two projects, independently run, converged to homogeneous results.

Combined, the two reports (The Golden Book and the e-TEG report) address all procurement actors by offering practical means to assess the current state of their business and by providing guidelines for future development.

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EU asks Japan to open up procurement market in regional cities | The Japan Times

BRUSSELS – The European Union has asked Japan to open up its market for goods and services procurement in municipalities with a population of 100,000 or more as the two economic powers work toward signing a free trade agreement, EU documents and sources said Thursday.

While it remains unclear how many EU firms intend to enter the market, a Japanese government source said Tokyo cannot accept the EU’s request since it means about a third of Japan’s 790 municipalities would be subjected to the burden of changing their procurement procedures.

The government of Prime Minister Shinzo Abe has been expediting talks on the envisioned FTA, seeing such frameworks as necessary to achieving economic growth. Abe met with EU chiefs during his trip to Europe earlier this month and reaffirmed their intention to reach a broad agreement by the end of the year.

Japan’s 47 prefectures and most of the designated major cities are already required to hold bids on public projects without discriminating against foreign firms under the government procurement rules of the World Trade Organization. The EU’s request calls for expanding the scope.

The European Union initially sought to ask Japan to open all of its government procurement market but later decided to narrow the scope to cover relatively large municipalities, including Tokyo’s 23 wards, according to the sources and the documents.

The EU has also urged Japan to further open up the market for state-ordered construction projects by giving its firms access to smaller projects with costs as low as about ¥16 million, instead of the current ¥740 million and over.

Japan and the EU began the FTA negotiations in April 2013, with Tokyo seeking to eliminate EU tariffs on Japanese automobiles and electronic appliances and the EU seeking to enter Japan’s food market and get greater access to the railway market, among others.

Although Japan struck the Trans-Pacific Partnership free trade deal with the United States and 10 other Pacific Rim countries in October, it did not budge in negotiations on government procurement.
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Civil Service interest in digital procurement from SMEs declines

Civil Service interest in digital procurement from SMEs declines | Public Procurement - Europe |
Digital procurement from small and medium-sized enterprises (SMEs) is increasingly marginalised in the Civil Service, according to an annual survey.
The survey of nearly 1,500 civil servants found only 6% said they had access to a wide range of suppliers, compared to 19% in 2015.
Furthermore, 36% said they did not see the need for procuring digital from SMEs, an increase from 17% the previous year.
Only 21% of respondents said there was an appetite in their department to procure more digital technology from SMEs and only 16% said access to disruptive innovation would give government better value from the tech industry.
Julian David, CEO of techUK, said: “The findings clearly demonstrate a lack of understanding of the benefits of a broad supply base and the potential for innovative technologies to revolutionise public services, putting the government’s target to procure 33% of tech from SMEs in jeopardy.
“We must take a new approach to show – not tell – civil servants how new tech can transform both their working environment and the services they provide.”
A recent National Audit Office report criticised the government for a lack of focus in SME procurement.
The survey also found that civil servants felt their organisation lacked understanding of digital technology.
Only 14% of civil servants rate their department as having good digital capability, and only 20% agreed that their department had the appropriate skills to manage IT supplier contracts. Neither figure had decreased since the same survey was conducted last year.
However, the survey found that positive attitudes towards technology had increased.
Technology was described as an enabler by 31% of civil servants, compared to 22% in 2015, with 84% agreeing that it was crucial to delivering their department’s business plan.
Mobile working was increasingly popular, with 61% of respondents saying that it made them more efficient, compared to 40% last year.
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Has The Sun Just Discovered Public Procurement Regulations?

Has The Sun Just Discovered Public Procurement Regulations? | Public Procurement - Europe |
Last Friday saw an idiotic article in the Sun, featuring posh Tory MP Jacob Rees-Mogg, who thought it was disgusting that EU public procurement rules actually apply to public procurement … who knows, those nasty foreigners might get their grubby hands on our great big clock. Yes, I said clock ...
“THE £29 million restoration of Big Ben could be carried out by Polish builders and Romanian roofers due to barmy EU rules, The Sun can reveal. Parliament is being forced to offer lucrative contracts for repairing Britain’s most famous clock to foreign firms in the European Union - rather than making sure the work is carried out by UK tradesmen. That is because EU procurement rules require major taxpayer-funded works to be opened up across the continent in a deliberate attempt to stop “buy national” policies”.
Yes, EU procurement rules do require that, just as they require other countries to open up contracts to UK firms. It is called free trade and competition, and it is sad to see Conservative politicians – who should understand the positives of capitalism and market competition, you might think, taking such a stupid point of view.
“Fellow Tory Andrew Percy said: “If this was Canada or Australia or the United States we would be able to apply local procurement rules, but because of EU rules we can’t."
“British people will be outraged to think rules from Brussels could force us to give foreign firms contracts to restore great British icon for no other reason that we are in the EU.”
Of course the whole thing is driven by the fact that The Sun is supporting an exit vote in the forthcoming EU membership referendum, so this is just one more bullet fired in that war. But don’t take our scorn for this article by the way as a sign that the Spend Matters editorial team are firmly “stay” rather than Brexit – I haven’t made my mind up yet. But whilst I can see some good reasons for leaving the EU, moving towards an ultra-protectionist stance on public procurement is not one of them.
Oh well, I suppose we should be excited that the largest selling newspaper in the country is featuring public procurement issues!
Toni Saraiva - EISC Ltd -'s insight:
And actually Canada and many other countries also open their procurement up to other countries including all the companies based in the European Union thanks to the agreement on procurement at WTO level...
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US, EU officials say they will not settle for limited trade deal | DailyTimes

NEW YORK: US and European Union trade officials said on Thursday they would not settle for a limited trans-Atlantic free trade deal that ignores deep divisions on agricultural products, services, public procurement and dispute resolution. In separate briefings during the latest negotiating round in New York, the US and EU officials said they would push for a comprehensive Trans-Atlantic Trade and Investment Partnership, or T-TIP, before US President Barack Obama leaves office in January. "We are not going to shoot for or accept a 'T-TIP light,' a US Trade Representative official said on condition of anonymity because of the sensitivity of the talks. "It has to be comprehensive, it has to be ambitious and we do think we have the time that we need this year to complete such an ambitious deal," the official added. But the US officials and their European counterparts said bridging gaps would take a lot of work and that progress this week had centered mainly on non-controversial technical language. They are trying to lay the groundwork to have all but the thorniest problems solved by the autumn. Among the deepest divides concern Europe's food safety rules that exclude American beef raised with hormones, genetically modified foods and Europe's many local food naming rules, such as for asiago and feta cheeses. US negotiators have complained those rules have fueled a $12 billion annual food trade deficit with the EU, $1 billion in cheese alone. Teamsters union legislative representative Michael Dolan told a forum for industry, labor and other trade stakeholders on Tuesday that he believed the two sides were too entrenched on some key issues and that those should be excluded. He recommended leaving out the food safety standards and naming rules, known as "geographical indications." Similarly, he said a deal should exclude European demands for greater access to US federal, state and local government procurement, which often carries "buy American" or local content standards. "Agree to disagree on government procurement," Dolan said. "Geographic indications? Not on the menu." An EU official told reporters that European negotiators were disappointed in the latest US procurement offer but were determined to keep working toward a deal. "We are obviously working hard to see where we can try to conclude these negotiations before the change of administration, without in any way compromising the substance of this agreement," the official said. "We don't believe in a 'TTIP light.'
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Scottish council probes 'extremely serious' procurement corruption allegations

Scottish council probes 'extremely serious' procurement corruption allegations | Public Procurement - Europe |
North Lanarkshire Council has opened an investigation into what it calls “serious allegations of corruption” in its procurement processes.

Council leader Jim Logue instructed chief executive Paul Jukes to launch the probe following an anonymous tip off in a letter to council.

Logue said: “These allegations, which are detailed, concern some of the council’s procurement processes. If true, they are extremely serious.”

The council’s internal audit team has already begun to investigate the allegations and will hand the case to the police if further evidence of wrongdoing is found.

The internal audit team has access to all files held by any part of the council and all IT systems.

“It is essential that the people of North Lanarkshire are able to have full confidence in the way the council conducts its business and I am determined that we are transparent at all times,” said Logue.

“Although these are currently unsubstantiated, anonymous allegations, I believe that it is right to carry out a full investigation and share any evidence which comes to light with the police.”

The council declined to comment further‎.
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Buying green handbook - Green Public Procurement - Environment - European Commission

Buying green handbook - Green Public Procurement - Environment - European Commission | Public Procurement - Europe |

On April 2016 the European Commission published a fully revised version of Buying Green! - A Handbook on green public procurement.
The Handbook is the European Commission's main guidance document to help public authorities buy goods and services with a lower environmental impact. It is also a useful reference for policy makers and companies responding to green tenders.
The third edition of the Handbook includes:
Guidance on how environmental considerations can be included at each stage of the procurement process in the current EU legal framework (adopted in 2014)
Practical examples drawn from contracting authorities across EU Member States
Sector specific GPP approaches for buildings, food and catering services, road transport vehicles and energy-using products.
The second edition of the Buying Green! Handbook (from 2011) is available here: ;

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Dr Gordy: Design & delivery of a compelling 'Stay In' public information leaflet without shooting client in the foot

Dr Gordy: Design & delivery of a compelling 'Stay In' public information leaflet without shooting client in the foot | Public Procurement - Europe |
Next week we are told every household in the UK will start to receive a copy of a public information leaflet setting out 'Why the Government believes that voting to remain in the European Union is the best decision for the UK'.  We are told the leaflet has cost £9m, including the cost of packaging and delivery (Production: £458,500; Print and delivery: £5.947m; Digital promotion and website: £2.894m).

The initiative is proving, unsurprisingly, to be politically toxic but there are interesting procurement issues too - so if I were the CPO asked to have handled this procurement exercise here's some of the questions I would have asked:

Have we processes in place to comply with the EU Regs?
I assume the business case has been agreed, risk assessed and approved?
Has the 'do nothing' option or leave to the 'Stay in' campaign been fully evaluated?
Do we let one contract for design, one for print, one for packaging, one for delivery, and one over-arching contract?
The budget is separate for 'production' and 'print and delivery', what do we mean by 'production' - is that 'design'?
The design appears to include every other page as a colour picture, given that this is primarily about 'facts' will the additional pages of print and costs directly associated with the pictures be justified?
Has an equality impact assessment been completed on the design?
Are those with special needs accommodated?
Is there any risk that the potential suppliers could subsequently prove to be an embarrassment to the initiative? 
Which elements of the work can be used to showcase UK businesses, SME's and the community sector?
Which elements of the work could be delivered by UK businesses, SME's and the community sector?
What quality of paper is required, would cheaper quality match our needs?
Given that this initiative is being led by the Environment Secretary, will the paper and inks used reflect our aspired environmental credentials?
What are the alternative avenues for distribution which can be subjected to an options appraisal, for example, do we use Royal Mail or its competitors, community sector, local government refuse collection operatives (some may say that would cut out the middle man for many householders and go straight to the bin)?;
Given the Government Digital Strategy, the target audiences, and the Environment Secretary leadership, would a 'soft copy' and making use of social media perhaps be worth exploring more before pursuing a print dominant route?
Will there be costs incurred if householders pursue a 'return to sender' protest and have they been factored in?
Are you sure this initiative is not something we may live to regret?
Almost echoing my suggestions for reducing the cost of organising the Queen's Birthday celebrations, a letter in today's Times must ring alarm bells for those concerned with stewardship of the public purse:

Sir, I doubt I am the only director of a creative agency who would be more than happy to design a 16-page glossy brochure, edit and proofread it, for less than one tenth of the £500,000 of taxpayers' money mentioned in your report.
EDEN PHILLIPS, CEO, Edenco Creative 
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EU public procurement corruption costs €5bn

EU public procurement corruption costs €5bn | Public Procurement - Europe |
Corruption risk in public procurement in Europe costs around €5bn (£3.95bn) every year, according to new research.

A study by RAND Europe said the annual total cost of corruption in Europe is as much as €990bn (£780bn). The figure is much higher than previous estimates of €120bn (£95bn).

Croatia, pictured, has the most risk of public procurement corruption, according to the report.

RAND Europe estimated that an initial €71bn (£56bn) could be saved if the EU adopted three policy measures.

The Cost of Non-Europe in the Area of Corruption study, commissioned by the European Parliament, investigated corruption, including paying bribes or exercising power to give privileged access to public services, goods or contracts.

Corruption could include having only one organisation in a procurement process, or giving organisations little time to respond to tenders.

According to the report, the World Bank definition of corruption in public procurement includes acts such as unjustified sole sourcing or direct contracting of awards, tailoring specifications to a favoured bidder and sharing inside information.

The study said corruption risk in public procurement varied significantly across EU member states, with Luxemburg having the lowest risk and Croatia having the highest for corruption among public procurement contracts.

Poland, Romania, Lithuania, Cyprus and Croatia had above EU member state average of corruption risk in public procurement, the study said.

However, the costs of corruption risk are highest in Poland and the United Kingdom (both above €1bn), and while in a country like Croatia there is a relatively high corruption risk across its public procurement contracts, the overall value of contracts is low, the report said.

The new overall figures are higher than initial estimates by the European Commission (EC) because RAND Europe used a measuring methodology that took into account the indirect effects of corruption, such as disincentives of companies to invest, and direct effects, such as money lost on tax revenues and public procurement.

RAND Europe has recommended three policy measures to address corruption in Europe which could stop billions being lost every year.

These include applying the updated Cooperation and Verification Mechanism, which was used in Bulgaria and Romania before they joined the EU and involves the EC monitoring countries’ progress in tackling corruption, to other member states.

Establishing a European Public Prosecutors’ Office, to help the EC Anti-Fraud Office investigate corruption, and implementing a full EU-wide procurement system are also recommended.

Marco Hafner, a research leader at RAND Europe and the report's main author, said corruption imposed significant social, political and economic costs.

“Not only does it result in huge amounts of money being lost annually, but corruption leads to more unequal societies, higher levels of organised crime, weaker rule of law and lower trust in public institutions,” he said.

“Measuring corruption is challenging, but our study provides one of the most realistic and current estimations of its true cost to Europe as a whole. Our recommendations highlight achievable targets for the EU and member states to help stop corruption from taking place and limit the amount of money lost each year.”
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Poland, Norway Mull Joint Sub Procurement

Poland, Norway Mull Joint Sub Procurement | Public Procurement - Europe |
WARSAW, Poland — The Polish Ministry of National Defence is planning to launch a joint procurement with Norway under which Poland’s Navy would acquire three new submarines, and the Norwegian Navy a further six subs, according to Brigade Gen. Adam Duda, the head of the ministry’s Armament Inspectorate. The announcement comes following the signing of a deal on joint naval training activities by the two countries.

“The talks with our Norwegian counterparts regarding a joint submarine acquisition are quite advanced. We have compared our requirements, and they are compatible,” Duda told Polska Zbrojna, the official magazine of the Polish Armed Forces.

In addition to Norway, Poland's other potential partners for a joint submarine procurement reportedly include the Netherlands.

Germany, Norway Eye Joint Submarine Procurement

On March 15, during the official visit to Poland of Rear Adm. Lars Saunes, the inspector general of the Royal Norwegian Navy, the two countries signed an agreement on joint training activities by their navies.

Poland aims to acquire three new submarines to replace its outdated Kobben-class subs, which are to be decommissioned by 2021. The Norwegian government has declared it could provide one submarine to the Polish Navy to help Warsaw maintain its submarine capacity, according to Duda.

The Norwegian and Polish navies both operate the naval strike missile (NSM) systems, which are produced by Norway’s Kongsberg Defence Systems.
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Government calls on councils to buy British steel in bid to save industry

Government calls on councils to buy British steel in bid to save industry | Public Procurement - Europe |

Ministers have announced a bid to save UK steel by encouraging councils and hospitals to buy British as they try to save the industry.

New medical facilities, schools and road projects are among £300 billion worth of infrastructure projects due to be built over the next five years. Public bodies must consider using British steel before importing from abroad under rules that value the social impact of production alongside the cost of the material for the first time.

The change will level the playing field between British made steel and Chinese imports, Ministers have announced. 

In November the Government revealed it will take into account the quality of workforce training and the carbon footprint of steel in national procurement schemes to help UK steel-makers compete with cheaper imports. 

This has now been extended to include local government and the NHS and alters current public sector procurement rules, which state that councils must opt for the most cost-effective bidder when building new infrastructure. 

Ministers hope the change will highlight the "true value" of British products.

It could unlock £300billion worth of new contracts for steel in the UK thanks to planned infrastructure schemes over the next five years.

The announcement came as it emerged one of Britain's leading steel tycoons is in talks with the Government over a plan to rescue the Port Talbot steelworks. 

Sajid Javid meets steel workers in Port TalbotPlay! 00:54
Sanjeev Gupta, founder of commodities firm Liberty House, is understood to have proposed replacing the blast furnaces at Port Talbot with modern electric arc furnaces to melt down scrap. 

It could potentially solve the problem posed by the energy-intensive and therefore expensive blast furnaces after Ministers revealed they will not nationalise Tat Steel's UK assets to solve the current crisis. 

The plan would form part of a joint venture with the Government, Mr Gupta said. 

Tata announced last week that it will attempt to sell all or part of its UK operations after it revealed the business is losing over £1million a day. 

Ministers are attempting to avert a full-blown collapse, taking with it the livelihoods of 15,000 workers at British steel plants and another 25,000 jobs in the supply chain. 

But campaigners and union bosses have warned the Government's intervention has come too late and criticised Ministers for blocking EU plans to slap Chinese steel imports with higher tariffs to level the playing field.

Steelworkers wait for the business secretary at a Tata plant
Matt Hancock, Minister for the Cabinet Office and Paymaster General, said: "We are going further than ever before to support British steel. Taxpayers spend billions of pounds buying steel for public projects.

"Last year we changed the rules across all central government procurement to ensure buyers take into account the true value of British steel - including local impact and jobs.  

"The industry is responding positively to this so I want to go further. Now we will apply this guidance across the public sector so that, from operating theatres to new buildings, public sector buyers will need to consider social and economic benefits, alongside value for money.

"When public bodies buy steel they must taking account of the true value of buying British."

But Angela Eagle MP, Labour's shadow business secretary, warned the plans may be too late to save the struggling industry.

She said: "The Government has been dragged kicking and screaming to take action to support the steel industry, which is a vital foundation industry and has descended further into crisis on their watch. 

"It is welcome that action is finally being taken by the Government on procurement and Labour has argued that shovel ready infrastructure projects should be prioritised and British steel used whenever possible. 

"But the Government also have to recognise that only by taking immediate and decisive action to ensure that the steel industry survives can we make sure that British steel is actually used in public projects - only then will these commitments be worth the paper they're written on."

Chancellor: 'We will do everything possible to help steel families'Play! 01:31
The Government has also announced it will drawn up a list of approved suppliers of steel in a bid to prevent under-cutting by overseas importers. Companies on the list must meet a host of strict criteria to be approved, including: "High and robust standards around health and safety, environmental impacts, responsible sourcing, supply chain management and training the workforce".

It follows a startling intervention from China, which announced 46 per cent anti-dumping tariffs on high-tech steel produced in the UK and the rest of the EU in retaliation for measures to block cheap imports to this country. 

In a statement a Chinese minister said the country has suffered "substantial damage" from trade abuses, the exact claim levied at it from British steel workers who claim they cannot compete. 

The Prime Minister is understood to have confronted the Chinese leader President Xi Jinping in Washington. Over the weekend he said: “It’s a very difficult situation, and people who pretend there’s some simple easy answer in a world of massive overproduction and collapsing prices are not playing straight with you."

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Slovenia Reforms Public Procurement System | Lexology

Slovenia Reforms Public Procurement System | Lexology | Public Procurement - Europe |
The new Slovenian Public Procurement Act, the ZJN-3 ("Procurement Act"), enters into force on 1 April 2016. After a long period of dual regulation of the general and utility areas of public procurement, the new Procurement Act unifies both areas in a single act, thus invalidating the existing Public Procurement Act - ZJN-2, and the Act Regulating Public Procurement in Water, Energy, Transport and Postal Services - ZJNVETPS. All public procurement procedures which commenced before 1 April 2016 will be concluded in accordance with the previously valid acts.

Enhancing Transparency and Simplifying Procedures

The main reason behind the adoption of the new Procurement Act is the implementation of Directive 2014/24/EU and Directive 2014/25/EU which are reforming the public procurement system at a European level. With the new directives and their implementation in national legal systems, legislators are pursuing greater transparency, limitation of corruption, promotion of innovative solutions and participation of small and medium enterprises, as well as promotion of green public procurements. The ambit of the European legislator was mainly to achieve greater flexibility of the procedures and to simplify complex procedures, as well as to open national markets to foreign enterprises. One of the best possibilities for achieving this is the gradual introduction of electronic public procurement.

The Slovenian legislator has commenced the reform systematically and has executed a thorough analysis of the public procurement market in Slovenia. The most important implications, which also facilitate comparison between different EU member states, are that a) the average duration of the most commonly used procurement procedure - i.e. open procedure - is 202,8 days, b) the most common reason for the unsuccessful completion of a procedure, which happens in 78,76% of cases, is the incomplete tender submission, and c) that the contractual value of all awarded contracts, without VAT, was almost EUR three billion. In comparison to previous years an uptrend of volume in procurement value has been noticed.

New Legislative Solutions

The most important new legislative solutions offer a simplified procedure for the contracting authorities due to several new procedures that are now available, improving the thresholds for small value procurements and shortening the deadlines for the submission of tenders. Simplifications were also sought for tenderers. From now on, tenderers will be able to use a single European form for establishing grounds for exclusion, i.e. ESPD. The maximum yearly turnover which may be requested by the contracting authority is also limited, which will probably enhance competition in the relevant markets.

On the other hand, the Procurement Act provides for several new grounds for exclusion with special emphasis on social procurements via social clauses, and gives absolute priority to certain tenderers in reserved contracting cases. To facilitate transparency, the publication of some recording contracts - those contracts that are below the threshold for public procurement - is now mandatory. Contract award decisions will also be published.

The new Procurement Act further invokes the most economically advantageous tender criterion, which is based on lifetime costs and price. However, this does not mean (except in some cases) that the criteria cannot solely take into account the lowest price, but it does put a priority emphasis on the relationship between price and quality. Another important change is in relation to mandatory direct payments to subcontractors, as well as additionally flexible regulation of utilities, which relate water, energy, transport and the postal sector.

Fundamental Concepts and Principles

The new Procurement Act departs from the existing definition of an 'incomplete tender', and rather defines an 'admissible tender'. An admissible tender eliminates grounds for exclusion, fulfils all relevant conditions, and is technically appropriate and timely. It is also absent of proven cartel agreements and corruption and offers prices that are not abnormally low or exceeding the guaranteed funds. It is evident that emphasis has been put on the prohibition of anticompetitive practices, which will be determined in a specific procedure before the Slovenian Competition Protection Agency, if the contracting authority has any suspicions.

The new Procurement Act also abandons the concept of a formally incomplete tender, which in practice enabled wide supplementing of a submitted tender. The only remaining concept will be the allowed supplementing and changing of the tenders, which is under contracting authority's control, since the contracting authority itself may request a supplement, correction, change or clarification of the tender. The definition of issues which may be supplemented and/or changed is narrower than it was in the previous act.

Even though the fundamental principles remain practically the same, the new Procurement Act did widen the social clause which provides that the tenderers have to fulfil all applicable obligations in respect to environmental, social and employment law. In practical implementation this means that the wider clause will be an essential element of each contract, meaning that rescission of contract will be possible only upon a breach of the clause. Non-compliance with the social clause also presents grounds for exclusion. Furthermore, tenderers will have to provide evidence of regular payment of tax obligations and social contributions with the relevant national tax forms.

Thresholds for Public Procurements

The new Procurement Act shall be applied to those procurements where the estimated value, without VAT, is equal or higher than the following values:

20.000 EUR for public supply and service contracts (50.000 EUR for utility);
40.000 EUR for construction contracts (100.000 EUR for utility);
750.000 EUR for social and other specific services contracts (1.000.000 EUR for utility).
Public contracts that exceed the above-mentioned thresholds, will necessitate the publication of a contract notice on the national public procurement portal. If the contract value exceeds European thresholds, which are relatively higher than national ones, publication in the Supplement of the Official Journal of the EU is also mandatory.

For public contracts where the estimated value is lower than the respective threshold (i.e. recording contracts), the only obligation of the contracting authority is to observe the principles of economy, efficiency, effectiveness and transparency. In cases where the recording contract value exceeds EUR 10,000 without VAT, the contracting authority is also obliged to publish a list of all such contracts concluded in the previous year.

The new Procurement Act also defines several exceptions where the Procurement Act will not be used. In general, the exceptions relate to urgent contracts, specific legal and financial services, in-house contracts and public-public relationships, in accordance with ECJ case law.

New Old Procedures

The most commonly used procedure in practice, i.e. the open procedure, has not been significantly changed. The most relevant change mainly applies to shorter minimum deadlines for the submission of tenders, which is now 35 days, except in exceptional circumstances where the deadline may be shortened to 15 days.

Even though the restricted procedure is - in terms of terminology - a new procedure, it is basically the same as the previously existing procedure with a prior establishment of competence. The Procurement Act provides for several other procedures such as competitive dialogue, competitive procedure with negotiations, negotiated procedure with prior publication of a contract notice, negotiated procedure without prior publication of a contract notice and a new procedure for small value contracts.

Changes in the Execution of the Procedure

The new Procurement Act eases the preparatory stage of the public procurement procedure by enabling prior cooperation with candidates or tenderers. In such cases the contracting authority has to take certain steps in order to prevent anticompetitive practices.

In the decision stage of the procedure, an important new change is that when a decision is published on the national web portal for public procurement, it is deemed served to all tenderers. In practice this means that service for all tenderers will be unified, which will impact the deadlines for the filing a review claim. In addition, the Procurement Act does not provide for requests for additional explanations anymore, meaning that deadline extension for filing a review claim on this basis will no longer be possible.

The tender review process, where other tenderers review competing tenders after the decision had been made, has been vitally changed by the introduction of greater restrictions to the potential detriment of tenderers. The review of other tenders is still possible, however, two different situations have to be distinguished. When the contracting authority performed a full check of all tenders regarding their admissibility, then the review of other tenders may be granted only to those who submitted an admissible tender. However, if the contracting authority decides to perform a full check of only the most economically advantageous tenders, then it is obliged to enable review to all tenderers who request it. The request for review has to be submitted within three working days (in procedures for small value contracts – within two working days) and the contracting authority has to facilitate the review within three working days (or two working days for small value contracts) following the receipt of the request.

New Regime for Subcontractors

If the tenderer intends to perform the task with subcontractors, each subcontractor and the parts they will undertake must be included in the tender. The tenderer will also have to include their contact information and legal representatives, completed ESPD forms of subcontractors, as well as the subcontractors' request for direct payments. An important improvement is that the tenderer is required to undergo the same procedure if the subcontractor is changed during contract execution.

In accordance with the new regime, there is no automatic mandatory direct payment to subcontractors. Such obligation will only exist if the subcontractor requests direct payment. If direct payment is not mandatory in a specific case, then the contracting authority will have to request that the tenderer submits a subcontractor's statement of payment receipt. Such statement must be provided within 60 days from payment of the final invoice, otherwise the tenderer will be liable for a misdemeanour.

If the contracting authority establishes, during the tender check process, that grounds for exclusion exist with a subcontractor, then the contracting authority must request from the tenderer that it submits an official change in subcontractors.

Additional Exclusion and Selection Criteria

The majority of exclusion and selection criteria has remained the same, however, the new Procurement Act applies different terminology to the processes and also distinguishes between mandatory and optional exclusion and selection criteria, meaning that the contracting authority may opt to consider optional criteria regardless of their inclusion in the tender documentation. Many grounds for exclusion are not necessary with regards to utility area.

Grounds for exclusion are as follows:

criminal record,
nonfulfillment of tax conditions,
negative references record,
being twice fined for a misdemeanour related to the payment of work,
failing to comply with obligations relating to social clause,
insolvency proceedings,
serious professional misconduct,
an agreement restricting competition,
conflict of interest,
involvement in prior stages of the procedure (in some cases),
shortcomings in the execution of other public contracts,
providing serious misleading information, or
attempting to unduly influence the contracting authority.
Even if certain conditions are relatively strict, the Procurement Act provides for a corrective mechanism where the tenderer has an option to provide evidence that it has taken sufficient measures to ensure its reliability.


It will be shown in practice whether the legislature has achieved the desired simplifications of the procedure, however, it is questionable whether this extensive reform will benefit tenderers. Changes regarding some crucial concepts and some legal vacuums which will have to be solved by the National Review Commission imply that it will not. However, it should be noted that a reform regarding legal protection in public procurement procedures is expected in late autumn 2016. In addition to this reform, both tenderers and contracting authorities will have to pay considerable attention to the fact that the legislator expects to fully introduce the system of electronic procurement by April 2017.

Karanovic & Nikolic - Marko Ketler
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 NHS procurement | Talk Business Magazine

 NHS procurement | Talk Business Magazine | Public Procurement - Europe |
Recent figures from the NHS North West Procurement Development show NHS organisations in Greater Manchester spend around £290 million a year on procurement, and a third of this, around £43.5 million, is on products and services from SMEs within their footprint.

For SMEs that have never done this kind of business before, getting a product or service into the NHS is a challenge. On one hand, they know their product will have positive health and cost benefits, while on the other they are attempting to engage a vast and complex public sector organisation, which is subject to regional management and UK and European regulation.

The good news is there’s help for SMEs; starting on the journey to NHS procurement is made simpler in knowing where the information is, which questions need to be asked, and who can answer them. This is where the Greater Manchester Academic Health Science Network (GM AHSN) can step in.

Greater Manchester is home to one of 15 AHSNs around the UK who are supporting this idea, each with a strategy unique to its populous and its membership organisations, which include Trusts and universities. We’d like to – and the government would too – see more business done between the NHS and SMEs to stimulate innovation within public sector healthcare to improve its value for money and patient outcomes, and to boost local economies.

GM AHSN has a primary focus on cardiovascular health, patient safety (especially medication error) and digital health/informatics. Its secondary priorities are atrial fibrillation, chronic kidney disease, familial hypercholesterolaemia (a genetic cause of high cholesterol and heart disease), EPaCCs (end of life care) and orthopaedics.

The priority areas were identified by the AHSN as being able to add the most value, according to results from original engagement work prior to the launch of our Innovation Nexus initiative.

Innovation Nexus facilitates our engagement of both med-tech and healthcare businesses – from SMEs to global companies – and the NHS. In its first year we helped med-tech companies access funding, procurement support and services to help with lab resources, office space, public sector collaboration and relocation.

A total of 146 enquiries received and 116 consultations completed
80% of those businesses were SMEs
More than 1,500 hours of support provided to businesses
9 SMEs helped to draw down a share of £1m from the Corridor Growth Fund
50 new jobs created as a result
Coming to Innovation Nexus is a key stage for companies. They might be at the R&D stage, or ready to enter into medical trials. But they have one thing in common – they’re already thinking about how to get their products into the NHS.

So, they might need funding help or to be introduced to AHSN member organisations that can collaborate with them on development or testing. But they will usually need help with procurement. This is our most in-demand service.

Procurement help comes in several forms. My immersive experience of how it works from pitch to contract, helps me give the right guidance that will help businesses approach NHS procurement departments directly and successfully. I also help companies identify tender opportunities, and to understand how the various tendering processes work so they can compete for business.

Exploring the procurement options helps businesses make informed decisions and take them forward. Procurement support is the most asked-for service that comes under the Innovation Nexus banner.

Yet while the NHS is a complicated organisation, its awareness that innovation, especially tech innovation, is a key driver of cost-efficiency and a cornerstone of modern patient care, is encouraging to our talented and flexible SMEs, whose products create opportunities that the NHS needs. Better communication will create opportunities for both.

We know and understand that the NHS is a huge organisation and at times the journey within can seem very daunting for new suppliers (SMEs), but we are here to make that journey easier, we know the nooks and crannies, we know where the potential walls of silence are.

It is to this end that stimulating discussions between the innovators and the NHS clinicians or commissioners in the CCGs (Clinical Commissioning Groups) will bring about the positive thought processes which in turn create the opportunities the NHS needs.

SMEs can seek more information and contact me at the Innovation Nexus via the contact form at
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EU in search of good procurement offer

EU IN SEARCH OF GOOD PROCUREMENT OFFER: A U.S. offer to open government procurement to European companies will go beyond anything the United States has put on the table in past negotiations, but don’t expect the European Union to be happy about it, Pro Trade’s Adam Behsudi reports. European businesses have high hopes that the Transatlantic Trade and Investment Partnership will deliver major access to more than $1.9 trillion in annual U.S. public procurement contracts. But if a U.S. offer earlier this month is any indication, U.S. Trade Representative Michael Froman might never be able to deliver on EU expectations.

“Certainly, a lot of EU asks are not there,” said one source in Brussels closely following the talks.

The U.S. has added a handful of federal agencies to the list of those that will be required to open their bids to EU firms, although officials wouldn't provide details. But high-dollar projects funded by the Federal Highway Administration and Federal Aviation Administration, which would provide major gains to European construction and railway multinationals, will still be largely off limits. The Obama administration is also unlikely to approach states to urge them to open their procurement contracts to foreign bids. Click here to read more:
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Government calls for innovative ideas to change public procurement

Purchasing professionals with proposals about how to radically transform public procurement may find a platform for their ideas in a new government consultation survey.

As part of its “call for ideas” for the National Innovation Plan, the government is seeking suggestions from the public to help develop innovation in the UK – and one of the main categories is how public procurement can be transformed.

A questionnaire asks respondents to suggest how the UK should develop a framework that encourages innovation and the power of procurement and customer demand to stimulate the development of innovative products.

The main question in the survey that is likely to concern SM readers is: “How can we deliver real culture change within public procurement?”

It asks respondents to suggest what government can do differently, what works well and what challenges businesses face when government is their customer.

“How can we work with innovative businesses to ensure innovation flourishes? How can we work together to be more innovative in our procurement approaches to achieve maximum value?” the survey asks.
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The challenge of balancing public sector cuts with social value

With the public sector remaining under pressure to increase efficiencies and demonstrate value for money, now is the perfect time for procurement to measure “the double bottom line”. 

As a result of operating in increasingly challenging climates, public sector organisations are placing even greater pressure on their procurement teams – with departments tasked to build business resilience by generating savings and demonstrating value for money.

Success of course is assessed on the reporting and measurement of efficiency gains – but since the introduction of the Public Services (Social Value) Act 2012, procurement has gained an added responsibility.

It is now considered best practice to embed social value within procurement activities – and this brings with it a whole host of social, quality, economic and environmental benefits.

Social value programmes are vital to supporting the growth, stabilisation and development of communities, and can offer a variety of positive outcomes – from tackling worklessness and social exclusion in disadvantaged areas to improving digital inclusion, reducing offending and supporting barriers to learning.

There is now more at stake than just seeking quality, while driving down cost and improving efficiencies.

Measuring the performance of social impact alongside efficiency gains, brings a new dimension to the concept of value for money – as this combination enables organisations to focus on generating savings that have a long-term impact past the point of commissioning.

Adopting this method can also increase service quality and lead to cross-departmental savings – in addition to creating opportunities for partnership working, and enhancing relationships with contractors and the supply chain.

At Fusion21, we practice this whole-package approach to procurement, and ensure that members accessing our procurement services also benefit from the generation of social value.

In the face of continued scrutiny – and amid ongoing cuts to budgets and services – securing sustainable and long-term savings will remain a high priority for the public sector.

The ability to report and measure efficiency gains alongside social impact has boosted the overall value of procurement – and I’m sure you’ll agree, the race to the double bottom line makes our jobs a lot more interesting. 

David Neilson is chief executive at Fusion21
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Changes Coming to Public Procurement System in Croatia

Changes Coming to Public Procurement System in Croatia | Public Procurement - Europe |
The lowest price principle will no longer be the main criterion.

The new public procurement system will no longer take as the main criterion the lowest price, which will be replaced with the economically most advantageous price-quality ratio principle, it was announced at a conference organized by the Economy Ministry on the new public procurement system. It is expected that the government will adopt the draft law by late May, reports on April 28, 2016.

“The new Law on Public Procurement will greatly contribute to the changes we all want – that we have a new, modern, flexible law that will allow the new criteria. The lowest price, which has so far been the only criterion, disappears and that will enable us to stop seeking just the cheapest options, which might not meet the quality criteria”, said Economy Minister Tomislav Panenić.

With this legislative proposal, Croatian system will be aligned with three European directives, and Panenić pointed out that this was “one of the reform laws of the reform government”.

The new law will also no longer require that all companies applying for tenders have to collect a number of supporting documents. They will have to do it only if they are selected as a preferred bidder. “We have received a large number of complaints in this area, and this will certainly be welcomed by entrepreneurs. This will especially help small and medium sized companies which do not have special public procurement departments. It will no longer be acceptable that for as much as 40 percent of public procurement tenders there is only one bidder. This is a bad practice which opens a possibility for corruption and must be urgently changed”, said Panenić.

The Minister also pointed out that the European Commission claimed that countries which had so far introduced this form of public procurement procedure generated savings of between 5 and 20 percent of the value of public procurement.
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Latvian FinMin: no public procurement deals are threatened

Latvian FinMin: no public procurement deals are threatened | Public Procurement - Europe |
No public procurement tender is threatened, and no tenders have been cancelled, the Finance Ministry in Latvia said today following media reports about major procurement deals being halted due to two new laws that still have not come into force, informs LETA.

As reported, the new Public Procurement Law and Law on the Procurement of Public Service Providers were endorsed at a meeting of state secretaries already in 2015, but there has been no further progress. Therefore Latvia has failed to transpose two European Union public procurement directives by the April 18 deadline. In order not to lose the EU funds available to Latvia, the Finance Ministry has recommended state and municipal institutions to postpone their tenders until the directives are transposed, several newspapers report today.
According to the Finance Ministry, it has issued recommendations on actions during the transition period while the EU directives are being transposed.
No tenders have been banned, says the Finance Ministry. Furthermore, the Finance Ministry has found a solution so the said two laws could be passed faster.
According to the Finance Ministry, the phrase in the ministry's letter sent to state and municipal institutions, which recommended postponing all major procurement deals, was due to "inconsistent communication", and the ministry has already apologized to all the parties involved for the faulty communication.
The new procurement laws have just a few sections related to the directives that Latvia has not yet transposed. For the most part, the new laws are meant to improve the current public procurement system. Also, part of the provisions in the EU directives has been incorporated in other laws and regulations of Latvia, which have already come into force.
The ministry emphasizes that it had timely started transposing the directives, involving a number of other institutions and social partners in the process. The discussions during the work on the new legislation helped reach solutions to many important problems concerning public procurement process, and it will be improved significantly after the new laws come into force.
Toni Saraiva - EISC Ltd -'s insight:
oh, dear!... not that they had 2 years to implement the directives and many more years knowing it was coming up... Latvia is not the only one unfortunately all but a handful of countries have implemented into their legislation the new directives by the 18th April...
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Public procurement could be next TTIP deal breaker

Public procurement could be next TTIP deal breaker | Public Procurement - Europe |
As EU-US negotiators prepare for a new round of transatlantic trade talks in New York next week, officials fear TTIP might run into a new brick wall: Public procurement.

The warning came from the European Parliament, where the International Trade Committee was holding a hearing on Wednesday (20 April).

German MEP Bernd Lange, an SPD lawmaker from the Socialists and Democrats (S&D) group who chairs the committee, said public procurement could turn into a TTIP deal-breaker as negotiators seem stuck in boasting the openness of their own public contracts market.

“There has been something of a ‘beauty contest’ over which country is the ’most’ open in terms of public procurement in recent years,” said one analyst at the European Centre for International Political Economy (ECIPE), a think tank.

“And the EU has appointed itself as the fairest in all the land,” he added.

Lost in numbers

If Europeans estimate that the “de jure” openness of the EU procurement markets is at roughly 85%, against 32% for the US, American officials told that EU firms have more guaranteed access to public tenders in the US.

Taking the World Trade Organisation Government Procurement Agreement (GPA) as proof, the US said it guarantees access to markets worth approximately $320 billion per year. Meanwhile, the EU covers approximately $333 billion, but only guarantees that US can compete for half of that amount —roughly $158 billion— officials claim.

According to US Trade Representative Michael Froman, the Federal Government spends approximately $500 billion annually for a wide range of goods and services and the EU has guaranteed access to approximately $200 billion – or two-fifths of federal procurement. This $200 billion is not subject to restrictions like the Buy American Act, the Berry Amendment and the US SME programme.

But here is the hick. The EU says European firms face discrimination even on those two-fifths of accessible public procurement.

A source in the European Commission’s trade directorate told EurActiv that even though some European companies have found a way to comply with the stringent domestic restrictions and win public contracts in the US, they have been obliged to change their supply chains and even establish their production in the US.

For example, the US procurement market for buses and public transportation is severely restricted for European suppliers, the EU official said. These restrictions are linked in particular to the Buy American Act, which requires that all steel and iron is produced in the US.

Things get even more complicated when going to the sub-federal procurement level, which stands at 60% of total public procurement in the US. While US officials say they provide guaranteed access to EU companies for $120 billion annually worth of contracts, the EU contends that the figure is overestimated.

“Federal money comes with strings attached,” said the EU official, stressing that this practically means that the most valuable infrastructure procurements are excluded from the GPA scope.

“Whatever the claims of ‘actual openness’, the reality is that the US federal government applies a ‘Buy American’ policy on federal procurement and on procurement which the Federal Government funds,” the EU official added.

Not Buy American, but Buy Transatlantic

Such rules make it more cumbersome for European SMEs to access large projects as subcontractors.

The EU would welcome a privileged agreement where “we would get rid of all the strings attached,” said the EU source. “Why can’t we transform the ‘Buy American’ into a ‘Buy Transatlantic’?” he wondered.

Europeans claim this could be a way of solving the mind boggling exercise of tackling the lack of proper statistical data, and finalise talks before President Barack Obama steps down in 2017, averting a potential new era of uncertainty for TTIP, depending on his successor.


Transatlantic Trade and Investment Partnership (TTIP) negotiators must soon strike deals on market access for services and certification of regulatory standards, sources have said, if the EU-US trade deal is to be struck before the end of the Obama Administration.
EU Trade Commissioner Cecilia Malmström and US Trade Representative Michael Froman have met face to face three times in the last two months, as well as having regular calls. The European Commission is handling the negotiations on a mandate handed to it by EU leaders.

Malmström said in Washington last March that she wanted to settle major differences over US “Buy American” government procurement standards, how to resolve investment disputes, and over Europe’s many geographical rules that govern food products from Parma ham to feta cheese, by the summer.

Both trade partners also said in February that they hope to make significant progress in consolidating texts, as part of this planned increase in momentum.

Even though EU officials do not expect an offer on public procurement at the upcoming negotiating round, the burning issue will stand high over the talks.

The issue might well come up during talks between German Chancellor Angela Merkel and US President Barack Obama, who will meet on Sunday in Hannover.


The European Commission has estimated that an ‘ambitious’ TTIP deal would increase the size of the EU economy by around €120 billion (or 0.5% of GDP) and the US by €95 billion (or 0.4% of GDP). Economically, TTIP can benefit consumers from creating cheaper products, according to the Commission.

A study by the Centre for Economic Policy Research estimates that in total the average European household of four will see its disposable income increase by an estimated €500 per year, as a result of the combined effect of wage increases and price reductions.

This would be a permanent increase in the amount of wealth that the European and American economies can produce every year.

But the deal has been beset by controversies centering on accusations that the talks are too secret, will drive down environmental standards or leave governments at the mercy of lawsuits brought by rich multinational companies.


24 April: US, EU and German leaders meet in Hannover.
25 April: 13th round of TTIP negotiations
7 June: Final presidential primaries
End-2016: Target date to sign TTIP
January 2017: Obama steps down
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BREXIT: Changes to procurement regulations unlikely in aftermath of vote regardless of result, says expert

Within the UK, the EU procurement regime is now well established as the framework within which utilities and public bodies must conduct their purchasing. Whilst initially perceived as unwieldy and restrictive, such purchasers are now well versed in the need to navigate the procurement pitfalls and increasingly look to the regime to maximise competition, achieve value for money and, particularly in light of the reforms introduced by the new EU procurement directives, seek to achieve social benefit and innovation in their purchases.
With the Brexit referendum looming on 23 June then, the question for many, whether those who embrace the regime, or those who might see an EU exit as a welcome escape from the perceived complexity and onerous restrictions of regulated procurement, is what impact the UK's withdrawal from the EU might have on procurement regulation?
Although there are a large number of unknowns that could shape what the answer is, a change of tact on procurement policy is unlikely to be pursued by policy makers in the UK in the immediate months and years after any 'out' vote.
Whilst the Treaty on the Functioning of the European Union and directives from which the procurement rules in the UK derive would cease to have effect, an 'out' vote would have no immediate impact on the validity of UK procurement laws. In England, Wales and Northern Ireland the main rules are the Public Contracts Regulations 2015 and the soon to be Utilities Contracts Regulations 2016 and Concessions Contracts Regulations 2016. Although still rooted in EU law, different rules apply in Scotland.
Until repealed or reformed, this legislation will continue to regulate purchasing. Moreover, in the aftermath of an 'out' decision, reform of procurement law seems unlikely to be top of the government's 'to do' list.
There was no single consolidated set of public procurement rules in place  in the UK prior before the first tranche of EU legislation was implemented, but there was nevertheless a pre-existing regulated procurement regime. This included compulsory tendering for local authorities, for example. Like the EU system, these rules existed to achieve best value for money when expending public monies and to ensure accountability and freedom from bribery and corruption. It is highly likely therefore that, even if the existing regime were to be repealed, another very similar regime would take its place.
It is unlikely that the public sector, nor indeed those who supply to it, would embrace an unregulated approach to procurement.
Whilst at a practical level there may be a mixed appetite for procurement regulation, this has not been reflected in how EU law has been implemented in the UK. In fact, quite the contrary. The UK's approach has been to go beyond the minimum requirements set by EU law. An example of this is the incorporation of the 'Lord Young reforms' in the Public Contracts Regulations and use of the Cabinet Office standardised pre-qualification questionnaires in England and Wales, and the steps being taken throughout the UK to encourage the use of social objectives in purchasing.
If the UK votes to leave the EU the UK would still need to have some form of continued relationship with the EU and this might, in some scenarios, mean adopting EU procurement rules.
If the UK adopted a similar relationship with the EU to Norway and Iceland and became a member of the European Free Trade Association (EFTA) – the main benefit being so that it could gain access to EU free trade agreements – the UK, as an EFTA member, would still need to adopt the EU procurement rules. In that scenario, not only would the UK still be stuck with the current rules, as a non-EU member state, it would have no influence on their content.
Whilst there is uncertainty over what the consequences of an out vote might be, from a procurement perspective at least, it seems highly unlikely that the procurement landscape will change quickly. Like it or loathe it, for the foreseeable future at least, procurement regulation seems here to stay.
Kerry Teahan is an expert in public procurement at Pinsent Masons, the law firm behind
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'Procedural errors' in procurement for London's Garden Bridge

'Procedural errors' in procurement for London's Garden Bridge | Public Procurement - Europe |
The procurement process for the Garden Bridge project in London was adversely affected by procedural errors, according to a report.

The Greater London Authority (GLA) Oversight Committee said mayor Boris Johnson should have been more upfront about the range and nature of contacts between his office, Tranport for London (TfL) senior management and Heatherwick Studio, which was awarded the contract for design services for the Garden Bridge.

The report is the result of four scrutiny meetings and investigations into the procurement of the design of the bridge and an internal audit review of it.

There were a series of procedural errors in the procurement process, while the final published audit failed to address the original objective, the report concluded.

It said the investigation identified significant failures of process throughout. This led the committee to “conclude that the objectivity and fairness of this procurement process was adversely affected by these actions, which casts a shadow on the ultimate outcome”, the report said.

The committee report recommended that TfL should consider reimbursing unsuccessful bidders for the design contract to compensate them for the time and expense incurred in preparing proposals.

There should be written records of all meetings the mayor holds with external bodies, which also clarify what capacity he is there in, it said.

The report said the principles of the Garden Bridge proposal were sound. “The controversy which has beset the project has stemmed from the mayor’s prior contact with bidders, TfL’s mishandling of the procurement process and the favourable treatment and access offered to one of the bidders in advance of the process,” it said.

The report is the view of a majority of the committee including Labour, Liberal Democrat and Green members. Conservative members did not support the conclusions. 

Len Duvall, Labour group leader and chairman of the oversight committee, said the whole process was badly handled.

“TfL started work without a clear idea of the extent of its eventual involvement, which led to confusion among staff and managers in the early stages of the project. The mayor’s private office was less than honest about where he was, what he was doing there and why.”

He added that “secretive and defensive” responses from TfL and the mayor probably made the situation appear worse than it was.

“What should be a great tourist attraction, has been tainted by the dodgy design procurement process. Whether the Garden Bridge can overcome its controversial beginnings, will remain to be seen.”

A spokesperson for the mayor said: “An audit of Transport for London’s procurement process found that it was open, fair and transparent. The mayor believes the Garden Bridge will be a spectacular new addition to London, and building is due to begin this year on a project that is widely supported by Londoners and businesses on both sides of the river.”

A TfL spokesperson said: “An extensive and thorough review of the procurement was undertaken last year which found no evidence to suggest that the final recommendations did not provide value for money from the winning bidders.”

Work is due to begin on the £175m project in the summer.
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UK Government Wants To “Change Procurement Rules” to Bail Out Steel Industry – Here’s Why It Won’t Work

UK Government Wants To “Change Procurement Rules” to Bail Out Steel Industry – Here’s Why It Won’t Work | Public Procurement - Europe |
Last November the Crown Commercial Service issued a guidance document around how public procurement could legitimately and legally support the British steel industry. Fast forward to last week, and…
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How EU procurement rules affect the public sector | Public Finance

EU procurement rules often get bad press but they have not yet had a high profile in the UK referendum debate on membership. But they lie at the heart of the internal market and often have a big impact on public services.

Public expenditure on goods, works and services represents about 13% of the European Union’s gross domestic product, and tenders for higher value contracts valued at around €420bn were published EU-wide in OJEU in 2014. 

Ever since the UK joined the then common market, public procurement regulations have been based on European law and regulation. Even if the UK were to vote to leave the EU it is almost certain that a condition of a favourable trade deal and access to the bloc’s Single Market would require the UK to continue to have public procurement legislation closely aligned with the wider EU regulations, including “state aid” rules.

Therefore the rules are likely to be of interest to the public sector whatever the outcome of June 23’s vote, and they have been constantly changing and evolving in recent years, with further change likely. The implications of the Transatlantic Trade and Investment Partnership proposals for a trade deal between the EU and the United States is one area where one would hope that an UK government would be seeking to exclude key public services from competition and competitive contracting. This requires the UK government to be at the EU Council not shouting across the Channel.

The EU procurement regulations have got a bad press and often this has been unfair. Any domestic government would wish to adopt sound public procurement rules so that it would be wrong to suggest that if the UK had not been a member of the EU its public procurement regulations would have been much different to the current ones.

It has been too easy and frankly lazy for public procurement officials and others to blame the EU for their own over-engineering of the application of the regulations or simply poor procurement practice.

Recent changes to the EU procurement directives are fundamentally important, and show how the UK can currently influence the regulations. These arise from the EU Public Contracts Directive (Directive 2014/24/EU) which has transposed into UK law for England, Wales and Northern Ireland by the Public Contracts Regulations 2015 and for Scotland by the Public Contracts (Scotland) Regulations 2015.

The new rules have been presented as a step forward in the simplification and modernisation of public procurement, with one change being the relaxation in the justification for the use of Competitive Dialogue and the newly created Competitive Procedure with Negotiation. This was in line with one of the key aims of the UK government in its response to the consultation by the European Commission before, as is normal, it made legislative proposals in a draft directive. The UK was then able to influence the negotiations amongst member states and in the European Parliament over the draft directive, underlining the importance of being at the table to help shape the laws that affect our communities, citizens and businesses. 

To understand these latest developments in the evolution of EU public procurement I have turned to an accessible and informative newly published book - “Competitive Dialogue and Negotiated Procedures – A Practical Guide (2nd edition) written by Michael Burnett and Martin Oder and published by the European Institute of Public Administration. An update of their 2010 book on a similar theme this book explains the new regulations, their genesis and context, and how practitioners and leaders can use them to secure value for money and excellent outcomes through effective public contracts.

Given the importance of and the emphasis which the government is placing on major public infrastructure programmes, and the continual wish of some in the public sector to adopt outsourcing arrangements for the delivery of public services, it is critical that public officials – political and executive – understand the potential opportunities and challenges which these European regulations create. Public procurement has to secure social value and value for money in efficient ways. It has to secure long-term sustainable contracts and partnership arrangements. The public sector has to maximise the effectiveness of its application of the new regulations and procedures.

As one might expect many possible ways of implementing these procedures within the law. And of course as ever what is legally permissible is not necessarily the same as what is desirable from a value for money perspective. Creative flexibility within the law is what is required. These regulations are with us and everyone involved needs to ensure that they understand and can apply them to the public benefit.
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Five ways to get small firms to bid for tenders

Small and medium-sized enterprises (SMEs) have become crucial to the success of our local economies and many organisations are beginning to recognise the benefits of adding SMEs to their supplier lists.

Apart from the fact it’s a CSR requirement, many large organisations are keen to engage with SMEs to take advantage of the low-cost, innovative products and services they have to offer. When you factor in the flexibility, local knowledge and the diversity that SMEs can bring to your supply chain, why then is it so difficult to encourage them to bid for potentially lucrative tenders?

There are a number of barriers that prevent SMEs from bidding for tenders from the outset. The perception that only big suppliers get on tenders still remains.

Many SMEs consider the tender process to be overcomplicated and steeped in red tape, ultimately, a process only big suppliers have the time or resource to manage. Why then should they bother if they feel they have little or no chance of winning?

However, these barriers can be effectively removed and the tender process adapted to encourage SME engagement:

1. Set realistic goals
Think about what SMEs can realistically do. Question whether your specifications include things that aren’t absolutely necessary. If the SME feels at risk from certain types of supply contract, they are unlikely to bid for it. Also, by breaking down tenders into smaller, more manageable lots, for example based on supplying a particular region, will help give SMEs the confidence that they can actually win it.

2. Insurance
As a rule many suppliers will only have 'off the shelf' insurance policies because it’s what they need and can realistically afford. Some sectors will set their insurance requirements very high, thereby immediately creating a barrier. Many SMEs don’t realise this can often be addressed very simply by topping up their current policy. Engage with potential suppliers to ensure they understand your requirements.

3. Simplify processes
SMEs typically have little time to dedicate to lengthy form-filling exercises. Standardising this process using an e-tendering solution will support them in the long term as, once registered, they won’t have to do it all over again. Also, ditch the complex terminology used in tender documents and use plain English.

4. Vetting finances
Think about the financial information you ask for. A new business, or one that hasn’t yet been fully audited, won’t be able to provide three years audited accounts. If you are keen to engage with SMEs, think of different methods to measure their financial capabilities, and ways that are appropriate to the risk you’re seeking to manage.

5. Bidders’ days
Consider hosting a bidders’ day and invite SMEs to come and discuss how they can best engage with you. Opening up lines of communication and demonstrating that you are keen to work with them will show them that it’s well worth responding to that tender.

Breaking down barriers takes a conscious effort to understand the SME community. Adapting usual practices and procedures specifically for SMEs means that these barriers can effectively be overcome.

☛ David Kwiatek is head of commercial at ESPO
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Welsh government launches supplier feedback service

The Welsh Government has launched a supplier feedback service that it hopes will pave the way to improving procurement.

The feedback supplier service was launched by the country’s finance and business minister Jane Hutt (pictured), and follows the revised Welsh Procurement Policy Statement in June.

The launch of the service is an effort by the government for businesses to provide feedback on procurement service and delivery. It aims to improve communication among suppliers regardless of location or size and to provide transparency on public procurement rules.

In a government statement Hutt said: “I want to ensure that public sector procurement in Wales is being carried out in a fair, open and consistent manner and is in line with our Welsh procurement policy.”

“By providing an opportunity to ask questions, the service will make it easier for businesses to compete, and hopefully win public sector work, and in turn boost the Welsh economy, ” he added.

The law under which the UK Government gave the Welsh Government powers to regulate public procurement came into effect on 14 August.

The Wales Procurement Policy Statement was initially introduced in December 2012 and outlines procurement practises and specific actions required of every public sector organisation. 
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