On 15th January 2014, the European Parliament has adopted the two new public procurement directives to replace the Utilities Directive and the Public Sector Directive together with a separate proposed directive on the award of concession contracts. It is expected that the Council of the European Union will approve the new directives in the coming weeks and that they will be brought into force in March 2014. Member states will then have 24 months to implement the new directives into national law and a further 30 months to introduce mandatory e-procurement.
The Public Sector Directive is probably of more widespread interest to business and public sector entities. There are a number of reforms proposed in this Directive but to pick a couple of points that might be of more interest to readers:-
European Single Procurement Document
At the time of submission of requests to participate or of tenders, contracting authorities will be required to accept the “European Single Procurement Document” as preliminary evidence of satisfaction of selection criteria and confirmation that they do not fall within one of the grounds of exclusion. This is an updated self-declaration. Only the winning bidder will have to submit formal evidence to verify the information. This is intended to simplify procedures for bidders.
Use of electronic communications
Member states must move to full e-procurement within 54 months of the formal adoption of the Directive (30 months after the transposition deadline for the other provisions in the Directive). Member states must ensure that all communication and information exchange in relation to procurement procedures (including submission of tender documents), are performed using electronic means of communication.
No distinction between Part A and Part B services and new simplified regime for certain services.
There is no longer to be a distinction between Part A services (subject to the full rules) and Part B services (subject to only limited procedural requirements). A new simplified regime is introduced for certain social and other services, including social, health, cultural, legal, hotel, restaurant and catering services. Procurement of such services will involve only limited procedural requirements: advertisement of the contract (through contract notice or prior indicative notice) and announcing award of the contract (possibly in a “grouped” notice published on a quarterly basis). They will only be covered by the Directive if contracts meet a threshold of EUR750,000. Member states are required to put in place national rules for the award of contracts to comply with the principles of transparency and equal treatment. Member states are free to determine the procedural rules applicable as long as such rules allow contracting authorities to take into account the nature of the particular services.
Proof of financial capacity
When specifying financial capacity of bidders, the minimum yearly turnover that economic operators are required to have may not exceed two times the estimated contract value, except in justified cases (for example, where there are special risks attached to the nature of the works, services or supplies). This is in order to encourage participation by SMEs.
There are other points of note and we will come back to the topic closer to the time of national implementation.
Hogan Dowling McNamara
17th January 2014