© OECD

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SIGMA Regional Conference on Public Procurement

Modernisation of the European Union public procurement policy and legal framework

Dariusz Piasta, Poland

Beirut 2-3 June, 2015

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Main elements of the procurement legal

framework

• Directive 2014/24/EU (…) on public procurement replacing 2004/18 directive,

• Directive 2014/25/EU (…) on procurement by entities operating in the water, energy, transport and postal services sectors replacing 2004/17 directive,

• Directive 2014/23/EU (…) on the award of concession contracts (“Concessions Directive”).

• Defence and security procurement directive (2009/81)

• „Remedies (review)” directives

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Short story of a long (recent) process of reforming EU rules

• Comprehensive evaluation of the impact and effectiveness of the EU procurement legislation (published June 2011)

• Public consultations by Green Paper on the modernisation of EU public procurement policy (over 620 replies, synthesis published June 2011)

• Draft proposals of 3 new EU directives (published December 2011)

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Short story…(cont.)

• Legislative process leading to adoption by EU institutions of three new directives (2012-2014),

• Adoption and publication of new directives,

• Implementation by EU Countries (2014-….), should be finalised by April 2016, with possible postponement concerning some provisions – (October 2018),

• the United Kingdom (England, Wales & the Nothern Ireland) first to implement (in comprehensive way) new rules.

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Results of the public consultations – fuel for the reform

• Insufficient cost – efficiency of the procedures – need for less administrative burden and more flexibility

• Not enough margin of manoeuvre for purchasers to pursue policy goals (horizontal policies, previously known as secondary objectives)

• Further room for improvement for access to public contracts (SMEs, (EU) cross – border procurement)

• Need for enhancing integrity of procedures and enforcement of proper application of the rules

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Objectives of the recent reform

1. Simpler/more flexible procedures

2. Strategic use of public procurement (pursue of policies)

3. Better access to public procurement (for SMEs and bidders from other EU countries)

4. Sound procedures

5. Governance/professionalisation of procurement

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International context of the reform

Full compliance with (old and new) Government Procurement Agreement and bilateral trade agreements (thresholds, procedures) is

required but

additional flexibility offered under GPA (shortening time periods, reducing obligations of sub – central authorities) possible

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Main elements of the reform

1. „Flexibilisation” of procedures

2. Strategic use of public procurement

3. Reducing documentation requirements (to be met by bdders)

4. (mandatory) e – procurement

5. SME access to public procurement

6. Sound procedures

7. Governance

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Main elements of the reform

The outline of presentation:

1. Problem identified in the consultation process/impact assessment

2. Actions undertaken in the new directives

3. (potential) impact of new provisions

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„Flexibilisation” of the procedures

Problem: disproportionate and inflexible procedures

Actions: increase use of competitive negotiation procedure, simplification of tools for repetitive purchasing, wider use of e-procurement, wider menu of available procedures („tool box”), alleviation of obligations

Results/impact: reduction of administrative burden, improvement of overall cost efficiency

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Strategic use of public procurement

Problem: insufficient leeway for strategic use of procurement

Actions: new instruments (e.g. special procedure for innovation), enhanced possibilities for taking account of social considerations in procurement, greater use of „labels”, exclusion of bidders for violation of EU environmental or social standards

Impact: higher prices, inappropriate use due to lack of maturity to use it, preferences, „fragmentation” of the market

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Reducing documentation requirements (of bidders)

Problem: administrative burden = barrier for SMEs

Actions: reliance of self declarations as prima facie evidence (documents from the winner only), exhaustive list of requirements for selection criteria, reliance on the European Single Procurement Document, reliance on electronic databases

Impact: savings in time for bidders, more work for procurement officers

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E – procurement Problem: lost opportunities due to insufficient

uptake of electronic procurement (translated from „EU speak” - some EU countries lagging behind)

Actions: mandatory e – procurement following expiry of transitional period, full electronic availability of tender documents, simplification of rules on dynamic purchasing systems, electronic auctions

Impacts: savings due to more competitive prices, lower transactional costs for economic operators but potentially a barrier for SMEs

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SME access to public procurement

Problem: missed opportunities for SMEs and

(EU) cross-border procurement

Actions: reduced documentation obligations for bidders/candidates, „turnover cap”, division of contracts into lots („divide or explain”)

Impact: increase competition, increase administrative burden (i.e. more work for purchasers), lower costs of participation for economic operators (or, transfer of transaction costs from bidders to purchasers)

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Sound procedures Problem: lack of sufficiently clear rules to prevent

corruption, lack of rules on „conflict of interest”

Actions: provisions ensuring integrity of procedures, minimum safeguards against conflict of interest and illicit behaviour; provisions on modification of contracts, enforcement of provisions on abnormally low tenders

Impacts: clearer rules for sound procedures increase confidence in the system; more attractive environment for bidders, increase competition

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Governance Problem: high „error rate” (translated from

auditors language – share of irregularities), divergent application of rules

Actions: provisions on monitoring of application of procurement provisions, reporting obligations of purchasers and EU countries (including effects of application of policies)

Impact: increased administrative burden, broader picture of the impact of procurement rules

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What next?

„There is no such thing as an empty space or empty time….”- there is always something to do:

1.Monitoring of the results of the reform

2. Impact assessment of functioning of review (remedies) rules in public procurement

3. public consultations (concerning) review/remedies

4. „professionalization”

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Thank you very much for your attention

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