On the new public procurement rules

Czech Republic: New Public Procurement Act does away with the often overblown formalism of previous times

On 9 March 2016, the House of Deputies passed the bill for a new Public Procurement Act, which is set to replace the current Act on Public Contracts and the Concessions Act in their entirety. The Senate had returned the bill to the House of Deputies, arguing that the time period between enactment of the bill and its coming into force should be six rather than three months. In spite of this, one may expect the new Public Procurement Act to come into force before the year is out.

The new set of rules brings a number of changes, both small and big, but the fundamental structure of the tender procedure remains unchanged. For this reason, previous experience with the awarding of public contracts will be useful also under the new regulation.

Above all, the Public Procurement Act brings some welcome relief from what has been (in some cases) pure overblown formalism. In the future, contract awarding authorities are less straightjacketed when it comes to evaluating the qualification of bidders or ordering extra work. Also, the list of reasons for which bidders may be excluded from a tender has been extended. Because of this, the contract awarding authority is allowed to respond more flexibly to the way in which a given tender procedure develops over time, and make decisions not solely based upon the submitted tender documentation but also based upon its broader knowledge of the individual bidders.

Among the most important changes are these:

Contract awarding authorities will have the right to demand that the bidder supplement the submitted documentation by „data, documents, samples, or models which will not be evaluated using the evaluation criteria.” For this reason, a bidder who has made formal mistakes in preparing their bid need not necessarily be „automatically disqualified” from participation in the tender.

Also, the contract awarding authority will have the option to expand the subject matter of performance under the public contract by up to 10% of the original contract value (or 15% in the case of construction work) (known as the commissioning of additional work) without having to organize a formal tender procedure.

In fact, where the statutory requirements are met (in the case of a regime that is similar to today’s ‘negotiated procedure without publication’), the original public contract may be increased in size by up to 50 %.

Source: House of Deputies, 7th legislative term, beginning 2013 / Parliamentary press 637


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