A “technical” amendment to the Public Procurement Act

Czech Republic: Reviews of public tenders have become more costly

In response to new procurement directives (2014/24/EU and 2014/25/EU), the ministry for regional development has begun work on an all-new Public Procurement Act. This Act is still in its nascent stage, but the new procurement directives already have manifest impact, as can be seen from a recent technical amendment to the existing Public Procurement Act. Finally, the amendment remedies certain previous changes to the rules of public procurement which missed their target.

By way of a partial transposition of the new procurement directives, the individual evaluation criteria for determining the economically most advantageous offer have been broadened. In the future, contracting authorities are expressly allowed to also evaluate the “organization, qualification, and expertise of persons involved in the performance of the public contract”. Time will tell whether this new evaluation criterion is conducive to greater transparency and non-discrimination.

Following the amendment, it has become again permissible to evaluate even single bids without having to repeat the tender procedure. In this respect, the lawmaker is conceding that it was a mistake to prohibit the evaluation of single bids, which brought no practical benefits but on the contrary made it more difficult and expensive to procure specialized equipment. The previous solution, under which the contracting authority could evaluate a single bid only after even the second tender procedure with a similar subject matter yielded no multiple bids, was found to be impracticable.

The amendment makes far-reaching modifications to the review procedure concerning actions taken by the contracting authority. Above all, the upper limit for the security deposit has been raised which complainants must pay into the competition authority’s account when filing their request for a review procedure. The current maximum of CZK 2,000,000 (approx. EUR 73,260) has been moved to the CZK 10mn mark (approx. EUR 366,300). If the complainant withdraws their request before a decision has been issued on the merits, the Office for the Protection of Competition will return the security deposit, minus a 20% deduction (here, the lawmaker took its cue from the rules which have for years applied to court proceedings). Last but not least, the amendment introduces streamlined procedures, in that it will no longer be possible to make later changes or additions to one’s request for the commencement of review proceedings against the contracting authority (save for certain exemptions, such as the submission of new facts which the complainant could not have raised during the preceding stage in which losing bidders may bring their complaints). Evidence may only be introduced, and proposals may only be made, within 15 calendar days from the day on which the notice of commencement of proceedings was served (this rule applies both to the complainant and to the contracting authority). The Office for the Protection of Competition will disregard any later filings.

Source: Act No. 40/2015 Coll. amending the Public Procurement Act (Act No. 137/2006 Coll.)

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