Tenders Direct Blog

Comment from the experts at Tenders Direct.

New European Procurement Rules

Posted by Tim Williams on March 26, 2013

The final revisions to the EU procurement directives are due next month. The main changes, so far, are as follows:

1. Greater involvement of small companies (SME’s)

Selection criteria must be “appropriate” and “related and strictly proportionate” to the subject matter of the contract. If they are used minimum turnover requirement must be no more than three times the contract value and insurance requirements must also be proportionate.

 Purchasers will be required to divide tenders into lots wherever possible or provide an explanation of why they haven’t.

2. Financial Thresholds

Purchasers claimed that the rules made tendering more expensive and time consuming and would have liked the thresholds increased to remove the requirement for smaller contracts. In reality the market is more open through increased visibility of opportunities. The lengthy tender process is frequently due to poor organisation.

3. Changes to contracts

Changes to the terms of a contract have always been allowed where they are not material. Materiality is now defined as changes affecting less than 5% of the value.

4. E-procurement

As it’s our core business, I’m delighted to see the moves towards e-procurement. Contract notices must be submitted online and tender documents must be available for download when the notice is published.

5. In-house suppliers

A purchaser using its own resources to fulfil a need, has always been allowed. The test for in-house provision is set out in three parts:

    • Control must be as if the contractor were an internal department;
    • 80% or more of the contractor’s turnover is for the authority; and
    • There is no private ownership.

6. Part A and B Contracts

I’m pleased to say that the artificial distinction between Part A & B categories of services will be removed. Part B services which previously haven’t subject to most of the rules, cover requirements such as accountancy, legal services, health and social services. There are of course national restrictions related to qualifications, etc., but if for example a UK company can satisfy French rules, why shouldn’t it bid for a contract in France on the same terms as a French supplier?

One Response to “New European Procurement Rules”

  1. Maybe slightly OT…. but – In the tender process, there are legal constraints on the supplier to provide the items in the contract at the tender price, but no legal requirement on the client to actually provide the contracts that the tenderer bid for.

    We have only once in a couple of dozen successful tenders actually received the contracts for which we tendered. A kind of ‘zero hours’ for SMEs! Given the huge investment in winning a tender, its about time procurement teams actually reviewed what they will actually require from the tenderer so bidders can make a judgement as to whether to participate.

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