From the 18^th of April 2017, all Central Purchasing Bodies (CPB) will only be permitted to accept electronic submissions to procurement exercises. By September 2018 this requirement will be extended to all public contracting authorities. Whichever type of buying organisation you are, you’ll need to be aware of what this means.

What is a CPB?

This is defined as a contracting authority that acquires goods or services intended for one or more contracting authorities (“buyers”). Examples of CPBs include The Crown Commercial Service, The Scottish Government and APUC (Advanced Procurement for Universities and Colleges) as they procure on behalf of multiple contracting authorities.

What counts as an electronic submission?

Regulation 22 of the Public Contracts Regulations 2015 tell us what we need to know. The main thing to clarify is this – e-mails do not count as electronic submission. Electronic submissions must use a tool where the exact time and date of submission is provided. In addition to this, only authorised persons can access the data and therefore no one has access to the data transmitted prior to the deadline.  Electronic submissions must also include a tool to clearly detect infringement or any attempt of infringement of the access prohibitions.

There are a number of benefits to electronic submissions for both the buyer and the supplier:

• Everything is automatically time-stamped and fully auditable
• Reduced costs
• Reduced impact on the environment
• Quicker and more streamlined process on both sides of the procurement

So what does this mean for buyers?

Moving on to an e-procurement portal would benefit all buyers as it allows them to run procurement processes in compliance with the EU Directive and UK Regulations on Public Procurement by:

• Attaching documents to their tenders
• Allow the submission of tender documents
• Allow one-to-one interaction with the suppliers

Want to find out more?

If you are a contracting authority, myTenders PRO is the ‘go to’ e-procurement portal for publishing contract notices. Our portal can facilitate electronic submissions to make sure you are compliant with these new regulations, and those that will come into place for all buyers in the future.

Call us on 0844 561 0670 or visit our website to find out more.

Framework Agreements allow a contracting authority (buyer) to enter into an agreement with one or more economic operators (suppliers) for a set period of time.  Buyers can run mini tendering exercises to call-off contracts from the frameworks under Regulation 33 of the 2015 Public Contracts Regulations (PCR 2015).  In general, there are legal remedies which can be used where a supplier wants to raise a challenge against the buyer. These remedies operate differently for frameworks and call-offs from a framework. To read more about Framework Agreements, please follow this link to our previous blog.

So what are the remedies available where there is a breach relating to a framework or call off contract? It’s a complicated topic – there are four main remedies which are outlined below:

1. Notification and Standstill

The standstill period offers a 10 calendar day pause from the point when the contract award decision is notified to bidders, and the point when the final contract is finalised, during which time suppliers can challenge the decision and claim the call off from the contract or framework as ineffective. A court may preserve a contract for overriding reasons of public interest as per Reg 103(5) where there is a claim of ineffectiveness.  The ability to challenge the decision is a legal requirement imposed through the remedies directives. It is worth noting that it is not mandatory for a buyer to give notification and standstill for call-offs under a framework, but, they can voluntarily do so for above EU threshold frameworks made after a mini-tender.  Reg 99 states that frameworks will be ineffective where there is an illegal direct award, unless the authority believes it was lawful to do so and a VEAT (Voluntary Ex Ante Transparency Notice) is published and the standstill period is observed. This does not apply to call-offs.

2. Damages

Suppliers are limited to claim damages for call-offs and these can also available when there is a breach of the award of the framework agreement. This could happen when there are lost profits or loss of future profits and bid costs.  Individual call-offs do not require call for competition and cannot be classed as ineffective for failure to publish a call for competition, and in this instance the notification and standstill period would not apply either.

3. Automatic Suspension

A contract arrangement can only be brought to an end as a result of an application made by a buyer to the court requesting suspension of the contract.  If the court considers that automatic suspension is not an option, then it would not be appropriate to make an interim order suspending the award. Attendance at automatic suspension hearings and consequently at hearings to challenge the continuation of automatic suspension, adds substantially to the cost involved and places the emphasis firmly on the balance of convenience and damages as an adequate remedy, which can undermine a supplier’s ability to obtain an effective remedy

4. Freedom of Information

Freedom of Information Act 2000 (FOIA) enables anyone to request information from a public body which is to be answered within 20 days. The exceptions include prejudice towards commercial interests of any person, trade secrets, breach of confidence and where incompatible with EU law or any enactment.

The obligation to disclose information may be difficult when dealing with call-offs from a framework. Under Reg 55 buyers must provide suppliers with their decision in relation to the conclusion of a framework agreement. It is unclear how far this extends to call-offs. Buyers send a notice to those who submit an offer in a mini-competition/mini-tender when a notification and standstill period is applied in above threshold call-offs. The Crown Commercial Service guidance suggests that the notification and standstill information is to be sent to all supplier who consider themselves qualified to bid within 15 calendar days under Reg 55(2) (but it is not clear whether this does apply to call-offs or not).

PCR limits information obligations to suppliers and not to ‘concerned citizens’ or organisations. Only suppliers can seek remedies under the PCR which is a further limitation on enforcement for breach of the PCR, as special interest groups, individuals or trade unions who may wish to seek enforcement are required instead to seek a judicial review route.

Case Study

The first and most recent case in the UK to deal with the remedy of ineffectiveness under the PCR 2015 is of Lightways (Contractors) Limited v Inverclyde Council CSOH 169. The facts of the case are as follows:

• In 2015 the Council ran a mini-competition and a call-off of a CCS (Crown Commercial Service) Framework agreement for street lighting services. It was awarded to “Amey Public Services LLP”. The contract was entered into and had been previously awarded to this company in 2013.
• Lightways was not on the framework and challenged the award on the grounds that Amey were not appointed under the framework and the contract award was in breach of Regulation 19(3) of the Public Contracts (Scotland) Regulations 2012, where only call-offs could be made to those appointed to the framework. Amey was in fact a different company, as it was “Amey OWE Limited” that was on the framework.
• Amey OWE and LLP both had links to Amey, but were substantially different as the LLP company was a joint venture between Amey and Lanarkshire Council, and Amey OWE’s principal activity was in engineering consultancy. Each company had their own assets, employees and were separate.
• Lightways’ argument was accepted and it was held that they had a right to challenge even though they were not party to the framework. The ruling did not accept the principle of proportionality applied to allow the court to correct the council’s mistake and substitute Amey OW to Amey LLP.
• The court concluded that the Council had no defence to the challenge under Reg 19(3) and therefore made an order for ineffectiveness. Lord Tyre concluded that the contract had been awarded to a non-framework provider without being advertised and, as a result, a breach of the Procurement Regulations had occurred.

Where an ineffectiveness order is granted, the court is also obliged to fine the contracting authority. At the moment, the level of the fine in this case has not been stated, but it is obviously a concern for authorities in times of austerity. Any fine would be payable along with any with potential compensation payments to the exiting provider as well as potential damages to the challenger – so it could get costly. Inverclyde Council have been granted leave to appeal and, at present, the ineffective contract will continue until the appeal has been resolved.

Overall, the UK does seem to provide a satisfactory system of legal remedies with regard to the Public Contracts Regulations 2015 While the range of remedies appears satisfactory, there is a relatively small number of reported procurement judgements in the UK.  This can also suggest that the system is not being used to its full potential.

Brexit: we don’t know what the impact on public sector spending will be and whether the approach to procurement as a result of the leave vote will change. The construction industry has seen uncertainty growing more recently and the impact of a potential EU exit is unknown.

Despite increasing uncertainty in the run-up to the referendum, over 1,900 public sector construction tenders were published, an increase of 29% compared to the six months prior and mirroring growth seen over the last two years with a particular increase in tenders for roads infrastructure, renewable energy and new build housing.

The public sector has a large construction project pipeline which includes new and ongoing infrastructure projects such as HS2 and the completion of affordable housing projects across the country which remain in high demand. Regardless of the leave vote, projects of this nature will carry on and continue to create future opportunities.

Public procurement is governed by UK regulations which originate from EU Directives, there won’t be any change for some time as the UK negotiates its exit. The current regulations will remain in force until they are repealed or revised. As we can see the Government has much higher priorities than revising a system that generally works well. So what could happen if the UK continues to have access to the Single Market? there will be very little change to public procurement and without it, the UK will likely operate under the World Trade Organisation’s Government Procurement Agreement (GPA). This provides similar access to bidders from the countries that are signatories meaning that UK construction contractors will be able to bid on contracts in Europe, whilst at the same time European contractors will be able to bid here in the UK.

For now, the approach from construction suppliers looking to bid for public sector work will not be altered by any changes to regulations.  Companies must ensure that they continue to meet the requirements set out in the tender, demonstrate efficiencies and remain competitive against the competition – it’s business as usual.

Ultimately, there is no reason why leaving the EU should mean that the public sector ‘downs tools’ on construction projects. Continued investment in the sector will have a direct, positive impact on confidence, growth and continued recovery. For now, we will just have to keep a watchful eye on proceedings…

A simplified selection stage has been welcomed by both suppliers and buyers in the public sector.

On 26 September 2016, the Crown Commercial Service (CCS) released the new Selection Questionnaire which is, with immediate effect, replacing the Standard PQQ which was itself only released in February 2015.

So why the change? What exactly has changed? And, most importantly what does this mean for suppliers to the public sector?

Why the change?

The form has been changed to align closer with the text and structure of the European Single Procurement Document (ESPD). The usage of the ESPD has been mandated across Europe and will be rolled out fully across the UK in the near future. The ESPD has been created to make tendering easier for smaller businesses, a key driver of the amendments to the Public Contracts Regulations 2015, and means that suppliers can submit their ESPD during the selection stage rather than full tender documents.

So, why do we need the new Selection Questionnaire then? Simply put, the system in place in England is not yet able to roll out a uniform ESPD platform. So, for now the buying authorities can accept the ESPD, the Selection Questionnaire or use a procurement portal such as Millstream’s mytenders

What exactly has changed?

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