EU Circulates Template for Public Tenders

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While Bulgaria’s MPs, already for six months, have been trying to outwit each other by various lobby amendments to the Public Procurement Act and are constantly delaying its adoption, the authorities in Brussels act much quicklier. Only a month after the European Parliament approved a directive that regulates the extremely sensitive issue of spending public funds, the Council of the European Union adopted the proposed changes. Thus, local legislators, whatever their games may be, will have to comply with the European regulations.

The new directive in facts reviews the current EU rules on public procurement. For the first time it will establish common standards for the contracts. One of the main reforms is associated with the reduction of red tape for applicants. Now most companies, especially SMEs, say the biggest problem for them is the need to present a significant number of certificates or other documents relating to the exclusion criteria and the selection. Henceforth these papers will be required only by the successful contenders.

The new rules will encourage the division of orders into lots to facilitate the participation of smaller firms. When a contracting authority decides not to implement this approach, it will need to indicate in writing their main reasons for this. Now the opposite is often done in Bulgaria and different activities in the implementation of a project are combined into one large contract. Indeed, this is saving time and effort, but on the other hand, the winners are always the same big players. The quality is questionable, since the same company alone plans and carries out everything with all the associated specific activities.

Brussels will also oblige us to introduce new criteria for “the most economically advantageous tender offer”. More emphasis should be placed on quality, environmental concerns, social aspects and innovation, while the price will have to take into account the life cycle of the purchased good or service. It is expected that the new requirements will end the dictatorship of the “lowest price”. In this area, Bulgarian law also says quite the opposite. The country has signed hundreds of contracts at unrealistically low prices, but then most of them have to be annexed.

To combat the social dumping and to ensure that the rights of workers are preserved, EU experts have provided schedules and additional rules for subcontracting and more stringent provisions for “abnormally low bids.” Companies that do not comply with the labour legislation of the EU, will be excluded from the auctions. Public contracts will not be allowed for companies that were found guilty of corruption or fraud against the financial interests of the community.

Non-payment of taxes or social security contributions will lead to mandatory exclusion. But in this case there is a loophole – Member States can decide not to comply with the rule in exceptional circumstances where overriding reasons of public interest make the contract award essential.

European partners will try to break also a very popular scheme in Bulgaria for hidden procurement. These are called negotiated procedures without prior publication of a contract notice in which there is no real competition between bidders and the contracting authority unilaterally decide to whom to assign the task. Under the new rules this will be possible only in exceptional circumstances caused by events that can neither be predicted nor attributable to the contracting authority. Or when it is clear that the publication of the notice will not lead to more competition or better results because there is only one economic operator, able to meet the set requirements. These “loopholes”, however, can negate entirely the basic idea of the reform.

The BANKER

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