There is a general principle that contracting authorities should request explanations when a proposed price, cost, or important components of price or cost seem grossly low and there are doubts about whether the contract can be performed. Art. 90(1) of the Public Procurement Act now no longer defines strict mathematical rules for examining a grossly low price. As a rule, whether explanations are requested from the contractor will depend on how the contracting authority assesses the contractor’s bid.
The European public procurement system is one of the foundations for the functioning of the common market. The principal task of laws in this area is to enable exercise of freedoms guaranteed in international agreements, being in this case unrestricted access to procurement procedures within the EU for contractors based in various member states. To achieve this, EU law not only requires adherence to the principles of a level playing field, fair competition and transparency; it also aims to remove market barriers, including those that are non-discriminatory, but are disproportionate. Regardless of this objective, interpretation and application of public procurement law leads to excessive formalism, rendering procurement procedures unintelligible, and distorting results around which public procurement law revolves.
Compulsory evaluation of the effectiveness of PPP projects, the possibility of obtaining an opinion on the legitimacy of a project carried out under this formula, a PPP test for projects valued at more than PLN 300 million, implementation of PPP projects via a special purpose vehicle owned by a private partner: these are just some of the changes introduced by an act recently signed by the President of Poland.
An amendment to the Public Procurement Law of 22 June 2016 implementing Directive 2014/24/EU upholds the principle that bid evaluation criteria cannot apply to a contractor’s economic, technical, or financial credibility. Lawmakers have however provided for the possibility of formulating a criterion applicable to qualifications of a contractor’s personnel.
Work on a concept for a new public procurement law is an opportunity to review the rules on bid bonds. The changes need to go beyond those proposed in the concept.
Public procurement contracts under the new framework: A clear step toward balancing the parties’ positions
The unique characteristics of public procurements should not impede a balanced allocation of risks between the parties. However, despite efforts by various groups this goal has remained unattainable. The drafters of the new Public Procurement Law have recognised the problems related to the parties’ unequal positions and proposed several remedies.