public procurement

EU Procurement Law 2020 thresholds lowered

EU thresholds and the average EU exchange rate for conversion of EUR thresholds into PLN will be lower from 1 January 2020, which means that some current contracts in Poland will exceed the EU thresholds.

In-house procurement may not be compatible with EU law

The award of an in-house procurement satisfying the conditions laid down in Art. 12(1)(a)–(c) of Directive 2014/24/EU is not necessarily consistent with European Union law, the Court of Justice of the European Union held in the judgment of 3 October 2019 in Case C-285/18, Kauno miesto savivaldybè. This ruling is not controversial, nor does it change the principles developed over the years for excluding internal procurement from the regime of the procurement directives. Nonetheless, it gives contractors an additional argument for challenging contracting authorities’ decisions ignoring such basic principles as transparency.

Subcontractors can’t always get paid directly by the contracting authority

Under Art. 143c(1) of the Public Procurement Law, the contracting authority is required to make direct payment to a subcontractor approved by the contracting authority if the subcontractor does not receive payment due from the general contractor. This regulation has provided greater protection to subcontractors under public contracts, but in certain situations it may be difficult to obtain this protection.

New Public Procurement Law: Mediation and conciliation at the Court of Arbitration at the General Counsel to the Republic of Poland—good or bad solution?

Under the proposed new Public Procurement Law, in the event of a dispute involving performance of a public contract, amicable resolution of the dispute would be handled by the Court of Arbitration at the General Counsel to the Republic of Poland. But the proposal generates legal doubts.

Public procurement deadlines must be realistic

Terms of reference should set contract performance deadlines that are possible to keep for completion of the contract and individual stages. It is better to specify these periods in years, months and days than as a specific date. However, if the contracting authority set specific dates which became impossible to meet after submission of the bids, it should modify them accordingly when signing the contract, reflecting the amount of time taken into account by contractors at the stage of submission of bids.

Substitute performance and party substitution in a public procurement contract

A party substitution in a contract concluded under the Public Procurement Law is possible if the contracting authority explicitly provided for the possibility of such a change in the contract announcement and specified the conditions for such a change. Whether a contractual provision authorising the contracting authority to entrust the performance of the contract to a third party (substitute performance) can be regarded as a review clause allowing for party substitution is an interesting issue in public procurement practice.