Procurement in a nutshell – Concessions Contracts Regulations 2016 and Utilities Contracts Regulations 2016 published
1st April, 2016
In this Procurement in a Nutshell we will be looking at the publication of two sets of procurement regulations in March.
The Cabinet Office has published the Concessions Contracts Regulations 2016 (SI 2016/273) and the Utilities Contracts Regulations 2016 (SI 2016/274). The final Regulations are substantially the same as the draft Regulations previous published.
The Regulations come into force on 18 April 2016 and will apply to all procurements commenced on or after that date. The Crown Commercial Service (CCS) has published information on when these Regulations will apply, and further guidance is expected shortly. To access the CCS guidance, please click here.
What effect do the regulations have?
» Utilities Contracts (UC) Regulations 2016
The UC Regulations cover the procurement of goods, services and works above EU thresholds by utilities operating in the water, energy, transport and postal service sectors. They replace the Utilities Contracts Regulations 2006 and implement the 2014 Utilities Directive.
The UC Regulations contains specific rules relating to the exclusion of certain contracts made between contracting authorities, plus rules relating to affiliated undertakings and utility joint ventures.
To read our previous summary on the draft Utilities Contracts Regulations, please click here.
» Concession Contracts (CC) Regulations 2016
The CC Regulations implement the 2014 Concessions Directive and will regulate public works and public services concession contracts valued at over the threshold of £4,104,394.
The CC Regulations carefully define the characteristics and features of a concession contract. In-scope concessions will need to be advertised in the OJEU and follow a procurement procedure that meets certain minimum standards around transparency, equality of treatment and non-discrimination. Duration of concession contracts must be limited to 5 years (unless it can be demonstrated that a longer term is needed for the concessionaire to recoup its investment).
To read our previous summary on the draft Concession Contracts Regulations, please click here.
Why is it important?
The above Regulations represent the final part of the implementation of the reform of the public procurement regime. These changes have been long-awaited following the government’s quick transposition of the public sector directive that resulted in the Public Contracts Regulations 2015, which came into force in February 2015.
The Regulations bring reduced thresholds, meaning more of the purchasing requirements of public sector bodies are likely to fall within the rules. Unsuspecting contracting authorities could be caught out where their requirements had previously fallen safely under the threshold but may now be on the borderline. It is a reminder of the importance of carefully assessing the likely value of a requirement and confirming whether it exceeds the thresholds and requires full competition. Getting it wrong by just a few hundred pounds can make all the difference between an efficient process and a potentially costly and time-consuming challenge.
How can I find out more?
If you have any queries on the issues raised or on any aspect of procurement, please contact us via our procurement hotline on 0191 204 4464.
Please note that this briefing is designed to be informative, not advisory and represents our understanding of English law and practice as at the date indicated. We would always recommend that you should seek specific guidance on any particular legal issue.
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