Procurement in a nutshell – international obligations
26th February, 2016
In this Procurement in a Nutshell we will be looking at a new Procurement Policy Note released by the Crown Commercial Service (CCS).
The note can be found here.
The Government has published a Procurement Policy Note detailing how Contracting Authorities (CAs) can ensure compliance with wider international obligations when awarding public contracts.
The UK’s public procurement regime derives largely from the EU procurement directives (the UK Public Contract Regulations 2015 (PCRs)) and the World Trade Organisation Government Procurement Agreement (GPA).
The EU procurement directives and the GPA impose a legal obligation on CAs when awarding contracts above certain thresholds to treat EU and GPA suppliers equally, and not discriminate by, amongst other things, favouring national suppliers.
Although the remedies available are not available to suppliers in ‘third countries’ (i.e. those not part of the EU or GPA), the CCS guidance makes it clear that they could offer the best value for money and should therefore be treated in the same way.
The CCS’s guidance states that procurements are not to be used as a tool to boycott tenders from suppliers based in other countries, outside where formal legal sanctions, embargoes and restrictions have been put in place by the UK government.
The Government also added that local level boycotts can ‘damage integration and community cohesion within the United Kingdom, hinder Britain’s export trade, and harm foreign relations to the detriment of Britain’s economic and international security.’
Why is it important?
All CAs will be impacted by this new guidance including Central Government, executive agencies, non-departmental public bodies, the wider public sector, Local Authorities and the NHS.
The CCS guidance reiterates that ensuring value for money in public procurement has recently been updated to make clearer that the key factor is whole life cost, not necessarily the lowest purchase price and CAs should be mindful of this when running their procurements.
CAs should remember the remedies available to aggrieved bidders under the PCRs, including damages and ineffectiveness. In addition the EU can take action against the Government for breaches by CAs and this may result in further action and fines. The CCS guidance states that individual CAs will be included in these proceedings.
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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