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New public procurement in the Czech Republic – part one

New public procurement in the Czech Republic – part one

The aim of this article is to bring insight into the new public procurement law in the Czech Republic, which became effective as of 1st October 2016 and is incorporated into the Act No. 134/2016 Coll., on public procurement.

The new legislation cancelled the existing Act No. 137/2006 Coll., on public procurement, and the existing Act No. 139/2006 Coll., on concession license procedure and concession license contracts (“the License Act”). The concession license procedure is newly regarded as a specific type of procurement procedure and the concession license as a specific type of a public procurement.

The general aim of the new legislation according to its preamble is:

  1. to provide the conformity with the law of the European Union;
  2. to set clear rules, which are capable to prevent corruption, to guarantee the economical use of public funds, the prompt realization of needed public projects and the fair contest of the contractors;
  3. to reduce administrative demands of public procurement and to ensure a sufficient level of its transparency at the same time.

In particular the new law aims especially for the reduction of: the duration of the procurement procedure, the number of cancelled procedures, the number of objections, the number of cases filed with the Office for the Protection of Business  Competition and the reduction of the difference between the expected and the realized price of the public procurement.

I. NEW TYPES OF PUBLIC CONTRACTS AND TYPES OF PUBLIC PROCUREMENT PROCEDURES

The new act distinguishes five types of public contracts with respect to their objects:

  1. public supply contracts;
  2. public services contracts;
  3. public contracts for building works;
  4. concession licenses for services and
  5. concession licenses for building works.

Further, the new law regulates nine different types of procurement procedures, which are:

  1. simplified subthreshold procedure;
  2. open procedure;
  3. restricted procedure;
  4. negotiated procedure with publishing;
  5. negotiated procedure without prior publishing;
  6. competitive dialogue;
  7. innovation partnership;
  8. concession license procedure and
  9. the procurement procedure with simplified regime.

Apart from the above mentioned procurement procedures, it is also possible to award a tender in other special procedures, i.e. in a dynamic purchasing system or on the basis of a framework agreement. A specific type of procurement procedure is also a design contest, where a most suitable design is chosen.

II. PRINCIPLES OF PUBLIC PROCUREMENT

Basic principles of public procurement are set down in Section 6 of the Public Procurement Act. The procurement authority shall respect them during each and every action in connection with the public procurement and in all phases of the public procurement procedure. The aim of these principles is to protect the competition during the public procurement.

Basic principles of public procurement are as follows:

  1. principle of transparency,
  2. principle of proportionate manner,
  3. principle of equal treatment and
  4. principle of non-discrimination.

III. IMPORTANT NEW LEGAL INSTITUTES

Preliminary market consultations. Before launching a procurement procedure, the procurement authority may conduct preliminary market consultations with independent experts, authorities or market participants. The aim of this institute is to prepare the public procurement properly and to inform economic operators of its procurement plans and requirements.
However, such consultations must not have the effect of distorting competition and must not result in a violation of the principles of the non-discrimination and the transparency. In the case of a distortion of the competition, the procurement authority is entitled to exclude the respective participant from the procurement procedure (under the fulfillment of other legal conditions).

Clarification and Completion of data, documents, samples or models. Pursuant to this provision the procurement authority is entitled to ask the participant of the procurement procedure to clarify already submitted data or documents or to submit further or missing data or documents.  The procurement authority may call for it anytime during the procedure, even repeatedly.

By Michaela Fuchsová & Magda Stárková

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