Public procurement: new regulations on the way

Public procurement: new regulations on the way

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Author: Jaime Jones

Public procurement rules are changing across Europe, and the UK government has just published a first draft of the new regulations that it proposes will implement the changes.

A consultation process is underway and some of the key points are listed below.

Earlier this year, three new procurement directives were published in the EU's Official Journal covering: (1) public contracts; (2) utilities contracts; and (3) the award of concessions. The government's approach to implementing the public contracts directive was confirmed on 19 September 2014 when the Cabinet Office published its first draft of The Public Contracts Regulations 2015 ('the proposed regulations').

The new proposals will implement the public contracts directive, largely replacing the current Public Contracts Regulations 2006 ('the 2006 Regulations').

Consultation

The Cabinet Office is now consulting on the proposed regulations. The consultation acknowledges that there is very limited scope to change the substantive content, given that the bulk of the public contracts directive is mandatory for EU member states to implement.

As the Cabinet Office has consulted once already on the optional content of the proposed regulations (in July 2013), this consultation asks only a limited number of questions. The consultation period is also deliberately short, ending on 17 October 2014.

The consultation documents, including the proposed regulations, can be viewed here.

Although the Cabinet Office will issue, and consult on, draft regulations implementing the utilities contracts and concessions directives separately, the current consultation is being used to address issues which are common to all three sets of regulations.

Key points

There are a number of points to note in the proposed regulations, including:

  • the proposed regulations have been drafted using the 'copy out' approach whereby the text of the directive is virtually copied into national legislation and so closely reflects the European wording. As such, the proposed regulations will be less recognisable to those who are familiar with the 2006 Regulations.
  • the proposed regulations also give statutory force to Lord Young's reforms on opening up procurement to SMEs. The additional provisions include obligations to advertise below-threshold contracts and to commit contractually to 30-day payment terms and pass those commitments down the sub-contracting chain.
  • under the transitional provisions currently proposed, the new regulations will apply to procurement processes started on or after the commencement date of the new regulations. Where a procurement process starts earlier, the whole procurement will remain subject to the 2006 Regulations.
  • the UK's 'light touch' regime applicable to the procurement of contracts for certain social and other specific services (including health, social, educational and cultural services) is extremely light, being limited essentially to an obligation to publish a notice in OJEU and run a procedure that is consistent with the Treaty principles.
  • the consultation highlights that the proposed regulations may be in force before the standard forms and notices required by the public contracts directive are ready for use (for example, a new form of contract notice reflecting the new procedures). The European Commission (mindful of the UK's early implementation aspirations) is apparently aiming to have the new forms and notices ready by autumn 2014 but the Cabinet Office has suggested interim measures involving the adaptation of existing forms should the new versions not be available in time.
  • until the separate new regulations implementing the utilities contracts and concessions directive are brought into operation, the 2006 Regulations will continue to apply to concessions and the Utilities Contracts Regulations 2006 will remain fully in force.

Next steps

The government has openly committed to early implementation of the directives and it is expected that after the consultation is closed, the Cabinet Office will move quickly to finalise the proposed regulations, apparently with the aim of them coming into force in spring 2015. In practice, this will require completion of the parliamentary procedure before the pre-election dissolution of parliament on 30 March.

If you would like to talk to anyone about the issues covered in this update, please contact Jaime Jones on 03700 865153, jaime.jones@shoosmiths.co.uk, or Michael Rainey on 03700 865683, michael.rainey@shoosmiths.co.uk

Disclaimer

This document is for informational purposes only and does not constitute legal advice. It is recommended that specific professional advice is sought before acting on any of the information given.

About the author

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Jaime Jones

Solicitor

03700 86 5153

Jaime is a solicitor in our specialist EU & competition law team. As well as advising clients in all sectors on a range of competition law issues, Jaime also has a specialism in Public Procurement law and advises both public and private sector clients on the application of the procurement rules.

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