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Document / Public procurement – Changes made by OUG: how to calculate guarantees, values over which contract must be publicly announced, how to change contract without resuming procedures

de Razvan Diaconu , 29.5.2018

Under the promise of reducing bureaucracy and increasing efficiency in the public procurement procedure, the Government approved on Thursday an emergency ordinance that brings essential changes in the field.

Basically, the most important changes are:

Thresholds over which publishing an announcement becomes compulsory

According to the document approved by the Government, the awarding procedures governed by this Law, for which it is compulsory to publish a participation and / or awarding announcement in the Official Journal of the European Union, applies in the case of awarding public procurement contracts/framework agreements whose estimated value, excluding VAT, is equal to or greater than the following thresholds:

  • 24,977,096 lei, in case of public procurement contracts / framework agreements for works;
  • 648,288 lei, in case of public procurement contracts / framework agreements for products and services;
  • 994,942 lei, in case of public procurement contracts / framework agreements for products and services awarded by the county council, the mayor’s office, the local council, the General Council of Bucharest Municipality, as well as the public institutions reporting to them;
  • 3,376,500 lei, in case of public procurement contracts/framework agreements for services related to social services and other specific services

The award procedures governed by this law, for which there is an obligation to publish a contract and/or awarding announcement in the Official Journal of the European Union, shall apply in the case of awarding sectoral contracts whose estimated value, no VAT included, is equal to or higher than the following thresholds:

  • 1,994,386 lei, in case of sectoral product and service contracts, as well as in case of contests for solutions;
  • 24,977,096 lei, in case of sectoral works contracts;
  • 4,502,000 lei in case of sectoral service contracts related to social services and other specific services

By way of exception to the provisions of art. 22 and 23, the contracting entities referred to in art. 4 par. (1) lit. a) and b) may apply the simplified procedure or, under art. 12 paragraph (4) direct acquisition to award contracts on individual lots where the following conditions are met cumulatively:

  • the estimated value without VAT of the respective lot is below 360,160 lei in the case of the acquisition of goods or services or below 4,502,000 lei in the case of the acquisition of works

Situations in which contracts can be changed without resuming procedures

Under the new OUG, public procurement / framework agreements may be modified without organizing a new awarding procedure, in the following situations:

  • (a) if changes, irrespective of their value, have been provided in the original procurement documents in the form of clear, precise and unambiguous revision clauses, which may include price revision clauses;
  • (b) for the works, services or additional products from the original contractor, up to a maximum of 50% of the initial contract’s value, which became necessary and were not included in the initial procurement procedure, and changing the contractor:

(i) is impossible for economic or technical reasons, such as the requirements of interchangeability or interoperability with the existing equipment, services or installations, purchased under the initial procurement procedure; and

(ii) would cause the contracting authority a significant increase in costs

  • (d) if the contractor with whom the contracting authority originally concluded the public procurement contract is replaced by a new contractor in one of the following situations:

(ii) rights and obligations of the original contractor resulting from the public procurement contract are taken over following a universal succession within a reorganization process, including merger, division, acquisition or insolvency, by another economic entity that meets the initial qualification and selection criteria, provided that this change does not imply other substantial changes to the public procurement contract and is not made in order to circumvent the application of the awarding procedures provided for by this law;

  • f) when the following conditions are met cumulatively:

(i) the amount of the change is less than the corresponding value thresholds set out in Art. 7 par. (1);

(ii) the amount of the change is less than 10% of the initial price of the public procurement contract in the case of public service or product procurement contracts or less than 15% of the initial price of public procurement in the case of public procurement of works;

(iii) the change does not cause any damage to the general nature of the contract or framework agreement under which the subsequent contract is awarded.

“Guarantees” for judging appeals

In order to solve the contestation filed in the public procurement procedure, the person who considers himself / herself injured must first constitute a guarantee as set out below:

  • 2% of the estimated value of the contract, if it is below the thresholds provided for in 7 par. (1) of the Law 98/2016 on public procurement, as subsequently amended and supplemented, art. 12 par. (1) of the Law 99/2016 on sectorial procurement, as amended and supplemented, art. 11 par. (1) of the Law 100/2016 on concessions of works and services, as subsequently amended and supplemented, but not more than 35,000 lei
  • 2% of the established value of the contract, if it is below the thresholds provided for in art. 7 par. (1) of Law 98/2016 on public procurement, as subsequently amended and supplemented, art. 12 par. (1) of Law 99/2016 on sectorial procurement, as subsequently amended and supplemented, art. 11 par. (1) of Law 100/2016 on concessions of works and services, as subsequently amended and supplemented, but not more than 88,000 lei
  • 2% of the estimated value of the contract, if it is equal to or above the thresholds provided for in art. 7 par. (1) of Law 98/2016 on public procurement, as subsequently amended and supplemented, art. 12 par. (1) of Law 99/2016 on sectorial procurement, as amended and supplemented, art. 11 par. (1) of Law 100/2016 on concessions of works and services, as subsequently amended and supplemented, but not more than 220,000 lei;
  • 2% of the established value of the contract, if it is equal to or above the thresholds provided for in art. 7 par. (1) of Law 98/2016 on public procurement, as subsequently amended and supplemented, art. 12 par. (1) of Law 99/2016 on Sector Procurement, as amended and supplemented, art. 11 par. (1) of Law 100/2016 on concessions of works and services, as subsequently amended and supplemented, but not more than 880,000 lei.

In the case of a procedure for awarding the framework agreement, the provisions of paragraph (1) shall be related to the estimated value of the biggest subsequent contract that is intended to be awarded under the framework agreement.

If the complaint has been rejected by the Council, the person who considers himself/herself offended and uses the appeal under art. 29 or art. 51 par. (3), where appropriate, does not have to constitute an additional guarantee.

If the appeal procedure regulated by art. 29 or art. 51 par. (3) is used by a person other than the person who constituted the guarantee under par. (1), a guarantee of 50% of the guarantee provided for in paragraph (1) shall be constituted in advance in order to solve the complaint or the appeal, where appropriate.

The guarantee shall be reimbursed upon request after the complaint is solved by a final decision, respectively after the effects of the suspension of the awarding procedure and/or the contract implementation have ceased.

The guarantee shall be reimbursed to the person who submitted it not earlier than 30 days after the final judgment or, where appropriate, from the date when the effects of the suspension of the award procedure and/or the contract implementation cease.

Contracting authorities are exempted from lodging a guarantee.

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