Amendments to Public Procurement Law: more flexibility for contracting authorities - International Law Office

Introduction
New legal institutions and definitions
Exemptions
Changes to administrative appeals

Introduction

The Law on Public Procurement 2006 has recently been amended by Law 10170/2009. The amendment law came into effect on December 2 2009. It has introduced many important changes and has amended the administrative appeal procedure.

The amendment law affords greater flexibility to contracting authorities in public procurement procedures. Specifically, the law introduces new institutions, definitions and special contracts, new elements to administration procedures and new exemptions.

New legal institutions and definitions

The amendment law has expanded the list of contracting authorities. It further defines a 'contracting authority' as: (i) any public company where the contract to be awarded is sectoral, provided that such public company is controlled by the contracting authority; or (ii) "any other entity carrying out sectoral activities or combined activities, on the basis of special or exclusive rights granted by the competent authority".

The amendment law also establishes the Public Procurement Commission as the authority in charge of administrative reviews of public procurement procedures. The commission takes over this role from the Public Procurement Agency. The commission is a budgetary institution under the Council of Ministers and is the supreme appeal authority, whose decisions constitute final administrative acts.

The amendment law has introduced new definitions. A 'framework agreement' is an agreement between one or more contracting authorities and one or more economic operators that defines the terms - in particular, price and supposed quantities - of contracts to be awarded. Framework agreements are entered into prior to the award of public contracts. Awarded contracts should comply with the general terms, prices and quantities set out in framework agreements.

'Sectoral contracts' are public contracts entered into between contracting authorities in the water, electricity, gas, transport and postal sectors and one or more economic operators for the purpose of performing any activity relevant to such sectors. In the case of public contracts relating to sectoral activities, a sectoral contract must be entered into. The amendment law gives a detailed description of sectoral contracts in Articles 58(1) to 58(10) of the Public Procurement Law (as amended). Sectoral contracts comply with further requirements in addition to those imposed on all public contracts.

The most important distinction between standard and sectoral procedures is in the first step taken by the contracting authority when commencing a public procurement procedure.

Exemptions

The amendment law states that the Public Procurement Law and related regulation shall not apply to procedures for the award of:

• resale or sub-letting contracts;
• contracts between affiliated undertakings and contracts involving joint ventures, or contracting entities in a joint venture;
• contracts in the power sector;
• contracts in the water sector;
• contracts involving the purchase of power, fuel and water; and
• contracts involving bus transportation services.

The rules and procedures for the award of such contracts shall be provided in other acts, which are yet to be enacted or issued.

Changes to administrative appeals

Bidders or other entities that are dissatisfied with a contracting authority decision during the public procurement procedure may submit an appeal to the contracting authority within seven days of the date on which the appellant became aware (or should have become aware) of the infringement. The contracting authority must render a decision within seven days (as opposed to five days, as previously). The timeframe for the second level of appeal to the commission has been also been extended to seven days.

An important condition has been added to the administrative review procedure: the upfront payment of a fee, details of which shall be defined by a Council of Ministers decision, which is yet to be issued.

For further information on this topic please contact Olti Skrame at Kalo & Associates Law Firm by telephone (+355 4 2233 532), fax (+355 4 2224 727) or email (o.skrame@kalo-attorneys.com).