The competition law investigation into approximately 40 construction companies has created a dilemma for clients. On the one hand, there is annoyance that important business partners may have been deliberately deceived for years and the desire to make amends is great. On the other hand, the clients see themselves as almost forced to continue business relationships with the accused construction companies.
The COVID-19 pandemic has infected public procurement, creating new challenges for companies and public purchasers. At least in the short term, exemptions have become the rule, procurement procedures have gone almost completely electronic and new contracts have had to be 'COVID-19 secured'. Some of these measures have an expiry date, but others will likely remain. The longer that some of these measures persist, the more susceptible the system will be to corruption.
More than four years after the entry into force of the new EU Public Procurement Directive, more than two years after the deadline for transposition and more than one year after publication of the first transposition draft, the time has come. Following the resolutions of the Council of Ministers and the Federal Council, it can be assumed that the Federal Procurement Act 2018 will enter into force by July 2018.
Almost one year after the two-year transition period of the EU directives on public procurement law expired, Austria published a consultation draft of the new Federal Procurement Act 2017 to implement the directives. While Austria took a somewhat conservative approach when implementing the directives, there are some areas where the Austrian draft for the transposition of the directives is significantly stricter than the directives themselves.
The regulation increasing the Procurement Act's thresholds has been extended for a further two years. Thus, contracting public authorities can continue to benefit from the significantly wider application of the direct award procedure and the so-called 'restricted procedure without prior publication' until 2018. However, contracting authorities should be aware that the Treaty on the Functioning of the European Union may still require an ex ante notice for contracts of a certain cross-border interest.
The two-year transition period for implementing the new EU directives on public procurement recently lapsed. While the majority of member states have at least partially implemented the directives, Austria has yet to pass draft legislation transposing any of them. However, despite this, the directives (at least in significant parts) already apply in Austria and individuals can – either directly or indirectly – rely on the majority of the provisions therein.
The Vienna Administrative Court recently ruled on a challenge to a tender conducted by a German centralised purchasing body under German public procurement law. The court concluded that even if the German purchasing body was qualified as a centralised purchasing body, the Austrian complaints mechanism would apply, as the purchasing activities in relation to the Austrian lot were attributable to the Viennese contracting authority.
The Vienna Administrative Court recently ruled on the requirements regarding the level of proof needed to demonstrate grave professional misconduct in relation to public procurement. The court held that a contracting authority need not necessarily wait for a final criminal judgment: if criminal investigations provide grounds for sufficient and precise suspicion, there is no need to wait for an indictment or a court order to institute proceedings.
The Administrative Court of Lower Austria recently confirmed that certain provisions in the new EU directives on public procurement have advance effects. The court ruled that the negotiated procedure set out in the Procurement Act must be interpreted in line with EU Directive 2014/24/EC. Contracting authorities and bidders should thus consider certain mandatory rules and provisions set out in the directives when applying existing regimes.
The government is preparing an amendment to the Federal Procurement Act which will create stricter rules for the award of construction contracts. However, the timing of the amendment is questionable, given that the act will need to be completely revised due to the implementation of three new EU directives, resulting in two procurement law adjustments within only 12 months.