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01st February 2021

Brexit - all change in regard to public contracts

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If you are a contractor, construction professional or materials supplier to the public sector, or a client subject to the public procurement rules when it comes to contracting for works, services or supplies, keep a close eye on post Brexit changes to the applicable legal regime.

By way of background the ‘OJEU tender rules’, as some will have termed them due to the use of the Official Journal of the EU to advertise public tenders, have for many years set the requirements for how the public sector procures its contracts. Based on a series of European Union public procurement Directives which were transposed into UK law, clients such as central and local Government and other bodies dependent on public funding (Contracting Authorities) have been expected to follow specified tender procedures with the aim of ensuring that public contracts are open to competition and are awarded fairly, transparently and without discrimination.

Brexit means that the UK is no longer subject to the EU law. While the immediate and current position is that public procurement is following substantially the same procedures as when we were part of the EU; albeit based now on UK law and one notable change is that use of the OJEU to notify tenders has already been replaced by the new Find a Tender site, the Government is proposing a major overhaul of the old EU based rules. In a Cabinet Office Green Paper – Transforming Public Procurement - published in December, it has set out just what changes we may see.

  • All current public procurement regulations (excluding healthcare) will be consolidated into a single set.
  • A new public procurement framework founded on the principles of public good, value for money, integrity, fair treatment of suppliers, non-discrimination, transparency, impartiality, competition and objective criteria will be created.
  • The current seven procurement tender procedures will be reduced down to three:
    • A new competitive flexible procedure giving buyers freedom to negotiate and innovate
    • An open procedure
    • A negotiated procedure, to be known as a limited tendering procedure
  • Evaluation of tenders is to be based on the Most Advantageous Tender, enabling assessment of value for money including social value as part of the quality assessment.
  • A new transparency regime requiring Contracting Authorities to publish procurement and contracting data throughout the lifecycle of a project will be brought in.
  • Bidders can be barred from tendering based on previous poor performance under a prior public contract.
  • Framework contracts which can be closed to additional contractors for up to four years will be available for use alongside new longer-term frameworks operable for up to eight years but where new entrants must be allowed the opportunity to bid after the third year.
  • New Court rules are proposed for the hearing of challenges to procurements, with a greater emphasis on remedies which will include requiring a tender to be re-run, or for tender decisions to be set aside where a breach of the tender procedures has been identified.

In practice, the UK having signed up to international trade agreements such as those with the World Trade Organisation and having the intent to strike trading deals around the globe mean that our laws relating to public procurement will not shift radically from when we were a member of the EU. However, consultation on the Green Paper will run until March 2021 following which we can expect to see new legislation brought forward.

The Hewitsons’ Construction Team covers public procurement as part of its practice so get in contact with one of us if you would like to know more.