Given the many challenges raised by the Covid pandemic, the impact of the UK’s withdrawal from the EU on public procurement will not have been high on many people’s agenda. However, as our exit approaches, minds are rapidly turning in that direction. Some welcome clarity is this week emerging on the shape of public procurement in the UK once the “transition period” has expired and the UK has fully left the EU.
It seems vanishingly unlikely that the transition period will be extended, but of course it remains a possibility. This blog is drafted on the basis that the transition period expires at 11pm on 31 December 2020 – whether or not we have reached a “deal” with the EU.
Amendments to the Regulations
The key point is that, although the EU Directives on public procurement will no longer bind the UK, nonetheless they are a part of UK law in the form of the Public Contracts Regulations 2015 (“PCR 2015”) (and their concessions and utilities equivalents) - and will continue to be so unless the UK parliament decides to amend them. No significant changes are expected in the short to medium term.
However, the PCR 2015 have just been amended by The Public Procurement (Amendment etc.) (EU Exit) Regulations 2020, in order to create a UK based procurement regime.
This post-exit regime applies to all procurement procedures launched and not finalised by 11pm on 31 December 2020. This includes contracts called-off from a framework which was itself concluded prior to that date. A procurement is launched for these purposes when the OJEU notice or call for competition is published. A procurement is finalised:
- on publication of a contract award notice; or
- or, where such a notice is not required, when the contract is entered into, or
- when bidders are informed why the contract was not awarded if there was a decision not to award
As a result, the current regime will remain with us to some extent as we go into 2021.
The amendments tweak the PCR 2015 to remove obligations and references to the Directives and replace them with UK based equivalents. Non-exhaustive examples include:
- references to publishing in the OJEU have been changed to refer to a UK based notification service (Find a Tender);
- threshold levels will now be expressly set out in the PCR 2015 in sterling (rather than cross referring to the relevant Directive);
- the ability to exclude tenderers for breaches of social, environmental and labour laws no longer refers to European law in that context (but only to UK law); and
- the Regulation 73 requirement to automatically terminate public contracts for series breaches of EC Treaty obligations has been removed.
One genuinely new requirement has come in at Regulation 32(2)(a) – around use of the negotiated procedure without a notice in circumstances where an open or restricted procedure has been run and no suitable tenders have been received; there is now an obligation to send a report to the Cabinet Office (if it so requests).
Using Find a Tender
The key change from 1 January 2021 is that contract notices will be sent to the new Find A Tender service (“FTS”). PPN 08/20 has just been published and provides more detail on what contracting authorities need to do to prepare and to use the service. The web link is www.find-tender.service.gov.uk, which will go live at 11pm on 31 December 2020.
The PPN includes some FAQs and a helpful flowchart.
It provides a list of third party e-Sender services which have already integrated their service with the new FTS systems - so if you use a third party provider it is worth checking whether they are on the list.
If you wish to publish directly, you will need have a supplier registration service account (note that if you already publish to Contracts Finder, you will be able to publish to FTS automatically and need not do anything more). See the PPN for further details.
Where there is an ongoing requirement to publish in OJEU, authorities are asked to also send notices which are required to be sent to FTS so that suppliers have only one place to look for UK. The guidance reminds authorities that where there is a legal requirement to send notices to OJEU/TED for publication, this must be done prior to publishing to FTS.
When advertising new procurements on FTS in place of the OJEU, authorities are required to post to FTS first, in advance of Contracts Finder (although there should be minimal delay between the two).
Future developments in procurement law?
We are shortly expecting the publication of a Green Paper on future changes to public procurement law, being worked on by a Procurement Transformation Advisory Panel made up of leading procurement law practitioners.
The UK is signed up to the WTO Government Procurement Agreement (“GPA”) which means we will always need to retain a baseline in public procurement around advertisement, transparency, fair treatment and so on, so there is no scope for drastic change. That said, the GPA is more flexible than the EU directives. For example, it does not include detailed remedies such as automatic suspension, standstill, and ineffectiveness, so in principle there is the possibility of change here (although these remedies remain part of the UK law at present thanks to the PCR 2015).
Likely proposals in the Green Paper include: a focus on cutting red tape, creating a single set of regulations to cover public contracts, concessions and utilities contracts, and the development of a public procurement “tribunal” empowered to deal with procurement challenges more quickly and efficiently than via a High Court claim.
Other hints of change have come in the recent National Audit Office report into the awarding of government Covid-19 contracts – that the government is looking into the possibility of a new procedure which would be both competitive but also allow urgent requirements to be met. The NHS Long Term Plan contains suggestions that clinical health services might potentially be removed from the scope of the light touch regime. However, we have not seen anything concrete as yet on either of these issues.
We will blog again once the Green Paper or further detail is available.