Legal Eye: Public tender requirements

The Act not only imposed new threshold amounts at which certain tender requirements would kick in, but also introduced new provisions intended to harmonize Poland's awarding of public contracts with those procedures followed by other EU member states.

Who is subject to requirements?

The Act, in general, applies to all public contracts in excess of E6,000 (zł.23,070) in value, including for example, those awarded by state and local governments, co-operatives, public health-care centers and any other entities which use public funds to finance at least 50 percent of a given project. State agencies that do not have "legal personality" are also subject to the Act. Defense-related purchases, in contrast, are not subject to the public tender requirements if the purchase is part of an international agreement with a foreign country. Moreover, contracts related to the performance of an international obligation, labor, and real property transactions are similarly exempt from the Act.

Public contracts may be awarded by one of six tender procedures, depending on the value and nature of the tender. The six include (1) public tenders, (2) limited tenders, (3) two-stage tenders, (4) competitive negotiations, (5) price inquiries and (6) open orders. The public entity administering the tender retains some discretion on the choice of tender. For instance, a tender may be restricted to only those bidders, regardless of the value of the tender, who are able to meet specific eligibility requirements set by the terms of the tender. Additionally, the option exists to submit bids via the internet in certain cases.

Generally, public contracts involving the sale of goods or services up to E60,000 (zł.230,700) in value may utilize simplified tender procedures, and thereby avoid the need to follow all public-tender requirements, including the need to post a bid deposit.

Information on the net

EU regulations require public-tender announcements to be published in the Official Journal of the European Union if the value of such tender exceeds E130,000 (zł.500,000) with respect to the sale of goods or services and E5 (zł.19.2) million with respect to construction services. Current tender announcements throughout the EU can be viewed on the EU's public tender website: www.ted.europa.eu. On any given day, hundreds of tender announcements are published. In Poland, for instance, on the day before this article went to press, 25 new tenders were posted, including a call for bids to construct a sewage system in Wroclaw, the supply of mining equipment in Katowice and the provision of insurance services in Bydgoszcz.

Time frames

The Act imposes various time frames in which a tender must remain open. Tenders worth up to E60,000 must remain open for at least 15 days. Tenders in excess of E60,000 must remain open for at least 52 days following publication in the Public Procurement Bulletin. The time frames are somewhat shorter for limited tenders.

Right to appeal.

Another significant change introduced by the Act includes the right of appeal, regardless of the value of the tender. Previously, appeals were limited to those tenders in excess of E30,000 (zł.115,360). Additionally, in contrast to the former regulations, a bidder will be entitled to correct mistakes in its calculations, mistakes which previously disqualified many bidders. Moreover, if just one bid is received, the process may continue without calling for a new tender.

Paul Fogo is a senior attorney with Miller, Canfield, W Babicki & Partners