4.5. What is public procurement?
Public procurement refers to the process by which goods, services, or works are acquired by public authorities or organisations receiving funding from these programs. It is a structured and regulated process that ensures transparency, competition, and fair treatment of potential suppliers or contractors.
In the context of these funding programs, public procurement typically applies to projects implemented by public entities, non-profit organisations, or private entities that receive public funding. It aims to ensure that the funds allocated for projects are used efficiently, effectively, and in compliance with the relevant regulations and guidelines.
Public procurement in these projects involves various stages, including:
- Needs Assessment: The procuring entity identifies its procurement needs, such as goods, services, or works required for project implementation. The needs are assessed in terms of quality, quantity, timeline, and budget.
- Procurement Planning: The procuring entity develops a procurement plan that outlines the procurement requirements, procedures, estimated costs, timelines, and evaluation criteria. The plan ensures a systematic and transparent approach to procurement.
- Advertising: The procurement opportunity is advertised to attract potential suppliers or contractors. The advertisement includes information about the project, contract scope, eligibility criteria, submission requirements, and evaluation criteria. The funding programs may specify the platforms or channels to be used for advertising.
- Bid Submission: Interested suppliers or contractors submit their bids or proposals in response to the advertisement. The bids typically include technical and financial information as requested in the procurement documents. The procuring entity sets a deadline for bid submission.
- Bid Evaluation: The received bids or proposals are evaluated based on predetermined criteria, which may include factors such as price, technical capabilities, experience, and quality. The evaluation is conducted by a selection committee or an evaluation panel to ensure objectivity and fairness.
- Contract Award: Following the evaluation process, the contract is awarded to the successful bidder or offeror who best meets the evaluation criteria. The contract award decision is communicated to all participants, and contractual negotiations may take place before finalising the agreement.
- Contract Execution and Monitoring: Once the contract is awarded, the procuring entity and the contractor enter into an agreement. The contract is executed and monitored throughout its duration to ensure compliance with the terms, quality of deliverables, and timely completion.
It is important to note that public procurement in these projects is subject to specific regulations, directives, and guidelines, both at the European Union level and the national or regional level. These regulations aim to promote fair competition, transparency, non-discrimination, and value for money in the procurement process.
How to comply with public procurement rules?
Here are some key principles commonly observed in these projects:
- Non-Discrimination: The procurement process must be conducted in a non-discriminatory manner, ensuring equal treatment and opportunities for all potential bidders or offerors. No bidder or offeror should be given preferential treatment based on factors such as nationality, location, or ownership.
- Transparency: The procurement process must be transparent and provide clear and comprehensive information to potential bidders or offerors. This includes transparent advertisement of procurement opportunities, disclosure of evaluation criteria, and communication of contract award decisions.
- Competition: Promoting competition is a fundamental principle. The procurement process should encourage participation from a wide range of potential bidders or offerors, ensuring open and fair competition. It may involve using competitive procedures, such as open tendering, restricted tendering, or competitive dialogue.
- Value for Money: The procurement process should strive to achieve value for money, ensuring that the selected bids or proposals provide the best combination of price and quality. The evaluation criteria may consider factors such as cost-effectiveness, quality, technical capabilities, and past performance.
- Compliance with EU Directives: The procurement rules in these projects often align with the relevant EU directives, such as Directive 2014/24/EU on public procurement. These directives establish common principles and procedures for public procurement across the EU member states.
- Documentation and Record-Keeping: The procurement process requires thorough documentation and record-keeping. This includes maintaining records of the procurement plan, contract notices, bid submissions, evaluation reports, and contract award decisions. Documentation ensures transparency, accountability, and auditability.
- Thresholds and Procedures: Procurement thresholds, which determine the value at which specific procurement procedures are required, vary depending on the funding programme and the country or region. Different procedures, such as open tendering, restricted tendering, or negotiated procedures, may apply based on the thresholds.
- Compliance with National Legislation: In addition to EU regulations, national legislation and regulations of the country or region where the project is implemented may also apply to procurement in ESF+, ERDF, EASI, and Interreg projects. It is essential to familiarize yourself with the specific national procurement laws and regulations that govern the project implementation.
Lack of compliance to public procurement rules was one of the main audit findings of the 2007-2013 programming period.