The risks of the proposed law to amend the Public Contracts Code

Not wanting to go so far in the criticisms that have been made of this proposal - namely, the risk of cartelization and increased corruption that the solution involves -, the deliberate option for restricting competition is notorious.

A proposal with an extensive amendment to the Public Contracts Code (CCP) is currently under discussion in the Assembly of the Republic - it is already the 12th amendment to the Code within 12 years!

Remember, in this regard, that the CCP has already undergone an extensive modification in 2017, regarding the transposition into Portuguese law of the 2014 European Public Procurement Directives, and that, in certain aspects, it was not at all happy.

The amendment now under discussion, as announced by the Government, aims to simplify, reduce bureaucracy and make public procurement procedures more flexible, while also taking the opportunity to correct some less positive points that resulted essentially from the aforementioned amendment of 2017.

However, despite the good intentions of the Government, the truth is that it does not seem to me that such an objective is properly achieved with the set of modifications now proposed.

The first point that seems to be open to criticism in the proposed amendment concerns the creation of an exceptional contracting regime - notwithstanding the CCP Part II contract formation rules - in certain priority areas, such as contracts that have as their object the execution of projects co-financed by European funds, contracts aimed at promoting public housing or controlled costs or contracts in the field of information and knowledge technologies.

For all these contracts, what the draft law foresees is that, when the respective value falls below the thresholds of application of the Community Directives of public procurement, they can be awarded by means of a prior consultation procedure to five entities, in detriment of the public tender (or limited) rule regime provided for as a rule in the CCP. With this change, for example, a public works contract financed with a base price of less than € 5.350.000,00, or a provision of computer services with a base price of less than € 214.000,00 may be awarded through prior consultation .

Not wanting to go so far in the criticisms that have been made to this proposal - namely, the risk of cartelization and increased corruption that the solution involves -, the deliberate option for restricting competition is notorious, given that, given the values ​​in question , there will even be many contracts that will be subject to procedures with a degree of competition and publicity that is manifestly lower than that ensured through a public tender, thus making the exception a rule.

This, without prejudice to understanding that the current values ​​applicable to the choice of the direct adjustment procedure and the choice of the prior consultation procedure to more than one entity - and that, it should be noted, were subject to a sharp reduction in the last amendment to the CCP in 2017 (direct contracting is only possible for contracts for the acquisition of goods and services with a value of up to € 20.000,00 and of contracts with a value of up to € 30.000,00) -, by comparison with European thresholds, they are quite maladjusted and that, in fact, could be corrected.

Another aspect that seems to me to be quite negative due to the problems that it may create is the change by which, in matters of public works contracts, the possibility of resorting to the design-construction modality is no longer exceptional, in which the responsibility for the elaboration of the project is from the contractor. With this change, contracting entities will be able to choose indiscriminately to launch contracting procedures without a previously approved project, referring this task to the contractor, for the post-award phase already in the execution of the contract.

Knowing that the use of this modality is primarily justified for a certain type of project whose technical complexity or specialization justifies it, it does not seem appropriate to transform this modality into an option perfectly alongside the tenders with a project prepared by the developer.

In addition, past experience tells us that this solution will bring more litigation in the scope of the execution of works contracts. In fact, we must not forget that, according to the rules of the CCP (namely, paragraph 5 of its article 43), there are a number of elements that must necessarily accompany the project - as is the case, for example, of geological and geotechnical studies - and that the Administrative Jurisprudence has always understood that they must be provided by the developer in the parts of the procedure, even in the case of contracts in the design-construction modality. In the absence of these elements, there will always be room for the contractor to come and claim costs incurred due to insufficiencies in his own project.

It is also not understood what the real benefit is from the possibility that, in limited tenders with previous qualification of works, the procedure can be launched without a project, being the same completed and presented after the qualification of the competitors. So in more complex works in which it is necessary to qualify competitors for their particular capabilities from the technical point of view, it does not seem to make any sense to launch a procedure without knowing the project. Even more because no one can guarantee that after knowing the project, qualified competitors will still be interested in applying to execute it or even that they will be able to do so.

As a last example, I would also like to highlight the proposed amendment to allow, in certain circumstances, contracting entities to exceptionally award a contract in the event of exclusion of all tenders, from those tenders that have been excluded due to exceeding the base price .

This solution, in fact, may not comply with the imposition of the Community Directives on public procurement to adopt the criterion of the most economically advantageous proposal, in cases where the “Multifactor” modality is followed.

These are some of the aspects that seem to me less happy in the proposed amendment to the CCP and which, in my view, should be reweighted.

The author writes according to the old spelling.

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