John O' Gorman

How To Bypass The Competitive Tender?

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Bypassing the competitive tender

Within the European Union directives set out advertising requirements and e tendering procedures for public procurement contracts above a threshold value which can  be as low as of €25,000 (exc. VAT).  However, it may surprise you to know that a significant volume of large purchases does not go to competitive tender.

Procurement Outside The Competitive Process

There are exceptions to the rules and if they apply to the purchase of your goods and services, you could be spared the risk and uncertainty of having to compete in a competitive tender.  The exceptions are as follows:

1. Urgency – where there is a sudden requirement emerges, but there is insufficient time to set up a competitive procurement process.

2. Proprietary Goods– the purchase of branded or named products or exclusive services.

There may be a technical or artistic dimension, an issue of the protection of exclusive rights, such as:

  • The maintenance of previously acquired goods or services, upgrades or additional purchases.
  • There is a desire to restrict the number of different products in use for simplicity of maintenance for example
  • Payments for ICT annual licences and maintenance, software support, etc. covering a number of years.

3. Extension/Rollover Contracts – continuing with existing contractual arrangements such as where:

  • the contractor had relevant experience gained from prior involvement
  • the contractor was best placed to provide the required goods/services economically
  • it was not possible to go to the market due to staffing difficulties.

4. Expert or Recent Experience – where the services of individuals or firms in

the recent past coincides with requirements in a way that best serves the buying organization.

5. Single Suitable Supplier— where there is only one suitable supplier of the required service.

6. Security Considerations — Where competition is limited in the interests of security (e.g. defense contracts).

7. Other Reasons — Principle among the other reasons, is the procurement of services locally (e.g. cleaning, or catering services)

Curtailing Non-Competitive Procurement

Of course the pressure is on public buyers to minimize purchases outside the competitive bidding process.  As an example here are some of the compliance requirements placed on buying organizations who make such purchases in the Republic of Ireland:

  • Must be reviewed prior to award by the relevant department’s/office’s Internal Audit or by an appropriate senior officer who was not part of the procurement process.
  • The Accounting Officer(s) must complete and submit an annual statement in respect of non-competitive
  • Contracts (including details of the subject or purpose of the contract, its value and the reasons for not having a competitive process
  • Must maintain an up-to-date central register of non-competitive contracts each department/office to designate a Procurement Officer to collate the information on these contracts.

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