Added on June 18, 2011 Ray Collis

5 Proposals That Could Stop You Winning More Public Contracts

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What are the implications of proposed changes to EU procurement policy for your sales success? In the first article we looked at proposals that could help you sell more, in this article we will look at those proposals that could hinder you selling more to the public sector.

When it comes to the proposals of the Commission it is not all good news for sellers. Here are some of the changes that if implemented could make it more difficult to win public sector business. Here are 5 proposals that could hinder you.

1. The Incumbency Advantage

The Commission is drawing attention to the risk of an unfair advantage being conferred on an incumbent supplier. That includes the possibility of favouritism where a bidder has had a previous relationship, or has been involved in designing the specification.

One of the proposals is to require the publication to all bidders of any knowledge, or information to which an incumbent supplier has unique access. If you are the incumbent supplier you won’t welcome this proposal, however practical or impractical it may be.

2. Business As Usual

If the public buyer makes significant contract changes following the award, a return to the tendering process is typically required. This is also likely to be required for changes that occur on the contractor side (internal re-organisation, bankruptcy, loss of crucial staff, etc.). The result is a zero tolerance approach to amending the contract, or its implementation.

It is an area that can however give rise to confusion and one which the Commission proposes to clarify. The commission is also addressing the issues as to whether in an environment of fast change, some modifications in contracts once awarded should be accommodated.

In a related issue the commission has highlighted the absence of regulations on sub-contracting by the successful tenderer. This introduces an element of uncertainty into project delivery.

Presently regulations enable contracting authorities to require that tenderers give notice of likely or planned sub-contracting. However the court has stipulated that a tenderer is generally entitled to sub-contract and can only be prohibited where the contracting authority has been unable to verify the technical and economic capabilities of the subcontractor. |

The grounds on which contracts can be terminated, as well as the procedures involves are also up for discussion.

These measures to give buyers greater flexibility to adapt and respond in the contract implementation stage may not be welcomed by sellers.

3. You Are Disqualified!

EU directives require the disqualification of bidders convicted of certain listed offences (notably corruption), as well as for other unsound business practices (including ‘grave professional misconduct’). However confusion can arise, particularly in the context of various national standards and safeguards.

Now the commission proposes a more rigorous exclusion regime. It proposes that actions, such as; corruption, or deliberately undeclared conflicts of interest should be subject to more severe sanction. It also proposes to mandate disqualification for attempts to gain access to confidential information, or to unduly influence the tendering process.

If the EU Commission’s proposals are accepted then more sellers are likely to face exclusion and

disqualification.

4. Central Buying

Newer regulations have facilitated centralized buying and the use of framework agreements. However the Commission is considering whether the measures now in place go far enough. If more provisions for aggregated demand (including cross border aggregation) are implemented the result is likely to be a concentration of business among fewer suppliers.

5. More Centralized Control

Many of the changes up for discussion could have the result of generating more rules and increasing the administrative burden involved for both buyer and seller. Examples include: