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    Feature

    New policy guidance on avoiding onerous practices in public procurement and public contracts

    On 5 December 2016, the Crown Commercial Service and Cabinet Office issued Procurement Policy Note (PPN) 10/16: Onerous practices in procurement and contracting. The PPN applies to all central government departments, executive agencies and non-departmental public bodies. Amid reports of public procurement exercises and public contracts resulting in a 'disproportionate or inappropriate' transfer of risk between contracting authorities and suppliers, the PPN sets out best practices for contracting authorities to avoid 'unnecessarily onerous requirements'. The PPN reiterates that public procurement and contracting activity should be conducted in accordance with published guidance and best practice, which includes:

    • Conducting effective pre-market engagement to maximise value for money and encourage innovation—for more detail on this subject see our Practice Note: Market engagementand our Market sounding questionnaire.
    • Ensuring accurate and reliable data is available during the procurement process and contract lifecycle—particularly data relating to performance and demand management.
    • Awarding public contracts on the basis of value for money using appropriate award criteria—for which the guidance suggests referring to HM Treasury’s guidance for public sector bodies: Managing Public moneyand The Green Book.
    • Putting in place appropriate and proportionate risk management mechanisms, avoiding a blanket approach—for which the guidance suggests referring to PPN 02/13: supplier financial risk issues. For further reading, see Practice Note: Project, programme and risk management.
    • Using the guidancedeveloped to support the government's Model Services Contract,to establish limits of liability in contracts based on detailed risk analysis.
    • Adopting a collaborative approach to managing change and resolving issues in contract delivery without creating unmanageable risks—for which the guidance refers to the government's established contract management tools and techniques.

    The PPN provides links to existing government guidance and standards, including the full list of PPNs, which is available from the Cabinet Office: here. For ease of reference, links to the full list of PPNs, is available in the legislation and guidance tab of our public procurement subtopics, with links to further policy and guidance documents available in our overviews:

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    Cases

    European Dynamics Luxembourg and Evropaïki Dinamiki v Commission Case T-764/14 (not available in English)

    The Court of Justice dismissed an application to annul the Commission's decision rejecting the applicants' tender in a restricted procurement procedure for development and implementation of an automated ASEAN Customs Transit System. Among the pleas, the applicant alleged breaches of law, infringement of the obligation to give reasons, manifest errors of assessment and infringement of the principle of equal treatment and the obligation of transparency. Rejecting all the pleas in law and arguments relating to the contested decision, the court dismissed the application and ordered the applicants to pay the costs.

    Undis Servizi Srl v Comune di Sulmona and another C-533/15, [2016] All ER (D) 44 (Dec)

    Abstract:

    The Court of Justice of the European Union gave a preliminary ruling deciding, among other things that, in the context of the application of the Court's case-law on direct awards of so-called 'in-house' public contracts, in order to determine whether the contractor carried out the essential part of its activity for the contracting authority, including local authorities which were its controlling shareholders, an activity imposed on that contractor by a non-shareholder public authority for the benefit of local authorities which were also not shareholders of that contractor and did not exercise any control over it should not be taken into account, since that activity had to be regarded as being carried out for third parties.

    Gem Environmental Building Services Ltd v London Borough of Tower Hamlets [2016] EWHC 3045 (TCC), [2016] All ER (D) 12 (Dec)

    Abstract:

    The Technology and Construction Court held that no order would be made on the claimant company's application for early disclosure of certain documents in a dispute about tendering for a construction project. In the circumstances, the application had little relevance and status, and the uncertainty caused in the proceedings by the withdrawal of an earlier application would not last. The application had been needlessly aggressive, misconceived, unnecessary and unjustified.

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    FYI

    Guidance note on government buying published

    A procurement policy note (PPN) issued by the Crown Commercial Service and Cabinet Office details how procurers can avoid conducting procurements in ways that result in disproportionate or inappropriate risk transfer between buyers' and suppliers' practices. The PPN applies to all central government departments, their executive agencies and non-departmental public bodies. See News: LNB News 05/12/2016 103.

    Public procurement—Revised guidance on procuring steel in major projects

    A procurement policy note from the Crown Commercial Service provides updated guidance for contracting authorities in both central government and the wider public sector to design major projects requiring steel to ensure best value for money, recognising relevant wider social and environmental benefits. The guidance also provides an indicative pipeline of upcoming and existing government steel requirements in England. Procurement policy note 11/16 replaces procurement policy note 16/15 and all other existing steel procurement guidance. See: News 13/12/2016 52.

    State liability and accountability—Draft Public Service Ombudsman Bill laid in Parliament

    The Draft Public Service Ombudsman (PSO) Bill has been laid in Parliament, the Cabinet Office has confirmed. The draft Bill provides for the functions of the Parliamentary and Health Ombudsman and Local Government Ombudsman to be combined into one single body. It affords the PSO new powers and provides for complaints to be made without a representative. The Bill was announced in the Queen’s Speech of May 2015.

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