Anthony Hussey

INTRODUCTION

– European Commission Paper “Access of SMEs to Public Procurement Contracts (2004)”

– National Procurement Service Objectives

– Circular 10/10

INTRODUCTION contd./….

• Reaction against sub-contractor abuse;

• Paid when paid clauses;

• Wholesale liquidation of main contract developers;

• Construction Bill 2010;

SPECIALIST CONTRACTOR UNDER GCCC FORMS OF CONTRACT

• Is the specialist better protected under this regime?

• 5.4.2 If Specialists or other Contractor’s Personnel are named in a Contract, the Contractor shall ensure that they are engaged for and perform the work for which they are named.

SPECIALIST CONTRACTOR UNDER GCCC FORMS OF CONTRACT

Contd./…

• 5.4.3 If the Works Requirements name a Specialist whose contract with the Employer is to be novated to the Contractor, and include a copy of that Contract, the Contractor shall accept the novation, and the parties shall, at the same time as entering the Agreement, enter the novation agreement in the Works Requirements.

• Specialist and designer both lose out.

APPLICATION OF EUROPEAN LAW TO SMALL CONTRACTS

• Relevant Directives only apply above threshold.

• Basic tenets of European Law apply above and below threshold.

(a) Equal treatment;

(b) Non-discrimination;

(c) Transparency;

(d) Proportionality

RECENT MEASURES AFFECTING SPECIALIST SMEs

• Circular 10/10• The intention is to set out positive measures with a view to

encouraging SME participation in publicly procured contracts.

• All works valued at €50,000 upwards are to be advertised. In fact the tendency is to advertise all works particularly those in border areas.

• Open procedure for all works to contract value of €250,000. • Contracting authorities are instructed to keep the process as

simple as possible and not to seek unnecessary information. • Contracting authority has discretion to use open or restricted

procedure for contracts above €250,000.

RECENT MEASURES AFFECTING SPECIALIST SMEs

Contd./…

FRAMEWORK AGREEMENTS A Framework agreement is defined in the European Communities (Award of Public Authorities Contracts) Regulations 2006 as meaning:-

“An agreement between one or more contracting authorities and one or more economic operators the purpose of which is to establish terms governing contracts to be awarded during a specified period (including terms relating to price) and where appropriate the quality of works to be carried out or the product or services to be supplied”.

FRAMEWORK AGREEMENTScontd./…

• Contractors put forward their best rates and quality assurances. Contracting authority selects a certain number of these and in practice all works of this nature are likely to be placed with these tenderers for the period of the framework agreement.

• When it comes to actual contract work being available, the individual contracting authority invites the selected tenderers to tender for the specific job. Their rates cannot be higher than those provided for the purpose of the framework agreement.

FRAMEWORK AGREEMENTS contd./…

• Are framework agreements for the benefit of the specialists / SMEs or for the benefit of the contracting authority?

• Are framework agreements as operated in Ireland legal?

• Two recent Northern Ireland cases have indicated that if the procedures adopted do not strictly comply with European Law, the entire framework agreement may be set aside. (McLoughlin & Harvey Limited v The Department of Finance & Personnel [2008] NIQB 122 and Henry Brothers (Magherfelt) Limited & Others v The Department of Education for Northern Ireland [2008] NIQB 153).

PRACTICAL ADVICE

The National Procurement Service advises contractors to take the following measures to improve their chances of success:1. Register with e-tenders website. 2. Establish when contracts are due and who the relevant personnel

are. 3. Tender only for work you are comfortable doing. 4. Familiarise yourself with public sector procurement procedures. 5. Pay attention to selection and award criteria. 6. Seek prompt clarification if unsure regarding tender

documentation. 7. Always request feedback even when the tender was successful.

PRACTICAL ADVICEContd./…

For the purpose of tendering on a regular basis, it is a good idea to have up to date documents available at all times including:

a) Tax clearance certificate; b) Auditors letter confirming last three years account; c) Insurance brokers letter; d) Bank references; e) Key staff profiles and cv’s;f) Organisation chart;g) Health and safety statement;

h) Quality policy statement;