These new Regulations mark a complete overhaul of every aspect of procurement law and practice, from major strategic changes (new procurement methods, public to public collaboration, replacement of “Part B” with the light touch regime, social and community benefits, etc) to changes to everyday practice (shorter time limits, e-procurement and more flexible procedures).

1. 19/03/2015 1

2. The Procurement Workshop
18 March 2015

3. Presenters
19/03/2015 3
Allan Wilson, Partner
Allan.Wilson@blakemorgan.co.uk
029 2038 5482
Charlotte Kendrick, Senior Solicitor
charlotte.kendrick@blakemorgan.co.uk
029 2038 5304

4. 18/03/2015 4
Workshop Agenda
Session 1: Becoming ‘tender ready’
Session 2: Conducting a successful procurement
Session 3: Standstill and contract award
Session 4: Issues arising post contract award
Session 5: Q&A

5. Session 1:
Becoming
Tender Ready
19/03/2015 5
The Procurement Workshop

6. 19/03/2015 6
Becoming ‘Tender Ready’
Today’s Scenario

7. 18/03/2015 7
Becoming ‘Tender Ready’
• Do the PCR 2015 apply?
• What are “contracting authorities”?
• Works, Services or Goods?
• Do any exemptions apply?
• Light Touch regime?
• Contract or Framework?

8. 19/03/2015 8
Becoming ‘Tender Ready’
• Do the PCR 2015 apply?
• Thresholds?
• Timescales?
• Lots?
• Conflicts of Interest?
• Practical issues – standing orders, internal
procurement rules

9. 19/03/2015 9
Becoming ‘Tender Ready’
Plan, plan, plan (and then plan some more!)
• Set the scope:
• What are the needs of the Contracting Authority – what to buy,
how to buy it and how much will it cost?
• Market research/testing – assessing bidder interest; involvement
of SME’s; division into lots?
• Prepare a business case and secure funding
• Practical issues – staff the procurement; data rooms; evaluation
teams; timetabling

10. 19/03/2015 10
Becoming ‘Tender Ready’
Plan, plan, plan (and then plan some more!)
• Stakeholder buy-in (genuine competition)
• Engaging with experts (e.g. financial modelling)
• Evaluation criteria and weighting and methodology for applying
those criteria
• Carry out “dry run”
• Set the timescale & stick to it!
• Electronic Availability of procurement documents

11. 19/03/2015 11
Becoming ‘Tender Ready’
Timescales and
Thresholds

12. 19/03/2015 12
Becoming ‘Tender Ready’
Thresholds under the PCR 2015:
Supplies Services Light Touch regime
services
Works
Central
Government
Authorities (see
schedule 1)
£111,676 £111,676 £625,050* (healthcare
service contracts
continue to have a
threshold of £172,514
under PCR 2006 until
the end of 2015, and
such revised threshold
as may be specified
until the PCR 2015
become applicable to
them in April 2016
EUR 5,186,000
Other public sector
Contracting
Authorities
£172,514 £172,514 EUR 5,186,000

13. 19/03/2015 13
Becoming ‘Tender Ready’
Procedures

14. 19/03/2015 14
Becoming ‘Tender Ready’
Selecting the correct procedure:
• Open procedure (Reg 27)
• Restricted procedure (Reg 28)
• Competitive procedure with negotiation (Reg 29)
• Competitive dialogue (Reg 30)
• Innovation Partnership (Reg 31)
• Use of the Negotiated procedure without prior publication (Reg 32)
Is your procurement subject to the PCR 2015? If so,
which procedure would you select for our procurement?

15. Session 2:
Conducting a
Successful
Procurement
19/03/2015 15

16. 19/03/2015 16
ADVERTISEMENT
PQQ & EVALUATION
INVITATION TO TENDER
BID SUBMISSION
EVALUATION

17. 19/03/2015 17
Conducting a Successful Procurement
Advertisement

18. Conducting a successful procurement
Advertisement:
• Contract notice
• PINs
• Prescribed form
• Published in OJEU
• Remember – electronic availability
of documents
• Make sure it’s correct!
Source: http://simap.europa.eu/docs/simap/pdf_jol/en/sf_002_en.pdf

19. 19/03/2015 19
Conducting a Successful Procurement
Pre-Qualification/Selection Stage

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Conducting a successful procurement
The PQQ Stage:
• Essentially a short-listing exercise
• Pre-cursor to ITT stage
• Question to be asked is ‘can the bidder do this’?
Consider the headline points you would need to cover in
the PQQ to be issued in respect of today’s scenario

21. 19/03/2015 21
Conducting a successful procurement
The PQQ:
• Only used to evaluate (1) the economic/financial standing (2)
technical/professional ability of suppliers and (3) eligibility :
• Any minimum levels set by contracting authorities must be
related/proportionate to the subject matter of the contract.
• Equal treatment and non-discrimination – ensure transparency
• The ‘must’ excludes and the ‘may’ excludes and ‘self-cleansing’
• Selection criteria are applied only at PQQ stage in order to short-list bidders
to be invited to tender and are not permitted to be re-assessed during award
stage.

22. 19/03/2015 22
Conducting a successful procurement
Developing the PQQ document: one size does not fit all!
• What are you seeking from the contract? What is each question asking for?
• Ensure the PQQ is structured to allow you to select suitable providers
• PQQ scoring model, weightings of evaluation criteria and PQQ itself should be drawn
up in tandem to ensure that they correspond. If possible/appropriate, keep it simple!
• Information requested in the PQQ should be relevant to the requirement, including
requests for policy documents (e.g. health and safety, HR etc).
• Complexity/structure should equate to the value/risk of the contract. Setting
unnecessarily high requirements should be avoided.
• Ensure that your evaluators understand how to assess the information provided and to
carry out the evaluation – put the right people in place

23. 19/03/2015 23
Conducting a successful procurement
Developing the PQQ document: one size does not fit all!
• European Single Procurement Document (“ESPD”) and eCertis
• Ensuring the financial robustness of supplier:
• Beware outdated credit checks
• Tangible net worth
• Management accounts
• PCGs, bonds, financial guarantees to mitigate risks
• Consider engaging external auditors for high value/high risk projects
• Cannot evaluate financial standing of bidder at award stage
• Build in provision for refresh of PQQ prior to award
• Key message - don’t set arbitrary limits/requirements unnecessarily

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Conducting a Successful Procurement
Invitation to Tender

25. 19/03/2015 25
Conducting a successful procurement
The ITT Stage:
• Sets out the contracting authority’s requirements and the
contracting authority marks responses received to this.
• Question being asked at this stage is: ‘how will the bidder
do this?’
Consider the headline issues you would need to cover in the
ITT documentation to be issued in respect of today’s scenario

26. 19/03/2015 26
Conducting a successful procurement
The ITT Documents:
• Must set out the full details of:
• the contracting authority’s requirements/specification
• the applicable contract terms (note there is limited scope to change
these after ITT!)
• the full evaluation and scoring methodology - you must test these
methodologies to the fullest extent possible before issuing an ITT
• Basis for the award of the contract – now only Most Economically
Advantageous Tender (MEAT)

27. 19/03/2015 27
Conducting a successful procurement
Developing the ITT documents: one size does not fit all!
• The evaluation criteria and methodology (including the relative weightings) setting out
the basis on which the contract will be awarded must be disclosed.
• The evaluation criteria should (not exhaustive!):
• link to the subject matter of the contract and not free-standing
• be verifiable and capable of measurement
• be transparent, objective and clear
• be non-discriminatory
• be proportionate
• Limitations of using pass/fail hurdles

28. 19/03/2015 28
Conducting a successful procurement
Developing the ITT documents: one size does not fit all!
• Potential tenderers should be made aware of all the elements taken into
account by the contracting authority, including the full scoring methodology, so
that this is available when they prepare their tenders.
• Key messages:
• transparency! This is the overarching consideration when drawing up
documents/processes.
• disclose everything at the start (all criteria, sub-weightings,
methodology etc)

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Conducting a Successful Procurement
Evaluation/Award Stage

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Conducting a successful procurement
Evaluation of the ITT responses:
• Application of overarching ‘Treaty Principles’: Transparency, fairness and equal treatment.
• Clarifications – no post-tender negotiation permitted (only clarification, specification and fine-
tuning)
• Scoring:
• Do not confuse award criteria (ITT) and selection criteria (PQQ)!
• Only use criteria, weightings and scoring methodology that’s been disclosed
• Tender reports: keep an audit trail of the scoring awarded – brief, objective reasons for
scores
• Think about the merits of including a moderation/second review element in evaluation.
• Ensure evaluation panel has sufficient expertise and resource

31. Session 3:
Standstill and
Contract Award
19/03/2015 31

32. Standstill and Contract Award
– Alcatel letters
• Content
• Purpose
– Standstill period
• What you can/cannot do in the 10 days
• Threat of ineffectiveness
– Debriefs
• Good or bad idea?
– Challenges and automatic suspension
32

33. Standstill and Contract Award
Regulation 86:
– Each tenderer to be sent notice of decision (save
where contract can be concluded without prior
publication, where there is only one tenderer, or
where the award is under a Framework
Agreement or a dynamic purchasing system)
– Contracting Authority cannot enter into the
contract without sending an “Alcatel” letter
33

34. Standstill and Contract Award
Notice must include:
– Criteria for award
– Reasons for decision including characteristics and relative advantages
of successful tender
– Tenderer’s and winner’s scores
– Name of winner
– Precise statement of end of standstill period or date before which
contracting authority will not enter into contract (complying with
Regulation 87)
– Reason for technical rejection
Can exclude certain information which:
– is contrary to public interest
– prejudices legitimate commercial interests
– prejudices fair competition
34

35. Standstill and Contract Award
Objective of Alcatel letters
– Meet statutory duty to give notice of award
– Provide required feedback about the
decision and the reasons for it
– Start time running for limitation
35

36. Standstill and Contract Award
Content of Alcatel letters
– How much detail?
• Headline scores?
• Scores for all questions/sections?
• Explanation behind differential scores?
• Statutory content: technical specification
– UAB Guamina -v- European Institute for Gender
Equality
• Challenger needs to be able to understand what
was required of him and the elements of the
successful bid that justified higher scores.
36

37. Standstill and Contract Award
Regulation 87
– Standstill period duration depends on method
of notification to bidders used
– Fax or electronic: period ends at midnight at
end of 10th day after relevent sending date
(i.e. date on which Alcatel notice sent or last
of dates if several sent)
– Other means: midnight at end of 15th day
after relevant sending date
– Extend period if expiry falls on non-working
day
37

38. Standstill and Contract Award
– Mandatory 10 days does not mean cannot
do anything
– Can progress contract preparation but do
not let contract
– Can correspond with bidders and provide
additional feedback/deal with challenges
– Can provide debrief if you choose
38

39. Standstill and Contract Award
Regulation 98
– Breach standstill at your peril
– If ground for ineffectiveness exists Court must
• Make declaration to that effect (limited
exceptions in Regulation 100)
• Impose financial penalties (Regulation
102)
• Award damages to innocent bidder
39

40. Standstill and Contract Award
Regulation 99
3 grounds for ineffectiveness:
– First - direct award without prior publication of contract notice
(save 3 exceptions where thought permitted, or published
voluntary notice, or waited at least 10 days after voluntary
notice)
– Second - breach of Regulation 87 (standstill period),
Regulation 95 (suspension ignored) or Regulation 96(1)(b)
(breach of interim order) and is another breach of Regulations
and economic operator deprived of change to start
proceedings and breach has affected chances of winning
– Third - applies to Framework Agreements/dynamic purchasing
(subject to exceptions)
40

41. Standstill and Contract Award
To debrief or not to debrief?
For debrief:
– Preserve or enhance reputation in market/commercial relationships
– Improve quality of future bids
– Show confidence in evaluation process and outcome
Against Debrief:
– Goes beyond what contracting authorities obliged to do
– May disclose material bidders would otherwise not see, which may
bolster speculative challenges
– May disclose inconsistencies between participants in process and
marking from different evaluators
– May show weaknesses in evaluation
41

42. Standstill and Contract Award
• Any debrief:
– Should be prepared carefully and scripted
– Should be capable of explaining how result
was arrived at
– Should be minuted
– Should note involve admissions of errors
– Should occur after the 10 day standstill if
possible
42

43. Standstill and Contract Award
Common grounds of challenge:
– Unclear criteria
– Use of undisclosed sub-criteria/weightings
– Inadequate methodology or deviation from it
– Manifest error
– Discrimination/unfair treatment / lack of transparency
– Successful bidder unable to meet specification
– Inadequate or unfair evaluation process
– Where scores are very close – whatever bidder can
think of!
43

44. Standstill and Contract Award
Suspension of contract process
– Automatic if Claim Form issued and notified to
Contracting Authority
– Serious issue to be tried
– Adequacy of damages
– Balance of convenience
– Cross undertaking in damages
– Conduct relevant to Court’s decision
44

45. Session 4:
Issues arising
post-award
19/03/2015 45

46. 19/03/2015 46
Issues arising post-award
Common issues that arise:
• Change of control of suppliers
• Issues with financial modelling in practice
• Renewal/extension & material change – codification
of Pressetext Nachrichtenagentur

47. Session 5:
Q&A
19/03/2015 47