PHILIP

On 27 January 2010 the Minister of Economic and Business Affairs Lene Espersen introduced a bill regarding enforcement of procurement rules etc. (L 110).
 
The bill, which implements EU’s control directives, is part of the government’s comprehensive competition package which, additional to tightening up the procurement rules, contains new and tightened up rules concerning merger control and anti-competitive agreements.

Purpose

It is the intention that the new bill shall replace the present Act on The Complaint Board for Public Procurement which only to a limited extent gives The Complaint Board the possibility of imposing sanctions on the contracting entities. Thus, the primary purpose of the introduced bill is to ensure that the public procurement rules are effectively enforced. 

Contents

The following can be mentioned as examples of concrete changes which the adoption of the introduced bill will imply: 

• In case of gross breach of the procurement rules The Complaint Board for Public Procurement obtains the possibility for termination of contracts already entered into by issuing an enforcement notice. From the explanatory notes to the bill it appears that this sanction will especially be invoked when the contracting entity has entered into a contract without on beforehand having invited tenders according to the prevailing rules.
• The period during which the contracting entities after award of the contract shall wait to sign the contract with the chosen bidder (the “stand still period”) will be prolonged from 10 calendar days to 15 calendar days.
• A complaint filed with The Complaint Board for Public Procurement during the stand still period will automatically be granted (temporary) suspensory effect until The Complaint Board within 30 calendar days has made a decision whether the complaint shall be granted suspensory effect until the final decision is ready.
• The contracting entities shall to a greater extent than before be able to account for the reason for choosing one bidder against the other bidders.
• In certain situations The Complaint Board for Public Procurement will be able to impose fines up to DKK 10 millions, depending on the circumstances in the matter in question. The explanatory notes to the bill contain concrete proposals for calculation models for the calculation of fines, in which the level of the fine varies according to the estimated value of the contract in question. 

Consequences

Overall, the bill is expected to have a number of positive consequences. Thus, with the bill the government believes to have procured the necessary instruments to ensure that the most competitive bidder is awarded the tender, just as the bill is expected to increase the number of tasks tendered.
 
As regards The Complaint Board for Public Procurement it is estimated that the number of complaints with The Complaint Board will increase by 10 %, just as The Complaint Board will have to consider suspensory effect in 33 % more cases compared to today.  

Commencement

It is proposed that the bill is to enter into force on 1 July 2010.