In any event, although Article 73 provides for a right of termination, the Guidelines state that contracting authorities should terminate a contract awarded on or after 26 February 2015 which is subject to change outside the safe harbour provisions of Article 72. Given that a right of termination must be implicit in both existing contracts and contracts awarded from 26 February 2015 onwards, it is not clear why the Guidelines consider that contracting authorities only apply to contracts awarded on or after 26 February 2015: and should not do the same in relation to existing contracts. The guidelines also specify that `for all contracts`, i.e. irrespective of the date on which they were awarded, a contracting authority has `also` the option of not accepting the amendment. Overall, this guide contains some welcome clarifications in this complex area of law. But it also raises a number of other questions. The new provisions of Regulations 72 and 73 have not yet been reviewed by the courts and we will have to wait and see to what extent some of the more controversial points here will be upheld by the courts. As with any guidance, it is not a substitute for understanding the law itself and its application to the particular circumstances of each case. The Guidelines explain that a significant amendment to Regulation 72(8) is defined as any amendment, regardless of value, that meets one or more of the following conditions: CSC`s view was recently confirmed by the Supreme Court, which today released its decision in the Edenred case. In the present case, the question was whether or not a proposal to amend an existing contract without a new procurement procedure was lawful. As part of the analysis, the Court had to determine which law would apply to the proposed amendment and ruled that Regulation 72 of the RCP 2015 would apply because the amendment would apply as of February 26, 2015 (even though the 2015 RCP does not generally apply to the original contract in question).
It is important to note that these guidelines confirm that Regulation 72 of the 2015 PCR applies to amendments to contracts on or after February 26, 2015 and therefore applies to existing contracts awarded under the Government Procurement Regulations, 2006, which are being amended or may be amended in the future. The guidelines emphasize that the date of the amendment(s) is important, not the date on which the original contract was concluded. Those who are also aware that Regulation 72 of the PCR 2015 now determines when changes can be made to existing public procurement without the need for an entirely new procurement procedure. This regulation codified and clarified the earlier position, which had hitherto been set out only in case law (i.e. in the Pressetext case). Although Regulation 72 does not amend the existing law, it clarifies it and provides greater certainty as to the likelihood that an amendment will be substantial. Clause 69(2) allows the contracting authority to amend a public or convertible contract if it is a simple contract (certain health and social action contracts and other municipal contracts). The bill contains a substantial amendment in the sense that these contracts, including those that are conversion agreements, can obviously be amended without conditions. We consider this to be an interesting interpretation of Regulation 72(5) and (6), which is not without risk given the still strict interpretation of exceptions by the Court of Justice of the EU. A stricter interpretation of the legislation (and therefore one that presents a lower risk) is that cumulative changes must be below the threshold and below the relevant limit of 10% or 15%. This element of rule 72 provides useful clarification in the event that the identity of the contractor changes during the term of the contract. If such a change is foreseen during the procurement process and therefore provided for in the contract, this reason for modification should easily be met.
Even if the change is not foreseeable, this reason leaves some flexibility for a change in the identity of the contractor if it results from an approved restructuring or takeover and if it can be established that the replacement entity would have fulfilled the selection criteria (often applied at the PQQ stage) if it had participated in the initial procurement procedure that led to the award of the contract. These are changes for which there is no financial cap, provided that the conditions set out in Regulation 72 are met. These amendments concern the `clear, precise and unambiguous review clauses` of Article 72(1)(a) and amendments which are not substantial within the meaning of Article 72(8). If a substantial change is to be made, the most common consequence is that a new tendering procedure is required. In such circumstances, however, Commissioners should consider whether another exception to the obligation to conduct proceedings under the Regulations might apply (e.g. the possibility to conduct a negotiated procedure without notice in accordance with Article 32 or to withdraw from an appropriate framework agreement). These options are outside the scope of this article, but are mentioned for completeness, and we recommend seeking expert legal advice before requesting an exemption. However, there was something of a mystery here. If the original contract was governed by the old 2006 rules, but the amendment was made after February 26, 2015, what was the set of rules for the new amendment? The guidelines specify that the right of cancellation must be included in all contracts awarded on or after February 26, 2015. However, the guidelines go further and assume that a right of termination is implicit in existing contracts.
While we believe that this is the right approach in principle (and indeed the approach we supported during the consultations on the draft regulation), it must be acknowledged that it is now inconsistent with previous Cabinet Office statements on this point and, in particular, with the general transitional provisions of Regulation 118. Therefore, it would be important for the government to provide further clarification on the apparent inconsistency of this position with the law. 1. The value of the amendment shall be less than the following two values: (a.dem the threshold relevant for the purposes of the Regulation; and b. 10 % of the initial value of the contract in the case of service and supply contracts or 15 % of that value in the case of works contracts, provided that the amendment does not alter the overall character of the agreement in question. Again, caution is advised before invoking this reason. The obvious assertion of a potential supplier wishing to challenge the reliance on this element of Rule 72 would be that a diligent contracting authority could/should have foreseen the need for the corresponding amendment. According to ground 4, if a contracting authority wishes to invoke that ground, it must publish a notice on that ground in the Official Journal of the European Union and that exception may be invoked on several occasions, taking into account the 50% value criterion each time the ground is validly applied. This Article examines the criteria under Rule 72 for determining whether a modification is substantial (and therefore may require a new procurement procedure) and what contracting authorities must do if they wish to rely on certain elements of Rule 72.
The long-awaited bill was tabled in the House of Lords on 11 May 2022 and sets out the UK government`s proposed reforms to public procurement rules in a post-Brexit world. Although the bill removed a number of the most drastic proposals from the government`s Green Paper on the transformation of public procurement, it nevertheless proposes a number of important changes aimed at simplifying and improving UK public procurement. • relate to additional works, services or supplies which have become necessary and certain other conditions are fulfilled (Rule 72(1)(b)); or In June 2022, Freshfields and Monckton Chambers co-hosted an event on how the Public Procurement Act proposes reform of public procurement law in the UK.