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Public procurement

Q: Describe the Public procurement law.

Public procurement law :prescribes in a formal way how to go about government contracts, i.e. how to deal with suppliers and how to award public contracts. The objective of procurement law is to make the European market for public contracts accessible to all providers and suppliers regardless of their nationality.

5 important questions on Public procurement

Public procurement involves disciplines such as economics, public administration, public finance and law in its broadest sense. Successful tendering by public authorities requires a thorough understanding of all of these disciplines. The purchasing policy of public authorities has some specific characteristics:

-Legality of tendering and public accountability. This holds that private companies may sue public authorities for not being compliant with the public procurement directives.
-Public authorities’ activities are not subjected to the rules of free markets. They are funded by tax incomes. Commercial incentive are almost totally absent in public institutions, thus, there is no drive to create the best value for taxpayer’s money
-Managing the finances. i.e. a budget needs to be spend within the year it is allocated to. Goal is to spend all the budget.

What are reasons for the slow development of procurement as a discipline within public authorities?

- Legality of the tender procedures
- public accountability
- the absence of commercial incentives
- the budget system

Describe the Public procurement law.

Public procurement law:prescribes in a formal way how to go about government contracts, i.e. how to deal with suppliers and how to award public contracts. The objective of procurement law is to make the European market for public contracts accessible to all providers and suppliers regardless of their nationality.

What's the scope of the European Directives on Public Procurement?

With regard to the public procurement scope of the European Directives, we need to differentiate between to whom the directives apply and what contracts need to be tendered according to these directives.

Directive 2004/18 applies to public authorities such as governmental institutions, regional or local authorities and bodies governed by public law. The latter may include specific research organizations, universities, academic hospital, educational institutions etc.
Public procurement principles: four major principals underlie each of these procurement directives. These are non-discrimination, equality, transparency and proportionality.

What are framework agreements?

This is an agreement between one or more contracting entities and one or more suppliers, the purpose of which is to establish the terms of governing contracts to be awarded during a given period, in particular with regard to price and, where appropriate, the quantities envisaged. They are used to deal with repetitive supplier in an efficient manner.

The question on the page originate from the summary of the following study material:

Purchasing and Supply Chain Management | 9781473749443 | ARJAN VAN WEELE

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