1.  Introduction

DISCLAIMER

This practical guide on contract procedures for European Union external action (PRAG) provides contracting authorities, on the one hand, and tenderers, candidates, applicants and contractors, on the other hand, with practical assistance in preparing and implementing procurement and grant contracts in the field of external action.

This practical guide does not apply to contracts for which the European Commission acts as contracting authority on its own account. These are covered by separate guides (the Vade-mecum on public procurement in the Commission and the Vade-mecum on grant management) drafted by the Directorate-General for Budget (DG BUDG). This practical guide does not apply to civil protection and humanitarian aid operations carried out by the Directorate-General for Humanitarian Aid and Civil Protection (DG ECHO).

This practical guide applies to contracts awarded by FPI in direct management for the implementation of assistance measures funded under the European Peace Facility, unless provided otherwise in the relevant regulatory framework.

It does not claim to cover every single matter that may arise with public procurement and grant procedures. It is only a general guide.

Although the PRAG provides explanations and information strictly in compliance with the rules and regulations in force, it is not legally binding [1]. The applicable legislation and any clarification provided by the Court of Justice of the European Union take precedence.

In the current and previous PRAG changes have been introduced following the introduction of electronic processes. Since January 2020, the specific contracts under Framework contracts (FWC) SIEA 2018, Audit 2018, PSF 2019, Events 2020, Eva 2020 are managed in eProcurement which is part of the OPSYS ecosystem. Since August 2020 the Public Procurement Management Tool (PPMT) was made available to External Action DGs. PPMT is a sub-part of the corporate eProcurement suite. PPMT is used to publish notices and procurement documents in Tenders Electronic Daily (TED) and in the Funding and Tender’s Portal (F&T).

This edition of the PRAG incorporates changes related to eSubmission. eSubmission allows economic operators to respond electronically to procurement procedures by preparing submissions (i.e. requests to participate or tenders) and submitting them electronically in a structured and secured way. Practical information on the functionalities of eSubmission are available on the dedicated Relex Wiki webpage. [2]eSubmission will be available for the electronic management of international open and restricted procedures and negotiated procedures. eSubmission applies only to the submission of requests to participate/tenders in direct management. For indirect management, the paper submission is still applicable. As a consequence, the annexes in the PRAG will provide options differentiating electronic submission and paper submission.

Electronic management has a positive effect on the processes, as there are automated features embedding some Annexes of PRAG or FWC templates and there are additional options for the paperless flows. However, it does not have an effect on the principles and rules under which procurement and grant award procedures are run. Building on the previous edition of PRAG, this edition has further introduced and developed the compatibility of procurement and grant procedures with electronic management. Given that electronic management evolves at a quicker pace than the PRAG editions, it possible that some dispositions of the current PRAG edition will be completed in the future by specific elements in the electronic management guidance available under "OPSYS documentation".

This edition of the PRAG also introduces novelties on the new Multiannual Financial Framework (MFF) 2021-2027 and the new legal framework applicable to external actions.

1.1    Scope of the PRAG

This practical guide explains procurement and grant award procedures applying to European Union external actions financed by the European Union.

The previous Multiannual Financial Framework (MFF) 2014-2020 will co-exist with the new Multiannual Financial Framework (MFF) 2021-2027 as commitments made under the previous MFF will still be implemented in the next years. This co-existence is reflected in this edition of the PRAG. The financing of the EU's external action under MFF 2014-2020 will continue to be governed by the legal framework in place at the time, notably the 11^th EDF, whereas the financing of the EU's external action under MFF 2021-2027 will be governed by the newly adopted legal framework.

The new MFF 2021-2027 introduces some substantial changes in respect of some established rules and practices: e.g. eligibility, rule of origin [3], and the disappearance of EDF specificities such as the National Authorising Officer, private commissioned operations and EDF preferences. It is important to remain vigilant as to the applicable set of rules that will depend on the MFF financing the action.

Under MFF 2021-2027, the PRAG is used by the Commission services responsible for the management of projects and programmes financed under the external financing instruments.

This concerns:

- Directorate-General for International Partnerships (DG INTPA) for the NDICI-Global Europe geographic programmes (all areas except Neighbourhood), NDICI-Global Europe thematic programmes (Civil Society Organisations, Global Challenges, Human Rights and Democracy), NDICI-Global Europe rapid response actions (resilience component), European Instrument for International Nuclear Safety Cooperation (INSC), the Council decision on the Association of the Overseas Countries and Territories, including Greenland.

- Directorate-General for Neighbourhood and Enlargement Negotiations (DG NEAR) for the implementation of the Instrument for Pre-accession Assistance (IPA III), NDICI-Global Europe geographic programmes (Neighbourhood) and NDICI-Global Europe – rapid response actions (resilience component).

- Service for Foreign Policy Instruments (FPI) for the NDICI-Global Europe thematic programmes (Peace, Stability and Conflict Prevention; Electoral Observation Missions under Human Rights and Democracy), NDICI-Global Europe rapid response actions (all components except resilience) [4].

Under MFF 2014-2020, the PRAG is used by the Commission services responsible for the management of projects and programmes financed under the external financing instruments and the EDF in the context of the Cotonou Agreement [5].

This  concerns primarily:

- Directorate-General for International Partnerships (DG INTPA) for the EDF [6], the Development Cooperation Instrument (DCI) [7], the European Instrument for Democracy and Human Rights (EIDHR) [8], the Nuclear Safety Co-operation Instrument (NSCI) [9], the Instrument contributing to Stability and Peace (IcSP) [10], the Overseas Countries and Territories (OCTs) [11] and the Instrument for Greenland (IfG) [12];

- Directorate-General for Neighbourhood and Enlargement Negotiations (DG NEAR) for the implementation of the Instrument for Pre-accession Assistance (IPA II) [13] and the European Neighbourhood Instrument (ENI) [14];

- Service for Foreign Policy Instruments (FPI) for the IcSP, the Partnership Instrument (PI) [15] and the election observation missions under the EIDHR [16].

This practical guide provides users with the comprehensive information necessary to undertake procurement (services, works and supplies contracts) or grant award procedures from the first steps to the award, signature and implementation of contracts. The annexes cover both the award phase and the implementation of contracts.

It outlines the contracting procedures to be used in direct management and in indirect management with partner countries and, to a limited extent, in shared management (see Section 2.2.).

Although the procurement and grant award procedures applicable to the general budget of the European Union, to the 10^thand to the 11^th EDF are quite similar, some remaining differences are featured in this practical guide and its annexes.

The financing of the EU's external action under MFF 2014-2020 is governed by the following legal framework:

(i) Under the general budget of the European Union

- Regulation (EU, Euratom) No 2018/1046 of the European Parliament and of the Council of 18 July 2018 on the financial rules applicable to the general budget of the Union [17]

The Financial Regulation (FR) entered into force on 2 August 2018.

The procurement rules for external action continue to contain differences as compared to the procurement rules in internal policies. More specifically, external action procurement rules apply when the Commission procures for the account of and on behalf of (‘for the exclusive benefit of’) partner countries or for the mixed interest of the Commission and the partner country.

- Council Regulation (EU, Euratom) No 1311/2013 of 2 December 2013 laying down the multiannual financial framework for the years 2014-2020 [18]

- Regulation (EU) No 236/2014 of the European Parliament and of the Council of 11 March 2014 laying down common rules and procedures for the implementation of the Union’s instruments for external action (CIR) [19]

 (ii) Under the European Development Fund

- Internal Agreement between the Representatives of the Governments of the Member States of the European Union, meeting within the Council, on the financing of European Union aid under the multiannual financial framework for the period 2014 to 2020, in accordance with the ACP-EU Partnership Agreement, and on the allocation of financial assistance for the Overseas Countries and Territories to which Part Four of the Treaty on the Functioning of the European Union applies (the Internal Agreement) [20]

- Council Regulation (EU) 2018/1877 of 26 November 2018 on the financial regulation applicable to the 11^thEuropean Development Fund, and repealing Regulation (EU) 2015/323 (11^th EDF Financial Regulation) [21]

The 11^th EDF Financial Regulation was revised in order to incorporate the changes that were stemming from the 2018 Financial Regulation (see above).

- Council Regulation (EU) 2015/322 of 2 March 2015 on the implementation of the 11^th European Development Fund [22]

The 11^th EDF Implementing Regulation contains provisions on both multi-annual programming and implementation as well as detailed rules on the involvement of the EDF committee.

- Annex IV to the Cotonou Agreement, as amended on 20 June 2014 [23]

The eligibility rules applicable to the EDF are included in Annex IV and have been aligned as much as possible with those of the general budget of the EU, since the entry into force of the 2010 revision of the Cotonou Agreement [24].

(iii) In the Overseas Countries and Territories (OCTs)

- Council Decision 2013/755/EU of 25 November 2013 on the association of the overseas countries and territories with the European Union (Overseas Association Decision) [25]

The Overseas Association Decision establishes the legal framework for the relations between the OCTs, the Member States to which they are linked and the EU. The OCTs comprise of non-European countries and territories that have special relations with Denmark, France, the Netherlands and the United Kingdom. They are listed in Annex II to the Treaties. According to Article 355(2) of the TFEU the specific provisions under Part IV of the TFEU apply to them. The purpose of association is to promote economic and social development of the countries and territories and to establish close economic relations between them and the European Union as a whole [26]. Article 77 of the Overseas Association Decision determines that OCTs are eligible for funding from resources allocated for the OCTs under the EDF Internal Agreement, the Union programmes and instruments provided for in the Union’s general budget and funds managed by the European Investment Bank (EIB) under the EIB’s own resources, and the resources allocated to the EDF Investment Facility, in accordance with the EDF Internal Agreement. The financial support to the OCTs is provided mainly through the EDF.

The financing of the EU's external action under MFF 2021-2027 is governed by the following legal framework:  

- Regulation (EU, Euratom) No 2018/1046 of the European Parliament and of the Council of 18 July 2018 on the financial rules applicable to the general budget of the Union [27]

- Regulation (EU) 2021/947 of the European Parliament and of the Council of 9 June 2021 establishing the Neighbourhood, Development and International Cooperation Instrument – Global Europe, amending and repealing Decision No 466/2014/EU and repealing Regulation (EU) 2017/1601 and Council Regulation (EC, Euratom) No 480/2009; OJ L 209, 14.6.2021, p. 1–78.

- Council Regulation (Euratom) 2021/948 of 27 May 2021 establishing a European Instrument for International Nuclear Safety Cooperation complementing the Neighbourhood, Development and International Cooperation Instrument – Global Europe on the basis of the Treaty establishing the European Atomic Energy Community, and repealing Regulation (Euratom) No 237/2014; OJ L 209, 14.6.2021, p. 79–90.

- Council Decision (EU) 2021/1764 of 5 October 2021 on the association of the Overseas Countries and Territories with the European Union including relations between the European Union on the one hand, and the Greenland and the Kingdom of Denmark on the other (Decision on the Overseas Association, including Greenland); OJ L 355, 7.10.2021, p. 6–134.

- Regulation (EU) 2021/1529 of the European Parliament and of the Council of 15 September 2021 establishing the Instrument for Pre-Accession assistance (IPA III); OJ L 330, 20.9.2021, p. 1–26.

1.2  What the practical guide does not cover

This practical guide does not apply:

-        to contracts for which the European Commission acts as contracting authority on its own account. For these, in-house public procurement procedures and templates (the Vade-mecum on public procurement in the Commission and the Vade-mecum on grant management) are applicable;

-        to humanitarian crisis management aid, civil protection operations and humanitarian aid operations carried out by the DG ECHO;

-        to contracting authorities, international organisations, national bodies with which there is an agreement for use of their own procedures;

-        to grant beneficiaries for which Annex IV of the standard grant contract applies (see Annex E3h3);

-        to ‘twinning’, which is governed by a separate manual [28];

-        to direct labour operations, which are governed by a separate guide [29].