2. Basic rules
Contracts under procurement and grants are awarded according to strict rules. These help ensuring that suitably qualified contractors and grant beneficiaries are chosen without bias and that the best price‑quality ratio or the best price is obtained, with the full transparency appropriate to the use of public funds.
Procedures established by the European Commission for procurement and award of grants under the relevant European Union external financing programmes are consolidated in this practical guide. Any deviation from this practical guide and its annexes requires either a derogation or an exception from the relevant European Commission services in accordance with internal rules.
Before starting any procurement or grant procedure, the budgetary commitment must have been approved by a financing decision and, where appropriate, reflected in a subsequent financing agreement. The funds must be available, except in the case of procedures with a ‘suspensive clause’ (see Section 2.6.12.).
2.2. Management mode
Procurement or grant award procedures for projects financed under EU external financing instruments vary according to the different arrangements for implementing the project (referred to as ‘management modes’).
There are different ways to implement the general budget of the EU or the European Development Fund (EDF) funds (MFF 2014-2020), depending on the degree of delegation of a number of budget implementation tasks (such as conclusion of contracts, their operational and financial management, audit, evaluation, etc.).
There are three different management modes: direct management, indirect management and shared management.
The choice of management mode is an essential element of the financing decision and it is reflected in the corresponding documents (e.g. the ‘action document’ for the relevant financing decision and the (annual) action programme).
2.2.1. Direct management
The European Commission is in charge of all EU budget implementation tasks, which are performed directly by its departments either at Headquarters or in the EU delegations or through EU executive agencies.
Therefore, in direct management, the European Commission (or the EU executive agencies) is the contracting authority and takes decisions on behalf and for the account of the partner countries.
The contracts are concluded directly by the European Commission, acting on behalf of the partner country. The European Commission is responsible for the entire cycle leading to contract signature (issuing calls for tenders and calls for proposals, publication, establishing shortlist in restricted procedures, evaluation, award and contract signature, etc.).
Deviations from standard procedures in this practical guide such as exceptions and derogations, as well as prior approvals, events to be reported and non-compliance events have to be adopted in compliance with internal procedures.
2.2.2. Indirect management
Under indirect management the European Commission entrusts budget implementation to:
- third countries (or to bodies designated by them);
- international organisations and their specialized agencies;
- bodies set up under the Treaty on the Functioning of the European Union and the Euratom Treaty;
- development agencies of EU Member States, or of third countries;
- public law bodies, including Member States organisations.
This practical guide mainly applies to the first case, i.e. when the European Commission entrusts budget implementation to partner countries. In this case, the contracts are concluded by the contracting authority designated in a financing agreement, i.e. the government or an entity of the partner country with legal personality.
It also applies to some exceptional cases where international organisations, development agencies or other bodies must use EU contracting procedures.
Two modalities are possible under indirect management with partner countries:
- indirect management with ex ante controls
Decisions on the procurement and award of contracts are taken by the partner country, acting as contracting authority, in line with the requirements set out in this practical guide and subject to the prior approval of the European Commission.
The contracts are signed by the contracting authority of the partner country and endorsed by the European Commission.
The relevant steps leading to contract award need the prior approval of the European Commission:
Prior to the launch of the procurement procedure or call for proposals, the contracting authority must submit the documents (prior information notice (not compulsory), contract notice, additional information about the contract notice, tender dossier or call for proposals file) to the European Commission for approval. The European Commission verifies that these have been drafted in accordance with the procedures and templates laid down in this practical guide. The contracting authority is then responsible for drawing up shortlists (for restricted procedures), issuing the calls for tenders and calls for proposals, receiving applications/requests to participate, tenders and proposals, chairing evaluation committees and deciding on the results of the procedure. Before signing contracts, the contracting authority submits the results of the evaluations to the European Commission for prior approval.
No prior approval is required in certain cases referred to in the practical guide to procedures for programme estimates.
- indirect management with ex post controls
Subject to the positive outcome of a prior ex ante pillar assessment (in relation to the third country’s accounting, internal control, external audit, recovery of funds, beneficiaries’ information, and data protection systems), the European Commission may decide to rely on the rules and procedures of the third country entities’ and to limit its control to ex post controls. Where these entities comply only in part with the requirements referred to above, the European Commission must take appropriate supervisory measures ensuring the protection of the European Union’s financial interests. These measures must be specified in the relevant agreements.
For programme estimates see above. Below the thresholds defined in the programme estimate guide, transactions are subject to ex post controls.
2.2.3. Shared management
The European Commission delegates implementation tasks to the EU Member States. This mode is rarely used in the implementation of external actions, but there are a few cases such as joint operational programmes on cross-border cooperation implemented by a joint managing authority (for instance, in the 2014-2020 MFF, under the European Neighbourhood Instrument (ENI) or the Instrument for Pre-accession Assistance (IPA II)). In the 2021-2027 MFF however, under Regulation (EU) No [2021/1529] establishing the Instrument for Pre-accession Assistance (IPA III), shared management is not foreseen.
In most cases, this practical guide applies to direct and indirect management with partner countries. Note, however, that the European Commission may, in some specific cases, allow partner countries to use other procedures depending on a prior positive assessment of such procedures.
The European Commission’s involvement in contracts signed by the partner countries under indirect management is to authorise the financing of the contracts and check, notably with reference to established checklists, that the procedures, the implementation of the contracts and the expenditure are correctly carried out. If the procedures established in this practical guide (or whatever procedure the European Commission decides must be used) are not followed, the expenditure incurred on the related operations may be found ineligible for EU financing. The European Commission’s intervention is limited to checking whether the conditions for EU financing have been met.
In no case will this intervention aim at compromising the principle according to which these contracts are drafted under the national legislation and concluded only by the contracting authority from the partner country. Tenderers, candidates and applicants for these contracts do not possess any form of contractual relationship with the European Commission during or after the implementation of the contracts. Their only contractual relationship is with the contracting authority. A contracting authority’s decision may not be replaced by a decision taken by the European Commission. The contracting authority assumes full responsibility for its actions and will be accountable for those actions in any subsequent audit or other investigation.
The box below summarises the control procedures that the European Commission must follow for each management mode.
2.3. Participation in award procedures
Participation in calls for tenders and calls for proposals financed from the external financing instruments, including the EDF (MFF 2014-2020), is governed by a set of rules and principles intended to ensure the legality and regularity of the procedures as well as the compliance with sound financial management.
Eligibility criteria such as the rule of nationality and origin determine the conditions for participating in calls for tender and calls for proposals and are essential requirements that each applicant, candidate and tenderer must comply with. The rule of origin only applies to award procedures financed under the framework of the Multiannual Financial Framework for the years 2014-2020. For award procedures financed under the new Multiannual Financial Framework 2021-2027 (Regulation (EU) 2021/947), with the exception of the INSC Regulation 2021/948 of 27 May 2021, all supplies and materials may originate in any country.
2.3.1. The rule of nationality
In general, participation in procurement procedures, grant procedures and other award procedures is open to all natural persons who are nationals of, and all legal persons who are effectively established in a Member State of the European Union or in a country eligible for the respective external financing instrument under which the specific project is financed. Participation is also open to international organisations. For each external financing instrument, specific rules on nationality and origin may apply.
For award procedures financed by a basic act under the MFF 2021-2027:
For financing under the OAD-Greenland Decision 2021/1764 and NDICI-Global Europe geographic programmes, NDICI-Global Europe Civil Society Organisations and NDICI-Global Europe Global Challenges programmes, participation is open to all natural persons who are nationals of and legal persons (participating either individually or in a grouping) which are effectively established in a Member State of the European Union or in an eligible country or territory as defined under Article 28 of Regulation (EU) N° 2021/947 establishing the Neighbourhood, Development and International Cooperation Instrument (NDICI-Global Europe).
For financing under NDICI-Global Europe Human Rights and Democracy and NDICI-Global Europe Stability and Peace programmes, as well as for the NDICI-Global Europe - rapid response actions: for the contract award procedures financed by <NDICI-Global Europe Human Rights and Democracy programme>/<NDICI-Global Europe Stability and Peace programme>/<NDICI-Global Europe rapid response actions>, participation is open without limitations.
Participation is also open to international organisations.
For INSC 2021/948 of 27 May 2021 participation is open to all natural persons who are nationals of and legal persons (participating either individually or in a grouping) which are effectively established in a Member State of the European Union or in an eligible country or territory as defined under Article 11 of Council Regulation (Euratom) 2021/948 establishing a European Instrument for Nuclear Safety complementing the Neighbourhood, Development and International Cooperation Instrument on the basis of the Euratom Treaty.
For IPA III 2021/1529, participation is open to all natural persons who are nationals of and legal persons (participating either individually or in a grouping) which are effectively established in a Member State of the European Union or in an eligible country or territory as defined under Article 10 of Regulation (EU) No [2021/1529] establishing the Instrument for Pre-accession Assistance (IPA III).
For each external financing instrument financed under the new Multiannual Financial Framework for the years 2021-2027 the countries corresponding to the rules of nationality are listed in Annex A2a1.
For commitments financed by a basic act under the MFF 2014-2020:For the general budget of the EU, the eligibility rules for participation in public procurement, grant (including procurement under grant contracts) and other award procedures are laid down in the 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 financing external action (CIR) as well as in the Financial Regulation. These eligibility rules differ depending on the external financing instrument under which the respective project or programme is to be financed:
- Participation in procurement and grant procedures financed by the European Instrument for Democracy and Human Rights (EIDHR) and the Instrument contributing to Stability and Peace (IcSP) is fully untied.
- Participation in procurement and grant procedures financed by the Development Cooperation Instrument (DCI), the European Neighbourhood Instrument (ENI) and the Partnership Instrument (PI) is open to all natural persons who are nationals of, and legal persons who are effectively established in:
- Member States, beneficiaries established in Annex I to the Pre-Accession Instrument (IPA II) and contracting parties to the Agreement on the European Economic Area;
- for the ENI, partner countries covered by the ENI and the Russian Federation under certain conditions;
- developing countries that are in the list of Official Development Assistance (ODA) recipients, which are not members of the G20 group, and Overseas Countries and Territories (OCTs);
- member countries of the Organisation for Economic Co-operation and Development (OECD) in case of contracts implemented in Least Developed Countries or Highly Indebted Countries, as included in the list of ODA recipients;
- countries for which reciprocal access to external assistance is established by the European Commission.
Eligibility to the IPA II is more restricted; it covers only Member States and beneficiaries established in Annex I to the IPA II, contracting parties to the Agreement on the European Economic Area and partner countries covered by the ENI.
Irrespective of the external financing instrument under which the respective project or programme is to be financed, where an agreement on widening the market for procurement of goods or services to which the Union is party applies, the procurement procedures for contracts financed by the budget shall also be open to natural and legal persons established in a third country other than those specified in the basic instruments governing the cooperation sector concerned, under the conditions laid down in that agreement.
For the EDF, Article 20 of Annex IV to the Cotonou Agreement replicates in general the same provisions as above for the DCI.
For each external financing instrument financed under the framework of the Multiannual Financial Framework (MFF) for the years 2014-2020, the countries corresponding to the rules on nationality and origin are listed in Annex A2a to this practical guide. Extension of the rule of nationality under MFF 2014-2020
The legislation also includes provisions that further extend the rules on nationality in certain cases.
For programmes funded by the general budget of the EU, the CIR extends the eligibility in case of:
- Jointly co-financed actions / shared management / trust funds: whether implemented through direct or indirect management, where actions are co-financed jointly with a partner or other donors or implemented through a Member State in shared management, or through a trust fund established by the Commission, natural and legal persons from countries which are eligible under the rules of that partner other donor or Member State or determined in the constitutive act of the trust fund are also eligible.
- Actions implemented through indirect management: natural and legal persons from countries eligible under the rules of the entrusted body are also eligible, except when the management is entrusted to partner countries. In the latter case, only the rules of the external financing instrument apply.
- Actions financed by more than one external financing instrument, including the EDF: natural and legal persons from countries identified under any of these instruments are eligible for the purpose of those actions.
- Actions of a global, regional or cross-border nature financed by one of the external financing instruments: eligibility can be extended to natural and legal persons from countries, territories and regions covered by the actions.
For EDF-funded programmes, Annex IV to the Cotonou Agreement extends the eligibility in the following cases:
- Actions implemented through an international organisation: all natural and legal persons who are eligible according to the rules of the organisation as also eligible, care being taken to ensure equal treatment of all donors.
- Actions implemented as part of a regional initiative: natural and legal persons from a country participating in the relevant initiative are also eligible.
- Actions implemented through direct management and co-financed jointly with a partner or other donor or implemented through a trust fund established by the Commission: all natural and legal persons that are eligible under the rules of that partner or other donor, or under the rules determined in the trust fund constitutive act are also eligible.
- Actions implemented in indirect management through entrusted bodies (namely Member States or their agencies, the European Investment Bank and international organisations or their agencies): natural and legal persons who are eligible under the rules of that entrusted body as identified in the agreements concluded with the co-financing or implementing body are also eligible; In addition, where actions are co-financed jointly with a partner or other donor, all persons that are eligible under the rules of that partner or other donor are also eligible.
- Actions co-financed under another external financing instrument: all natural and legal persons eligible under any of these Instruments are also eligible.
Finally, the 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) extends the eligibility in case of :
o Actions jointly co-financed with a partner or other donor countries / shared management / trust funds: natural and legal persons from countries eligible under the rules of that partner, other donor or Member State or determined in the constitutive act of the trust fund are also eligible.
o Actions implemented through entrusted bodies (namely Member States or their agencies, the European Investment Bank or through international organisations or their agencies): entities eligible under the rules of that entrusted body, as identified in the agreements concluded with the co-financing or implementing body, are also be eligible.
o Actions financed under the Overseas Association Decision and another instrument for external action, including the EDF: natural and legal persons from countries identified under any of these instruments as eligible, are considered eligible for the purpose of that action.
o Actions of a global, regional or cross-border nature: natural and legal persons from countries, territories and regions covered by the action may participate in the procedures implementing such actions.
2.3.2. Rules for experts and international organisations
Both for the EDF (including OCTs) and programmes financed by the general budget of the EU and irrespective of the applicable MFF, the nationality of experts and other natural persons employed or legally contracted does not have to follow the nationality rules. Therefore, unless otherwise provided for in the applicable financing decision/agreement, experts recruited or otherwise legally contracted by an eligible contractor/sub‑contractor, may be of any nationality.
Likewise, the nationality rule does not apply to international organisations participating in a procurement or grant award procedure.
2.3.3. How to verify compliance with the nationality rules
For the purpose of verifying compliance with the nationality rules, the tender dossier and the guidelines for applicants require the following from candidates, tenderers and applicants:
- natural persons must state the country of which they are nationals;
- legal persons must state the country in which they are established and provide evidence of such establishment by presenting the documents required under that country’s law.
If the contracting authority (or evaluation committee) suspects that a candidate, tenderer or applicant does not comply with the nationality rules, it must ask the candidate/tenderer/applicant to provide evidence demonstrating actual compliance with the applicable rules.
To demonstrate their actual compliance with the ‘establishment’ criterion, legal persons have to demonstrate that:
- the legal person is established under the law of an eligible State, and
- its real seat is within an eligible State. ‘Real seat’ must be understood as the place where its managing board and central administration, or its principal place of business, are located.
The decision on whether or not candidates/tenderers/applicants are eligible is taken by the contracting authority (usually on the basis of the information and evidence provided during the evaluation).
2.3.4. Origin of goods
Goods and materials supplied under a procurement or a grant contract, financed under the new Multiannual Financial Framework for the years 2021-2027 are fully untied and can originate in any country, with the exception of procurement and grant contracts financed by the INSC Regulation 2021/948 of 27 May 2021 where goods and materials must originate from an eligible country as designated by the financing instrument.
For the award procedures under MFF 2014-2020, in principle, goods supplied under a procurement contract or a grant contract, financed under the general budget of the EU or the EDF (including OCTs) financed under the framework of the multiannual financial framework for the years 2014-2020 must originate from an eligible country as designated by the relevant external financing instrument(s).
For the award procedures under MFF 2014-2020, subject to derogation (granted on a case-by-case basis), all goods to be delivered under a supply contract fall under the rules of origin, as do materials, goods and components to be incorporated or to form part of the permanent works under a works contract.
Goods purchased by the contractor for use during the execution of the contract (such as machinery used by a supply contractor for testing and installing the goods supplied, equipment used by a works contractor for building a road, computer(s) used by a service contractor to draft a study) are not subject to the rule of origin. It is only when the contract explicitly states that at the end of the contract the ownership of the goods is transferred from the contractor to the contracting authority (in the case of procurement contracts) or transferred by the grant beneficiary to another entity/person or retained by him (in the case of grant contracts), that these goods are subject to the rule of origin.
2.3.5. Goods with a value under the threshold of the simplified procedure
Under the MFF 2021-2027, goods can originate in any country whatever their value (full untying), with the exception of the INSC Regulation 2021/948 of 27 May 2021, where goods must originate from an eligible country as designated by the financing instrument.
For the award procedures under the MFF 2014-2020, goods can originate in any country (full untying) if their value is below the threshold of the simplified procedure for supply contracts (EUR 100 000).
This provision for full untying below the threshold of the simplified procedure must be stated in the contract notice.
Where the procurement is divided into lots, the rule applies per lot (only applicable to lots of less than EUR 100 000). The division into lots must be legitimate. This rule must not lead to artificially sub‑dividing procurement into smaller lots to circumvent the threshold of EUR 100 000.
This rule applies also to procurement done by grant beneficiaries and procurement of works involving the supply of products. In case of works contracts that involve multiple purchases, the EUR 100 000 threshold applies by type of supply. Where the contract takes the form of a lump sum price, the breakdown of the lump sum price must be used to verify the EUR 100 000 threshold by type of supply.
The above rules have to be clearly stated in the instructions for tenderers and applicants.
2.3.6. Definition of ‘origin’
For award procedures financed by a basic act under the new Multiannual Financial Framework 2021-2027, all supplies and materials are fully untied and no verification of origin is required.
The term ‘origin’ is defined in the relevant EU legislation on rules of origin for customs purposes: Regulation (EU) No 952/2013 of the European Parliament and of the Council of 9 October 2013 laying down the Union Customs Code, and the Code’s implementing provisions: Commission Delegated Regulation (EU) 2015/2446 of 28 July 2015 supplementing Regulation (EU) No 952/2013 of the European Parliament and of the Council as regards detailed rules concerning certain provisions of the Union Customs Codeand Commission Implementing Regulation (EU) 2015/2447 of 24 November 2015 laying down detailed rules for implementing certain provisions of Regulation (EU) No 952/2013 of the European Parliament and of the Council laying down the Union Customs Code.
The country of origin is not necessarily the country from which the goods were shipped and supplied. Two basic concepts are used to determine the origin of goods, namely the concept of ‘wholly obtained’ products and the concept of products having undergone a ‘last substantial transformation’:
- If only one country is involved in the production, the ‘wholly obtained’ concept will be applied. In practice, these goods wholly obtained in a single country must be regarded as having their origin in that country. This will be restricted to mostly products obtained in their natural state and products derived from wholly obtained products.
- If two or more countries are involved in the production of goods, it is necessary to determine which of those countries confers origin on the finished goods. For this purpose, the concept of ‘last substantial transformation’ is appliedIn general, the criterion of last substantial transformation is expressed in three ways:
· by a rule requiring a change of tariff (sub)heading in the HS nomenclature (i.e. the Nomenclature governed by the Convention on the Harmonized Commodity Description and Coding System);
· by a list of manufacturing or processing operations that do or do not confer on the goods the origin of the country in which these operations were carried out;
· by a value added rule, where the increase of value due to assembly operations and incorporation of originating materials represents a specified level of the ex-works price of the product.
2.3.7. How to verify compliance with the origin rules?
For award procedures financed by a basic act under the new Multiannual Financial Framework 2021-2027, with the exception of the INSC Regulation 2021/948 of 27 May 2021, all supplies and materials are fully untied and no declaration of origin is required.
For award procedures under the Multiannual Financial Framework for the years 2014-2020 and for award procedures financed by the INSC Regulation 2021/948 of 27 May 2021 under the Multiannual Financial Framework 2021-2027:
When submitting its tender, if the rules of origin apply, the tenderer must state expressly that all the goods meet the requirements concerning origin and must state the country(ies) of origin. When tendering for systems comprising more than one item, the origin of each item in the system must be specified. The tenderer is bound by the declaration of origin she/he submits. The tenderer is obliged to verify that the provided information is correct. Otherwise, the tenderer risks to be excluded because of negligently misrepresenting information. The tenderer may be requested to provide documents supporting the stated origin. In this case, the tenderer must provide a declaration of origin or additional information considering that the issuing authority may refuse to issue a certificate of origin at tendering stage without presentation of commercial invoices.
The declaration of origin must be submitted at the latest during implementation of the contract when the certificate of provisional acceptance is requested. Failing this, the contracting authority will not make any further payment to the contractor. Exceptionally, other substantiating documents can be accepted by the contracting authority instead of the aforementioned declarations if the contractor justifies that it is impossible to provide declarations of origin.
Declarations of origin must be issued by the competent authorities of the goods’ or supplier’s declared country of origin (for example the chamber of commerce) and comply with the international agreements to which that country is a signatory. However, declarations of origin are not exhaustive proof of origin, and should not be regarded as a legal proof, but as useful element for determination of the origin, which may, in case of doubts, facilitate further checks.
It is up to the contracting authority to verify compliance with the rules of origin. Where there are serious doubts about the authenticity of a declaration of origin or the information it contains (e.g. because of discrepancies in the document, spelling errors, etc.), the contracting authority should contact the issuing authority to have the authenticity of the documents submitted and/or the information it contains confirmed. Declarations issued by an authority, other than the one located at the place of declared origin, should be investigated carefully. The contracting authority may also carry out on-the-spot checks of compliance with the origin rules, preferably before the issuance of the provisional acceptance certificate.
For EDF procurement, supplies originating in the OCTs are regarded as originating in the EU.
2.3.8. Derogations to the rules on nationality and origin
Basic acts provide for the possibility of adopting derogations from the general rules on a case-by-case basis. The derogation can further (a) extend or (b) limit the eligibility of certain entities/goods on grounds foreseen in the basic acts.
The decision on derogations is taken by the European Commission before the procedure is launched. In principle, it is not possible to derogate from the rules on nationality and origin to allow only one or a group of countries to become eligible unless it is duly motivated in the request for derogation. Where actions are implemented in shared management, the relevant Member State to which the Commission has delegated implementation tasks can also take such decisions.
The derogation must be mentioned in the contract notice (if published) and in the guidelines for applicants (grants).
In duly substantiated cases, the European Commission may extend eligibility to natural and legal persons from an ineligible country and, under MFF 2014-2020, allow the purchase of goods and materials originating in an ineligible country.
Extension may be granted on the grounds of:
- economic, traditional, trade or geographical links with neighbouring countries (only for award procedures under the MFF 2014-2020);
- unavailability of products and services in the markets of the related countries concerned;
- extreme urgency / crisis situation; or
- extreme difficulties to carry out a project, programme or other action with the general rules on eligibility.
Where the EU is a party to an agreement on widening the market for the procurement of supplies, works or services, eligibility can be extended, as required by that agreement.
Countries for which reciprocal access to external funding is established by the Commission; that access may be granted, for a limited period of at least one year, whenever a country grants eligibility on equal terms to entities from the Union and from countries eligible under NDICI- Global Europe; the Commission shall decide on the reciprocal access and on its duration after consultation of the recipient country or countries concerned.
In the context of grants, the basic acts also allow to limit eligibility on certain grounds, notably where this is required by the nature and the objectives of the action and as necessary for its effective implementation.
The limitation can be made with respect to the nationality, localisation or nature of applicants and does not require a prior approval / event to be reported.
2.4. EU restrictive measures
Article 215 of the Treaty on the Functioning of the European Union (TFEU) provides the legal basis for the interruption or reduction, in part or completely, of the European Union’s economic and financial relations with one or more third countries, where such restrictive measures are necessary to achieve the objectives of the Common Foreign and Security Policy (CFSP).
By means of Council Decision taken on the basis of Article 29 of the Treaty on European Union (TEU) and related implementing Regulation pursuant to Article 215 TFEU, the EU restrictive measures are directly applicable in the European Union. Hence, when implementing the EU budget, the Commission must give effect to EU restrictive measures.
The same obligation is implicitly imposed onto persons or entities entrusted with indirect management by virtue of Article 62(1)(c) FR, which requires implementing partners to ensure that funds are only disbursed in accordance with EU law, including therefore the implementation of EU restrictive measures.
The obligation to ensure compliance with the EU restrictive measures applies:
· to the EU institutions and bodies and to all EU contracting partners;
· not only at the initial distribution of funds but also down to the level of final beneficiary.
Evaluation committees must ensure that there is no detection of a recommended tenderer (and consortia members thereof) or grant applicant, co-applicants, affiliated entities in the list of EU restrictive measures, at the latest before award of a contract.
Likewise, grant beneficiaries and contractors must ensure that there is no detection of subcontractors, natural persons (including participants to workshops and/or trainings and recipients of financial support to third parties), in the lists of EU restrictive measures.
The lists of persons, groups, entities subject to the EU restrictive measures are maintained by the DG FISMA and published on the following website: www.sanctionsmap.eu
2.5. General principles applying to procurements and grants
There are some fundamental principles that apply to procurement and grant procedures which the contracting authority has to respect throughout the procedure. These principles are laid down in the Financial Regulation.
The contracting authority must take all necessary measures to ensure full compliance with these principles also by facilitating the detection of unreliable economic operators and the protection of the European Union’s financial interests. To this aim, an early detection and exclusion system (EDES) is established by the Financial Regulation to reinforce the protection of the European Union’s financial interests and to ensure sound financial management (see Section 184.108.40.206.).
Failure to comply with these general principles may lead to the annulment of the award decision.
EU public procurement consists in contracts concluded in writing in order to obtain, against payment of a price, the execution of works, the supply of goods or the provision of services.
EU public procurement is governed by rules intended to remove barriers and open up markets in a non-discriminatory and competitive way.
The following principles should be followed:
The contracting authority should ensure openness and clarity on procurement policy and its delivery. This obligation consists in ensuring, for the benefit of any potential tenderer, a degree of advertising sufficient to enable the market to be opened up to competition and the impartiality of procurement procedures to be reviewed.
- Equal treatment and non-discrimination
All interested parties should be treated in the same way, meaning that all tenderers must be afforded equal opportunities when formulating their tenders, which therefore implies that the tenders of all competitors must be subject to the same conditions.
Procurement should be carried out by competition, unless there are justified reasons to the contrary; this obligation also means that the estimated value of a contract may not be established in such a way as to avoid the competitive tendering procedure or to circumvent the rules which apply to certain procurement procedures or above a certain threshold, nor may a contract be split for that purpose (a practice known as ‘salami-slicing’). Moreover, as pointed out by the Court, the widest possible opening-up to competition is also in the interest of the contracting authority itself, which will have thus greater choice as to the tender that is the most advantageous and the most suited to the needs of the public authority.
This principle requires that measures adopted by the European Commission do not exceed the limits of what is appropriate and necessary in order to attain the objectives pursued and that where there is a choice between several appropriate measures recourse must be had to the least onerous.
- Sound financial management
Budget appropriations must be used in accordance with the principles of economy, efficiency and effectiveness.
A grant is a financial contribution made by the European Commission by way of donation to one or more beneficiaries for the purpose of carrying out an action or implementing a work programme.
Grants are divided in two general categories:
- action grants financing actions intended to achieve a European Union policy;
- operating grants financing the functioning of a body pursuing an aim of general European Union interest or an objective forming part of a European Union policy objective.
The following principles should be followed:
The contracting authority must publish all relevant information in order to enable the potential beneficiaries to obtain timely and accurate information on the actions being undertaken by the European Union. The work programme is implemented by publishing calls for proposalsand all grants awarded in the course of the financial year will be published annually with due observance of the requirements of confidentiality and security.
- Equal treatment
No preferential treatment may be given to any potential beneficiary. This rule applies not only to the process of identifying and selecting beneficiaries but also during the implementation of the action.
The costs are shared between the Commission and the beneficiary. This means that a grant awarded for an action cannot fund the entire cost of the action and that an operating grant cannot fund all the operating costs incurred by the beneficiary body. For more details on the exceptions to the co-financing principle, see Section 6.3.9.
Grants must not have the purpose or effect of producing a profit within the framework of the action or the work programme of the beneficiary. For more details, see Section 6.3.10.
- No-cumulative award
Each beneficiary may not get more than one grant per action (unless otherwise provided in the applicable basic act), neither more than one operating grant for a given financial year. Under the direct management mode, however, an action may be financed jointly from separate budget lines by a number of authorising officers. The applicant must specify in the application form any applications and awarded grants relating to the same action or to the same work programme.
Financing by the general budget of the EU and EDF funding may not be used to finance actions that have already been completed and which have therefore proved achievable without financial support from the European Union. At the same time, the rule prohibits awarding an operating grant for activities carried out in previous budgetary years of the beneficiary. For more details on the non‑retroactivity principle and crisis situations, see Section 6.3.8.
Unless the European Commission requests or agrees otherwise, all beneficiaries, managing authorities and implementing partners of EU funding must use the EU emblem and short funding statements in their communication to acknowledge the support received under EU programmes and contribute to the visibility of the EU on the ground in accordance with the guidelines (https://ec.europa.eu/info/sites/default/files/eu-emblem-rules_en.pdf). Such measures shall be carried out in accordance with the latest Communication and Visibility Requirements for EU-funded external action, published by the European Commission (Communication and Visibility Requirements for EU External Actions | International Partnerships (europa.eu)) or with any other guidelines agreed between the European Commission and the Organisation.
2.5.4. Conflict of interest
The term ‘conflict of interest’ is used with different meanings in different contexts. Four cases can be distinguished:
(1) conflict of interest for the contracting authority
(2) grave professional misconduct
(3) involvement in drafting tender specifications and distortion of competition
(4) professional conflicting interests.
220.127.116.11. Conflict of interest for the contracting authority
A conflict of interest exists where the impartial and objective exercise of the authorising officer (namely, any financial actor including national authorities at any level involved under direct, indirect and shared management in budget implementation) is compromised for reasons involving family, emotional life, political or national affinity, economic interest or any other direct or indirect personal interest.
In procurement and grant procedures, the situation of conflict of interest applies to persons in charge of the procedure as well as to persons involved in the preparation, opening and evaluation phases.
A conflict of interest may arise where, for instance, a member of the opening and evaluation committee or someone in the contracting authority or others involved in the procedure grant themselves, or others, unjustified direct or indirect advantages by influencing the outcome.
Special care should be taken in cases where external experts are involved in the evaluation committee. Indeed, the authorising officer responsible must ensure that these external experts satisfy the obligations concerning conflict of interests and confidentiality.
In the potential case of members of staff of the EU delegations (local or contract agents) proposed as experts by tenderers, the European Commission must make sure that the contract with the EU institution is officially terminated before the expert starts to work on an EU financed project under a contract with an external organisation/company. In the case of civil servants or other staff of the public administration of the partner country, or of international/regional organisations based in the country, regardless of their administrative situation, these must only be approved by the European Commission if well justified. The tenderer must in its offer include information on the added value the expert will bring, as well as proof that the expert is seconded or on leave on personal ground (see Section 18.104.22.168.).
22.214.171.124. Grave professional misconduct
A grave professional misconduct refers to all wrongful conduct that denotes a wrongful intent or gross negligence.
It encompasses the violation of applicable laws or regulations or ethical standards of the profession to which the contractor belongs, and any wrongful conduct that has an impact on the professional credibility of the contractor (for details, see Section 2.5.6.).
There are specific situations for economic operators that qualify as ‘grave professional misconduct’ and not as conflict of interests:
- where the operator attempts to unduly influence the decision-making of the contracting authority during a procurement procedure;
- where the operator enters into agreement with other operators in order to distort competition;
- where the operator tries to obtain confidential information that may give it undue advantages in the procedure.
Cases where an expert or company attempts to obtain information leading to an unfair advantage in subsequent or related procedures or attempts to influence the decision making process of the contracting authority or enters into agreement with other economic operators with the aim of distorting competition are rather to be treated as grave professional misconduct and are a basis to reject/exclude the economic operator concerned (see Section 126.96.36.199.).
188.8.131.52. Involvement in drafting tender specifications and distortion of competition
There are cases where the contracting authority uses a technical assistance contract to help drafting the tender specifications of a subsequent procurement procedure. In this case, it is the responsibility of the contracting authority to ensure equality of treatment between the operator involved in the technical assistance and other economic operators. The contractor can be rejected from the subsequent procedure when the contractor, its personnel or subcontractors were involved in the preparation of procurement documents and this entails a breach of the principle of equality of treatment, including a distortion of competition that cannot be remedied otherwise. On this regard, please note the existence of a declaration of objectivity and confidentiality (Annex A3) that should be completed by all persons involved in preparing terms of reference, technical specifications or other documents relating to a call for tenders or a call for proposals.
Burden of proof: it is up to the contracting authority to prove the distortion of competition and to prove that it has taken all possible measures to avoid the rejection. In particular, these measures must include the communication to the other candidates/tenderers of the relevant information exchanged in the context of or resulting from the involvement of the candidate/tenderer in the preparation of the procurement procedure and the fixing of adequate time-limits for the receipt of tenders. The rejection is subject to a contradictory procedure, so the tenderer must be given the opportunity to prove that its prior involvement cannot distort competition.
184.108.40.206. Professional conflicting interest
Finally, there are specific cases where the operator has a professional conflicting interest that negatively affects its capacity to perform a contract. Such a situation arises where an operator could be awarded a contract to evaluate a project in which it has participated or to audit accounts that it has previously certified, and therefore is treated at the selection stage.
A case-by-case assessment is required to confirm that the situation of conflict of interest may negatively affect the performance on the contract in question. If the operator is in such a situation, the corresponding tender is rejected. These cases often arise in evaluation or audit framework contracts, where the contractor can have a professional conflicting interest for a specific contract.
Where a conflict of interest might occur with regard to on-going contracts, the contractor must immediately inform the contracting authority and measures must be adopted to prevent or to resolve such a conflict, including terminating the contract if necessary.
2.5.5. Other essential points
Exceptional changes to the composition of the consortium
To ensure fair competition, no changes to the identity or composition of the candidate/tenderer are permitted, except in the situations listed below where the contracting authority has to give prior approval in writing.
The only cases where a change in composition of a consortium may be accepted are:
(i) where there is a merger or takeover of one member of the consortium (universal succession);
(ii) where the change comes from the contracting authority, i.e. one member (leader or other member) of the consortium is subject to exclusion or rejected because it does not comply with a selection criterion applicable to it. Indeed, in this case, exclusion or rejection applies to a legal entity, not to a group, so it may be disproportionate to reject the whole request to participate/tender on that basis; such situations should be appreciated on a case-by-case basis. The position to adopt could be different according to the various exclusion cases (for instance, a change could be accepted in case of bankruptcy, but not in the case where the member of the group has been convicted of fraud, corruption, etc.). In case of rejection, withdrawal of the rejected member of the group could be accepted if the selection criterion is still fulfilled without it.
The fact that the entity excluded is the leader of the consortium does not affect the substance of the changes to the consortium. A leader has powers of attorney to represent other members of the group of economic operators, but this does not determine per se its relative weigh in the consortium. What has to be considered is the incidence that the entity concerned has in the selection criteria and in the award criteria.
In both cases (i) and (ii) above, the contracting authority must verify the following conditions:
1. in the case (i) above, whether the new entity meets eligibility requirements;
2. in the case (i) above, whether the new entity is not in an exclusion situation;
3. in both cases, whether the selection criteria are still fulfilled (without the excluded or rejected entity if applicable and without replacing it) compared to the request to participate/tender originally submitted;
4. in both cases, whether the change in composition of the consortium does not entail any substantial change in the tender as originally submitted. For the case (ii), this condition is met as long as:
(a) all the tasks assigned to the excluded entity are taken over by the other members of the consortium;
(b) the change does not make the tender non-compliant with the requirements set in tender documents;
(c) the change does not modify the evaluation of award criteria as originally submitted.
If all the conditions are fulfilled, the contracting authority can accept the change in the composition of the consortium. Otherwise, the request to participate/tender must be rejected.
Once the contract is signed by the consortium, as a matter of principle there should be no change, except in the cases of universal succession (merger/takeover of one of the members of the consortium). In this case, the contracting authority must verify the following conditions:
(a) whether the new entity is eligible;
(b) whether the new entity is not in an exclusion situation;
(c) whether the selection criteria are still fulfilled.
For the selection criteria, the principle of proportionality may be used if the contract implementation is already well advanced when the change occurs (e.g. selection criteria which were only necessary for the start phase do not have to be fulfilled anymore at a later stage of the contract).
However, if a change, including the replacement of a member of the consortium, happens for another reason, the contracting authority must analyse the consequences of terminating the contract vs. accepting the change, and it must in particular assess whether the change is substantial or not (i.e. if it requires to terminate the contract and launch a new procurement procedure or not). If the change is accepted, the same verification as in the case of universal succession must be made.
Requesting information only once
As provided for by Article 128 FR, information already available at European Union institutions, the management authorities and other bodies and entities implementing the European Union budget, must be used to the extent possible to avoid asking persons and entities receiving European Union funds for the same information more than once.
Contracts take effect from the date of signature of the last signatory. All contracts must show the true dates on which the contracting parties signed them. Exceptionally, they might be applicable from an earlier date (in cases of retroactive financing for instance).
Verification of financial guarantees
Financial guarantees have the effect of making the third party stand as irrevocable collateral security, or first-call guarantor of the defaulting contractor's or grant beneficiary's obligations. At the contracting authority's request, the third party will therefore automatically replace the contractor or grant beneficiary if the latter fails to fulfil its obligations towards the contracting authority, up to the amount for which the financial guarantee has been given. A thorough check on the legality, reliability and authenticity of any financial guarantees is therefore essential.
In indirect management, the contracting authority should seek guidance from the European Commission before accepting a financial guarantee.
Subject to the contracting authority’s legislation on access to documents, written records of the entire procurement and grant award procedure must be kept confidential and kept by the contracting authority in accordance with the policy adopted on archiving. If its law conflicts with the confidentiality required, the contracting authority must obtain prior authorisation from the European Commission before disclosing any information.
Financial guarantees (originals) must be kept in a safe place where they are protected against the risk of loss or theft up to the end of their validity period or the end of the contractual obligations.
Availability of funds
Before initiating any procedure, the funds must be available. Calls may exceptionally be launched with a suspensive clause after prior approval of the relevant services. The call is then launched before the financing decision is adopted or before the financing agreement between the European Commission and the partner country is signed. The call is cancelled if the financing decision is not adopted or if the financing agreement is not signed. The contract cannot be signed until the funds are available.
Concepts such as environmental issues, climate change, gender equality, accessibility for disabled people need to be taken into account by tenderers, candidates and applicants in the context of procurement and calls for proposals. Furthermore, appropriate environmental screening, including for climate change and biodiversity impacts, must be undertaken at project level, in accordance with the applicable legislative acts of the European Union, for both procurements and grants. Where relevant, strategic environmental assessments must be used in the implementation of sectoral programmes.
Joint procurement with an EU Member State, an EFTA State or an EU candidate country
In case of joint action between an EU institution and a contracting authority from a Member State, from an EFTA State or from an EU candidate country, the procurement procedure may be carried out jointly by the EU institution and that contracting authority. In this case, the procedures applicable to the European Union Institutions must apply.
Ex post publication of recipients
In addition to the publicity rules applicable to each type of procedure, the European Commission provides information on the recipient of EU funds (both grants beneficiaries and procurement contractors) on an annual basis, regardless of the management mode used. The information is available at the following site: https://ec.europa.eu/info/about-european-commission/service-standards-and-principles/transparency/funding-recipients_en.
Per diem are daily subsistence allowances that may be reimbursed for missions foreseen in the terms of reference and/or approved by the Contracting Authority, carried out by the contractor’s authorised experts outside the expert's normal place of posting. The per diem is a maximum fixed flat-rate covering daily subsistence costs. These include accommodation, meals, tips and local travel, including travel to and from the airport. Taxi fares are therefore covered by the per diem. Per diem are payable on the basis of the number of hours spent on the mission. Per diem may only be paid in full or in half (no other fractions are possible). A full per diem shall be paid for each 24-hour period spent on mission. Half of a per diem shall be paid in case of a period of at least 12 hours but less than 24 hours spent on mission. No per diem shall be paid for missions of less than 12 hours. Travelling time is to be regarded as part of the mission. Any subsistence allowances to be paid for missions undertaken must not exceed the per diem rates published on the website - https://international-partnerships.ec.europa.eu/funding/guidelines/managing-project/diem-rates_en- in force at the time of contract signature.
2.5.6. Ethics clauses
All types of contracts (procurement and grants) include a code of conduct laying down ethical clauses the respect of which is considered as a contractual obligation.
Any mention of the contractor in the present section has to be understood as the beneficiary in case of a grant contract. The contractual obligations referred to in the present section must also apply to all members of a consortium, to any sub-contractors and capacity providing entities, to lead applicants, co-applicants, associates and affiliated entities.
The contractor as impartial and faithful adviser - absence of conflict of interest: the contractor must at all time act impartially and as a faithful adviser in accordance with the code of conduct of its profession. It must refrain from making public statements about the project or services without the contracting authority’s prior authorisation. It may not commit the contracting authority in any way without its prior written consent. The contractor must refrain from any relationship likely to give rise to a conflict of interest compromising its independence or that of its personnel. If the contractor ceases to be independent, the contracting authority may terminate the contract with immediate effect
The contractor must respect human rights as well as environmental legislation and core labour standards: the contractor and its -personnel must comply with human rights. In particular and in accordance with the applicable basic act, tenderers and applicants who have been awarded contracts must comply with the environmental legislation including multilateral environmental agreements, and with the core labour standards as applicable and as defined in the relevant International Labour Organisation conventions (such as the conventions on freedom of association and collective bargaining; elimination of forced and compulsory labour; abolition of child labour).
Zero tolerance for sexual exploitation, abuse and harassment
The European Commission applies a policy of ‘zero tolerance’ in relation to all wrongful conduct that has an impact on the professional credibility of the contractor.
Physical abuse or punishment, or threats of physical abuse, sexual abuse or exploitation, harassment and verbal abuse, as well as other forms of intimidation must be prohibited. Should the contractor become aware of any breach of the above mentioned ethical standards, it must report in writing to the contracting authority.
For grant award procedures, please refer to Section 6.3.11.
The contractor and payments: the contractor may not accept any payment connected with the contract other than that provided for therein. The contractor and its personnel must not exercise any activity or receive any advantage inconsistent with their obligations to the contracting authority.
The contractor and professional secrecy: the contractor and its personnel are bound to maintain professional secrecy for the entire duration of the contract and after its completion. All reports and documents drawn up or received by the contractor during the performance of the contract are confidential.
The contractor and anti-corruption and anti-bribery: the contractor must comply with all applicable laws and regulations and codes relating to anti-bribery and anti-corruption.
The European Commission reserves the right to suspend or terminate the contract, if corrupt practices of any kind are discovered at any stage of the award process or implementation of the contract and if the contractor fails to take all appropriate measures to remedy the situation.
For the purposes of this provision, ‘corrupt practices’ are the offer of a bribe, gift, gratuity or commission to any person as an inducement or reward for performing or refraining from any act relating to the award of a contract or implementation of a contract already concluded with the contracting authority.
Corrupt practices may also include unusual commercial expenses that are not mentioned in the contract or not stemming from a properly concluded contract referring to the contract, commissions not paid in return for any actual and legitimate service, commissions remitted to a tax haven, commissions paid to a recipient who is not clearly identified or commission paid to a company that looks like a front company. Contractors found to have paid unusual commercial expenses on projects funded by the EU are liable, depending on the seriousness of the facts noted, to have their contracts terminated or to be excluded from receiving EU funds.
The European Commission may carry out whatever documentary or on-the-spot checks it deems necessary to find evidence in cases of suspected unusual commercial expenses.
Consequences of non-compliance with the ethical clauses and code of conduct
Failure to comply with the aforementioned contractual obligations constitutes a breach of the contract that may lead to suspension or termination of the contract.
A serious breach of the obligations under the code of conduct and ethical rules can amount to grave professional misconduct that may lead to immediate termination of the contract without prejudice to further administrative sanctions and exclusion from future calls for tenders.
A grave professional misconduct is not only constituted by violations of applicable laws or regulations or ethical standards of the profession to which the contractor belongs, but also encompasses any wrongful conduct that has an impact on the professional credibility of the contractor, and refers to conduct that denotes a wrongful intent or gross negligence (see in detail Section 220.127.116.11. on the exclusion criteria).
2.5.7. Anti-fraud strategy
The European Commission is committed to fight and mitigate fraud, corruption or other illegal activity affecting the financial interests of the European Union. In this context, the development of an anti-fraud culture among all the stakeholders is of great importance.
The Commission adopted its first anti-fraud strategy (CAFS) in 2011, which is an internal policy document binding on the Commission services and executive agencies in their fight against fraud and corruption affecting the EU's financial interests. The CAFS was updated in 2019 to enhance the protection of the EU budget, to strengthen the corporate oversight of the Commission regarding all issues related to fraud and to reinforce the overall anti-fraud system already in place.
In line with the requirements of the CAFS, DG INTPA has an anti-fraud strategy (AFS) and a related action plan to enhance the prevention, detection and correction of fraud. The first AFScame into effect in January 2014 and has been regularly updated to reflect the evolution in the Commission’s external action policy and operations.
In 2021, the DG adopted a significant review to align its anti-fraud policy to the evolving financial and operational context.The latest AFS highlights the DG's operational specificities that make the fight against fraud particularly complex and important. The accompanying action plan focuses on increasing internal and external awareness on fraud-related issues; strengthening the follow-up measures taken once fraud is detected; on the reinforcement of coordination, cooperation and processes; and on the use of the Early Detection and Exclusion System (EDES) as a fraud-sanctioning tool.
An important factor in combatting fraud is staff awareness and an effective system of reporting indications of fraud and irregularities. While whistleblowing is a right in many legal systems, it is an obligation for EU staff. The EU Staff Regulations and the Financial Regulation set out an obligation to report serious irregularities for any EU official who becomes aware of:
- facts that give rise to a presumption of possible illegal activity, including fraud or corruption, detrimental to the interests of the EU;
- conduct relating to the discharge of professional duties that may constitute a serious failure to comply with the obligations of EU officials.
While fraud prevention and detection is primarily the responsibility of each head of a Commission service (as appropriate in each management mode), two complementary bodies reinforce the protection of EU’s financial interests in a comprehensive way:
- The European Anti-Fraud Office, commonly known as OLAF, in charge of administrative investigations;
- The newly created European Public Prosecutor’s Office, the EPPO, to conduct criminal investigations.
OLAF investigates fraud against the EU budget, corruption and serious misconduct within the EU, and develops anti-fraud policy for the Commission. OLAF has to be informed of suspicions of fraud, corruption or other irregularities concerning EU funds, and is entitled to conduct:
- externalinvestigations relating to expenditure and revenue under the EU budget/EDF;
- internaladministrative investigations concerning staff of the EU institutions.
OLAF makes its investigations independently and in compliance with the cooperation agreements in force in third countries. It cooperates actively with its partners in the EU Member States and third countries.
Following its investigation, OLAF makes a report indicating its findings and recommendations. The competent responsible authorising officer by sub-delegation must ensure the financial follow-up, vis-à-vis the recovery of amounts wrongly paid, in cooperation with OLAF.
The EPPO represents the first true supranational prosecutorial body with the powers to carry out independently investigations and prosecutions into crimes affecting the financial interests of the EU. The focus of its mandate is fraud and other crimes affecting the EU’s financial interest as defined under Directive 2017/1371. Since 2021, the EPPO can prosecute and bring the suspected perpetrators of such crimes to judgment in the 22 participating Member States.
2.6. Procurement procedures
The basic means of awarding contracts is competitive tendering. The purpose is twofold:
· to ensure that operations comply with the awarding principles; and
· to obtain the quality of services, supplies or works wanted, at the best possible price.
There are several different procurement procedures, each allowing a different degree of competition.
Article 164 FR provides the following list of procedures for awarding concession contracts or public contracts, including framework contracts:
(a) open procedure;
(b) restricted procedure, including through a dynamic purchasing system;
(c) design contest;
(d) negotiated procedure, including without prior publication;
(e) competitive dialogue;
(f) competitive procedure with negotiation;
(g) innovation partnership;
(h) procedures involving a call for expression of interest.
Article 178 FR on external action procurement provides on the one hand that the common provisions on public procurement must be applicable to the external action procurement, subject to special provisions relating to the arrangements for awarding external contracts laid down in its Annex I.
On the other hand, it also adds further conditions to the use of certain common provisions. Accordingly, the publicity measures of Article 163(1) and the obligation to respect a standstill period must only apply as from:
(a) EUR 300 000 for service and supply contracts;
(b) EUR 5 000 000 for works contracts.
In addition to the above-mentioned types of procurement procedures, Article 38 of Annex I to the FR further indicates that procurement procedures in the field of external actions must be as follows:
a) the restricted procedure as provided for in Article 164(1)(b);
b) the open procedure as provided for in Article 164(1)(a);
c) the local open procedure; and
d) the simplified procedure.
The simplified procedure is the new terminology adopted to replace the former ‘competitive negotiated procedure’ under the previous Financial Regulation (the 2012 Financial Regulation).
Note also that for services, supply and works contracts both open and restricted procedures can be used. However, only templates for the restricted procedure for services, and templates for the open procedure for supplies and works are available as annexes to the PRAG. Templates for the simplified and negotiated procedures for services, supply and works are now also available.
2.6.1. Which procurement procedure to apply and how?
The applicable standard procedures further explained in this practical guide are summarised in the table below. They are divided between those for services (e.g. technical assistance and studies), supplies (i.e. equipment and materials) and works (i.e. infrastructure and other engineering works). Once the European Commission has approved an action by adopting a financing decision and, where appropriate, a financing agreement, the contracting authority can proceed with tendering and contracting following these standard procedures. The thresholds given in the table are based on the maximum budget for the contract in question (including any co-financing). Where contracts are subdivided into lots, the value of each lot is taken into account when calculating the overall threshold.
Regardless of which procedure is used, all basic principles must be complied with (including the eligibility, exclusion and selection criteria).
Where possible and appropriate in light of the nature of the action, and in line with the financing agreement if any, the use of the simplest procedures must be favoured.
Note that projects must not be split artificially to circumvent the procurement thresholds.
Other procedures can be applied regardless of the thresholds, for instance negotiated procedures on the basis of a single tender — as long as the relevant conditions are met (see Sections 2.6.5., 2.6.6., 2.6.7. and 2.6.8.).
≥ EUR 300 000
- International restricted or open tender procedure
- Audit 2018
≤ EUR 999 999
- Framework contract SIEA 2018, Events 2020
Or < EUR 300 000 - Framework contracts (EVA 2020)
- Simplified procedure
≤ EUR 20 000
- Single tender
A payment may be made against invoice without prior acceptance of a tender if the expenditure is ≤ EUR 2 500
≥ EUR 300 000
- International restricted or open tender procedure
< EUR 300 000 but ≥ EUR 100 000
- Local open tender procedure
<EUR 100 000 but > EUR 20 000
- Simplified procedure
≥ EUR 5 000 000
- International open tender procedure
- International restricted tender procedure
< EUR 5 000 000 but ≥ EUR 300 000
- Local open tender procedure
< EUR 300 000 but > EUR 20 000
- Simplified procedure
Electronic Submission (eSubmission) has been introduced for the management of the procurement procedures in external actions. eSubmission is available through the TED eTendering website and accessible on the Funding and Tenders Opportunities portal (F&T portal). eSubmission allows economic operators to electronically submit requests to participate or tenders in a structured and secure way. At the moment, eSubmission supports the following procurement procedures:
· Open procedures
· Restricted procedures
· Negotiated procedures without prior publication of a contract notice
When applying the direct management mode, the requests to participate and tenders in in the above-mentioned procurement procedures must be submitted exclusively via eSubmission Requests to participate and tenders submitted in any other way (e.g. post, courier, e-mail, hand delivery) will be disregarded.
In order to submit a request to participate or tender using eSubmission, economic operators will need to register in the European Commission's Participant Register - an online register of organisations participating in EU calls for tenders or proposals. In case of consortia, requests to participate will have to be made through a group submission which requires for each member of the group a registration in the Participant Register.
When registered, each organisation obtains a Participant Identification Code (PIC, 9-digit number) which acts as its unique identifier in the above register. Instructions on how to create a PIC can be found on this page. Economic operators already registered in the Participant Register shall reuse their existing PICs when preparing tenders in eSubmission.
It is up to the contracting authority to request the legal and financial validation of the data (PIC validation) of any organisation applying via eSubmission. The EU Validation Services of the Research Executive Agency (REA) are in charge of the PIC validation. The request for supporting documents in no way implies that the organisation has been successful in a procurement procedure. All communications with the EU Validation Services will take place through the F&T portal.
When applying the indirect management mode, the requests to participate and tenders will continue to be submitted through paper documents.
2.6.2. Open procedure
In ‘open’ calls for tenders (international or local), all economic operators may submit a tender. The contract is given maximum publicity by publishing a notice in the official journal of the European Union (S series), the official journal of the partner country, the F&T portal, and in any other appropriate media.
See guidelines for publication (Annex A11e).
The tenders are examined, the eligibility and the financial, economic, technical and professional capacity of the tenderers are checked to arrive at a selection, the tenders are evaluated and the contract is awarded (see Sections 2.6.11. and 18.104.22.168.). No negotiation is allowed.
2.6.3. Restricted procedure
In ‘restricted’ calls for tenders, all economic operators may submit a request to participate but only those who satisfy the selection criteria may be invited to submit a tender.
The contract is given maximum publicity by publishing a notice in the Official Journal of the European Union (S series), in the Official Journal of the partner country, on the F&T portal, and in any other appropriate media.
The selection criteria and the tasks to be undertaken are described in the published additional information about the contract notice (A5f) document. A ‘long list’ of all the candidates replying to the notice is cut down to a shortlist of the best qualified, on the basis of their replies. At the shortlisting stage, before the list is approved by the evaluation committee, the contracting authority checks that none of the candidates or their partners is in an exclusion situation in the early detection and exclusion system (see Section 2.6.11.).
The contracting authority prepares the shortlist notice and publishes it together with the award notice on TED (Section VI.3 of the award notice).
The contracting authority -sends the tender dossier only to the short-listed candidates.
See guidelines for publication (Annex A11e).
Once the tenders have been analysed, they are evaluated and the successful tenderer is chosen (see Sections 2.6.11. and 22.214.171.124.). No negotiation is allowed.
2.6.4. Simplified procedure (formerly known as ‘competitive negotiated’ procedure)
Under the simplified procedure, the contracting authority invites at least three candidates of its choice to submit tenders.
The evaluation (including the use of an evaluation committee) and the award of the contract follow the rules of the open procedure.
For further details regarding simplified procedure in services, see Section 3.5.2., for supplies see Section 4.5. and for works Section 5.6.
2.6.5. Framework contracts
Although it is not a procurement procedure in itself, a framework contract is an agreement between one or more contracting authorities and one or more economic operators, the purpose of which is to establish the terms governing specific contracts which may be awarded during a given period, in particular with regard to price and, where appropriate, the quantity envisaged. In this way, the framework contract represents a structure within which subsequent specific contracts are concluded.
Framework contracts with several economic operators are called ‘multiple’ framework contracts; they take the form of separate contracts but they are all concluded on identical terms. The specifications must state both the minimum and the maximum number of operators with which the contracting authority intends to conclude contracts. The minimum may not be less than three.
The duration of a framework contract may not exceed 4 years, save in exceptional cases duly justified in particular by the subject matter of the framework contract. Contracting authorities may not make undue use of framework contracts or use them in such a way that the purpose or effect is to prevent, restrict or distort competition.
The award of a framework contract always requires a public procurement procedure. However, once a framework contract has been concluded, the award of specific contracts follows a request for services sent by the contracting authority to a fixed number of framework contractors, usually three, and the evaluation of their offers. A specific contract or a purchase order is then concluded. Specific contracts based on framework contracts are thus awarded in accordance with the terms of the framework contract. Hence, when awarding specific contracts under a framework contract, the procedure set out in the framework contract should be followed (and not the rules applicable to tenders), provided that the principles of transparency, proportionality, equal treatment and non-discrimination are respected, and framework contracts are not used improperly or in such a way that their purpose or effect is to prevent, restrict or distort competition.
2.6.6. Dynamic purchasing system
A dynamic purchasing system is a completely electronic process for making commonly used purchases, for a limited period, which is open to any economic operator who meets the selection criteria and has submitted a technically compliant indicative tender. No specific threshold applies.
For each individual contract, the contracting authority publishes a contract notice and invites all contractors admitted to the system to bid. The contract is awarded to the cheapest tender proposing the delivery of the items requested most economically advantageous tender (i.e. the sole award criterion is the price).
See Section 126.96.36.199. for further details. A legal framework for this procedure has been devised for future use, but the IT tools to make it possible (ensuring confidentiality and security) are not yet available in the European Commission.
2.6.7. Competitive dialogue
In the case of particularly complex contracts, where the contracting authority considers that neither direct use of the open procedure nor the arrangements governing the restricted procedure will result in the best value for money, it may use the competitive dialogue referred to in the Financial Regulation. A contract is considered to be ‘particularly complex’ if the contracting authority is objectively unable either to specify the technical means of satisfying its needs or objectives or to specify the legal or financial makeup of the project. No specific threshold applies. This procedure is, however, exceptional and must be used with caution.
Contracting authorities must publish a contract notice/additional information about the contract notice setting out or attaching their needs and requirements. They must open a dialogue with the candidates satisfying the selection criteria. The dialogue may cover all aspects of the tender; however, it is conducted separately with each candidate on the basis of their proposed solutions and ideas. The contracting authority must ensure equal treatment of tenderers and keep the tenders confidential. It is therefore not allowed to pick the best solutions from different tenderers (i.e. no ‘cherry-picking’ is allowed).
The minimum number of candidates invited to tender is three. Before selecting the candidates, the contracting authority checks that none of the candidates or their partners is in an exclusion situation in the EDES system (see Section 188.8.131.52.3.). If fewer than three candidates meet the selection criteria, the contracting authority may continue the procedure with the one or two who do meet the criteria. The contracting authority may not make up the number with other economic operators who did not take part in the procedure or candidates who do not meet the selection criteria.
During the dialogue, the contracting authority must treat all tenderers equally and ensure that the solutions proposed or other information received in the dialogue is kept confidential unless the candidate agrees to disclosure.
The contracting authority may reduce the number of solutions for dialogue by applying the award criteria at a pre-dialogue stage, if the contract notice informs candidates of this possibility. The contracting authority must prepare a report explaining the manner in which dialogue was conducted.
The contracting authority must inform tenderers who are not in an exclusion situation, whose tender is compliant with the procurement documents and who make a request in writing, of the progress of dialogue. Such information should not prejudice the legitimate commercial interest of tenderers or distort fair competition between them. After informing the participants that the dialogue has been concluded, contracting authorities must ask them to submit their final tenders on the basis of the solutions presented and specified during the dialogue. The tenders must contain all the information required and necessary for the performance of the project. At the request of the contracting authority, these tenders may be clarified, specified and fine-tuned, provided this does not have the effect of changing basic aspects of the tender or of the invitation to tender, variations in which could distort competition or have a discriminatory effect. At the request of the contracting authority, the tenderer offering best value for money may be asked to clarify aspects of the tender or confirm commitments contained in the tender provided this does not have the effect of amending substantial aspects of the tender or of the call for tenders and does not risk distorting competition or causing discrimination.
The contracting authorities may specify prices or payments to the participants in the dialogue.
The contract is awarded to the technically compliant tender which is the most economically advantageous (i.e. the sole criterion is the best price-quality ratio).
The standard templates must be adapted as required.
DIRECT MANAGEMENT AND INDIRECT MANAGEMENT WITH EX ANTE CONTROLS
Prior approval by the European Commission must be sought to use competitive dialogue.
INDIRECT MANAGEMENT WITH EX POST CONTROLS
No prior authorisation of the European Commission is required.
2.6.8. Negotiated procedure / single tender procedure
A contract may be awarded directly in the following circumstances:
- using the ‘single tender procedure’ when the contract does not exceed EUR 20 000;
- using the ‘negotiated procedure’ whatever the value of the contract in exceptional and duly justified cases, provided the factual or legal circumstances described in Sections 184.108.40.206., 220.127.116.11. and 18.104.22.168. are met. No specific threshold applies in such cases.
The negotiated procedure may only be used in cases stipulated in this practical guide. No prior approval can be granted to apply the negotiated procedure in cases others than the ones stipulated in this practical guide.
Before selecting the candidates, the contracting authority checks that none of the candidates or their partners is in an exclusion situation in the early detection and exclusion system (see Section 22.214.171.124.3.).
In the case of negotiated procedures, an evaluation committee must be nominated prior to proceeding with the negotiation. However, depending on a risk analysis by the contracting authority, appointing an evaluation committee might not be deemed necessary in the following cases:
- extreme urgency not attributable to the contracting authority;
- crisis situation;
- new services or works consisting in the repetition of similar activities as in the original contracts, provided the conditions laid down in Sections 126.96.36.199., point e) and 188.8.131.52., point c) are met;
- additional supplies, provided the conditions laid down in Section 184.108.40.206., point d) are met;
- supplies quoted and purchased on a commodity market;
- legal services which do not have mandatorily to be awarded through a simplified procedure (see Section 220.127.116.11.(f)).
When the contract does not exceed EUR 20 000 appointing an evaluation committee is never mandatory.
For all procedures, a negotiation report (Annex A10a for negotiated procedures and Annex A10b for single tender procedures) must be produced, explaining how participant(s) in the negotiations were chosen, how they met the selection criteria, how the price was set, and the grounds for the award decision.
The negotiation steps shown in the negotiation report template must be followed. Eligibility rules (nationality as well as exclusion situations mentioned in Sections 2.3.1. and 2.3.2.) and selection criteria must be duly complied with. Documentary evidence for exclusion criteria and selection criteria should be submitted as referred to in Sections 18.104.22.168.3. and 2.6.11., respectively.
The negotiated procedure covers two different types of negotiations for which different templates should be used:
- negotiation with one economic operator to which the contracting authority awarded an initial contract. The amendment of the initial contract is the outcome of the procedure. This type of negotiated procedure takes place to procure similar services or works or additional supplies- negotiation with one or several economic operators, which, if successful, will result in the award of a new contract.
Negotiated procedure resulting in the award of a new contract
The tender dossier, to be drafted and approved by the relevant contracting authority for the negotiated procedure before launching the procedure, shall include at least the invitation letter, contract notice with the selection and award criteria, ITT, standard draft contract, relevant annexes and terms of reference/technical specifications. For negotiated procedures the templates of the simplified procedure, with the exception of the contract and its annexes, should be used and adapted on a case-by-case basis. The invitation letter shall specify that it is a negotiated procedure, indicate the deadline to receive the offer (to be determined on a case-by-case basis) and outline the process.
Negotiated procedure resulting in the amendment of an initial contract
The conditions stated in section 22.214.171.124 under e), 126.96.36.199 under d) or 188.8.131.52 under c) should be met in case a negotiated procedure takes place to procure similar services or works or additional supplies. Annex a8 is the template to be used to invite to tender for an amendment of a contract. The invitation letter describes the scope and the revised terms of reference/technical specifications. The invitation letter also provides the necessary background information, outline the negotiation process and indicate the deadline to receive the offer.
There is no minimum time-limit for receiving tenders in negotiated procedures, but tenderers should be given reasonable time to prepare good tenders, especially taking particular account of the complexity of the contract. The minimum requirements included in the terms of reference / technical specifications and the exclusion, selection and award criteria specified in the procurement documents are not negotiable. Whenever appointed, the evaluation committee may organise negotiation round(s) and possibly invite the tenderer(s) to discuss the technical and financial offer(s), which can be disclosed at any time during the process. In such cases, recommendations on the award decision will be made by the evaluation committee on the basis of the outcome of discussions held during the negotiation(s) round(s) and will be documented in the negotiation report.
The contracting authority may award a contract on the basis of the initial tender without negotiation where it has indicated in the procurement documents that it reserves the possibility to do so.
The contracting authority must inform tenderers who are not in an exclusion situation, whose tender is compliant with the procurement documents and who make a request in writing, of the progress of negotiation. Such information should not prejudice the legitimate commercial interest of tenderers or distort fair competition between them.
The negotiation report must be approved by the contracting authority.
Prior approval/event to be reported as the case may be is required from the European Commission to use the negotiated procedure.
INDIRECT MANAGEMENT WITH EX ANTE CONTROLS
Prior authorisation by the European Commission must be sought to use the negotiated procedure. The negotiation report must be endorsed by the European Commission.
INDIRECT MANAGEMENT WITH EX POST CONTROLS
No prior authorisation by the European Commission is required to use the negotiated procedure and the negotiation report does not need to be endorsed by the European Commission.
If applicable, payments for amounts less than or equal to EUR 2 500 may be made against invoices without prior acceptance of a tender.
No ACP preference is possible in procurement procedures under MFF 2021-2027.
Only for award procedures under MFF 2014-2020:
See Article 26 of Annex IV to the Cotonou Agreement:
1. Measures must be taken to encourage the widest participation of the natural and legal persons of ACP States in the performance of contracts financed by the EDF in order to permit the optimisation of the physical and human resources from those States. To this end:
a. for works contracts of a value of less than EUR 5 000 000, tenderers of the ACP States, provided that at least one quarter of the capital stock and management staff originates from one or more ACP States, must be accorded a 10% price preference during the financial evaluation;
b. for supply contracts of a value of less than EUR 300 000, tenderers of the ACP States, either individually or in a consortium with European partners, shall be accorded a 15% price preference during the financial evaluation;
c. in respect of service contracts other than the European Commission's Framework contracts, where tenders of equivalent economic and technical quality are compared, preference must be given to:
i. experts, institutions or consultancy companies or firms from ACP States with the required competence;
ii. offers submitted by ACP firms, either individually or in consortium with European partners; and
iii. offers presented by European tenderers with ACP sub-contractors or experts;
d. where subcontracting is envisaged, preference must be given by the successful tenderer to natural persons, companies and firms of ACP States capable of performing the contract required on similar terms; and
e. the ACP State may, in the invitation to tender, propose to the prospective tenderers the assistance of other ACP States’ companies or firms or national experts or consultants selected by mutual agreement. This cooperation may take the form either of a joint venture, or of a subcontract or of on the job training of trainees.
2. Without prejudice to the provisions in paragraph 1, where two tenders for works, supplies or service contracts are acknowledged to be equivalent, preference must be given:
- to the tenderer of an ACP State; or
- if no such tender is forthcoming, to the tenderer who:
i. allows for the best possible use of the physical and human resources of the ACP States;
NB. South African natural or legal persons cannot benefit from the preference system.
GENERAL BUDGET OF THE EUROPEAN UNION
In order to promote local capacities, markets and purchases, priority must be given to local and regional contractors when the applicable Financial Regulation provides for an award on the basis of a single tender. In all other cases, participation of local and regional contractors must be promoted in accordance with the relevant provisions of that regulation.
2.6.10. Exclusion, selection and award criteria
Regardless of the type of procurement procedure used (including negotiated procedures), the capacity of the candidate or tenderer to implement the contract is always assessed on the basis of objective criteria set out below.
184.108.40.206. Exclusion criteria
In the Financial Regulation, the provisions on early detection and exclusion system are contained in Articles 135 FR. The exclusion system is a system to facilitate the detection of persons and entities that pose a risk to the European Union’s financial interests. It aims at excluding from receiving European Union funds or participating in grant or procurement procedures the entities or persons found in specific exclusion situations (also called ‘exclusion grounds’).
The exclusion is decided by the Commission on the basis of a final judgment or a final administrative decision or, in the absence of such a judgment or decision, on the basis of established facts or findings and their preliminary classification in law contained in the recommendation of the EDES panel referred to in Article 143 FR.
220.127.116.11.1. Exclusion criteria from participation in procurement and grant procedures
An economic operator will be excluded from participation in procurement and grant procedures if:
a) it is bankrupt, subject to insolvency or winding-up procedures, where its assets are being administered by a liquidator or by a court, where it is in an arrangement with creditors, where its business activities are suspended, or where it is in any analogous situation arising from a similar procedure provided for under national laws or regulations;
b) it has been established by a final judgment or a final administrative decision that the economic operator is in breach of its obligations relating to the payment of taxes or social security contributions in accordance with the applicable law;
c) it has been established by a final judgment or a final administrative decision that the economic operator is guilty of grave professional misconduct by having violated applicable laws or regulations or ethical standards of the profession to which the economic operator belongs, or by having engaged in any wrongful conduct which has an impact on its professional credibility where such conduct denotes a wrongful intent or gross negligence, including, in particular, any of the following:
i) fraudulently or negligently misrepresenting information required for the verification of the absence of grounds for exclusion or the fulfilment of selection criteria or in the performance of a contract;
ii) entering into agreement with other economic operators with the aim of distorting competition;
iii) violating intellectual property rights;
iv) attempting to influence the decision-making process of the contracting authority during the procurement procedure;
v) attempting to obtain confidential information that may confer upon it undue advantages in the procurement procedure;
d) it has been established by a final judgment that the economic operator is guilty of any of the following:
i) fraud, within the meaning of Article 3 of Directive (EU) 2017/1371 of the European Parliament and of the Council of 5 July 2017 on the fight against fraud to the Union's financial interests by means of criminal lawand Article 1 of the Convention on the protection of the European Communities’ financial interests drawn up by the Council Act of 26 July 1995;
ii) corruption, as defined in Article 4(2) of Directive (EU) 2017/1371 and Article 3 of the Convention on the fight against corruption involving officials of the European Communities or officials of Member States of the European Union, drawn up by the Council Act of 26 May 1997, and in Article 2(1) of Council Framework Decision 2003/568/JHA of 22 July 2003 on combating corruption in the private sector, as well as corruption as defined in the law of the country where the contracting authority is located, the country in which the economic operator is established or the country of the performance of the contract;
iii) conduct related to a criminal organisation referred to in Article 2 of Council Framework Decision 2008/841/JHA of 24 October 2008 on the fight against organised crime;
iv) money laundering or terrorist financing within the meaning of Article 1(3), (4) and (5) of Directive (EU) 2015/849 of the European Parliament and of the Council of 20 May 2015 on the prevention of the use of the financial system for the purposes of money laundering or terrorist financing, amending Regulation (EU) No 648/2012 of the European Parliament and of the Council, and repealing Directive 2005/60/EC of the European Parliament and of the Council and Commission Directive 2006/70/EC (Text with EEA relevance) of the European Parliament and of the Council;
v) terrorist-related offences or offences linked to terrorist activities, as defined in Articles 1 and 3 of Council Framework Decision of 13 June 2002 on combating terrorism, respectively, or inciting or aiding or abetting or attempting to commit such offences, as referred to in Article 4 of that Framework Decision;
vi) child labour or other forms of trafficking in human beings as defined in Article 2 of Directive 2011/36/EU of the European Parliament and of the Council of 5 April 2011 on preventing and combating trafficking in human beings and protecting its victims, and replacing Council Framework Decision 2002/629/JHA;
e) the economic operator has shown significant deficiencies in complying with main obligations in the performance of a contract financed by the EU, which has led to the early termination of a legal commitment or to the application of liquidated damages or other contractual penalties or which has been discovered following checks and audits or investigations by an authorising officer, OLAF or the Court of Auditors;
f) it has been established by a final judgment or final administrative decision that the economic operator has committed an irregularity within the meaning of Article 1(2) of Council Regulation (EC, Euratom) No 2988/95 of 18 December 1995 on the protection of the European Communities financial interests.
g) it has been established by a final judgment or final administrative decision that the person or entity has created an entity under a different jurisdiction with the intent to circumvent fiscal, social or any other legal obligations of mandatory application in the jurisdiction of its registered office, central administration or principal place of business.
h) it has been established by a final judgment or final administrative decision that an entity has been created with the intent provided for in point (g).
Point a) does not apply to the purchase of supplies on particularly advantageous terms either from a supplier that is definitively winding up its business activities or from liquidators of an insolvency procedure, an arrangement with creditors, or a similar procedure under EU or national law.
In cases referred to in points c), d), f), g) and h) in the absence of a final judgment or a final administrative decision, or in the case referred to in point e), the contracting authority must exclude an economic operator on the basis of a preliminary classification in law having regard to established facts or other findings contained in the recommendation of the EDES panel. The EDES panel ensures a centralised assessment of those situations after giving the economic operator the opportunity to submit its observations. In indirect management, where applicable according to the correspondent financing or contribution agreement, the contracting authority/entrusted entity will transmit the information to the European Commission and the European Commission may refer the case to the EDES panel.
The contracting authority must exclude the economic operator where:
- a natural or legal person who is member of the administrative, management or supervisory body or has power of representation, decision or control on the economic operator is in a situation listed in points c) to h);
- a natural or legal person that assumes unlimited liability for the debts of that economic operator is in a situation listed in points a) or b);
- a natural or legal person who is essential for the award or for the implementation of the legal commitment and is in a situation referred to in point c) to h).
The contracting authority must not exclude an economic operator where i) it can demonstrate that adequate measureshave been adopted which ensure its reliability, except in the cases listed in point d); ii) it is indispensable for the continuity of the service for a limited duration and pending the adoption of remedial measures; iii) where the exclusion would be disproportionate.
The exclusion system and the new requirements to promote good tax governance
With reference to taxation avoidance and money laundering, the following exclusion criteria apply:
1. breach of obligations relating to the payment of taxes or social security contributions in accordance with the applicable law (point (b) above);
2. involvement in money laundering or terrorism financing as defined in Directive (EU) 2015/849 (point (d)(iv) above);
3. creation of an entity to circumvent tax, social or other legal obligations (empty shell company) (points (g) and (h) above).
For the first case (breach of obligations relating to taxes or social security), a final judgement or final administrative decision is required in order to exclude an entity. For the second (involvement in money laundering or terrorism financing) and the third case (creation of an entity to circumvent tax, social or other legal obligations), the authorising officer can bring the case before the EDES panel (see Section 18.104.22.168.) at any moment, on the basis of established facts and findings brought to its attention.
Evidence to be provided
Candidates, tenderers and participants are obliged to declare that they are not in one of the exclusion grounds mentioned above through a signed declaration on honour (see Section 22.214.171.124.3.).
Where it is necessary to ensure the proper conduct of the procedure and there is a risk that the declaration may contain false or distorted data, the authorising officer should verify the reliability of the information provided in the declaration on honour by requesting appropriate evidence. Such verification should in particular be undertaken if the authorising officer becomes aware of concrete signs or indications (such as press reports) that put into question the information provided in the declaration. Authorising officers should notably pay attention in this regard if the participant is incorporated or established in a jurisdiction considered by the EU as non-cooperative for tax purposes.
· For the purpose of non-payment of taxes, a recent certificate by the competent authority of the State concerned may be accepted as satisfactory.
· For the purpose of creation of an entity to circumvent tax, social or other legal obligations, the authorising officer may accept as satisfactory evidence a recent extract from the judicial record or, failing that, an equivalent document issued by a judicial or administrative authority in the country of establishment demonstrating that those requirements are satisfied. Particular attention should be paid in the case that the information cannot be obtained because this includes a condition of confidentiality or when the information reveals that specific tax clearances are being applied. To the extent possible this information should be analysed in conjunction with the situation of the jurisdiction as regard the EU list of non-cooperative jurisdictions.
Under the Financial Regulation, participants also have the obligation to disclose their beneficial ownership structure upon request of the contracting authority.
If the result of this analysis confirms that the participant/recipient may be in a ground for exclusion, the authorising officer must submit the case to the EDES panel.
In the context of ongoing grant or procurement award procedures, the authorising officer may ask that the case is treated by the EDES panel as a matter of priority.
126.96.36.199.2. Rejection from a given procedure
The contracting authority must reject from a given award procedure a candidate, tenderer or applicant who:
a) is in one of the exclusion situations established under Section 188.8.131.52.1.;
b) has misrepresented the information required by the contracting authority as a condition for participating in the procedure or has failed to supply that information;
c) was previously involved in the preparation of procurement documents used in the award procedure where this entails a breach of the principle of equality of treatment, including distortion of competition that cannot be remedied otherwise.
In cases under (a), if the contracting authority becomes aware of a situation of exclusion where a recommendation of the EDES panel is required in accordance with Section 184.108.40.206.1., it will immediately seize the EDES panel. The evaluation will not be suspended, except in procurement restricted procedures at shortlisting stage (in this case the establishment of the shortlist must be suspended until a decision on the rejection is taken). If the contract is to be awarded to the entity/person concerned by the situation of exclusion, the award of the contract will be suspended until the EDES panel has issued its recommendation. Where necessary, the contracting authority may ask all tenderers to extend the period of validity of the offers accordingly. If the situation of exclusion is confirmed in the recommendation of the EDES panel, the relevant entity/person must be rejected from the given procedure according to Section 220.127.116.11.4.) and the procedure can resume with an award to the second tenderer on the list or, if necessary, cancellation. In parallel, after the recommendation of the EDES panel, a decision of exclusion must be taken according to Section 18.104.22.168.1.
If the rejection is justified by the fact that the participant is already included at exclusion level in the EDES, the decision of rejection must be taken directly without any contradictory procedure with the participant.
In cases under (b) and (c), before taking the decision to reject a tenderer, candidate or applicant from a given procedure, the contracting authority must give the economic operator the opportunity to submit its observations (right to be heard) and to prove, in case of (c) that its involvement in the preparation of documents used in the award procedure does not breach the principle of equal treatment, including distortion of competition.
These grounds of rejection may have serious consequences for the economic operator concerned as they may also qualify as grave professional misconduct according to Section 22.214.171.124.1. and result in a decision of exclusion. In this case, after or in parallel to the decision of rejection, the contracting authority must refer the case to the EDES panel according to Section 126.96.36.199.1.
188.8.131.52.3. Evidence to be provided
A) Declaration on honour
Candidates, tenderers and applicants must sign a declaration together with their applications, certifying that they do not fall into any of the exclusion situations cited under Sections 184.108.40.206.1. and 220.127.116.11.2. and, where applicable, that they have taken adequate measures to remedy the situation. For calls for proposals, the obligation to fill and sign the declaration on honour (PRAG Annex A14b) applies to all applicants, co-applicants and affiliated entities.
They must also declare whether i) natural and legal persons that are members of the administrative, management or supervisory body or that have powers of representation, decision or control and; ii) beneficial owners as referred to in Article 3 of Directive (EU) No. 2015/849 are in one of the situations under points c) to g) of Section 18.104.22.168.1.
Where the candidate or tenderer intends to rely on capacity providing entities or subcontractor(s), he/she must provide the same declaration signed by this/these entity(ies).
The contracting authority must accept the European single procurement document (ESPD) as an alternative to the declaration. The declaration must not be requested when it has already been submitted for the purposes of another award procedure, provided the situation has not changed and that the time elapsed does not exceed one year.
For procurement contracts with a value of EUR 15 000 or less, the contracting authority may waive the requirement to submit a declaration depending on its risk assessment. For grants of EUR 15 000 or less, no declaration on honour must be required. The obligation to submit a declaration on honour does not apply to entities implementing European Union funds in indirect management.
B) Documentary evidence
When specifically requested by the contracting authority and where this is necessary to ensure the proper conduct of the procedure, candidates and tenderers, the entity on whose capacity they intend to rely or subcontractors must provide:
a) appropriate evidence that they are not in a situation of exclusion;
b) information on natural or legal persons that are members of its administrative, management or supervisory body or that have powers of representation, decision or control and appropriate evidence that one or several of these persons are not in one of the exclusion situations listed in points c) to h);
c) appropriate evidence that natural or legal persons that assume unlimited liability for the debts of that economic operator is not in a situation listed in points a) or b) of Section 22.214.171.124.1.
For procurement contracts with a value equal or greater than the international thresholds (services ≥ EUR 300 000, supply ≥ EUR 300 000, works ≥ EUR 5 000 000), before the notification of potential award, tenderer(s) to which the contract is to be awarded (including consortium members) must supply evidence that they do not fall into the exclusion situations, unless such evidence has already been submitted earlier in the procedure.
In restricted and open procedures, these supporting documents will be requested from tenderers at evaluation stage and verified by the contracting authority before the award of the contract to the potential successful tenderer(s). In addition, the tenderers and candidates must certify that the situation has not altered since the date of issue of the evidence.
The contracting authority must waive the obligation to submit documentary evidence: (i) if it can access it on a national database free of charge; or, (ii) if such evidence has already been submitted to it for the purposes of another procedure and provided that any submitted documents are still valid and that the time that has elapsed since the issuing date of the documents does not exceed one year; (iii) if it recognises that there is a material impossibility to provide such evidence. The obligation to submit documentary evidence does not apply to entrusted entities.
For grants, no documentary evidence has to be submitted unless specifically requested by the contracting authority.
As satisfactory evidence that the candidate or tenderer is not in one of the situations described in:
- a), c), d), f), g) or h) of Section 126.96.36.199.1. (exclusion criteria from participation in procurement procedures), the contracting authority may accept a recent extract from the judicial record or, failing that, a recent equivalent document issued by a judicial or administrative authority in the country of establishment showing that the requirements are satisfied;
- a) or b) of Section 188.8.131.52.1. (exclusion criteria from participation in procurement procedures), the contracting authority will accept a recent certificate issued by the competent authority of the State concerned. Where the certificate is not issued in the country concerned it may be replaced by a sworn/solemn statement made before a judicial authority or notary or, failing that, a solemn statement made before an administrative authority or a qualified professional body in the country of establishment.
The documents may be originals or copies. However, originals must be made available to the contracting authority upon request. The date of issuing of the documents provided must be no earlier than one year before the date of submission of the tender. If the supporting documents are not written in one of the official languages of the European Union, a translation into the language of the procedure must be attached. Where the documents are in an official language of the European Union other than the one of the procedure, they have to be accepted. However, it is strongly recommended that a translation into the language of the procedure be provided, in order to facilitate the evaluation of the documents.
C) Check of the EDES database
During the evaluation procedure and at the latest before taking the award decision, the contracting authority must check whether any of the entities involved (i.e. candidates or tenderers, including all consortium members, indicated subcontractors and capacity providing entities) have been recorded in EDES. Where the contracting authority limits the number of candidates invited to submit a tender, e.g. in a restricted procedure, such checks must be conducted before the candidates are selected. For restricted procedures in calls for proposals, such checks must be conducted once applicants are provisionally selected or placed in a reserve list, during the final eligibility checks before the award of the contract.
The EDES is a database, containing restricted information on cases of early detection, exclusion and/or financial penalties. The EDES replaced as from 1st of January 2016 the early warning system and the central exclusion database.
The purpose of this system is to facilitate:
- the early detection of risks threatening the European Union’s financial interests following information provided by OLAF, authorising officers of the Commission, European offices, executive agencies, other Union institutions, a body or person entrusted with implementation of Common Foreign and Security Policy actions or entities implementing the EU budget under indirect and shared management;
- the exclusion of economic operators which are in one of the situations of exclusion listed in point 184.108.40.206.1.;
- the imposition of a financial penalty on an economic operator in accordance with Article 138 FR.
and to encourage the contracting authorities in these various situations to take the appropriate measures provided in the Union legislation to protect the financial interest of the European Union.
The contracting authority cannot conclude a contract with entities that are recorded in EDES at exclusion level. If any of the parties involved are recorded at the early detection level, the signature of the contract might be conditioned upon measures to strengthen monitoring to be applied during the execution of the contract and payments.
The contracting authority must notify the third party in question of its registration in the EDES database. For early detection cases, such notification is deferrable in exceptional circumstances, where there are compelling legitimate grounds to preserve the confidentiality of an investigation or of national judicial proceedings, until such compelling legitimate grounds to preserve the confidentiality cease to exist.
220.127.116.11.4. Consequences of an exclusion/rejection situation in an award procedure
When the contracting authority takes the decision to reject a candidate/tenderer or applicant from an award procedure because it is in an exclusion situation established according to Section 18.104.22.168.1. or because it is in another situation of rejection (Section 22.214.171.124.2., points b) and c)), it must notify it to the economic operator. Depending on the reason of rejection, the notification will specify that the request to participate/tender/application is unsuitable (for the situations under Section 126.96.36.199.2., point a)) or irregular (for the situations under Section 188.8.131.52.2., points b) and c)).
If a subcontractor or an entity on whose capacity the candidate or tenderer intends to rely is in an exclusion situation, the contracting authority must require their replacement.
184.108.40.206.5. Consequences of fraud and irregularities in an award procedure
Where the award procedure has been subject to irregularities or fraud, the authorising officer responsible must suspend the procedure and may take any necessary measures, including the cancellation of the procedure. The authorising officer responsible must inform the OLAF immediately of suspected cases of fraud.
Where, after the award, the award procedure proves to have been subject to irregularities or fraud, the authorising officer responsible may:
(a) refuse to sign the legal commitment;
(b) suspend payments;
(c) suspend the implementation of the legal commitment;
(d) where appropriate, terminate the legal commitment in whole or with regard to one or more recipients.
2.6.11. Selection and award criteria
220.127.116.11. General principles
The contracting authorities must draw up clear and non-discriminatory selection criteria for the purpose of assessing that the candidate/tenderer has sufficient financial, economic, technical and professional capacity to implement the tasks of the contract. The chosen criteria must be proportionate and may not go beyond the scope of the contract.
For contracts divided into lots, different minimum levels of capacity can be set for each lot. Additional levels of capacity can be added for the case several lots are awarded to the same tenderer.
It is important to seek to enhance the quality of short-listed organisations/consortia rather than merely seeking to shortlist organisations/consortia that have the biggest project references, e.g. reference to the number of projects presented above the value of the contract being procured should be avoided. Rather, the pertinence of experience should be advantaged, e.g. in the technical area and/or in similar environments.
For the international restricted procedure the contracting authority must shortlist a maximum of eight candidates (six in case of an international restricted procedure for works). The contracting authority will also publish criteria in addition to the financial, professional and technical ones. These additional criteria will only be used to reduce the shortlist to eight candidates (six for works). These criteria must therefore not be drafted in such a way that they would reduce competition too much. For example, a criterion such as ‘experience in the country’ is too restrictive and should be avoided.
The contract notice, additional information about the contract notice or the instructions to tenderers templates include examples of criteria to be used in the procedure. Below, examples of criteria not to be used
- requesting disproportionate annual turnover, number of personnel, number of previous projects, etc. as regards the amount of the contract;
- using imprecise terms such as ‘sufficient’, ‘major’, ‘relevant’ as they are too ambiguous.
- requesting a percentage of the personnel working in specific fields as this may be discriminatory for large companies;
- requesting technical experience relating to EU projects only, as this may in general be regarded as discriminatory;
- requesting prior experience in the partner country, unless specific justification is provided, as this could in general be regarded as discriminatory;
- requesting technical experience in an overly prescriptive manner that effectively restricts the number of eligible candidates to one or a few firms.
When deciding on the appropriate criteria, contracting authorities must consider whether compliance can be proved and should, for instance, consider what type of documentary evidence the tenderer may submit as proof.
The selection criteria must be specified in the contract notice/additional information about the contract notice/instructions to tenderers and applied by the contracting authority without modification unless a corrigendum has been published.
The contract notice must clarify how each selection criterion will be assessed in the case of application submitted by a consortium. For instance, some criteria aiming at assessing the financial and economic capacity might not be checked on the basis of aggregate values but are rather to be met by each member of a consortium.
The candidates/tenderers are asked to provide a declaration on honour and to indicate in the application form or tender submission form their economic, financial, professional and technical capacity in accordance with the selection criteria laid down in the tender documents. Previous experience that would have led to breach of contract and termination by a contracting authority must not be used as reference. This is also applicable concerning the previous experience of experts required under a fee-based service contract.
For service award procedures, the documentary evidence of the financial and economic capacity and the technical and professional capacity according to the selection criteria specified in the additional information about the contract notice (annex A5f) has to be provided at evaluation stage, upon request of the contracting authority.
For supply procedures, only successful tenderers have to supply documentary evidence supporting the information submitted in the tender before the award of the contract.
For works procedures however, the documentary evidence has to be submitted in accordance with the tender dossier.
When in doubt about the authenticity of the documents provided, the contracting authority should carry out additional checks and request additional documents.
For contracts with a value less than the international thresholds (services < EUR 300 000, supplies < EUR 300 000 and works < EUR 5 000 000), the contracting authority may, depending on its assessment of risks, decide not to require evidence of the legal, regulatory, financial, economic, technical and professional capacity of economic operators.
Where the contracting authority decides not to require evidence of the legal, regulatory, financial, economic, technical and professional capacity of economic operators, no pre-financing must be made except in duly justified cases.
Capacity-providing entities and subcontractors
A candidate/tenderer may, where appropriate and for a particular contract, rely on the capacity of other entities, regardless of the legal nature of the links that it has with them, to fulfil one or more selection criteria.
With regard to technical and professional criteria, an economic operator may only rely on the capacities of other entities where the latter will perform the works or services for which these capacities are required.
Where an economic operator relies on the capacities of other entities with regard to criteria relating to economic and financial capacity, the economic operator and those entities are jointly liable for the performance of the contract. If the candidate/tenderer relies on other entities it must prove to the contracting authority that it will have the necessary resources available to implement the contract, by producing a commitment by those entities to place such resources at its disposal. Such entities, for instance the parent company of the economic operator, must respect the same rules of eligibility, and notably that of nationality, that apply to the economic operator relying on them.
The contracting authority must verify whether the entities on whose capacity the economic operator intends to rely and the envisaged subcontractors, fulfil the relevant selection criteria. The data for these entities as concerns the relevant selection criterion must be included in the tender in a separate document. Proof of the capacity will also have to be furnished when requested by the contracting authority.
The contracting authority must require that the economic operator replace an entity or subcontractor who does not meet a relevant selection criterion.
The contracting authority may request information from the tenderer on any part of the contract that the tenderer intends to subcontract and on the identity of any subcontractors.
In the case of works contracts, service contracts and siting or installation operations in the context of a supply contract, the contracting authority may require that certain critical tasks be performed directly by the tenderer itself of, where the tender is submitted by a group of economic operators, a participant in the group.
The contracting authority must not demand that a group of economic operators have a legal form in order to submit a tender or request to participate, but the selected group may be required to adopt a legal form after it has been awarded the contract if this change is necessary for proper performance of the contract.
If the documentary evidence submitted is not written in one of the official languages of the European Union, a translation into the language of the procedure must be attached. Where the documents are in an official language of the European Union other than the one of the procedure, it is however strongly recommended to provide a translation into the language of the procedure, in order to facilitate the evaluation of the documents.
If the candidate/tenderer is unable to provide the evidence requested for some exceptional reason that the contracting authority finds to be justified, it may prove its capacity by any other means which the contracting authority considers appropriate (see also Section 2.9.3.).
If the tenderer submits a self-declaration/statement as documentary proof, the contracting authority reserves the right to ask for further documentary evidence.
18.104.22.168. Economic and financial capacity
- To ensure that economic operators possess the necessary economic and financial capacity to perform the contract, the contracting authority may require in particular that:
a. economic operators have a certain minimum yearly turnover, including a certain minimum turnover in the area covered by the contract;
b. economic operators provide information on their annual accounts showing ratios between assets and liability;
c. economic operators provide an appropriate level of professional risk indemnity insurance.
For the purposes of point (a), the minimum yearly turnover must not exceed two times the estimated annual contract value, except in duly justified cases linked to the nature of the purchase, which the contracting authority must explain in the procurement documents.
For the purposes of point (b), the contracting authority must explain the methods and criteria for such ratios in the procurement documents.
- In the case of dynamic purchasing systems, the maximum yearly turnover must be calculated on the basis of the expected maximum size of specific contracts to be awarded under that system.
The contracting authority must define in the procurement documents the evidence to be provided by an economic operator to demonstrate its economic and financial capacity. It may request in particular one or more of the following documents:
a. appropriate statements from banks or, where appropriate, evidence of relevant professional risk indemnity insurance;
b. financial statements or their extracts for a period equal to or less than the last 3 years for which accounts have been closed;
c. a statement of the economic operator’s overall turnover and, where appropriate, turnover in the area covered by the contract for a maximum of the last 3 financial years available.
If, for any valid reason, the economic operator is unable to provide the references requested by the contracting authority, it may prove its economic and financial capacity by any other document that the contracting authority considers appropriate.
22.214.171.124. Technical and professional capacity
The contracting authority must define in the procurement documents the evidence to be provided by an economic operator to demonstrate its technical and professional capacity. It may request one or more of the following documents:
a. for works, supplies requiring siting or installation operations or services, the educational and professional qualifications, skills, experience and expertise of the persons responsible for performance;
b. a list of the following, with a description providing sufficient details on their relevance to the selection criteria:
1. of the principal services provided and suppliesdelivered in the past 3 years, with the nature of the services, the sums, dates and clients, public or private, accompanied upon request by statements issued by the clients; where necessary in order to ensure an adequate level of competition, the contracting authority may indicate that evidence of relevant supplies or services delivered or performed more than 3 years before will be taken into account;
2. of the works carried out in the last 5 years, accompanied by certificates of satisfactory execution for the most important works; where necessary in order to ensure an adequate level of competition, the contracting authority may indicate that evidence of relevant works delivered or performed more than 5 years before will be taken into account;
c. a statement of the technical equipment, tools or plant available to the economic operator for performing a service or works contract;
d. a description of the technical facilities and means available to the economic operator to for ensuring quality, and a description of available study and research facilities;
e. a reference to the technicians or technical bodies available to the economic operator, whether or not belonging directly to it, especially those responsible for quality control;
f. in respect of supplies: samples, descriptions or authentic photographs or certificates drawn up by official quality control institutes or agencies of recognised competence attesting the conformity of the products clearly identified by references to technical specifications or standards;
g. for works or services, a statement of the average annual manpower and the number of managerial personnel of the economic operator for the last 3 years;
h. an indication of the supply chain management and tracking systems that the economic operator will be able to apply when performing the contract;
i. an indication of the environmental management measures that the economic operator will be able to apply when performing the contract.
Candidates/tenderers are allowed to refer either to projects completed within the reference period (although started earlier) or to projects not yet completed. Only the portion satisfactorily completed during the reference period (although started earlier) will be taken into consideration. This portion will have to be supported by documentary evidence (statement or certificate from the entity that awarded the contract or proof of final payment) also detailing its value.
If a candidate/tenderer has implemented the project in a consortium, the percentage that the candidate/tenderer has completed must be clear from the documentary evidence, together with a description of the nature of the services, supplies or works provided if the selection criteria relating to the pertinence of the experience have been used.
Where the supplies or services are complex or, exceptionally, are required for a special purpose, evidence of technical and professional capacity may be secured by means of a check carried out by the contracting authority or on its behalf by a competent official body of the country in which the economic operator is established, subject to that body’s agreement. Such checks must concern the supplier’s technical capacity and production capacity and, if necessary, its study and research facilities and quality control measures.
Where the contracting authority requires the provision of certificates drawn up by independent bodies attesting the compliance of the economic operator with certain quality assurance standards, including on accessibility for disabled persons, it must refer to quality assurance systems based on the relevant European standards series certified by accredited bodies. The contracting authority must also accept other evidence of equivalent quality assurance measures from an economic operator that has demonstrably no access to such certificates or has no possibility of obtaining such certificates within the relevant time-limits, for reasons that are not attributable to that economic operator and provided that the economic operator proves that the proposed quality assurance measures comply with the required quality assurance standards.
Where the contracting authority requires the provision of certificates drawn up by independent bodies attesting that the economic operator complies with certain environmental management systems or standards, it must refer to the European Union Eco-Management and Audit Scheme or to other environmental management systems as recognised in accordance with Article 45 of Regulation (EC) No 1221/2009 of the European Parliament and of the Council of 25 November 2009 on the voluntary participation by organisations in a Community eco-management and audit scheme (EMAS), repealing Regulation (EC) No 761/2001 and Commission Decisions 2001/681/EC and 2006/193/EC or other environmental management standards based on the relevant European Union or international standards by accredited bodies. Where an economic operator had demonstrably no access to such certificates, or no possibility of obtaining them within the relevant time limits for reasons that are not attributable to that economic operator, the contracting authority must also accept other evidence of environmental management measures, provided that the economic operator proves that these measures are equivalent to those required under the applicable environmental management system or standard.
A contracting authority may conclude that an economic operator does not possess the required professional capacity to perform the contract to an appropriate quality standard where the contracting authority has established that the economic operator has conflicting interests that may negatively affect its performance.
126.96.36.199. Award criteria
Contracts are awarded on the basis of the most economically advantageous tender established for the call for tender in one of the following two ways:
o under the best price-quality ratio, in which case the contracting authority takes into account the price and other quality criteria linked to the subject matter of the contract, and apply a weighting formula;
Quality criteria may include elements such as technical merit, aesthetic and functional characteristics, accessibility, design for all users, social, environmental and innovative characteristics, production, provision and trading process and any other specific process at any stage of their life cycle, organisation of the -personnel assigned to performing the contract, after-sales service, technical assistance or delivery conditions such as delivery date, delivery process and delivery period or period of completion.
The contracting authority may lay down minimum levels of quality. Tenders below those levels of quality must be rejected.
o under the lowest price, provided the tender satisfies the minimum requirements laid down.
The criteria must be precise, non-discriminatory and not prejudicial to fair competition.
Abnormally low tenders: see Sections 3.4.4. for services, 188.8.131.52. for supplies and 184.108.40.206 for works.
220.127.116.11. Distinction between selection and award criteria
In the tender procedure, a firm distinction between selection and award criteria should be made, in particular when preparing the tender specifications and when tenders are evaluated in order to avoid any legal uncertainty with regard to the conditions of the award of the contract.
Confusing selection and award criteria constitutes a procedural defect that may result in the annulation of the procedure in case of dispute. Indeed, as confirmed by the case law, this confusion could favour certain economic operators at the detriment of others regardless of the quality of their technical offer.
At the stage of evaluation of award criteria, the contracting authority can no longer review the capacity or ability of the tenderers as already assessed during the selection phase. Only the technical and financial offers must be evaluated at this stage by reference to the award criteria which are to be directly related to the tender specifications in order to assess the intrinsic quality of the offer and which may not relate to the capacity of the tenderer.
In this regard, particular attention should be paid when defining award criteria for key experts in order to avoid overlapping and double evaluation with the requirements related to personnel (professional capacity) in the selection criteria.
2.6.12. Procedure with a suspensive clause
In duly justified cases and via a prior approval, tender or grant award procedures may be published with a suspensive clause in the two following cases:
a) before a financing decision is adopted or
b) before a financing agreement between the European Commission and the partner country is signed.
PROGRAMMES FUNDED BY THE GENERAL BUDGET OF THE EU
Suspensive clauses are rarely used because the EU financial rules generally require the adoption of a financing decision by the European Commission (or, where relevant, conclusion of a financing agreement) before a call for tenders or proposals is launched. However, exceptional circumstances may arise that give grounds for departing from the usual decision-making process. As a rule, circumstances justifying the use of a suspensive clause are outside the European Commission’s control. Note that:
- the use of the suspensive clause after the financing decision is adopted but before the financing agreement is signed may be considered in most cases as being outside the European Commission’s control, as the entry into force of such agreement depends on the will of a third party (i.e. the partner country);
- the use of the suspensive clause before a financing decision is adopted requires good reasons why there are objective circumstances leading to the use of such clause and it is impossible to wait for the decision to be adopted. These reasons must be duly reflected in the request for prior approval. There are some cases where a suspensive clause is justified in order to make efficient use of procedures, e.g. by having the option of launching a call for proposals covering two budgetary years.
PROGRAMMES FUNDED BY THE EDF
Note that the use of this clause before the adoption of the financing decision is expressly authorised for the EDF (see Article 19b of Annex IV to the Cotonou Agreement) in all duly substantiated cases in order to ensure early project start-up.
The actual award and signing of contracts following a call/a negotiated procedure launched with a suspensive clause depends on the adoption of the financing decision and/or, where applicable, the conclusion of the financing agreement.
Because of its implications, the contract notice or the guidelines for grant applicants/invitation to negotiate must explicitly state that there is a suspensive clause.
The procedure will invariably be cancelled if the European Commission’s decision-making procedure is not completed or the financing agreement is not signed.
2.6.13. Cancellation of procurement procedures
According to Article 171 FR the contracting authority may, before the contract is signed, cancel the procedure without the candidates or tenderers being entitled to claim any compensation. If the procedure is divided into lots, single lots may be cancelled.
Cancellation may occur, for example, if:
- the tender procedure has been unsuccessful, i.e. no suitable, qualitatively or financially acceptable tender has been received or there is no valid response at all;
- the economic or technical data of the project have fundamentally changed;
- exceptional circumstances or a force majeure render normal performance of the contract impossible;
- all technically acceptable tenders exceed the financial resources available;
- there have been breach of obligations, irregularities or frauds in the procedure, in particular where these have prevented fair competition;
- the award is not in compliance with sound financial management i.e. does not obey the principles of economy, efficiency and effectiveness (e.g. the price proposed by the tenderer to whom the contract is to be awarded bears no relation to the market price).
If a procurement procedure is cancelled, all tenderers having submitted a request to participate or a tender must be notified in writing and as soon as possible of the reasons for the cancellation. If a contract notice was published, a cancellation notice must be published. See annex A11e for additional guidance.
After cancelling a tender procedure, the contracting authority may decide:
- to launch a new tender procedure;
- to re-launch the tender procedure using the same reference as the original call.
- to open negotiations with one or more tenderers who participated in the tender procedure and who meet the selection criteria,provided that the original terms of the contract have not been substantially altered (this option is not available if the procedure was cancelled because of irregularities which might have prevented fair competition);
- not to award the contract.
Whatever the case, the final decision is taken by the contracting authority (with the prior agreement of the European Commission for contracts awarded by the contracting authority under the ex ante system). In no event will the contracting authority be liable for any damages whatsoever including, without limitation, damages for loss of profits in any way connected with the cancellation of a tender even if the contracting authority has been advised of the possibility of damages. The publication of a contract notice or the issuance of an invitation to negotiate does not commit the contracting authority to implement the programme or project announced.
The responsibility for cancelling a tender procedure lies with the competent authority of the European Commission in compliance with internal procedures.
INDIRECT MANAGEMENT WITH EX ANTE CONTROLS
The responsibility for cancelling a tender procedure lies with the contracting authority, with the prior authorisation of the European Commission.
INDIRECT MANAGEMENT WITH EX POST CONTROLS
The responsibility for cancelling a tender lies with the contracting authority. No prior authorisation from the European Commission is required.
2.7. Contract value
To the extent possible and for the purpose of simplification of the financial administration, small contracts should be avoided. Therefore, it should be avoided to split programmes unnecessarily into a series of small contracts.
2.8. Terms of reference and technical specifications
Terms of reference (for service contracts) and technical specifications (for supply and works contracts) give instructions and guidance to contractors to submit a tender that responds to all technical and administrative requirements, and later to serve as the contractor’s mandate during project implementation. The terms of reference or technical specifications are included in the tender dossier and will become an annex to the resulting contract.
Thorough preparation of the terms of reference or technical specifications is extremely important for the ultimate success of the project. It is important to ensure that the project has been properly conceived, that the work is carried out on schedule and that resources will not be wasted. Greater effort during project preparation will save time and money at later stages of the project cycle.
The terms of reference and the technical specifications must allow equal access for candidates and tenderers and must not have the effect of creating unjustified obstacles to competitive tendering. They must be clear and non-discriminatory, and proportionate to the objective and/or the budget for the project. They specify what is required of the service, supply or work to be purchased. They also specify the minimum requirements whose non-compliance entails the rejection of the tender. The specifications include:
a) quality levels;
b) environmental and climate performance (e.g. care is taken to ensure that specifications take into consideration the latest developments on the matter);
c) for purchases intended for use by natural persons, design for all users requirements (accessibility for disabled people, environmental issues, etc. in accordance with the latest developments), excepted in duly justified cases;
d) levels of and procedures for conformity assessment, including environmental aspects;
e) performance or use of the supply;
f) safety or dimensions, including, for supplies, the sales name and user instructions, and, for all contracts, terminology, symbols, testing and test methods, packaging, marking and labelling (including environmental labelling, e.g. on energy consumption), production processes and methods.
Make the terms of reference and technical specifications clear and concise. Technical specifications may not point to particular brands and types, and they may not limit competition by being too specific.
The terms of reference or technical specifications are drafted by the contracting authority. Where the European Commission is the contracting authority, the standard practice is to consult and obtain the approval of the partner country and, where appropriate, of other parties involved, on the terms of reference or technical specifications, in order to strengthen both ownership and quality.
Given the technical complexity of many contracts, preparing the tender dossier — particularly the technical specifications / terms of reference — may require the assistance of one or more external technical specialist(s). Each such specialist must sign a declaration of objectivity and confidentiality (see Annex A3).
Once the tender dossiers have been finalised, the tender procedure may be launched as soon as possible. The terms of reference or technical specifications contained in a tender dossier — the basis for the project work-plan — must reflect the situation at the time of project start-up to avoid considerable effort being spent on re-designing the project during the inception period.
The general structure of terms of reference for services reflects the principles of project cycle management. The aim is to ensure that all issues are covered systematically and that key factors related to clarity of objectives and sustainability are thoroughly examined. Annex B8 contains skeleton terms of reference that show the minimum details to be provided within each of these section headings.
For fee-based service contracts, the sections in the terms of reference include the allocated budget headings. They consist of the fees, which are the only part of the budget that is subject to competition (except if a component with global price is planned, which is also subject to competition). The services are provided on the basis of a fixed daily fee rate for the days the experts work under the contract. The budget also contains a fixed provision for incidental expenditure that covers all current expenses incurred by the contractor that are not included in the fees. The section on incidental expenditure must specify the type of expenditure that can be included in the expenditure verification of the contract. The terms of reference also make provision for expenditure verification. The budgets for incidental expenditure and expenditure verification are fixed by the contracting authority. They must meet the requirements of the terms of reference and must be carefully estimated. Unless exceptionally specified in the terms of reference, the use of the allocated provision for incidental expenditures does not require a prior authorisation by the contracting authority.
For global price service contracts, the terms of reference should clearly indicate output(s) expected. The contractor must provide a given product. The technical and operational means by which it achieves the specified outcome are irrelevant. These are, therefore, lump-sum (global-price) contracts and the contractor will be paid only if the specified outcome is achieved. Therefore, terms of reference should describe precisely the output(s) expected. Please note that global price contracts do not entail any reimbursable expenses/incidental expenditure and are not subject to an expenditure verification.
The terms of reference and the technical specifications may not be disclosed to any third party and must be kept confidential until they are made available to the tenderers simultaneously as part of the procedure.
2.9. The evaluation committee
These instructions apply to all procedures governed by the PRAG including, when the value of the specific contract is equal to or above EUR 300 000 , the evaluation of offers submitted in reply to requests for services under framework contracts with reopening of competition managed by DG INTPA and under framework contracts managed by other DGs whenever DG INTPA is using them.
2.9.1. Appointment and composition
Requests to participate/tenders are opened and evaluated by an evaluation committee formally and promptly appointed by the contracting authority comprising a non-voting chairperson, a non-voting secretary and an odd number of voting members (the evaluators). In case of eSubmission there will be an opening and evaluation committee for the tender opening sessions and evaluation sessions. It is recommended that the opening committee is made up of the same members as the evaluation committee.
Although Art 150 FR exempts Delegations from ensuring a hierarchical separation between members of evaluation committees, the hierarchical separation amongst voting members should in principle be applied whenever possible. In order to ensure an appropriate segregation of duties, cumulating the role of authorising officer with that of any member of the evaluation committee must be avoided. If appropriate, on a case-by-case basis, the chairperson may also act as secretary, in particular during periods of limited resources in terms of staff and internal expertise.
There must be a minimum of three evaluators for all procedures except for calls for tenders for works above EUR 5 000 000, which require a minimum of five of them.
Evaluators must be provided with detailed information regarding the planned timetable and the workload that the evaluation implies.
The contracting authority must make sure that evaluators are available during the scheduled evaluation period. The contracting authority will appoint a replacement evaluator for each procedure to prevent delays in case of unavailability.
Every member must have reasonable command of the language in which the tenders are submitted. Evaluators must have the technical and administrative ability to give an informed opinion on the tenders.
Although observers are not part of the evaluation committee, they may attend the sessions of the committee if appointed by the responsible authorising officer. They shall only intervene in the debates at the request of the evaluators or the chairperson.
Members of the evaluation committee (i.e. the chairperson, the secretary and the evaluators) are appointed on a personal basis by the relevant European Commission services that also approve any observer. In eSubmission and only for procurement procedures, there are two types of committees: opening and evaluation committee. It is recommended that for each lot, the composition of both committees is the same. The opening and evaluation committees must be appointed in PPMT before the start of the opening session and evaluation of requests to participate/tenders.
For procurement procedures, a representative of the partner country may participate as appropriate, either as an evaluator or as an observer.
In grant procedures, a representative of the partner country may participate as an observer, or in the case of EDF, as an evaluator.
INDIRECT MANAGEMENT WITH EX ANTE CONTROLS
The members of the evaluation committee (i.e. the chairperson, the secretary and the evaluators) are appointed on a personal basis by the contracting authority and the appointments are submitted in due time to the European Commission in order to get its approval, together with the CVs of those members who are not staff of the Contracting Authority. If the European Commission does not object within 5 working days, the committee is deemed to be approved. The European Commission must be invited to appoint an observer and is encouraged to attend all or part of the meetings. Independent experts recruited under service contracts may only attend as observers. Attendance by other observers requires prior authorisation by the European Commission.
INDIRECT MANAGEMENT WITH EX POST CONTROLS
The members of the evaluation committee (i.e. the chairperson, the secretary and the evaluators) are appointed on a personal basis by the relevant services, which also approve any observers. Independent experts recruited under service contracts may only attend as observers.
Evaluation committee members must attend all meetings. Any absence must be recorded and explained in the evaluation report. The only exception is the opening session meeting in case of eSubmission, whereby the technical opening can be done by the chair and secretary on behalf of the opening committee.
All evaluators have equal voting rights.
An evaluation committee must be established for all procurement procedures, with the exception of the single tender one (less than or equal to EUR 20 000) and the cases of negotiated procedure mentioned under Section 2.6.8. However, in case of a negotiated procedure using eSubmission, it is recommended to appoint an evaluation committee to allow the evaluation committee members to access the offers.
For grants procedures, see Section 6.5.7. and Section 6.4.2.
For consultation procedures under a framework contract, the guidelines of that specific framework contract should be followed. In case no such guidelines are set, the present rules and Section 3.5.1. apply.
2.9.2. Impartiality and confidentiality
All members of the evaluation committee and any observers must sign a declaration of impartiality and confidentiality (see Annex A4) prior to carrying out any tasks related to the evaluation. Any evaluation committee member or observer who has or might have an actual or potential conflict of interest with any tenderer or applicant must declare it and immediately withdraw from the evaluation committee.
There is a conflict of interests where the impartial and objective exercise of the functions of a financial actor or other person is compromised for reasons involving family, emotional life, political or national affinity, economic interest or any other direct or indirect personal interest (see in detail Section 18.104.22.168.). Should the conflict of interests be proven, the member or observer will be excluded from participating further in any capacity in the evaluation meetings.
Acts likely to be affected by a conflict of interest may, inter alia, take one of the following forms:
(a) granting oneself or others unjustified direct or indirect advantages;
(b) refusing to grant a beneficiary the rights or advantages to which that beneficiary is entitled;
(c) committing undue or wrongful acts or failing to carry out acts that are mandatory.
A conflict of interest must be presumed to exist if an applicant, candidate or tenderer is a member of staff covered by the EU Staff Regulations, unless her/his participation in the procedure has been authorised in advance by his superior.
The chairperson of the evaluation committee decides whether the evaluation process must be restarted. That decision must be recorded and reasons given in the evaluation report.
During the grant award procedure or during the procurement procedure, all contacts between the contracting authority and candidates, applicants or tenderers must be transparent and ensure equal treatment. Those contacts must not lead to any amendment to the conditions of the contract or the terms of the original tender or call for proposal.
No information about the examination, clarification, or evaluation of tenders, or proposals, or decisions about the award of a contract, may be disclosed before the evaluation report is approved by the contracting authority (and by the European Commission in indirect ex ante management).
Any attempt by a tenderer, candidate or applicant to influence the process in any way (whether by making contact with members of the evaluation committee or otherwise) will result in the immediate exclusion of its tender or proposal from further consideration and might lead to the exclusion from future award procedures according to Section 22.214.171.124.1.
For supplies and works tenders, apart from the tender opening session, which is public, the proceedings of the evaluation committee are conducted in camera and are confidential. For service tenders and calls for proposals, the proceedings of the evaluation committee, from the opening of tenders/proposals to the conclusion of the work of the evaluation committee, are conducted in camera and are confidential.
In case of electronic opening through MyWorkplace and in duly justified cases, proceedings can be done using videoconference systems. The system to be used must ensure the confidentiality of the communication. Any electronic transfer of information needed under this modality must also guarantee its confidentiality.
If its law conflicts with the confidentiality required, then the contracting authority must obtain prior authorisation from the European Commission before disclosing any information.
In order to keep the proceedings confidential, attendance at evaluation committee meetings is strictly limited to the committee members and to any authorised observer (including assessors in the case of call for proposals).
Apart from the copies given to the assessors or EU delegations in call for proposals, the tenders or proposals must not leave the room/building in which the committee meetings take place before the conclusion of the work of the evaluation committee. They must be kept in a safe place when not in use.
2.9.3. Responsibilities of evaluation committee members
The chairperson is responsible for coordinating the evaluation process in accordance with the procedures in the practical guide and for ensuring its impartiality and transparency. The voting members of the evaluation committee have collective responsibility for decisions taken by the committee.
The secretary to the evaluation committee is responsible for carrying out all administrative tasks connected with the evaluation procedure. These include:
· circulating and collecting the declarations of impartiality and confidentiality;
· keeping the minutes of all meetings of the evaluation committee and the relevant records and documents;
· recording attendance at meetings and compiling the evaluation reports and their supporting annexes.
Any request for clarification requiring communication with the tenderers or applicants during the evaluation process must be conducted in writing. Copies of any such communication must be annexed to the evaluation report.
Where a participant fails to submit evidence or to make statements, the evaluation committee or, where appropriate, the authorising officer responsible shall, except in duly justified cases, ask the participant to provide the missing information or to clarify supporting documents, within a reasonable period of time. Such information, clarification or confirmation shall not substantially change application documents.
If an applicant, who was short-listed solely by relying on capacity providing entities, submits an offer where the organisation and methodology does not include a written commitment proving that these entities will, depending on the case, perform the work or services for which their capacities are required, and/or will be jointly liable for the performance of the contract, the evaluation committee shall ask the applicant to submit the requested evidence within a reasonable period of time. In case the applicant fails to do so, the evaluation committee shall not evaluate further the technical offer and shall reject it on those grounds.
If a tender or proposal infringes the formal requirements, the evaluation committee may use its discretion to decide whether it will still be considered during the rest of the evaluation process, while ensuring equal treatment of tenderers and applicants and upholding the principle of proportionality. Whatever the evaluation committee decides, this must be fully recorded and reasons given in the evaluation report.
Tenders or proposals should not be rejected in the following cases:
– If they are submitted in fewer than the number of copies required.
– If they are submitted in the correct format and provide the requisite information, but the document is organised incorrectly, e.g. information is provided in Section X of the form when it should have been provided in Section Y.
– If they have not been signed or contain a scanned signature (the signature can be requested later — but if it is not obtained or if the original document provided later is not exactly the same as the one received earlier, the tender must be rejected). If a tender guarantee is required, the tender must always contain an original of the tender guarantee. If only a copy of the tender guarantee is provided, the offer must be rejected.
– If candidates, applicants or tenderers can demonstrate that a required document is not available (e.g. under national law, duplicates of a given lost document cannot be obtained from the issuing administration), provided that an acceptable alternative is obtained (e.g. a declaration by the said administration that the document for the candidate, applicant or tenderer is still valid but no duplicate can be issued).
– In a service contract award procedure, tenderers who have not submitted all the documentary evidence regarding the exclusion or the selection criteria together with the tender. The necessary supporting documentation may be requested from the successful tenderer giving a reasonable time-limit.
– If information is made available to the evaluation committee that a key expert in a service tender procedure is no longer available. Instead, the evaluation committee should proceed with the evaluation of the original tender and the awarded tenderer will be given a chance to replace the key expert, see Section 126.96.36.199.
– The tender was sent in a single envelope rather than the two envelopes required, provided the envelope is sealed (the confidentiality of the tender has been preserved).
– The tender combines the technical part and the financial part or has not used the requested standard presentation.
The evaluation committee must be formed early enough to ensure that the members (and any observer appointed by the European Commission) are available in time to prepare and conduct the evaluation process. The tenders must be evaluated in time to allow the procedure to be completed within the validity period of the tenders. Extending the validity of tenders (see Section 2.9.5.) should be avoided. It is very important that all tenderers, whether successful or unsuccessful, receive information without delay.
Once the evaluation has been completed, the contracting authority is required to promptly approve the evaluation report and take the award decision in annex to the evaluation report. Any failure of the contracting authority to approve the evaluation report or to follow any recommendations and conclusions contained in the report must be subject to a detailed and reasoned written explanation.
2.9.5. Period of validity of tenders
Tenderers are bound by their tenders for the period specified in the letter of invitation to tender or in the tender dossier. This period must be sufficient to allow the contracting authority to examine tenders, approve the contract award proposal, notify the successful and unsuccessful tenderers and conclude the contract. The period of validity of tenders is fixed at 90 days from the deadline for the submission of tenders.
In exceptional cases with prior approval by the competent authority of the European Commission, before this period of validity expires, the contracting authority may ask the tenderers for a one-off, specific extension, which may not exceed 40 days.
The successful tenderer is bound by the tender for a further 60 days, irrespective of the date of notification (i.e. 90 (+ 40) + 60 days) of the award of the contract. This period can only be further extended when the contracting authority has referred a potential case of exclusion to the EDES panel mentioned in Section 2.6.11. and for the duration of the procedure before the EDES panel.
The contracting authority may also request a one-off extension of the validity of the offers submitted in response to request for services of framework contracts, before the original validity period has expired. For request for services below EUR 300 000, the period of validity can be extended for maximum 14 days. For request for services equal or above EUR 300 000 EUR, the period of validity can be extended for maximum 30 days.
2.10. Award of the contract (see also special features for service contracts in Chapter 3)
2.10.1. Notifying the successful tenderer and unsuccessful tenderers
DIRECT MANAGEMENT AND INDIRECT MANAGEMENT WITH EX POST CONTROLS
At the latest before taking the award decision, the contracting authority ensures:
· the submission of the original signed Declaration on honour on exclusion criteria and selection criteria
· the submission and admissibility of the documentary evidence on compliance with exclusion and selection criteria
· that the pre-selected tenderer, including all consortium members, subcontractors and capacity providing entities, if any, are not recorded in the EDES Database as an excluded economic operator nor in the lists entities subject to EU restrictive measures (see Sections 188.8.131.52. and 2.4.).
Before the tenders expire but after the award decision is taken and approved by the European Commission, the contracting authority notifies the successful tenderer in writing that its tender has been accepted and draws attention to any obvious arithmetical errors which were corrected as part of the evaluation.
INDIRECT MANAGEMENT WITH EX ANTE CONTROLS
In addition to the above, the European Commission must formally approve the award before the notification letter is sent.
Notification of the award to the successful tenderer automatically extends the validity of the successful tender for 60 days. If a contract is awarded under a financing agreement that is not concluded before the tender procedure is launched, the contracting authority must not notify the successful tenderer before the financing agreement is concluded.
The notification submitted to successful and unsuccessful tenderers must follow the templates referred to above.
If unsuccessful tenderers (i) are not in a situation of exclusion and fulfil the selection criteria, and (ii) request further information in writing, they may be given any information that is not confidential e.g. comments.
Article 170 FR lays down the content of the duty to state reasons pursuant to Article 296 TFEU, which the contracting authority has to discharge towards unsuccessful tenderers in a public procurement procedure.
The General Court ruled in this respect that a contracting authority fulfils its obligation to state reasons if it confines itself first to informing unsuccessful tenderers immediately of the reasons for the non-award of the contract (the non-award decision) and then subsequently, if expressly requested to do so by an unsuccessful tenderer who has submitted an admissible tender, provides the characteristics and relative advantages of the tender selected as well as the name of the successful tenderer.
The information should be provided within 15 days of receipt of a request in writing.
The contracting authority may suspend the signature of the contract for additional examination if this is justified by the requests or comments made by unsuccessful tenderers or by any other relevant information received during the standstill period.
In case of suspension, all tenderers have to be informed within 3 working days following the suspension decision, which automatically extends the validity of their tender for the appropriate period.
In case the evaluation committee revises its initial award recommendation on the basis of examination of information received in the standstill period and decides to award the contract to another tenderer, a further standstill period has to be respected in the notification of the revised award decision.
It is not necessary to apply the standstill period in the following cases:
1) when the value of the contract does not exceed the threshold of EUR 300 000 for service and supply contracts; and EUR 5 000 000 for works contracts;
2) in a procedure where only one tender has been submitted;
3) to specific contracts based on a framework contract;
4) to dynamic purchasing system;
5) in a simplified procedure under Section 2.6.4.
For grants, see Section 6.5.10.
2.10.2. Contract preparation and signature
When preparing the contract for signature, the contracting authority must proceed as follows:
– Prepare a contract dossier (if possible printed in double-sided copies) with the following structure:
a) explanatory note, using the format in Annex A6
b) copy of the financing decision/ agreement authorising the project
c) copy of the call (prior information notice (if applicable) and contract notice, additional information about the contract notice, tender opening record, evaluation report, guidelines for applicants, evaluation reports, list of grants to be awarded, and any other relevant information)
d) the originals of the proposed contract, which is based on the standard contract
e) special care should be taken to incorporate all minutes of pre-tender meetings, questions and answers, clarifications and corrigenda issued during the tender procedure, clarifications requests by the evaluation committee and replies received, and any minutes of negotiation meetings into the contract intended for signature. For grant contracts, include minutes of information sessions and published Q&A, if any.
The standard contract annexes including the general conditions, forms and other relevant documents must be reproduced unchanged in every contract. Only the special conditions (and the budget in the case of grants) need to be completed by the contracting authority.
INDIRECT MANAGEMENT WITH EX ANTE CONTROLS
The contracting authority sends the contract dossier to the delegation of the European Union for endorsement. The delegation signs all originals of the contract (and initials all pages of the special conditions and the budget) to endorse the EU financing and sends them back to the contracting authority. No endorsement by the delegation is required in certain cases referred to in the practical guide to procedures for programme estimates.
– Sign and date all originals of the contract and initial all pages of the special conditions and most relevant annexes including, for grants, the budget. In the case of grants, the contracts must be signed within 3 months from the date of notification of the evaluation results, save in exceptional cases, in particular for complex actions, calls using 2 budgetary years, calls for proposals launched in the context of facilities, multi-beneficiary contracts, or large number of proposals or where there have been delays attributable to the applicants.
– Send the signed originals of the contract to the successful tenderer/applicant, who must countersign them within 30 days of receipt.
– The tenderer or grant applicant keeps one original and returns the other(s) to the contracting authority together with any financial guarantee(s) required in the contract. If the successful tenderer/applicant fails to do this within the specified deadline or indicates at any stage that it is not willing or able to sign the contract, the tenderer/applicant cannot be awarded the contract. The contract preparation process must be restarted from step 1 with a new contract dossier prepared using the second-best tender (provided that that tender passed the technical threshold and is within the maximum budget available for the contract). In the case of grants, the contract will be offered to the highest-ranking applicant on the reserve list (see Section 184.108.40.206.).
On receipt of the signed original(s) from the successful tenderer/applicant, the contracting authority checks that it/they correspond(s) strictly to those sent originally.
INDIRECT MANAGEMENT WITH EX POST CONTROLS AND INDIRECT MANAGEMENT WITH EX ANTE CONTROLS
On receipt of the signed originals from the successful tenderer/applicant, the contracting authority checks that they correspond strictly to those sent originally. One original is kept and the other is sent to the delegation of the European Union.
The contracting authority checks that the natural person who signs the contract for the successful legal entity has the power to represent that legal entity.
The contract takes effect on the date of the last signature. The contract cannot cover earlier services or costs or enter into force before that date, unless in duly substantiated exceptional cases (see Section 6.3.8.).
Contracting authorities must retain all documentation relating to the award and execution of the contract for a minimum period of 7 years after payment of the balance and up to the date of prescription of any dispute under the law governing the contract.
2.10.3. Qualified electronic signature
Qualified Electronic Signature (QES) is a standard that comes from the eIDAS Regulation (Regulation (EU) No 910/2014) and is recognised as the digital equivalent to the handwritten (also known as ‘blue-ink’) signature in all EU Member States. QES can only be used by Authorising Officers who have obtained a qualified certificate for electronic signatures.
QES can be used as a solution for signing any document for which a handwritten signature is required. However, QES only applies to contracts managed outside OPSYS (since the digital signatures embedded into OPSYS are equivalent to handwritten signatures) and where both the applicable law and the dispute settlement forum are in an EU Member State.
Currently, QES cannot apply to the following legal commitments:
- Financing Agreements with partner countries.
Moreover, the QES feature is currently not available for indirect management by partner countries.
European Commission staff in Delegations belong from an IT point of view to the EEAS domain. Currently, the EEAS is not yet covered by the DG DIGIT qualified certificates for electronic signatures. Therefore, European Commission staff in Delegations will only be able to apply QES once the DG DIGIT certificates have been extended to the EEAS domain.
Before applying QES, the other party needs to be contacted to be informed about the use of QES and inquired whether they can also use it. In the signature process, there are three options, which are described below:
Option 1: Both parties can sign with QES
If both parties can sign electronically using QES, both parties will sign the same original. There will be no need to send paper documents by post or keep paper copies of the contract. The qualified electronic seal is automatically applied on all the documents registered in ARES.
Before sending the contract in pdf format to the contractor/beneficiary for signature, the European Commission, as the Contracting Authority, applies a qualified electronic seal on the pdf version of the contract. The European Commission electronic seal serves as evidence that an electronic document was issued by the Commission. This seal ensures the origin and integrity of the document. If someone tries to modify or compromise the integrity of a ‘sealed’ document, the seal will no longer be valid.
Before sending back the countersigned document to the Contracting Authority, it is recommended that the contractor/beneficiary check the signature and validity of the certificate. Once the contractor/beneficiary has checked the signature and validity of the certificate, the contractor/beneficiary can sign the document using QES and send it back to the European Commission via email.
Once the signed contract has been received, the European Commission checks if the content of the document is intact by verifying that the European Commission electronic seal has not been compromised and that the signature used is a valid QES.
Option 2 (hybrid): The Contracting Authority signs with QES, the contractor/beneficiary signs on paper
The process to apply the QES on behalf of the European Commission is the same as in Option 1.
As in Option 1, it is recommended that the contractor/beneficiary check the signature and validity of the certificate. After applying the necessary checks, the contractor/beneficiary should print two or three copies of the contract, initial each page, provide a handwritten signature and send one or two original(s) back to the Contracting Authority by post. For this purpose, the Contracting Authority should provide the contractor/beneficiary with a postal address.
Once the Contracting Authority has received the signed original paper copy by post, the Contracting Authority verifies the signature and the initials on the original. Then the Contracting Authority scans the signed original, certifies the scan’s conformity with the signed original and registers it in ARES. The new document must be linked to the previous ARES document containing the electronically signed version signed by the Contracting Authority.
The European Commission will keep the original signed document received by post, file and store it in the paper archives.
Option 3 (hybrid): The Contracting Authority signs on paper, the contractor/beneficiary signs with QES
The European Commission, as the Contracting Authority, will print out the contract and provide the two or three originals with a handwritten signature. One of the signed originals will be sent to the contractor/beneficiary. The Contracting Authority will keep an original for archiving purposes.
The contractor/beneficiary scans the contract, signs it with QES and sends it back by email.
The Contracting Authority checks if the document received by email containing the counter-party’s QES is intact and corresponds exactly to the signed original carrying the handwritten signature. The Contracting Authority also checks the validity of the QES from the contractor/beneficiary and registers the document in ARES. The new document must be linked to the previous ARES document containing the version signed by the Contracting Authority.
2.10.4. Publicising the award of the contract
Publishing award notices is an important legal obligation to comply with the principle of transparency.
In the case of procurement, after having received the countersigned contract from the successful tenderer, the contracting authority fills in the appropriate award notice template and sends it for publication (see Annex A11e).
The European Commission publishes the results of the tender procedure in the Official Journal (where applicable), and on the F&T portal.
If the award notice is also published locally, the contracting authority must arrange local publication directly.
An award notice is published if the value of the contract is above international thresholds (services > EUR 300 000, supplies > EUR 300 000, works > EUR 5 000 000), unless the contract was declared secret (and the secrecy is still relevant at the time of the award), or where the performance of the contract must be accompanied by special security measures, or where the protection of the essential interests of the EU or the partner country so requires, and where the publication of the award notice is deemed not to be appropriate. Please note that in case of restricted procedures, the list of selected candidates has to be given in Section VI.3 of the award notice.
Grants awarded in direct management from EUR 15 000 or more are published in the Financial Transparency System (FTS) (as extracted from ABAC) and also on the website of DG International Partnerships or Funding and Tender opportunities website (F&T portal) (as extracted from PROSPECT in case of call for proposals).
For grants contracts concluded in the framework of programme estimates, the relevant contracting authority shall prepare for publication a summary table based on the format in annex E11 to the practical guide (‘Publication of awards’) and i) publish it on its own Internet site and/or in any other appropriate media. If the relevant contracting authority does not publish on its own internet site, the EU Delegation should remind this obligation and if still not published, the EU Delegation should ii) immediately upload annex E11 in electronic form in Prospect (indirect management - publication only) and it is automatically sent for publication on the website of DG International Partnerships or Funding and Tender opportunities website (F&T portal).
Unsuccessful applicants should be informed without delay, and in any event no later than 15 calendar days after information has been sent to the successful applicants, in writing using the appropriate template (Annex E9).
They may receive, at their request, further information regarding the evaluation of their own proposal (any weakness, poor or insufficient description of the action, budget not matching the proposed activities, overall lack of consistency, etc.).
As a rule, all applicants should be notified the outcome of the evaluation of their applications within 6 months following the submission deadline of the full application.
2.11. Modifying contracts
For modifications of grant contracts, please refer also to Section 6.8.
For modifications of the composition of a consortium, please refer to Section 2.6.3.
Contracts may need to be modified if the circumstances of project implementation have changed since the contract was signed. However, the subject matter of the contract cannot be altered. Contracts can only be modified during their execution period. Any changes to the contract must be made officially by means of an administrative order or an addendum in accordance with the general conditions. Substantial changes to the contract must be made by means of an addendum. Such an addendum must be signed by the contracting parties (and, under an indirect ex ante management, approved and endorsed by the European Commission). The contractor may simply notify the contracting authority of changes of address, changes of bank account, and changes of auditor; this does not affect the contracting authority’s right to oppose the contractor’s/beneficiary’s choice of bank account or auditor. The same applies to clerical and administrative changes (contact persons, addresses, other contact details) that affect the contracting authority. Please note that any such notification sent by the contracting authority must request an acknowledgment of receipt by the contractor.
2.11.1. General principles
The following general principles must always be complied with:
Contracts cannot be amended after the end of the execution period. Note that the execution period of the contract is generally longer than the implementation period. For definition of the execution period of the contract and implementation period, see Annex A1a.
Any modification extending the period of implementation must be such that implementation and final payments can be completed before the expiry of the financing agreement (if any) under which the initial contract was financed.
A contract can be amended through an administrative order or an addendum under the conditions provided for in the contract itself. In exceptional circumstances, the amendment may have a retroactive effect provided the execution period has not expired but the contractor or grant beneficiary will only receive confirmation that the contracting authority has agreed to its request once the addendum has been duly signed or an administrative order has been issued. The contractor or grant beneficiary bears the financial risk of any costs incurred or goods and services provided before the addendum or administrative order has been issued, because the contracting authority has the right to refuse to sign the addendum or issue the order. Only once the addendum or order enters into force may the contractor or grant beneficiary claim payment for the costs, goods or services.
i. A contractor reports an urgent need to replace a key expert in March, which is accepted in an addendum in April. The amendment enters into force in April, acknowledging the change as from March. The contractor is only entitled to ask for payment for the work carried out in March after the entry into force of the amendment.
ii. In a grant, the implementation period expired in May and the grant beneficiary requests a one-month extension in June. If the contracting authority accepts the justification, including for the late request, and issues an addendum in July, the implementation period will be extended by 1 month from May to June. Costs incurred from May to June would only become eligible after the entry into force of the addendum in July.
No changes to the contract may alter the award conditions prevailing at the time the contract was awarded.
Following this logic, major changes, such as a fundamental change to the terms of reference or to the technical specifications, cannot be made by means of an addendum or an administrative order.
A request for changes to the contract must not automatically be accepted by the contracting authority. There must be justified reasons for modifying a contract. The contracting authority must examine the reasons given and reject requests that are not fully substantiated.
Modifications to contract amounts may entail changes for the financial guarantees linked to the contract.
The purpose of the addendum or administrative order must be closely connected with the nature of the project covered by the initial contract.
Requests for contract modifications must be made (by one contracting party to the other) in time to allow the addendum to be signed by both parties before the expiry of the execution period of the contract.
A contract, a framework contract or a specific contract under a framework contract can be modified by means of a simple addendum, with no need to undertake a negotiated procedure, in the following cases, provided the modification does not alter the subject matter of the contract or framework contract:
a) additional works, supplies or services by the original contractor that have become necessary, if the following cumulative conditions are fulfilled:
- they were not included in the initial procurement (i.e. not similar to the ones which were provided for in the initial contract);
- changing contractor is not feasible for technical reasons (e.g. compatibility with existing equipment, services or installations);
- changing contractor would cause substantial duplication of costs for the contracting authority;
- any increase in price, including the net cumulative value of successive modifications, does not exceed 50% of the initial contract value.
b) modifications needed because of circumstances which a diligent contracting authority could not foresee, provided that any increase in price does not exceed 50% of the initial contract value;
c) where the value of modifications is below the following thresholds (also known as the double de minimisrule):
(i) EUR 300 000 for service and supply contracts, and EUR 5 000 000 for works contracts; and
(ii) 10% of the initial contract value for service, and supply contracts, and 15% of the initial contract value for works contracts; and
(iii) the net cumulative value of several successive modifications does not exceed the thresholds under points i) and ii) above.
d) all other modifications which do not alter the minimum requirements of the initial procurement but the value of which is within the limits of c) (i) and (ii) above, unless such modification of value results from the strict application of the procurement documents or contractual provisions.
Cases under d) above concern minor changes which do not affect substantial aspects of the contract or the initial procurement procedure, or changes that are part of the economic life of the contractor. They entail administrative changes such as universal succession or concern administrative details (e.g. change of address, replacement of auditor).
Reference to the initial contract value does not take into account price revisions.
All kind of modifications listed above apply also to specific contracts under framework contracts. Moreover, cases under points a), b), c) and d) also apply to the framework contract itself.
Modifications consisting in the repetition of similar services or works, or in additional deliveries, require a negotiated procedure and must comply with some conditions (see Sections 220.127.116.11.e), 18.104.22.168.d), and 22.214.171.124.c) for contract-specific information about negotiated procedures and Sections 3.6., 4.7., and 5.7. for contract-specific information on changes to contracts).
2.11.2. . Preparing an addendum
The contracting authority drafts an addendum as follows:
1) Use the templates for an addendum provided in Annex B16, Annex C12, Annex D11 and Annex E10.
All references in the proposed addendum to article numbers and/or annexes to be amended must correspond to those in the initial contract.
Any addendum modifying the budget must include a replacement budget showing how the full budget breakdown of the initial contract has been modified by this (and any previous) addendum (see Annex B17, Annex C13, Annex D12 and Annex E3h7).
If the budget is modified by the proposed addendum, the payment schedule must also be modified accordingly, taking into account any payments already made in the course of the contract.
The payment schedule must not be modified unless either the budget is being modified or the contract is being extended.
2) Prepare a dossier comprising the following items:
a. an explanatory note (see the model in Annex A6) providing the technical and financial reasons for the modifications in the proposed addendum;
b. a copy of the request for (or agreement to) the proposed modifications;
c. the originals of the proposed addendum, which is based on the standard addendum and includes any revised annexes.
DIRECT MANAGEMENT, INDIRECT MANAGEMENT WITH EX POST CONTROLS
3) Sign and date all the originals of the addendum and initial all pages of the special conditions and most relevant annexes including, for grants, the budget.
INDIRECT MANAGEMENT WITH EX ANTE CONTROLS
3) Send the addendum dossier to the delegation of the European Union for endorsement (initialling all pages of the special conditions) to confirm the EU financing. No endorsement by the delegation is required in certain cases referred to in the practical guide to procedures for programme estimates.
4) Send the signed originals of the addendum to the contractor, who must countersign them within 30 days of receipt and return two originals to the contracting authority together with the possible financial guarantee required in the addendum.
4) On receipt of the signed originals from the contractor, the contracting authority checks that it/they correspond(s) strictly to those sent originally.
INDIRECT MANAGEMENT WITH EX POST CONTROLS AND INDIRECT MANAGEMENT WITH EX ANTE CONTROLS
5) On receipt of the signed originals from the contractor, the contracting authority checks that they correspond strictly to those sent originally. One original is kept and the other is sent to the delegation of the European Union.
The addendum takes effect on the date of the last signature.
6) Publish a notice for modification of contract in the Official Journal of the European Union and on F&T portal, when the addendum concerns the addition of activities that were not included in the original contract or have become necessary due to unforeseeable circumstances (i.e. cases of modification through simple addendum under points (a) and (b) of Section 2.11.1.). However, the publication of such notice is not requested when the value of the modification is lower than EUR 300 000 for service and supply contracts, or lower than EUR 5 000 000 for works contracts.
2.12. Legal remedies
2.12.1. Complaints to the contracting authority
Without prejudice to other remedies and, in particular, without altering the time-limits for bringing actions set out in paragraphs 2.12.3., where a candidate, tenderer or applicant believes she/he has been adversely affected by an error or irregularity allegedly committed as part of a selection or procurement procedure, or that the procedure was vitiated by any maladministration, she/he may file a complaint to the contracting authority.
Where the European Commission is the contracting authority, the complaint will be sent to the person who took the contested decision, who will endeavour to investigate the complaint and respond within 15 working days. If the candidate, tenderer or applicant is not satisfied with the answer received, she/he may refer to the relevant geographical director in Headquarters. The complaint shall be substantiated and its sole object shall not be to obtain a second evaluation for no reason other than the complainant disagrees with the final award decision.
2.12.2. Complaints to the European Ombudsman
Without prejudice to other remedies and, in particular, without altering the deadlines laid down for the appeals set out in Section 2.12.3., any citizen of the European Union or any natural or legal person residing or having its registered office in a Member State has the right to complain to the Ombudsman for any instance of maladministration by the European Union institutions (Article 228 TFEU). Ombudsman inquiries do not affect time-limits for appeal in legal proceeding. More information may be found on the website http://www.ombudsman.europa.eu/en/home.faces.
2.12.3. Ordinary actions - litigation
When a candidate, tenderer or applicant believes she/he has been adversely affected by an error or irregularity allegedly committed as part of a selection procedure or procurement, she/he may also bring ordinary actions, provided the conditions are met.
Where the European Commission is the contracting authority, the action must be launched in accordance with the rules set out by the TFEU.
Where the European Commission is not the contracting authority, the action must be launched in accordance with the conditions and deadlines fixed by the national legislation of the contracting authority.
The Court of Justice of the European Union has the sole jurisdiction in disputes relating to compensation for damages caused by the European Commission in the case of non-contractual liability.
National tribunals are competent in case of contractual liability as set out in the general conditions of the contract.
No subcontract can create contractual relations between any subcontractor and the contracting authority. The contracting authority must not be held responsible for any failure by the contractor to honour its contract with the subcontractor. In case of disagreement regarding the implementation of that contract, the subcontractor must address itself to the contractor and/or to the respective jurisdiction competent to hear such litigations. The same situation is applicable to experts working under service contracts.
2.12.4. Amicable settlement, conciliation and arbitration procedures
The amicable settlement of disputes is an essential precondition before starting a legal action before the courts or an arbitration procedure (this latter foreseen only for procurement contracts). Therefore, a party to the contract is able to initiate a court proceeding only if this party has attempted to resolve the dispute amicably without being able to reach an agreement. Therefore, if the contracting authority is the initiator of the legal action before the courts, it must provide a proof that it has made firstly an attempt to resolve the dispute amicably. This means that the contracting authority should have a preliminary contact with the beneficiaries or the contractors aiming at resolving the disputes amicably, following which it turned out that the parties could not reach a settlement.
PROGRAMMES FUNDED BY THE EDF
Disputes relating to an EDF-financed contract may be settled by conciliation or by arbitration under the general conditions and the special conditions governing the contract. The procedure to be used is set out in Annex V to Decision No 3/90 of the ACP-EEC Council of Ministers of 29 March 1990 adopting the general regulations, general conditions and procedural rules on conciliation and arbitration for works, supply and service contracts financed by the European Development Fund (EDF) and concerning their application.
These rules can be found in Annex A12.
PROGRAMMES FUNDED BY THE EU BUDGET
The rules on dispute settlements are to be found in the general conditions for the relevant contract models (Article 40 for service and supply contracts and Article 68 for works contracts).
2.13. List of Annexes
Glossary of terms
Glossary of Terms (multi)
Eligibility programmes 2014-2020
Eligibility programmes 2021-2027
EU external aid programmes
Declaration of objectivity and confidentiality
Declaration of impartiality and confidentiality
Cancellation notice (e-notices)
Corrigendum of contract notice
Notice for modification of contract
Prior information notice (e-notices)
Contract notice (e-notices)
Additional information about the Contract Notice (e-notices)
Award notice (e-notices)
Receipt for hand delivered applications/ tenders/ proposals
Invitation for tender (amendment of contract through a negotiated procedure)
Cover letter for submission of contract/addendum
Negotiation report for negotiated procedures (procurement) and direct award (grants)
Award decision for negotiated procedures
Negotiation report for single tenders
Guidelines for the drafting of IT tenders’ technical specifications in the field of external actions
Guidelines for the drafting of technical specifications for office furniture tenders in the field of external actions
Guidelines for the drafting of technical specifications for vehicle tenders in the field of external actions
Annex V to Decision No 3/90 of the ACP-EEC Council of Ministers of 29 March 1990 adopting the general regulations, the general conditions and the rules governing the conciliation and arbitration procedure for contracts financed under the EDF
Declaration on honour on exclusion and selection criteria for procurement
Declaration on honour on exclusion and selection criteria for grants
 Article 62 of Regulation (EU, Euratom) No 1046/2018 of the European Parliament and of the Council of 18 July 2018 on the financial rules applicable to the general budget of the Union (OJ L 193, 30.7.2018, p.1), hereafter the "Financial Regulation" or FR.
 Article 62(1)(a) FR.
 Article 62(1)(c) FR.
 Please note that the European Commission usually undertakes directly activities such as project evaluation and audits even under indirect management with partner countries.
 The different ex ante and ex post control procedures are explained throughout this practical guide.
 Article 154(6)(b) FR.
 See https://international-partnerships.ec.europa.eu/funding/guidelines/programme-estimates_en. A programme estimate is a document containing a work programme to be implemented by a partner country of the European Union. It is drawn up by the partner country and endorsed by the European Commission. The programme estimate is a mixed form of financial implementation that may include activities entailing different levels of delegation. It is the value of the contract to be concluded, as defined in the Programme Estimate Guide, which determines which form of delegation is allowed.
 Article 154(4) FR.
 Article 62(1)(b) FR.
 Regulation (EU) No 232/2014 of the European Parliament and of the Council of 11 March 2014 establishing a European Neighbourhood Instrument (OJ L 77, 15.3.2014, p. 27).
 Regulation (EU) No 231/2014 of the European Parliament and of the Council of 11 March 2014 establishing an Instrument for Pre-accession Assistance (IPA II) (OJ L 77, 15.3.2014, p. 11).
 The European Commission’s endorsement of the contracts is not necessary in certain cases, which are specified in this practical guide or in the practical guide to procedures for Programme Estimates.
 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 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.
 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.
 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.
 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 financing external action (CIR), (OJ L 77, 15.3.2014, p. 95).
 Regulation (EU) No 230/2014 of the European Parliament and of the Council of 11 March 2014 establishing an instrument contributing to stability and peace (OJ L 77, 15.3.2014, p. 1).
 Article 11 CIR.
 Regulation (EU) No 233/2014 of the European Parliament and of the Council of 11 March 2014 establishing a financing instrument for development cooperation for the period 2014-2020 (OJ L 77, 15.3.2014, p. 44).
 Regulation (EU) No 232/2014 of the European Parliament and of the Council of 11 March 2014 establishing a European Neighbourhood Instrument (OJ L 77, 15.3.2014, p. 27).
 Regulation (EU) No 234/2014 of the European Parliament and of the Council of 11 March 2014 establishing a PartnershipInstrument for cooperation with third countries (OJ L 77, 15.3.2014, p. 77).
 Members of the G20 Group only when they are beneficiaries of the action financed by the European Union, see Article 9 (1)(d) CIR.
 Article 9(1) CIR.
 Article 9(e) CIR. Reciprocal access may be granted, for a limited period of at least one year, whenever a country grants eligibility on equal terms to entities from the European Union and from a country eligible under the DCI, ENI and Partnership Instrument for cooperation with third countries. This provision is replicated also for the EDF (Article 20(1)(c) of Annex IV of Cotonou Agreement; Article 89 (1)(d) of the Overseas Association Decision for OCTs).
 Article 10(1) CIR.
 Article 179 of Regulation (EU, Euratom) No 1046/2018 of the European Parliament and of the Council of 18 July 2018 on the financial rules applicable to the general budget of the Union (OJ L 193, 30.7.2018, p.1).
 Council Decision 2010/648/EU of 14 May 2010 on the signing, on behalf of the European Union, of the Agreement amending for the second time the Partnership Agreement between the members of the African, Caribbean and Pacific Group of States, of the one part, and the European Community and its Member States, of the other part, signed in Cotonou on 23 June 2000, as amended in Luxembourg on 25 June 2005 (OJ L 287, 4.11.2010, p. 1) (Annex IV to the Cotonou Agreement).
 Article 8(2)(3) CIR.
 Where actions are co-financed in parallel with a partner or other donor, the respective rules on nationality apply, i.e. EU rules apply to the part of the action financed by the external financing instruments (without extension) and the rules of the partner or other donor apply to the part financed by it.
 Article 20, paras. (5)-(8) of Annex IV to the Cotonou Agreement.
 Article 6(4) of Annex IV to the Cotonou Agreement.
 Where actions are co-financed in parallel with a partner or other donor, the respective rules on nationality apply, i.e. EU rules apply to the part of the action financed by the external financing instruments (without extension) and the rules of the partner or other donor apply to the part financed by it.
 OJ L 344, 19.12.2013, p. 1.
 Article 89(1)(b)(c) of the Overseas Association Decision.
 Article 8(5) CIR, Article 1(5) of Annex IV to the Cotonou Agreement and Article 89(1)(e) of the Overseas Association Decision.
 Article 8(1) CIR, Article 1(5) of Annex IV to the Cotonou Agreement and Article 89(1)(a) of the Overseas Association Decision.
 This is to avoid awarding contracts to companies that have established ‘letter box’ companies in an eligible country to circumvent the nationality rules.
 Article 8(4) CIR, Article 1(4) of Annex IV to the Cotonou Agreement and Article 89(1)(d) of the Overseas Association Decision.
 In a works contract, the option of having equipment vested in the contracting authority, given under Article 43(2) of the general conditions, only applies while the works are being carried out and therefore does not constitute full transfer of the property.
 Article 8(4) CIR and Article 20(3) of Annex IV to the Cotonou Agreement.
 Regulation (EU) No 952/2013 of the European Parliament and of the Council of 9 October 2013 laying down the Union Customs Code, OJ L 269, 10.10.2013, p. 1.
 Commission Delegated Regulation (EU) 2015/2446 of 28 July 2015 supplementing Regulation (EU) No 952/2013 of the European Parliament and of the Council as regards detailed rules concerning certain provisions of the Union Customs Code, OJ L 343, 29.12.2015, p. 1.
 Commission Implementing Regulation (EU) 2015/2447 of 24 November 2015 laying down detailed rules for implementing certain provisions of Regulation (EU) No 952/2013 of the European Parliament and of the Council laying down the Union Customs Code, OJ L 343, 29.12.2015, p. 558.
 Article 9(2) CIR, Article 9(1) of Annex IV to the Cotonou Agreement, Article 89(2)(f) of the Overseas Association Decision and Article 11(8) of the INSC Regulation 2021/948.
 Article 8(7) CIR, Article 1(8)(9) of Annex IV to the Cotonou Agreement, Article 89(1)(f) of the Overseas Association Decision and Article 11(7) of the INSC Regulation 2021/948.
 In place since 1 January 2016 and replacing the early warning system and the central exclusion database.
 For the EDF, see Article 19a(2) of Annex IV to the Cotonou Agreement and Article 36 of the 11th EDF Financial Regulation. For the general budget of the EU, see Article 101 FR.
 Article 160 FR.
 Judgment of the Court (Sixth Chamber) of 7 December 2000, Telefonadress GmbH v Telekom Austria AG, C-324/98, ECLI:EU:C:2000:669, paragraph 62.
 Judgment of the General Court (First Chamber), 13 December 2013, European Dynamics Luxembourg SA and Evropaïki Dynamiki — Proigmena Systimata Tilepikoinonion Pliroforikis kai Tilematikis AE v European Commission, T‑165/12,ECLI:EU:T:2013:646, paragraph 46.
 For mixed contracts, covering a combination of works, supplies or services, the contracting authority determines the procurement thresholds and procedure to be used (with the agreement of the European Commission, for indirect management with ex ante controls). This determination is made on the basis of the main component (works, supplies or services) in terms of value.
 Judgment of the Court (Fifth Chamber) of 18 December 2014, Azienda Ospedaliero-Universitaria di Careggi-Firenze v Data Medical Service srl, C-568/13, ECLI:EU:C:2014:2466, paragraph 34.
 Any attempt by a candidate, applicant or tenderer to obtain confidential information, enter into unlawful agreements with competitors whose aim or effect is to impede, restrain or distort competition in a given market, or influence the evaluation committee or the contracting authority during the process of examining, clarifying, evaluating and comparing tenders and applications will lead to the rejection of its candidacy, proposal or tender (see Section 126.96.36.199).
 Judgment of the Court of First Instance (First Chamber) of 27 September 2002, Tideland Signal Ltd v Commission of the European Communities, T-211/02, ECLI:EU:T:2002:232, paragraph 39.
 Article 2(59) FR.
 Article 188 FR.
 Except for duly substantiated and exceptional cases where direct award is justified (see Section 6.4.2.).
 See Section 6.5.3.
 Guidance on the avoidance and management of conflicts of interest under the FR (2021/C 121/01) https://eur-lex.europa.eu/legal-content/EN/TXT/PDF/?uri=CELEX:52021XC0409(01)&from=EN.
 Article 61 FR.
 Articles 150(5), 225(4), 237(2), Annex I points 28.2 and 29.1 FR 2018.
 For this purpose, each external expert must sign a declaration of impartiality and confidentiality (Annex A4). These must be attached to the specific contract concluded with the contractor under a framework contract or to the expert’s contract if there is no framework contract involved.
 Article 136(1)(c) FR.
 Article 136 FR.
 Article 141(c) FR.
 Article 20(6) of the Annexe 1 to the FR.
 For further guidance about the procedure, please consult Guidance on the avoidance and management of conflicts of interest under the FR (2021/C 121/01), p. 19 https://eur-lex.europa.eu/legal-content/EN/TXT/PDF/?uri=CELEX:52021XC0409(01)&from=EN.
 For additional details, see chapter 9.1 of the INTPA Companion.
 Article 132 FR.
 Article 165(2) FR.
 The AFS and related information is available for European Commission staff on INTPA’s intranet: https://myintracomm.ec.europa.eu/dg/INTPA/audit-and-control/anti-fraud/Pages/olaf.aspx
 In particular, the creation of the Neighbourhood, Development and International Cooperation Instrument (NDICI) under the Multiannual Financial Framework 2021-2027, the in-depth reorganisation of DG INTPA on 16/01/2021, and the adoption of the new CAFS in 2019.
 EEC/EAEC Council: Regulation No 31 (EEC), 11 (EAEC), laying down the Staff Regulations of Officials and the Conditions of Employment of Other Servants of the European Economic Community and the European Atomic Energy Community, Article22a-c.
 Regulation (EU, Euratom) 2018/1046 on the financial rules applicable to the general budget of the Union, repealing Regulation (EU, Euratom) No 966/2012 (2012 Financial Regulation), Article 74(8).
 Regulation (EU, Euratom) No 883/2013 of the European Parliament and of the Council of 11 September 2013 concerning investigations conducted by the European Anti-Fraud Office (OLAF) and repealing Regulation (EC) No 1073/1999 of the European Parliament and of the Council and Council Regulation (Euratom) No 1074/1999, Article 8. This OLAF Regulation will be amended in 2021.
 Austria, Belgium, Bulgaria, Croatia, Cyprus, Czechia, Estonia, Finland, France, Germany, Greece, Italy, Latvia, Lithuania, Luxembourg, Malta, Netherlands, Portugal, Romania, Slovakia, Slovenia, Spain.
 See Article 2(14) FR for the definition of concession contracts.
 Regulation (EU, Euratom) No 966/2012 of the European Parliament and of the Council of 25 October 2012 on the financial rules applicable to the general budget of the Union (OJ L 298, 26.10.2012, p. 1).
 Article 2(31) FR.
 The EDES panel must be composed of a standing high-level independent chair (chosen from former members of the Court of Auditors, the Court of Justice or former officials with at least the rank of director general in an EU institution other than the Commission), two representatives of the Commission and one representative of the contracting authority. The EDES panel has no investigative powers but bases its preliminary classification in law on established facts and findings presented to it by the competent authorising officers.
 OJ L 198, 28.7.2017, p. 29.
 OJ C 316, 27.11.1995, p. 48.
 OJ C 195, 25.6.1997, p. 1.
 OJ L 192 , 31.07.2003, p. 54.
 OJ L 300, 11.11.2008, p. 42.
 OJ L 309, 25.11.2005, p. 15.
 OJ L 164, 22.6.2002, p. 3.
 OJ L 101, 15.4.2011, p. 1.
 OJ L 312, 23.12.1995, p. 1.
 These measures may include, in particular: (a) measures to identify the origin of the situations giving rise to exclusion and concrete technical, organisational and personnel measures within the relevant business area of the economic operator, appropriate to correct the conduct and prevent its further occurrence; (b) proof that the economic operator has undertaken measures to compensate or redress the damage or harm caused to the European Union's financial interests by the underlying facts giving rise to the exclusion situation; (c) proof that the economic operator has paid or secured the payment of any fine imposed by the competent authority or of any taxes or social security contributions.
 The Council of the European Union adopted a list of non-cooperative jurisdictions for tax purposes on 5 December 2017. It contains two Annexes: (i) Annex I includes jurisdictions that are classified as non-cooperative and (ii) Annex II includes further jurisdictions (‘Annex II Jurisdictions’ or ‘Committed Jurisdictions’) that have taken sufficient commitments to address their identified deficiencies and as such have not been considered as non-cooperative for the time being. Annexes I and II will be updated by the Council as appropriate and the changes will become effective once published in the Official Journal of the EU. See http://www.consilium.europa.eu/media/31945/st15429en17.pdf.
 Article 137(2)(b) FR.
 Article 143(6)(a) FR.
 According to this provision, ‘beneficial owner’ means any natural person(s) who ultimately owns or controls the customer and/or the natural person(s) on whose behalf a transaction or activity is being conducted.
 Standard electronic declaration for exclusion and selection criteria created under Directive 2014/24/EU of the European Parliament and of the Council of 26 February 2014 on public procurement and repealing Directive 2004/18/EC Text with EEA relevance (OJ L 94, 28.3.2014, p. 65).
 This refers in particular to pillar assessed entities and entities designated by third countries.
 Article 131(1) FR.
 Article 131(2)(d) FR.
 Article 38(3) of Annex I to the FR.
 Article 19 of Annex I to the FR.
Article 20 of Annex I to the FR.
 OJ L 342, 22.12.2009, p. 1.
 Article 21 of Annex I to the FR.
 Judgment of the Court (Fourth Chamber) of 20 September 1988, Gebroeders Beentjes BV v State of the Netherlands, C-31/87, ECLI:EU:C:1988:422, paragraphs 15-16; Judgment of the Court (Sixth Chamber) of 19 June 2003, Gesellschaft für Abfallentsorgungs-Technik GmbH (GAT) v Österreichische Autobahnen und Schnellstraßen AG (ÖSAG), C-315/01, ECLI:EU:C:2003:360, paragraphs 65-67; Judgment of the Court (First Chamber) of 24 January 2008, Emm. G. Lianakis AE, Sima Anonymi Techniki Etaireia Meleton kai Epivlepseon and Nikolaos Vlachopoulosv Dimos Alexandroupolis and Others, C-532/06, ECLI:EU:C:2008:40, paragraphs 30-32; Judgment of the General Court (Eighth Chamber) of 8 December 2011, Evropaïki Dynamiki v European Commission, T-39/08, ECLI:EU:T:2011:721, paragraphs 21-24 and 40-42.
 Hence the importance of carefully choosing the selection criteria, which must be clear and non-discriminatory, and may not go beyond the scope of the tasks or budget (see Section 2.8.1. for further details).
 The framework contracts currently managed by DG INTPA are SIEA 2018, AUDIT 2018, EVA 2020 and EVENTS 2020, however this instruction is to be followed for any other framework contract that DG INTPA would conclude after the release of this version of the PRAG.
 Article 150 FR.
 For instance when the chair/secretary/voting members/assessors/observers are in another country.
 The system to be used has to support encryption and this option has to be enabled. It also has to support protocol H.323 and/or SIP.
 Encryption must be used (using S/MIME V3 standard or equivalent).
 See Section 188.8.131.52.
 The requirement to submit an original Declaration on honour on exclusion criteria and selection criteria is only applicable in case of paper submission.
 Information is confidential where its disclosure would e.g. hinder application of the law, would be contrary to the public interest or would harm the legitimate business interests of public or private undertakings or could distort fair competition between those undertakings. See Regulation (EC) No 1049/2001 of the European Parliament and of the Council of 30 May 2001 regarding public access to European Parliament, Council and Commission documents (OJ L 145, 31.5.2001, p. 43).
 Judgment of the General Court (Seventh Chamber) of 15 September 2011, CMB Maschinenbau & Handels GmbH and J. Christof GmbH v European Commission, T-407/07, EU:T:2011:477, paragraph 160; Judgment of the General Court (Third Chamber) of 19 March 2010, Evropaïki Dynamiki - Proigmena Systimata Tilepikoinonion Pliroforikis kai Tilematikis AE vEuropean Commission, T-50/05, ECLI:EU:T:2010:101,paragraph 133ff.
 Regulation (EU) No 910/2014 of the European Parliament and of the Council of 23 July 2014 on electronic identification and trust services for electronic transactions in the internal market and repealing Directive 1999/93/EC.
 Article 172(3) 2018 FR.
 The General Court has jurisdiction over acts of the European Commission intended to produce legal effects vis-à-vis third parties — pursuant to Articles 256 and 263 TFEU.
 Pursuant to Articles 256, 268 and 340 TFEU. The deadline to introduce an action for annulment before the General Court against the European Commission's decisions runs from the moment of the publication of the measure, or of its notification to the plaintiff, or, in the absence thereof, of the day on which it came to the knowledge of the latter, as the case may be (pursuant to the TFEU).
 OJ L 382, 31.12.1990, p. 1.