Emergency situations require emergency measures, they say. How will COVID-19 outbreak and the declared state of emergency affect public procurements?
At this moment, the measures introduced under the state of emergency do not specifically tackle public procurements. However, emergency situation and its effects will certainly affect the mechanisms of public spending. This will trigger exceptional methods of public procurement as set under the law and, inevitably, more discretion for the state and local communities. But will this affect all public procurements?
Some of the exceptional situations under current Serbian public procurement laws, which could be activated due to COVID-19, are the following:
(i) A public procurement contract having a conflict of interest between the parties could be approved by an authorized state body, where the case of COVID-19 could be a potential reason for approving the deal (i.e. emergency, hardship etc.), contrary to the general rule of no conflict of interest in public procurement;
(ii) The buyer could opt for a negotiation procedure without publishing the call to tender, only having to seek an opinion from the Public Procurement Office, the issuing of which, in this situation, would not postpone the procedure.
At this moment, we believe that such cases would only concern procurements directly linked to the prevention of the outbreak and/or enforcement of the decisions under the declared state of emergency. All other tenders would be subject to regular requirements of the law. This comes from the fact that the public tender could be initiated only if envisaged under the annual public procurement plan. Even in exceptional cases, the liabilities taken by the buyer must be contracted in line with the budget regulations.
For now, there are no announcements from the Public Procurement Office linked to the outbreak or rescheduling of the already published tenders, either by the state or local communities. It is to be expected that the state of emergency will slow the pace of the public procurement procedures to a certain degree.
Last but not least, a new public procurement laws shall come into force as of July 1, 2020. Having in mind that the state of emergency has been declared for 90 days’ period (for now), which will end before that date, it is unlikely that COVID-19 will play a role in activating exceptional methods. And we hope that this is going to be the case. BOPA remains at your disposal for any further inquiries.
