Dr Katarzyna Śliwak | In Principle

Some characteristics of the performance offered by a contractor can only be verified at the contract performance stage. But if such non-price criteria are supposed to be considered when evaluating bids, verification only at the stage of contract performance renders these criteria illusory, as the contractors compete on the basis of price anyway. So far, decisions from the National Appeal Chamber have allowed the use of such criteria. But on 18 December 2020, the Warsaw Regional Court issued a judgment holding that the characteristics of the performance offered by a contractor should be verified before selecting the most advantageous bid. Will this judgment change the approach taken by the National Appeal Chamber?

The pandemic requires immediate response and rapid launch of solutions for combating the coronavirus and its socio-economic impacts. Thus the Anti-Crisis Act includes provisions allowing contracts for fighting the pandemic to be awarded without following lengthy formal procedures.

The coronavirus pandemic is already affecting contractors carrying out public projects and other contracts under the public procurement regime. With the dynamic development of the situation, there is a risk that negative consequences will go even further. The current situation affects not only the performance of contracts but also ongoing and future public procurement procedures.

Under Art. 143c(1) of the Public Procurement Law, the contracting authority is required to make direct payment to a subcontractor approved by the contracting authority if the subcontractor does not receive payment due from the general contractor. This regulation has provided greater protection to subcontractors under public contracts, but in certain situations it may be difficult to obtain this protection.

If a contractor does not agree to extension of the binding period of its offer when requested by the contracting authority, the bid is rejected. However, the effects of expiration of the binding period are unclear when the contractor fails to extend the period at its own initiative. The current wording of the Public Procurement Law does not specify whether the contractor’s bid remains valid after the binding period expires.

If a bank denies financing for a contract for rolling stock (or other items subject to a tender) awarded in conformity with the principle of competitiveness because material collateral cannot be established in Poland, the contracting authority is required to award a contract for delivery with financing.

The draft of the new Public Procurement Law, released by the Ministry of Entrepreneurship and Technology on 24 January 2019, proposes changes in the grounds for exclusion of contractors and institution for “self-cleaning,” bringing the Polish regulations closer to Directive 2014/24/EU.

The contractor’s explanation of a grossly low price or cost must indicate the specific factors making it possible to offer a low price or cost, supported by evidence. The burden of proving that the price or cost is realistic lies with the contractor. If this obligation is not met, the contracting authority will reject the contractor’s bid.

There is a general principle that contracting authorities should request explanations when a proposed price, cost, or important components of price or cost seem grossly low and there are doubts about whether the contract can be performed. Art. 90(1) of the Public Procurement Act now no longer defines strict mathematical rules for examining a grossly low price. As a rule, whether explanations are requested from the contractor will depend on how the contracting authority assesses the contractor’s bid.

Compulsory evaluation of the effectiveness of PPP projects, the possibility of obtaining an opinion on the legitimacy of a project carried out under this formula, a PPP test for projects valued at more than PLN 300 million, implementation of PPP projects via a special purpose vehicle owned by a private partner: these are just some of the changes introduced by an act recently signed by the President of Poland.

An amendment to the Public Procurement Law of 22 June 2016 implementing Directive 2014/24/EU upholds the principle that bid evaluation criteria cannot apply to a contractor’s economic, technical, or financial credibility. Lawmakers have however provided for the possibility of formulating a criterion applicable to qualifications of a contractor’s personnel.

According to current laws, limits on application of the criterion of lowest price apply only to government and local government contracting authorities. Other contracting authorities are permitted to apply the price as the sole criterion or a criterion of a weighting of more than 60%. Meanwhile, both EU and Polish legislators say that criteria other than price should also be applied more often.