Public Procurement Regimes in the UK and EU

24.01.2017

Legal Framework
Public procurement rules apply to the purchase of goods, works or services by governments and other public bodies (referred to as a ‘contracting authority’). The over-arching EU objective is to safeguard the free movement of goods and services, which is achieved by requiring contracting authorities to follow the general principles of the EU Treaties: equal treatment, transparency, and non-discrimination. These principles also apply to contracts below the threshold for the standard procurement regime.
The present EU public procurement regime is contained within EU Directive 2014/24/EU, implemented in the UK by the Directive in the Public Contracts Regulations 2015. The National Health Service (Procurement, Patient Choice and Competition) (No. 2) Regulations 2013 are also applicable in the context of healthcare services.
Standard procurement regime
Contracting authorities are required to take ‘appropriate measures’ to avoid conflicts of interest. This will principally mean identifying and eliminating any personal interests or potential personal interests of relevant staff involved within the contracting authority.
Light touch regime – Health, Social and related services
Contracts for certain specified services, including healthcare services, are covered by a ‘light touch’ regime, which provides more flexibility than the standard public procurement regime. Where the value of the contract is at least €750,000, a contracting authority need only:
i. advertise its intention to award a contract as Contract Notice in the Official Journal of the EU (“OJEU”); and
ii. determine a procurement process that complies with the principles of equal treatment, transparency, and non-discrimination.
Importantly, the process chosen does not have to be one of the procedures outlined above – commissioners are given freedom in terms of how the procurement process is carried out, provided it remains within the framework of the applicable regulation. The relevant rules in respect of the procurement of healthcare services are contained in the National Health Service (Procurement, Patient Choice and Competition) (No. 2) Regulations 2013.
The Regulations do not contain prescriptive rules but instead encourage a principles-based approach where commissioners decide which individual services are best for patients. They are principally aimed at ensuring high quality and efficient NHS health care services, protecting patient rights and preventing anti-competitive behaviour by commissioners.
• Open Procedure
• Restricted procedure
• Competitive Procedure with dialogue/ negotiation
• Innovative partnership

Note that as a result of Brexit it is likely that EU procurement law will cease to apply to the UK. However, in the light of the government’s announcement as regards the Great Repeal Bill it is likely that in the short to medium term at least, EU procurement law will continue to apply in the UK. For more information please see our materials on the implications of Brexit.

Claire Phipps-Jones

Author