1. ACCESS OF FOREIGN BIDDERS COMPLAINT MECHANISMS PROF. LAURENCE FOLLIOT LALLIOT Focus on Certain Legal Aspects of Public Procurement Proceedings

2. 2 ACCESS OF SMALL AND MEDIUM ENTERPRISES

3. RESTRICTION OF ACCESS FOR FOREIGN COMPANIES Procurement Law may restrict the access Non-tariff barriers Domestic Preferences Set aside of contracts (reserved) Mandatory association with local contractors Technical specifications But International obligations call for openess Regional Directives WTO Trade agreements (BTA) Bilateral Investment Treaty 3

4. SME: SPECIAL PROVISIONS 2012: 67% of workforce, 57 % of gross product in EU 34% of OECD countries (USA, France, Korea, Australia) have put in place specific legislative provisions 81% of OECD countries have dedicated provisions for SMEs: - guidance(s)online -workshop and training But only ¼ of OECD countries have simplifie administrative provisions - 4

5. U.S. PROCUREMENT: SMALL BUSINESS ACT Total federal procurement: $600 billion+ contracts 23% of procurement contracts (and 40 % of subcontracts) to be set aside for: Small businesses Disadvantaged businesses Women-owned businesses Service-disable veteran-owned businesses “HUBZones” (geographic) Others

6. OPPONENTS Costs are high and hidden Socioeconomic policies collide Frequently outmoded Acquisition slowed and made more complex Discourages contractors from federal market Impact of EU Procurement directives (1990s) on competition. Study on bidding process from 1995 (55 000) to 2002 (106 000). Results: 3 % of contracts with companies from other EU states. 30 % of contracts with local affiliates of foreing companies. Savings= - 30 % of average contract price.

7. 7 REVIEW MECHANISMS

8. WHY A COMPLAINT SYSTEM? Against alleged breach of procurement rules and principles purpose to resolve legality issue not to review whole procedure and not to second guess entity/re-evaluate Understanding the differences with: Dispute resolution Audit Criminal investigation Arbitration 8

9. WHO CAN BRING A COMPLAINT ? Bidder-driven complaints mechanism Initiated by bidders (standing) bidder has knowledge of the facts of the procedure bidder has interest in ensuring compliance with rules in case of specific contract for future transactions 9

10. WHERE ? Complaint Bodies: different solutions Contracting authority Hierarchical Review Administrative Review Body Independent Review Body Courts, judicial mechanism 10

11. LOCATION OF THE COMPLAINT MECHANISM 11 Court of Auditors Complaint Body Administrative Courts Competition Body Ordinary Courts Parliament Anti- corruption Unit

12. WHY DO BIDDERS’ COMPLAINTS WORK? A tool to enhance value for money no cost to Government (free policemen) bidder has knowledge of the facts of the procedure bidder has interest in ensuring compliance with rules in case of specific contract for future transactions confidence in the procurement rules (reality and perception) preserves market operations 12

13. ISSUES Duration of the complaint process: efficiency v. quality Standstill? = suspension of the contract’s signature Powers granted to the complaint body: Automatic suspension? Revision of the bidding decisions? Annulment of the contract? Fees? Transparency (bidding docs and publication) Potential implication on the existing contract 13

14. PROCEDURES AND TIMEFRAMES 14 complaint Appeal Procuring entity Administrative Body Independent Tribunal Award of the contract ??? Bidder Complaint bodies Bidding process