PROCUREMENT NEWS. In This Issue. Expert Q&A...with Michael Humphreys QC. 10 Key Changes in Public Procurement. Dates for your Diary.

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1 PROCUREMENT NEWS Cleaver Fulton Rankin Quarterly Newsletter February 2015 In This Issue Expert Q&A...with Michael Humphreys QC 10 Key Changes in Public Procurement Dates for your Diary The Cleaver Fulton Rankin Procurement Team Welcome to the inaugural Cleaver Fulton Rankin Quarterly Procurement Newsletter. Our aim is to keep you up to date and familiar with all of the latest developments in procurement through a series of articles and features produced by experts in the area. Our team of experts are on hand to help if you have any procurement related queries or issues, so please do not hesitate to get in contact. What we do Cleaver Fulton Rankin s highly regarded procurement team has considerable experience acting for both private and public bodies in both contentious and non-contentious procurement matters. Our highly experienced team provide strategic and efficient solutions for a wide range of clients including economic operators and contracting authorities, utilities, local authorities and other public bodies. Why us? Lisa Boyd heads our procurement team and has recently completed a Postgraduate Certificate in Public Procurement Law and Policy at the University of Nottingham, making her one of the few solicitors, if not the only solicitor, with this qualification in Northern Ireland. Our Procurement team has been described as Strong in procurement law across a broad spectrum of industry sectors, including construction, healthcare and the public sector. Well regarded for its expertise in procurement challenges and increasingly engaged in an advisory capacity. - Chambers & Partners UK 2014 Many of our team are members of the Procurement Lawyers Association which is a recognised organisation which acts as a platform to represent, promote and strengthen procurement law expertise.

2 Expert Q & A......with Michael Humphreys QC In this edition we welcome Michael Humphreys QC as our expert to clarify your tendering queries by answering a series of tricky Procurement questions concentrating on the new Regulations and the impact these will have. 1. A substantial body of case law has come from Northern Ireland. What are the reasons for this trend and do you see this changing in light of the new Regulations? There are essentially four reasons for the emergence of such a body of case law in Northern Ireland. Firstly, our economy is heavily dependent on the public sector and therefore most public contracts are much sought after. Secondly, the poor economic climate over the past number of years has meant that contractors are seeking out the relative security of government work. Thirdly, the legal costs in this jurisdiction are much less than would be the case in England and Wales which has encouraged aggrieved contractors to pursue bid challenges. Fourthly, contracting authorities have traditionally proved resistant to settling procurement resorts which has led to most cases being determined by the Courts, although this trend has altered somewhat in the last 18 months. The new Regulations are likely to prompt a further set of challenges as both the contracting authorities and bidders seek clarity as to the interpretation of the new requirements. 2. In your experience, what are the main obstacles faced by tenderers wishing to challenge a public procurement? Bidders sometimes do not recognise the importance of completing due diligence on tender documentation at an early stage as they may be too late to challenge an issue with the tender documentation once they are notified that they have been unsuccessful. The reason for this being that within public procurement law there is a short window of opportunity to challenge a flawed processes. The Regulations require proceedings to be issued within 30 days from the date of knowledge or when the tenderer ought to have known. This therefore means the time for challenge can be before the outcome of the tender is announced or indeed before the deadline for submitting tender responses. If a tenderer wishes to maintain the statutory suspension on the award of a contract pending the outcome of a challenge, it is common for the Court to require a crossundertaking in damages, i.e. an undertaking to compensate the contracting authority for any loss it may sustain as a result of the delay in the event that the challenge is unsuccessful.

3 Expert Q & A How can tenderers reduce this risk? Tenderers should thoroughly read through the tender documentation as soon as same is released by the procuring authority. It should be thoroughly examined to identify any points of clarification and raised as soon as possible. In some cases, particularly for high value procurements, tenderers will seek legal advice and request that a solicitor or barrister reviews them. The purpose of the exercise is twofold, firstly to ensure that if they are unsuccessful they are not out of time to raise such challenges and secondly and perhaps more importantly to ensure that no other bidder can raise a challenge if they win the procurement. The main reason for the 30 day limitation period is so that bidders can inform the procuring authority early in the process of any issues and so that they can be addressed in order to allow the procurement to proceed with as little disruption as possible. 4. Is there anything that bidders should be cautious of in the new Regulations? There are some important and innovative changes introduced by the new Regulations but uncertainty exists as to how some of the new rules will work. It is important for bidders to be aware of how the new Regulations work but also for contracting authorities to ensure that they fully understand the changes so that they do not expose themselves to challenges due to flawed processes. Contractors should be careful when performing a contract as there is a new discretionary exclusion allowing contracting authorities to reject bidders based on poor past performance. The new Regulations only apply to procurements started on or after 26 February 2015 and procurements started before this date will be governed under the previous Regulations. 5. What do you see as the positive aspects of the new Regulations? The new Regulations seek to foster greater participation from SMEs in public tenders by reducing financial thresholds and encouraging the division of larger contracts into lots. The Regulations also codify and confirm some leading procurement case law on exemptions and contract changes. Innovative partnerships have been introduced with the intention of encouraging and embracing innovation. About our expert Michael Humphreys QC graduated with the degrees of BA and BCL from Oxford University in 1993 and was called to the Bar in 1994 taking Silk in He is currently Chair of the Commercial Bar Association and is both a member of the Commercial Court Liaison Committee and the Government Civil Senior Panel. Michael practises mainly in the areas of Chancery and Commercial law, which extends to litigation, arbitration, adjudication and mediation as forms of dispute resolution. His particular specialism is in construction disputes, public procurement challenges, banking and professional negligence actions. He also advises on public law aspects of commercial law, including licensing and planning.

4 10 Key Changes in Public Procurement On 28 March 2014 three new Directives were published in the Official Journal of the European Union (OJEU) updating and amending the current regime. This list intends to focus on Directive 2014/24/EU which governs how public authorities can award public works, supply and service contracts. The Directives prescribe a two year period for transposition into national law by the Member States and a further 30 months for implementing full electronic procurement. The UK Government, however, have fast tracked the implementation by introducing the Public Contracts Regulations 2015 on 26 February The 2015 Regulations replace the existing procurement rules. The Regulations will not have retrospective effect and so all ongoing tenders are subject to the previous regime. Tenderers therefore will have to navigate both the old and the new rules for the foreseeable future. What has changed under the new rules? This list focuses on the 10 key changes in Directive 2014/24/EU. 1. The distinction between Part A and Part B services has been abolished 2. Improved access for SMEs 3. Award Criteria must be on the Most Economically Advantageous Tender and be based on a cost-effectiveness approach 4. Mandatory use of electronic communications 6. Teckal in-house exemption codified 7. A new ground for discretional exclusion 8. Compulsory acceptance of selfdeclarations 9. Minimum deadlines to submit tenders shortened 10. Competitive Negotiated Procedure 5. Amending Contracts post-award - Pressetext codified This article provides only a summary of the key changes under the new Directive and is not exhaustive, nor does it contain definitive advice. Specialist advice should be sought from a member of the Cleaver Fulton Rankin Procurement Team. If you have any queries on any aspect of the new Procurement Directives please contact: Lisa Boyd Director Tel: l.boyd@cfrlaw.co.uk

5 Dates for your Diary Talks & Events 10 Key Changes in Public Procurement Date 11 March 2015 Click here for more information: The Construction Professionals Guide to BIM Date 24 March 2015 Click here for more information: Become a Mediator Dates April 2015 and May 2015 Attendance on all days of the training is compulsory. Early Bird Discount Book before 6 March and pay 850. To book your place, please contact j.mccaffrey@cfrlaw.co.uk Click here for more information: Copyright in Construction Date 30 April 2015 Location Cleaver Fulton Rankin Offices, 50 Bedford Street Click here for more information: Contact Us Give us a call for more information about our services and products Cleaver Fulton Rankin 50 Bedford Street, Belfast, BT2 7FW info@cfrlaw.co.uk Visit us on the web at Legal Excellence + Commercial Sense