New legal regulation of public tenders
- Czech Republic
- 07/25/2006
- Štros & Kusák - Czech Republic
In March 2006, Czech parliament adopted brand new legal regulations regarding public tenders. This legislation in the form of a new Public Tenders Act largely reflects recent changes to Community law concerning bids in public tenders. In this regard, the new Czech law changes the previous statutory definition of “public tender”. At the same time, however, the new Czech regulation imposes a different definition of “public tender” to the one stated under EU laws. The new law deems public tenders to be any tenders that are financed by the bidders in the public tender. Under the new regulation, public tenders fall into three categories: a) “over-limit”, b) “under-limit” and c) small scale. Small-scale public tenders have a predicted future value which is less than or equal to CZK 2,000,000 (excl. tax ) in the case of tenders for supplies or services, or CZK 6,000,000 CZK in the case of tenders in the construction industry.
We would draw attention to the fact that under the new law, bidders in/persons/public authorities commissioning small-scale public tenders are not bound to follow the rules under the Public Tenders Act.
Furthermore, we would highlight the special “simplified under-limit procedure” which may be used in most underlimit public tenders under the new regulation. Public bidders participating in an under limit public tenders must request offers from at least five interested parties in writing. This request must be published in an appropriate manner for the entire time period designated for bid submission.
In addition, we would point out the new procedure under the Act for the review of a public commissioner’s actions vis-à-vis the Office for the Protection of Economic Protection. A party filing a request for such a review must now pay a deposit in the amount of 1% of the bidder’s offering price; this deposit may be a maximum of 2,000,000 CZK and a minimum of 50,000 CZK. This deposit must be charged to the account of the reviewing body no later than on the final day of the period provided for filing a request for the review of the commissioner’s actions.
If you would like to learn more about these issues, we are happy to provide you with further information about the new legal regulation regarding the holding of public tenders/bid submission in public tenders. This legal regulation is only part of a larger group of legal changes in the Czech Republic in the area of public commissions and concessions, which also includes the Act Amending Certain Other Acts related to the Adoption of the Public Tenders Act (Act No. 138/2006 Coll.), the Concession Agreement and Concession Procedure Act (Act No. 139/2006 Coll.), and the Act Amending Certain Other Acts related to the Adoption of the Concession (Act No. 140/2006 Coll.). All of the acts mentioned in this article will come into force on 1st June 2006.
