On 16 September 2021 the government submitted the bill “A simplified regulatory framework for procurements” to Parliament. In the bill the government makes proposals that seek to simplify implementation of public procurements in accordance with procurement laws. The proposals apply to procurements not subject to directives, i.e. ones below EU thresholds. It is proposed that the legislative amendments come into force on 1 February 2022.
The following are the main features proposed in the bill.
New direct-procurement limit
According to the bill, direct procurement may be used in the procurement of goods and services and construction work in accordance with the Swedish Public Procurement Act (LOU) when the value of the procurement is below SEK 700,000. The same will apply pursuant to LUF when the value of the procurement is less than SEK 1,200,000. The direct-procurement limit is thus slightly increased, and set at a fixed, even amount, instead of as a percentage of EU thresholds, as is now the case.
Simplified and more flexible regulatory framework for procurements below thresholds
The bill proposes that Chap. 19 of the Swedish Public Procurement Act (LOU)/the Utilities Procurement Act (LUF), which mainly apply to procurement below the thresholds, be replaced by two chapters: one for procurements not subject to directives that require advertisement and one for direct procurements. One of the most important aims of this is to create clarity and a better overview of the rules that apply in various situations. Current legislation to a large extent includes cross-references, which it is deemed will make application more difficult, especially bearing in mind that many purchasers and similar persons are not lawyers.
The government also proposes to make it clear that a procuring authority or entity that voluntarily elects to use a procedure similar to procurement subject to directives, despite the prerequisites for direct procurement being met, should not be obliged to adhere to rules other than the applicable direct-procurement rules. When the prerequisites for direct procurement have been met, only the rules on direct procurement will apply. The purpose of the new provision is to clarify the meaning of the Supreme Administrative Court’s ruling HFD 2018 ref. 60. The decision stated that no specific procedural rules can be applicable to direct procurements, but that procurement-law principles of proportionality and equal treatment should also be of importance in procurements not subject to directives (including direct procurements).
New possibility of direct procurement in conjunction with review
The government’s proposal means that direct procurement may be used in an acquisition that is necessary in order to meet an urgent need arising as a result of a general administrative court:
- dealing with or having settled a case regarding review of a procurement, as a result of which an agreement may not be entered into,
- having decided that a procurement must be re-run or rectified, or
- dealing with a case regarding review of an agreement’s validity and the agreement may not be implemented.
Such a directly procured contract shall not have a longer duration or be more extensive than is required with regard to the procurement’s purpose. Direct procurement in the above situations shall only be permissible if it is estimated that the value of the procurement is below the applicable thresholds or if the procurement concerns a sub-contract that may be awarded in accordance with the rules regarding procurements not subject to directives.
The possibility of direct procurement based on a review complements the provisions on extreme urgency, but with the intention that the new possibilities for direct procurement should not have such a restrictive area of application as the provisions on extreme urgency. Instead of the acquisition having to be absolutely necessary (a requisite condition if extreme urgency is to be invoked), it must thus be a procurement that is necessary in order to meet an urgent need.
Although many procuring authorities and entities are likely to welcome this possibility of direct procurement of so-called covering purchases, it can also be stated that we can probably expect a degree of difficulty in determining its area of application, which is largely left to the application of legislation (i.e. the courts).
Inclusion of a specific provision regarding dialogue between a contracting authority or entity and tenderers in an ongoing procurement
The bill also includes a proposal that a provision be introduced that clarifies the possibility of conducting a dialogue, carrying out a negotiation and facilitating corrections and additions to tenders for procurements requiring advertisement that are below the thresholds.
However, the provision can be expected to correspond to what already follows from the current legislation or is regulated for procurements above the thresholds. Thus it remains to be seen whether the provision will have any effect in practice.
New relaxations with regard to post-advertisement
The bill proposes that direct procurements below the direct-procurement limits be exempted from the post-advertisement obligation.
The proposal is to be read in the light of the new rules on post-advertisement of procurements that came into force on 1 January 2021, which mean that all procurements both above and below the thresholds are to be advertised. The new rules have met with strong criticism, as many of the bodies consulted deem that a requirement for post-advertising without a lower amount limit creates burdensome documentation and extra work for procuring authorities and entities. Thus if the proposal in the bill becomes a reality, the direct-procurement limits will act as such a lower threshold.
New direct-procurement limit and new rules on social services and other specific services
It is proposed that the services currently regulated in Appendices 2 and 2a of the Swedish Public Procurement Act (LOU) be combined to form a joint appendix. This means that all services will be regulated in a new Appendix 2.
It is also proposed that the direct-procurement limit for these services be raised to the applicable threshold, i.e. by removing the current obligation to apply a simplified procedure for procurements whose value exceeds the current direct-procurement limit and falls below the threshold. Advertisement of such procurements on a publicly available database will thus not be mandatory.
It is furthermore proposed that there should be a possibility of carrying out a reserved procurement for all the services listed in the forthcoming Appendix 2 (and not just the services in accordance with Appendix 2a that apply in accordance with the current legislation).
The bill will now be dealt with in Parliament, and only time will tell whether the regulatory framework on procurement will become more simplified and flexible in practice – we look forward to seeing the outcome!
The bill as a whole can be found at government.se.
Do you want to know more about the bill, or did the article raise other questions? Please feel free to contact one of us or your regular contact at Lindahl.