Overview
The Public Procurement (International Trade Agreements) (Amendment) Regulations 2023 (the Amending Regulations) have made some important changes to the Public Contracts Regulations 2015 (PCR); the changes came into effect on 25th May 2023.
The Amending Regulations were made to implement the free trade agreements entered by the United Kingdom with Australia and New Zealand (the FTAs) and is part of the wider progression of the UK parliament to overhaul current procurement law post-Brexit. We consider below the key changes made to the PCR by the Amending Regulations.
Amendments
There are three main changes to the PCR:
- Valuation of procurements: in situations where the value of a procurement cannot be estimated, the value will be deemed equal to the relevant threshold set out in regulation 5 of the PCR. This means that in such situations, a contracting authority will have to comply fully with the PCR regime and run a competitive procurement, if no exemptions otherwise apply to that procurement.
- Public Information Notices (PIN): Contracting authorities can no longer use PINs as a means of calling for competition. PINs could previously be used by sub-central contracting authorities as a means of calling for competition and as an alternative to a contract notice, as well as a means of notifying the market of a potential opportunity. Note that procurements already in progress are not affected by the rule change.
- Termination of contracts: contracting authorities cannot terminate their contracts in ways that circumvent their obligations under the FTAs.
What actions are needed?
With these changes now in effect, it is important for contracting authorities to review their procurement processes to ensure that proper record keeping is in place with regard to documenting estimated values of contracts and also to review procedures on contract advertisement and termination, especially if PINs have previously been used as a call for competition.
PPN 05/23 has also been published and provides useful further guidance on the changes. The PPN is available here.
A brief update on the Procurement Bill
Finally, the government has announced that the Procurement Bill will enter the House of Commons’ report stage and third reading on 13 June 2023. This is the first concrete update on the Bill’s progression for a couple of months and represents another step towards the granting of Royal Assent.
As we’ve previously reported, the government has made it clear that there will then be a further period before the Bill comes into force to allow contracting authorities to prepare for the changes and to allow the making of secondary legislation to implement further elements of the Bill’s wider objectives.
If you would like to discuss this topic further, please get in touch with us at Hill Dickinson LLP.
For further information, please contact:
Lucy Probert, Hill Dickinson
lucy.probert@hilldickinson.com
