Negotiation without the prior publication of a contract notice is one of the recognised methods of public procurement. The situations where this method may be used have now been narrowed down from those allowed under the previous law. This is partly because some earlier grounds for using this method are now covered by regulations on changes to obligations. Act no. 134/2016 Coll., on public procurement, as amended (the “PPA”), sets out the circumstances where procurement may take place through a negotiated procedure without prior publication. Generally speaking, the PPA foresees three scenarios.
The first situation is one in which a contracting authority had made negligible or no changes to the terms of reference used in an earlier open procedure, a restricted procedure or a simplified below-threshold procedure. In all three cases, it is vital that(i) no bids or participation requests were submitted, (ii) the bids submitted did not meet the contracting authority’s requirements for the public contract or (iii) those seeking to take part did not meet the qualifying conditions.
The second scenario concerns a public contract that may only be performed by a specific contractor for one of the following reasons: (i) it involves a unique work of art or performance, (ii) there is no competition for technical reasons or (iii) this action is needed to protect exclusive rights including intellectual property rights. In the latter two cases, the requirements will only be met if no other option is available and the authority did not draft the terms and conditions with a view to eliminating competition.
In the case of public service contracts, the PPA also allows for the use of a negotiated procedure without prior publication if the procurement is based on a design contest where the contracting authority will award the contract to the winning participant.
The third situation where this method may be used is that of an extreme emergency. In this case, it is crucial that (i) the contracting authority could not foresee and did not cause the extreme emergency and (ii) the deadlines for an open procedure, restricted procedure or negotiated procedure with prior publication cannot be met. The PPA does not define the term “extreme emergency”. We may, however, refer to earlier legislation along with past decisions of the Office for the Protection of Competition on the concept of “extreme urgency”. According to these sources, an extreme emergency is an exceptional situation that can only be resolved through the use of exceptional measures and thus requires a departure from the general or standard process used to award public contracts. The situation must be urgent, i.e. an acute state of affairs, accident or crisis that has objectively reached a certain (extreme) level of intensity. Furthermore, there must be a need for immediate action that cannot be delayed because of the danger to life and public health or the risk of an accident, natural disaster or vast damage. Expert commentaries are almost unanimous that this category includes force majeure events such as natural disasters.
In general, cases of extreme urgency do not include incidents that could have been foreseen by the contracting authority if it had time to deal with the fallout via a standard public contract process. In addition, if the authority created the extreme emergency itself, then this will not normally justify the use of a negotiated procedure without prior publication. If, for example, the authority is responsible for the dangerous disrepair of a particular building, then the state of that building will not constitute an extreme emergency even if it poses a danger to its surroundings. The reason for this is that the contracting authority brought on the emergency itself. It will, however, be necessary to consider the specific circumstances of each case.
Finally, the contracting authority must show that it was impossible to deal with the emergency through another type of procurement process, i.e. an open procedure, restricted procedure or a negotiated procedure with prior publication. This condition must be met objectively. In other words, the impossibility of meeting these deadlines must not be due to the conduct of the contracting authority.