Defra policy on awarding contracts: legal requirements
Introduction
All public procurement must abide by rules laid out in the EC Procurement Regulations which aim to encourage and develop open, fair and effective competition in procurement by:
- Using common practices and procedures
- Publishing advance information on public purchasing programmes and individual contracts.
These rules are set out in Directives which have been incorporated into UK law through Statutory Instruments (SI).
| EU Directive | What is covered |
| The Supplies Directive (UK SI 201/1995) |
The supply, lease, rental or hire purchase of goods |
| The Works Directive (UK SI 2680/1991) |
The supply of capital works |
| The Services Directive (UK SI 3228/1993) |
The supply of services |
| The Utilities Directive (UK SI 3279/1992) |
The supply of goods, works and services in the Utilities sector (water, energy, telecommunications and transport infrastructure) |
Defra's obligations
The UK's EC and international obligations include the following:
EC Treaty provisions which prohibit:- Discrimination on grounds of nationality, either directly or indirectly
- Restrictions on the free movement of goods and services
- Restrictions on the freedom of establishment of service providers, and
- Measures of equivalent effect.
- Reinforce the above Treaty provisions for contracts above certain values
- Are based on principles of equal treatment, transparency and competitive procurement
- Establish a framework of rules to which procedures for the award of supplies, works and certain services contracts by public bodies and various utilities must be adapted, and
- Are implemented by SIs made by the Treasury.
EC Remedies Directives which provide, where the Procurement Directives apply:
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That suppliers harmed or at risk of harm from a breach of the EC rules (the Directives, the Regulations which implement them or any other relevant Community law, including the Treaty) are to have access to rapid and effective review systems with powers to grant interim and final remedies including powers to suspend the award procedure, to set aside decisions and/or to award damages, and
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A corrective mechanism under which the European Commission can draw attention to alleged breaches and accelerate its consideration of infraction proceedings against the member state in the European Court of Justice (ECJ). In addition to powers to determine whether there has been a breach of Community law by the member state, the ECJ has powers to grant interim remedies or to order that the contract is not to be performed.
The UK Regulations give effect to these provisions by:
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Providing for relevant suppliers to bring proceedings against the purchaser before the High Court in England and Wales, the High Court in Northern Ireland or the Court of Session in Scotland. They provide for injunctive relief and/or damages, but with damages to be the only remedy if the contract has been entered into
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Imposing an obligation on purchasers to provide information needed for the purpose of responses to the Commission. For purchasers other than departments, this obligation is enforceable by the Courts on application by the department most closely concerned with the purchaser's activities, and
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The European Economic Area Agreement and various Europe Agreements, under which purchasers have the same obligations towards suppliers from other European countries as they do to suppliers from other EU member states. The UK Regulations identify the countries concerned and provide for the same remedies;
WTO (formerly GATT) Government Procurement Agreement (GPA), under which obligations similar to those under the EC rules are enforceable by suppliers from other Signatories to the GPA where it applies; and
Jurisprudence of the ECJ and UK courts
Broadly speaking, sound practice for the pursuit of value for money under appropriate award procedures and meeting various publicity and information requirements will ensure compliance with the EC rules and other international obligations.
Judicial review
In general, procurement decisions by departments and non-departmental public bodies (NDPBs) will be of a commercial rather than administrative nature.
Applications for judicial review are unlikely to be granted where an alternative, more appropriate, remedy is available.
Actions under the Regulations or, if the Regulations do not apply, for breach of a statutory duty or for breach of an implied contract will generally be more appropriate.
Page published: 11 July 2005