P UBLIC PROCUREMENT SYSTEM IN POLAND

1Public Procurement Office, Poland

PPUBLIC UBLIC PROCUREMENT PROCUREMENT SYSTEM SYSTEM IN IN POLANDPOLAND

Rome,Rome, 13 December 13 December 20042004


CONTENTSCONTENTS

1.1. PUBLIC PUBLIC PROCUREMENT PROCUREMENT MARKETMARKETIN IN POLANDPOLAND

2.2. HISTORICAL HISTORICAL BACKGROUNDBACKGROUND

3.3. CURRENTCURRENT LEGAL LEGAL FRAMEWORKFRAMEWORK

4.4. CONTRACTCONTRACT AWARD AWARD PROCEDURES PROCEDURES

5.5. PUBLICATION PUBLICATION OF OF NOTICESNOTICES

6.6. REVIEW REVIEW PROCEDURESPROCEDURES

7.7. PUBLIC PUBLIC PROCUREMENTPROCUREMENT OFFICE OFFICE


PUBLIC PROCUREMENT MARKET IN PUBLIC PROCUREMENT MARKET IN POLAND (1)POLAND (1)

SIZE OF MARKETSIZE OF MARKET

-- full information about awardedfull information about awarded

contracts available only above threshold contracts available only above threshold of 60 000 Euro of 60 000 Euro (source Bulletin of Public Procurement) (source Bulletin of Public Procurement)

-- PPO estimates expenditure on publicPPO estimates expenditure on public

procurement in 2003 at least 1procurement in 2003 at least 111 billion billion EUR (EUR (overover 5% of GDP) 5% of GDP)

-- OECD estimates – 9.7 % GDP OECD estimates – 9.7 % GDP (2002)(2002)


PUBLIC PROCUREMENT PUBLIC PROCUREMENT MARKET IN POLAND (2)MARKET IN POLAND (2)

Value of public procurement market in Poland Value of public procurement market in Poland

in billions of Polish Zlotyin billions of Polish Zloty(contract notices in open procedure of value above EUR 30 000)(contract notices in open procedure of value above EUR 30 000)

13,617,5 17,7

23 23,9

35 37

0

10

20

30

40

1997 1998 1999 2000 2001 2002 2003


PUBLIC PROCUREMENT MARKET IN POLAND (3)PUBLIC PROCUREMENT MARKET IN POLAND (3)

- - according to the value of according to the value of contractscontracts awarded awarded

in particularin particular type of procurement type of procurement

84 77 79 79 75 68

47

10 17 15 13 15 19

33

6 6 6 8 10 12 20

0%

20%

40%

60%

80%

100%

1997 1998 1999 2000 2001 2002 2003

Works Supplies Services


PUBLIC PROCUREMENT MARKET IN POLAND PUBLIC PROCUREMENT MARKET IN POLAND ((44))Award procedures according to type of procurementAward procedures according to type of procurement

(number of contract notices of value above EUR 30 000)(number of contract notices of value above EUR 30 000)

Source: Source: Report on the functioning of public procurement system in 200Report on the functioning of public procurement system in 20033

0

5000

10000

15000

20000

25000

30000

35000

40000

works supplies services total 39 300


PUBLIC PROCUREMENT MARKET IN POLAND (5)PUBLIC PROCUREMENT MARKET IN POLAND (5) Who purchases most frequently?Who purchases most frequently?

(contract notices of value above EUR 30 000)(contract notices of value above EUR 30 000)

Source: Source: Report on the functioning of public procurement system in 200Report on the functioning of public procurement system in 20033

15243

2052

8424

640

1732

4749

6323

0

2000

4000

6000

8000

10000

12000

14000

16000

number of contract notices

municipalitiesand gminas

powiats centraladministration

military units universities health careunits

other


PUBLIC PROCUREMENT MARKET IN PUBLIC PROCUREMENT MARKET IN POLAND (6)POLAND (6)

Number of active enterprises in Poland Number of active enterprises in Poland - over 1.750.000. - over 1.750.000.

Procuring entities - 4.050 units in state Procuring entities - 4.050 units in state administration and about 51.000 entities administration and about 51.000 entities in local government.in local government.

20% of entrepreneurs participate in 20% of entrepreneurs participate in public procurement market public procurement market (estimate based on surveys)(estimate based on surveys)

1.69% of Polish procurements 1.69% of Polish procurements announced in OJ awarded to contractors announced in OJ awarded to contractors from other EU Member States from other EU Member States


PUBLIC PROCUREMENT MARKET IN POLAND (7)PUBLIC PROCUREMENT MARKET IN POLAND (7)

Procurement notices from New Member States published in OJ EUProcurement notices from New Member States published in OJ EU (based on TED from 01.05 to 23.09.2004 (based on TED from 01.05 to 23.09.2004 - - total numbertotal number 3864 3864))

Slovenia 4,09

Hungary 4,84

Cyprus 0,75Czech Rep.

4,48

Estonia 2,36Lithuania

14,34

Latvia 4,81

Malta 0,6

Slovakia 4,17

Poland 59,6


HISTORICAL HISTORICAL BACKGROUNDBACKGROUND

No separate procurement No separate procurement regulation before 1989regulation before 1989

Act on Public Procurement adopted Act on Public Procurement adopted on 10 June 1994 – initially based on on 10 June 1994 – initially based on the UNICITRAL Model Lawthe UNICITRAL Model Law

Public Procurement Law adopted on Public Procurement Law adopted on 29 January 2004 – in force from 229 January 2004 – in force from 2ndnd March 2004 – adjustment to EU March 2004 – adjustment to EU procurement directivesprocurement directives


CURRENT LEGAL FRAMEWORKCURRENT LEGAL FRAMEWORK (1) (1)

PUBLIC PROCUREMENT LAWPUBLIC PROCUREMENT LAWOne single act regulating all aspects of publicOne single act regulating all aspects of public procurement:procurement:-- from the start of a procedure till the signing from the start of a procedure till the signing of a contractof a contract-- covers also review procedurescovers also review procedures-- covers also the utilities sectorscovers also the utilities sectorsIt does not regulate matters related to:It does not regulate matters related to:-- planning and financing planning and financing of of public contractspublic contracts (subject to finance law)(subject to finance law)-- performance of contracts (subject to civil performance of contracts (subject to civil law)law)



COVERAGE OF THE PUBLIC PROCUREMENTCOVERAGE OF THE PUBLIC PROCUREMENT LAW LAW::

Procurement of public services, goods and worksProcurement of public services, goods and works Entities obliged to apply the Entities obliged to apply the PPLPPL Values of thresholdsValues of thresholds

-- 6 000 Euro6 000 Euro - - the the PPLPPL does not apply to does not apply to public public contracts below this thresholdcontracts below this threshold

-- 60 000 Euro60 000 Euro - - application of the rules laidapplication of the rules laid down by down by EU directivesEU directives

-- over 5 000 000 Euro for services and over 5 000 000 Euro for services and supplies supplies and over 10 000 000 Euro for public works - and over 10 000 000 Euro for public works - strengthened monitoring and control rulesstrengthened monitoring and control rules - - „ „strictstrict procedureprocedure””



IMPLEMENTING IMPLEMENTING REGULATIONSREGULATIONS

Currently 14 implementing regulations in force:Currently 14 implementing regulations in force: issued by competent ministers on the basis issued by competent ministers on the basis

of the PPLof the PPL (majority by Prime Minister – (majority by Prime Minister – otherotherss by Minister of Infrastructure) by Minister of Infrastructure)

regulate in detail matters such as:regulate in detail matters such as: standard forms of notices for publicationstandard forms of notices for publication,, documents which may be demanded from documents which may be demanded from

biddersbidders,, proceedings of tendering committeesproceedings of tendering committees..


CONTRACTCONTRACT AWARD AWARD PROCEDURESPROCEDURES (1) (1)

The Polish Public Procurement The Polish Public Procurement Law Law provides for provides for 77 different procedures for the award of public different procedures for the award of public contracts:contracts:

open tenderingopen tendering restricted tenderingrestricted tendering negotiations with publication negotiations with publication negotiations without publicationnegotiations without publication single source procurementsingle source procurement request for quotationsrequest for quotations electronic auctionelectronic auction


CONTRACTCONTRACT AWARD AWARD PROCEDURES PROCEDURES ((22))

Only one eligible tender submitted required for Only one eligible tender submitted required for

valid procedure of awarding a contract.valid procedure of awarding a contract.

OPEN TENDERING and RESTRICTED TENDERINGOPEN TENDERING and RESTRICTED TENDERING

Two primary procedures for the award of public Two primary procedures for the award of public

contracts - possibility of equal application.contracts - possibility of equal application.

OPEN TENDERING -all bidders may submit a OPEN TENDERING -all bidders may submit a

tender.tender.


CONTRACTCONTRACT AWARD AWARD PROCEDURES PROCEDURES ((33))

RESTRICTED TENDERINGRESTRICTED TENDERING- only suppliers or contractors qualified by the only suppliers or contractors qualified by the

awarding entity after the selection phase may awarding entity after the selection phase may submit tenders,submit tenders,

- selection criteria set up by the implementing selection criteria set up by the implementing regulation issued on 7th of April 2004:regulation issued on 7th of April 2004:

a). pa). personal situation of the candidate or bidder

b). suitability to pursue the professional activity

c). economic and financial standing

d). technical and/or professional ability to perform a contract



NEGOTIATIONS WITH PUBLICATIONNEGOTIATIONS WITH PUBLICATION- contract award procedure in which, following contract award procedure in which, following

a public notice, the awarding entity shall a public notice, the awarding entity shall negotiate the terms of the public contract negotiate the terms of the public contract with contractors (at least 5, if available) and with contractors (at least 5, if available) and shall subsequently invite them to submit shall subsequently invite them to submit their tenderstheir tenders

- if the contract value exceeds 10 000 000 if the contract value exceeds 10 000 000 Euro for works and 5 000 000 Euro for Euro for works and 5 000 000 Euro for supplies and services, prior consent of supplies and services, prior consent of the Chairman of the PPOthe Chairman of the PPO,, by administrative by administrative decisiondecision,, is required is required



Procedures where application require prior Procedures where application require prior consent of the Chairman of the PPO by consent of the Chairman of the PPO by administrative decision if the contractadministrative decision if the contract value value exceeds 60 000 Euroexceeds 60 000 Euro

NEGOTIATIONS WITHOUT PUBLICATIONNEGOTIATIONS WITHOUT PUBLICATION- contract award procedures in which the contract award procedures in which the

awarding entity awarding entity negotiates the terms of the negotiates the terms of the contract with contractors of its choice (at contract with contractors of its choice (at least 5, if available) and subsequently invites least 5, if available) and subsequently invites themthem to submit their tenders to submit their tenders

SINGLE-SOURCE PROCUREMENTSINGLE-SOURCE PROCUREMENT- contract award procedures in which the contract award procedures in which the

awarding entity awards a contract after awarding entity awards a contract after having negotiated with only one contractorhaving negotiated with only one contractor



REQUEST-FOR-QUOTATIONSREQUEST-FOR-QUOTATIONS

- tthe procuring entity addresses a request he procuring entity addresses a request for quotations for for quotations for readily available goods readily available goods or servicesor services with established quality with established quality standards,standards,

- the contract value does not exceed 60 000 the contract value does not exceed 60 000 Euro,Euro,

- contracts are awarded to the suppliers contracts are awarded to the suppliers offering the lowest price. offering the lowest price.



ELECTRONIC AUCTIONELECTRONIC AUCTION- contract award procedure in whichcontract award procedure in which,, using using

a form available on the website allowing to a form available on the website allowing to enter the necessary data on-line, enter the necessary data on-line, contractors shall submit successive more contractors shall submit successive more advantageous tenders (bid increments), advantageous tenders (bid increments), subject to automatic classificationsubject to automatic classification,,

- forfor readily available goodsreadily available goods with with established quality standardsestablished quality standards,,

- the contract value does not exceed 60 000 the contract value does not exceed 60 000 Euro.Euro.



STRICT PROCEDURESTRICT PROCEDURE additional requirements if the contract additional requirements if the contract

value exceeds value exceeds - 10 000 000 Euro for works10 000 000 Euro for works- 5 000 000 Euro for goods or services: 5 000 000 Euro for goods or services:

- contract notice in a national daily or contract notice in a national daily or periodical, periodical,

- obligatory participation of the obligatory participation of the independent observer during the works of independent observer during the works of the tender committee,the tender committee,

- obligatory obligatory ex-anteex-ante check by the Chairman check by the Chairman of the PPO.of the PPO.



STRICT PROCEDURESTRICT PROCEDURE from the entry into force of PPL over from the entry into force of PPL over

150 „strict procedures” was started, 150 „strict procedures” was started, average value of contract ca. 35 mln Euro,average value of contract ca. 35 mln Euro, biggest value of contract this year biggest value of contract this year

– 1.7 billion Euro,– 1.7 billion Euro, the predominant among award procedures the predominant among award procedures

of highest value iof highest value iss electro – energy sector. electro – energy sector.


PUBLICATION OF NOTICES (1)PUBLICATION OF NOTICES (1)

The following notices are The following notices are mandatory:mandatory: contract noticescontract notices and and contract award noticescontract award notices

of value above 60 000 Euro are published in the of value above 60 000 Euro are published in the Bulletin of Public Procurement,Bulletin of Public Procurement,

contract noticescontract notices of value above 130 000 Euro of value above 130 000 Euro for goods and services and 5 000 000 Euro for for goods and services and 5 000 000 Euro for works are also published in the Official Journal of works are also published in the Official Journal of the European Union,the European Union,

prior information noticesprior information notices about procurements about procurements planned for a given year of value above 750 000 planned for a given year of value above 750 000 Euro for goods and services and 5 000 000 Euro Euro for goods and services and 5 000 000 Euro for works are published in the Bulletin of Public for works are published in the Bulletin of Public Procurement and in OJ of the European Union.Procurement and in OJ of the European Union.


PUBLICATION OF NOTICES (2)PUBLICATION OF NOTICES (2)

BULLETIN OF PUBLIC PROCUREMENTBULLETIN OF PUBLIC PROCUREMENT an official governmental gazettean official governmental gazette prepared by the Public Procurement Office prepared by the Public Procurement Office

(a separate unit within the Office dealing with (a separate unit within the Office dealing with matters related to the Bulletin)matters related to the Bulletin)

published both in paper and electronic formpublished both in paper and electronic form e-version e-version available free of charge on the PPO available free of charge on the PPO

website (website (www.uzp.gov.plwww.uzp.gov.pl)) notices for publication may be sent by post, fax or notices for publication may be sent by post, fax or

on-line (currently over 55% of all notices for on-line (currently over 55% of all notices for publication is sent electronically)publication is sent electronically)

apart from the Bulletin mandatory notices must be apart from the Bulletin mandatory notices must be placed at the premises of contracting entities and on placed at the premises of contracting entities and on the internet site of the awarding entity,the internet site of the awarding entity,

notices may not be released prior to their notices may not be released prior to their publication in the Bulletin of Public Procurement.publication in the Bulletin of Public Procurement.


PUBLICATION OF NOTICES (PUBLICATION OF NOTICES (33))Number of cNumber of contract notices in 2000-200ontract notices in 2000-20044

- - above EUR 30 000 thresholdabove EUR 30 000 threshold for 2000 – 2003 for 2000 – 2003- - above EUR above EUR 660 000 threshold0 000 threshold for 2004 for 2004

1793

2

1870

2

1930

8

1646

5

9015

8002

9430

1414

7

6858

6347

7662

8262

8677

3777

1297

1

0

5000

10000

15000

20000

2000 2001 2002 2003 2004*

works

supplies

services

**Data for period Data for period from 2 March from 2 March till 8 Octobertill 8 October


REVIEW PROCEDURES (1)REVIEW PROCEDURES (1) suppliers and contractors wishing to contest a suppliers and contractors wishing to contest a

decision of the awarding entity are entitled to decision of the awarding entity are entitled to use use consecutivelyconsecutively the following review the following review measures:measures:-- protestprotest-- appealappeal-- complaintcomplaint

tthe right to apply review measureshe right to apply review measures - - anyone anyone whose legal interest has been or might have whose legal interest has been or might have been infringedbeen infringed

tthe provisions on review measures apply if he provisions on review measures apply if the value of a contract exceeds the threshold the value of a contract exceeds the threshold of 6of 6 000000 Euro Euro


REVIEW PROCEDURES (2)REVIEW PROCEDURES (2)PROTESTSPROTESTS-- supplier or contractor may lodge a protest supplier or contractor may lodge a protest

against a decision of the awarding entityagainst a decision of the awarding entity-- protest shall be submitted directly to the protest shall be submitted directly to the

awarding entityawarding entityAPPEALSAPPEALS-- supplier or contractor may then lodge an appeal supplier or contractor may then lodge an appeal

to the Chairman of PPOto the Chairman of PPO-- appeals are examined by arbitration panels appeals are examined by arbitration panels

consisting of three arbiters appointed by consisting of three arbiters appointed by Chairman of the PPOChairman of the PPO

COMPLAINTSCOMPLAINTS-- interested suppliers or contractors may lodge a interested suppliers or contractors may lodge a

complaint to the regional court competent for complaint to the regional court competent for the place of residence of the awarding entitythe place of residence of the awarding entity


PUBLIC PUBLIC PROCUREMENTPROCUREMENT OFFICE ( OFFICE (11))

OORGANISATION AND STRUCTURE:RGANISATION AND STRUCTURE:

created on 1 January 1995 following the created on 1 January 1995 following the adoption of the Act on public procurement.adoption of the Act on public procurement.

a separate body within public a separate body within public administrationadministration

the Chairman of the Office appointed by the Chairman of the Office appointed by the Prime Ministerthe Prime Minister

currently PPO employs over 100 people currently PPO employs over 100 people working in 7 divisionsworking in 7 divisions



The key functions of the PPO are:The key functions of the PPO are:

to prepare drafts of legislation on public to prepare drafts of legislation on public procurementprocurement,,

to issue the Bulletin of Public Procurementto issue the Bulletin of Public Procurement,, to take administrative decisions concerning to take administrative decisions concerning

the application of the the application of the PPLPPL by by awarding awarding entitiesentities,,

to arrange and organise review proceedingsto arrange and organise review proceedings,, to inspire training programs and events in to inspire training programs and events in

the field of public procurement.the field of public procurement.



The PPO The PPO does not:does not:

award contracts for other public entities,award contracts for other public entities, qualify candidates and evaluate tenders,qualify candidates and evaluate tenders, approve and invalidate conducted approve and invalidate conducted

procedures,procedures, examine protests and appeals lodged by examine protests and appeals lodged by

bidders (which is a competence of bidders (which is a competence of Arbitration Panels)Arbitration Panels)

Source of useful information Source of useful information on public procurement on public procurement

in Poland:in Poland:

www.uzp.gov.plwww.uzp.gov.pl

- website of - website of the Public Procurement Officethe Public Procurement Office


DEPOSITDEPOSIT

-- tthe awarding entity shall require the he awarding entity shall require the contractors to pay a deposit where the contractors to pay a deposit where the value of the contract exceeds 60 000value of the contract exceeds 60 000 Euro, Euro,

-- the awarding entity may require the the awarding entity may require the contractors to pay a depositcontractors to pay a deposit where the where the value of the contract is less than 60 000 value of the contract is less than 60 000 EuroEuro


VARIANTS/LOTSVARIANTS/LOTS

-- the awarding entitythe awarding entity may may permit the permit the possibility of submitting variants, when the possibility of submitting variants, when the contract is awarded contract is awarded toto the most economically the most economically advantegous tender advantegous tender

-- tthe awarding entity may also permit the he awarding entity may also permit the possibility of submitting tenders for lots, possibility of submitting tenders for lots, where the object of the contract is where the object of the contract is divisabledivisable

-- iin this case the contractor may submit n this case the contractor may submit tenders for one or more lots, unless the tenders for one or more lots, unless the awarding entity specified the maximum awarding entity specified the maximum number of lots for which one contractor may number of lots for which one contractor may submit his tenders. submit his tenders.


SUBMISSION OF TENDERSSUBMISSION OF TENDERS

-- tender tender is is submitted, under the pain of submitted, under the pain of nullity, nullity, in writingin writing or if the awarding or if the awarding entity agrees, in entity agrees, in electronic formelectronic form with a with a secure electronic signature verifiable secure electronic signature verifiable using a valid qualified certificateusing a valid qualified certificate,,

-- in the case of in the case of electronic auctionelectronic auction, , tender istender is submitted, under the pain of submitted, under the pain of nullity, in electronic form with a nullity, in electronic form with a secure electronic signature verifiable secure electronic signature verifiable using a valid qualified certificateusing a valid qualified certificate


DOCUMENTS TO SUBMITDOCUMENTS TO SUBMITDocuments confirming that:Documents confirming that:- bankruptcy proceedings have bankruptcy proceedings have notnot commenced or commenced or

bankruptcy hasbankruptcy has not not been declared been declared,,- prohibitition to participate in the public procurement prohibitition to participate in the public procurement

procedure has not been issued,procedure has not been issued,- no arrears with no arrears with payment of taxes, charges or social payment of taxes, charges or social

insurance or health insurance premiums, with the insurance or health insurance premiums, with the exception of cases where they have been legally exception of cases where they have been legally exemptedexempted,,

- natural person or partner or member natural person or partner or member of the of the management boardmanagement board of the legal person of the legal person has has not not been been validly sentenced for an offence committed in validly sentenced for an offence committed in connection with a contract award procedure, for connection with a contract award procedure, for bribery, for an offence against economic trade or for bribery, for an offence against economic trade or for any other offence committed with the aim of gaining any other offence committed with the aim of gaining financial profitsfinancial profits. .


PRINCIPLES OF CONDUCTING PRINCIPLES OF CONDUCTING PUBLIC PROCUREMENTPUBLIC PROCUREMENT

PROCEDUREPROCEDURES S

transparency of tendering procedures,transparency of tendering procedures, fostering competition,fostering competition, economic use of public means,economic use of public means, equal treatment of equal treatment of participantparticipants,s, clear requirements for participation,clear requirements for participation, clear contract award criteriaclear contract award criteria,, open tendering and restricted tendering – open tendering and restricted tendering –

primary procedures for awarding contractsprimary procedures for awarding contracts

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