Government Administrative Measures To Support SMEs In Public Procurement

Author:Mr Patrick McGovern and Peter Curran
Profession:Arthur Cox

Circular 10/10 Issued by the Department of Finance of Ireland 13 August 2010

The Department of Finance of Ireland (which has legislative responsibility for Public Procurement) has issued an administrative Circular (Circular 10/10 issued on 13 August 2010) addressed to Government Departments and public bodies entitled "Facilitating SME Participation in Public Procurement". This is not legally binding and does not amend the EU Law on Public Procurement as transposed in Ireland. Nevertheless, it is of the first importance for those bodies to which it is addressed. It is intended to remove obstacles to small and medium sized enterprises (SMEs) participating successfully in Public Procurement competitions as bidders.

The Circular comes in the light of the EU Code of Best Practice (published in 2008) on increased SME participation in Public Procurement. In particular, the guidance seeks to inform public bodies how they should structure their competitions in order to facilitate increased participation by SMEs, whilst, at the same time, complying with the principles and rules of the existing EU-based legally binding Public Procurement regime. Two guidance documents have been issued with the Circular in support of the objective, namely "Guidance for Contracting Authorities: Facilitating Participation of SMEs in Public Procurement" and "Suitability Criteria For Contractors, Submission of Evidence and Procurement Thresholds".

Among the features of the Circular are the following, largely based on a pragmatic application of the EU principle of Proportionality:

a prohibition on public bodies entering into arrangements that require SMEs to pay to enter the tendering process; all contracts for supplies and general services (other than in a works context) with an estimated value of €25,000 or greater (previously €50,000) must henceforth be advertised on the etenders (Irish Government Procurement) website. The threshold for works contracts and related services remains at €50,000. Contracting authorities are also encouraged to advertise contracts for lower values to promote SME participation; the pre-qualification requirements have been eased somewhat. An Open procedure (that is, without pre-qualification of tenderers) must be utilised for all advertised contracts with values up to €250,000 for works contracts and up to €125,000 for supplies and general service (non-works) contracts. This new arrangement is stated to be to ensure that all contracts within...

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