Decreto-Lei n.º 111-B/2017

Publicação: Diário da República n.º 168/2017, 2º Suplemento, Série I de 2017-08-31
  • Emissor:Planeamento e das Infraestruturas
  • Tipo de Diploma:Decreto-Lei
  • Número:111-B/2017
  • Páginas:5250-(1894) a 5250-(2052)
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Summary in plain english (Without legal value)

What is it?

This decree-law amends the Public Procurement Code and introduces into Portuguese law the European Directives:

  • 2014/23/EC on the award of concession contracts
  • 2014/24/EC on public procurement
  • 2014/55/EC on electronic invoicing in public procurement.

What will change?

Changes resulting from European directives

  1. The system of contracts between public entities is extended to cover more forms of cooperation between public entities.
  2. A partnership for innovation is created, a new procedure for buying innovative products or services.
  3. The award of batch contracts is promoted to encourage the participation of small and medium-sized enterprises.
  4. The criteria of most economically advantageous tender becomes the awarding criteria.
  5. This criteria is based on price or cost and the best value for money. However, it will still be possible to award to the lowest price, whenever this is the most appropriate criteria.

  6. The rule used for setting the criteria for an abnormally low price is changed. To evaluate whether the price is abnormally low, the price is compared with the average prices of other offers under consideration. It is also possible that other criteria may be used as appropriate in this case.
  7. The abnormally low price is therefore not indexed to a base price for comparison.

  8. All parts of the procedure must be freely available on the electronic procurement platform from the notice’s date of publication.
  9. Simplified rules are created for contracts greater than 750,000 euros for:
    • health, social and other related services
    • administrative services in social, educational and health areas
    • collective, social and personal services, including those provided by trade union organizations, political organizations, youth organizations and other associative organizations
    • services provided by religious organizations
    • administrative and public administrations’ services
    • services provided to the community
    • international services.

  10. The use of the electronic invoice is introduced for public contracts.
  11. The concepts of "overwork" and "work for rectifying errors and omissions" are replaced by complementary work or services.

Measures to simplify, reduce bureaucracy and increase flexibility

  1. The deadlines are shortened for submitting proposals and requests for procedures valued below the European thresholds, i.e. those that don’t need to be published in the Official Journal of the European Union.
  2. The value of the collateral must not exceed 5% of the contract value. The rules are also explained so that the need for collateral is gradually withdrawn.
  3. It is again possible to correct the errors of a proposal that hasn't fulfilled some unessential formality, without excluding that proposal. The aim is to avoid disproportionate exclusions that may affect public interest.
  4. Small works contracts of public works up to 5,000 euros can be awarded with a simplified direct contract.
  5. Works contracts involving contracts with an estimated value of up to 300,000 euros can now be contracted through an urgent public bidding process.
  6. New rules are created for the transfer of movable assets by public entities. The transfer of ownership or use of the property may be final or temporary; for example, renting and loaning.
  7. These rules are intended to allow assets that public services don’t need to be delivered to other services or transferred.

  8. Deadlines for direct contract and preliminary consultation are shorter.

Transparency measures and good public management

  1. Entities will have to informally consult the market before opening a procurement procedure. This is called preliminary consultation.
  2. Preliminary consultation is now different, as three suppliers must be consulted. This limits the use of direct contracting.
  3. Special justification is now required for contracts of more than 5,000,000 euros, which must be based on a cost-benefit assessment.
  4. The contract manager role is created. They must monitor contract performance on a permanent basis and ensure the quality of the work of those who perform public tasks.
  5. It is now prohibited to use time of delivery of the proposal as a tie-breaking criteria. This means one proposal cannot be preferred over another because it was delivered first.

Measures to implement the National Reform Programme

  1. Direct awarding after consultation with a single company can only be used when hiring only one company for contracts up to:
    • 20,000 euros for goods and services
    • 30,000 euros for works contracts.

  2. The preliminary consultation procedure is once again autonomous, with consultation of three entities for:
    • purchases of goods and services between 20,000 and 75,000 euros
    • public works contracts between 30,000 and 150,000 euros.

  3. The use of electronic contracting platforms is extended.
  4. Measures are created to prevent and eliminate conflicts of interest in contract formation procedures by the various actors involved in the proceedings. This includes members of the selection board and the experts who support it.

Government Programme Measures to relieve the courts

The use of arbitration is encouraged. Arbitration is a simple, quick and inexpensive way of resolving conflicts without having to go to court.

What are its benefits?

This decree-law is intended to:

  • make public procurement procedures simpler, less bureaucratic and more flexible
  • increase the efficiency of public spending
  • facilitate access to public procurement.

When does it come into effect?

This decree-law comes into effect on 1 January 2018.

This text is intended to present the content of the legal act in accessible, plain and understandable language for citizens. The summary of the legal act in plain language has no legal value and does not replace the consultation of the legal act in the Diário da República.