Procurement Pulse UK – February 2025

Welcome to Procurement Pulse, DLA Piper's newsletter for those interested in developments in public procurement law. In this issue, we cover recent court rulings, policy updates, and the latest legislative changes that may impact procurement professionals in both contracting authorities and supplier companies.

 

RECENT COURT JUDGEMENTS

ECJ Ruling: Third-Country Bidders and EU Procurement Rules

Kolin Insaat Turizm Sanayi ve Ticaret AS v Drzavna komisija za kontrolu postupaka javne nabave (C-652/22)

The European Court of Justice (ECJ) has ruled that bidders from non-EU countries without reciprocal agreements cannot rely on EU procurement rules when challenging procurement decisions.

What happened?

Turkish company Kolin Insaat challenged a Croatian procurement decision after HZ Infrastruktura awarded a railway infrastructure contract to Strabag. Kolin argued that Strabag failed to meet technical and professional capacity requirements and challenged the re-evaluation process.

The decision

The ECJ decided Kolin's case was inadmissible. It confirmed that only bidders from countries with EU reciprocal agreements can invoke EU procurement rules.

UK perspective

The case is relevant to UK suppliers looking to bid on EU contracts under the UK-EU Trade and Cooperation Agreement. 

What this means for you

• UK suppliers: UK businesses should ensure they understand their rights under the UK-EU Trade and Cooperation Agreement, which allows them to challenge procurement decisions in EU national courts.
• Other non-EU suppliers: If your country doesn’t have a procurement agreement with the EU, you may have limited legal recourse under EU law.

 

Concession Contract Modifications

Adusbef (Pont Morandi) C-683/22

The ECJ has provided clarity on when concession contracts can be modified without a new tender process under Directive 2014/23/EU.

What happened?

In 2007, Azienda Nazionale Autonoma delle Strade and Autostrade per l’Italia SpA (ASPI) entered into a motorway management agreement. From 2012, this agreement was overseen by the Italian Ministry of Infrastructure and Sustainable Mobility. The collapse of the Morandi Bridge in 2018 led to significant legal and financial consequences for ASPI. ASPI reached a settlement agreement, including compensation, safety enhancements, and shareholding transfers. The settlement was challenged in court as an illegal modification of the original concession agreement.

The decision

The ECJ ruled that concession contracts can be modified without a new tender if:

• The modification is permitted by national law.
• It does not alter the overall nature of the original contract.
• The contracting authority provides reasons why a new award procedure is not required.

UK perspective

The UK's new Procurement Act 2023 retains rules on contract modifications broadly in line with EU principles. Whilst UK courts are no longer bound by ECJ decisions the ruling could be persuasive if a similar case arose in the UK.

What this means for you

• Contracting authorities: Contract modifications should be justified under relevant legislation and documented to avoid challenges.
• Suppliers: If major contract changes occur, consider whether a new procurement challenge is possible.

 

POLICY, GUIDANCE and LEGISLATIVE DEVELOPMENTS

Upcoming Procurement Reform: What You Need to Know

The Procurement Act 2023 will come into force on 24 February 2025, bringing a major overhaul to the procurement landscape. Here's what's been happening:

Key developments

• National Procurement Policy Statement: The UK Government is finalising the Statement, which sets new procurement priorities, and it is expected to be published in February 2025.
• Procurement Act 2023 (Consequential and Other Amendments) Regulations 2025: The Regulations adjust the Procurement Act and Procurement Regulations 2024 and are expected to enter into force on 24 February 2024.
• New Cabinet Office Guidance Published: The UK Government has released comprehensive guidance documents to support the implementation of the Procurement Act 2023 covering all stages of a procurement process: Plan, Define, Procure, and Manage. The Welsh Government has also published guidance for implementation in Wales.
• New Central Digital Platform: The Government Commercial Function has published new guides for suppliers and contracting authorities. These guides explain how to use the new central digital platform introduced under the Act.
• Training and Support: New Learning materials have been published to help contracting authorities prepare for implementation.

How to prepare

• Stay informed: Read the guidance and attend training sessions.
• Review procurement processes to ensure compliance with new rules.
• Join our webinar - See below for details!

DLA Piper Webinar: Prepare for the Procurement Act 2023

• Date: 11 February 2025
• Online
• Expert speakers: Our procurement reform team will walk you through the key changes and practical steps to prepare for your first procurement under the new Act.

Register here

New Procurement Policy Notes (PPNs) you should know about

Several new PPNs, SPPNs, and WPPNs have been issued by the UK, Scottish and Welsh Governments covering key procurement policy updates:

• PPN 015 and PPN 018 - Assessing supplier payment practices for major contracts.
• SPPN 02/24 - Changes to Scottish procurement law due to international trade agreements.
• WPPN 03/24 - Updates to Sell2Wales contract notice publication rules.
• WPPN 01/25 - New supplier selection criteria for Works contracts in Wales.

Read our full analysis on PPNs 015/018 here.

New Welsh NHS procurement rules coming soon

The Health Services (Provider Selection Regime) (Wales) Regulations 2025 will take effect on 24 February 2025, streamlining how NHS health services are procured in Wales. The regulations will: 

• Establish new procurement principles and decision-making processes.
• Apply to relevant authorities such as local health boards and NHS trusts.
• Disapply the UK Procurement Act 2023 for relevant contracts.

Takeaway: If you're involved in NHS procurement in Wales, make sure to review the new framework before it takes effect.

AI in public procurement: Are authorities ready?

A recent report by the Ada Lovelace Institute explores whether public sector procurement is equipped to handle AI technologies responsibly. The paper raises concerns about:

• Lack of expertise in evaluating AI solutions.
• Potential bias and risks in AI-driven decision-making.
• Transparency challenges in AI procurement.

Read the full report here.

EU public procurement consultation: Have your say

The European Commission is seeking input on possible reforms to EU Public Procurement Directives. This review aims to:

• Boost competition and SME participation.
• Improve transparency.
• Support green and innovative procurement.

Consultation deadline: 7 March 2025.

Want to contribute? Read the questionnaire and submit your feedback here.

 

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