UK: Changes Ahead: Public Procurement 2014

Last Updated: 22 May 2013
Article by Fenwick Elliott

At the end of 2011, after extensive public consultation, the European Commission published its proposals for simplifying and modernising the public procurement regime. It is not expected that the proposals will become law in the UK before June or July 2014. However, the Commission is now in the process of making the final revisions to the relevant Directives.


UK current law is based on the public sector and utilities Directives of 2004, supplemented in 2007 by another Directive setting out the remedies available to aggrieved suppliers when there are problems with the process. Despite the innovations and improvements brought about by these Directives, the regime has been criticised for taking too long to implement them, and for being resource heavy and inflexible. A number of changes have been introduced to address these issues.


The new Directives for public contracts and utilities will be accompanied by a third Directive which will apply to concession contracts. The new Directives will apply alongside the existing remedies Directive and other sector-specific legislation. Implementation in the UK is likely to be through statutory instruments. The new rules will not apply retrospectively, so will apply to procurements beginning after the date of implementation.


We consider some of the most significant anticipated changes here.

  • No differentiation between Part A and Part B services

    Part A services are currently fully regulated by the procurement rules; Part B services (education, health, cultural and some transport services, for example) are regulated to a more limited extent. However, all contracts above the financial thresholds will generally now need to be procured formally, and so will be subject to OJEU contract notices. The proposed new thresholds are 5 million euros for public works contracts, 130,000 euros for goods or services contracts awarded by central government bodies and 200,000 euros for goods or services contracts awarded by other government bodies. Different thresholds apply to "social services" and utilities contracts.
  • More flexible procedural rules with increased opportunity to negotiate

    A lighter-touch regime for certain low-value health and social services contracts (due to their diversity across member states) will be implemented. Contracting authorities will be able to dictate their own procedures, provided that they advertise their contracts properly and adhere to the established principles of equal treatment and transparency.

    Open and restricted procedures remain; however, member states will also be able to use two new procedures: (i) the competitive procedure with negotiation (similar to the previous negotiated procedure) and (ii) the innovative partnership procedure (where the market does not already offer viable procurement solutions). Option (i) is distinct from the competitive dialogue procedure. Competitive dialogue will no longer be limited to complex procurements, again allowing a contracting authority greater choice.
  • Simplified tendering through e-procurement

    The ability to submit contract notices online and to download tender documentation following publication of a notice will increase accessibility and streamline the tender process.
  • Benefits for SMEs

    The new rules are intended to promote the participation of small businesses through various initiatives. When procuring large contracts, a contracting authority must now justify why the large contract could not be broken down into smaller lots. Other than in exceptional circumstances, contracting authorities will now no longer be able to specify a turnover of more than three times the contract value in a pre-qualification questionnaire. The new rules will also allow bidders to self-certify that they meet the selection criteria at pre-qualification stage and so reduce the administrative burden (accounts and/or other financial information will therefore only be checked if the particular bid progresses).
  • In-house suppliers exemption

    The Teckal test for in-house provision has been codified and so clarifies the exemption criteria for direct awards of contracts. For the exemption to apply: (i) there must be no private ownership; (ii) a prescribed percentage of the contractor's turnover must be generated by work for the contracting authority; and (iii) the contractor must be controlled as if it were a department of the authority.
  • Clarification of the effect of change in a project

    Whilst changes to the terms of a contract have always been allowed provided they were not material, it has been difficult to determine in some cases where a significant change should properly trigger a new procurement. The new rules follow the Pressetext case law, so that changes increasing the value of a contract by less than 5% of the initial contract price are not considered material (provided that the change in question does not alter the nature of the contract). Structural changes to a party to a contract, such as internal restructuring or merger, will now no longer in themselves trigger a fresh procurement.
  • Additional rules on framework agreements

    Clarification has been needed for some time as to when authorities not originally party to a framework agreement can subsequently use it. The new regime provides this clarification and establishes other rules to simplify and support framework procurements.

Good news?

In many ways, the changes are good news, particularly for SMEs and in-house suppliers. The emphasis on efficiency and the clarification (through extra rules) of perceived gaps or grey areas in the current law which previously the ECJ has been left to address, can only be seen as a positive development.

However, the public procurement regime will now apply to more contracts. Contracting authorities will therefore need to update their internal procedures, published policies and other know-how to respond properly to the new rules and provide additional training for staff involved in commissioning and project delivery.

To see further articles from Fenwick Elliott, please got to

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

Fenwick Elliott
In association with
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at and we will use commercially reasonable efforts to determine and correct the problem promptly.