A draft law amending the Belgian Act of 17 June on public procurements is underway...

The Belgian Council of Ministers has just approved a draft law which aims at promoting the access of small and medium-sized enterprises to public procurement procedures. This draft law is in line with the action plan drawn up by the Belgian government to identify the various barriers to access to public contracts[1]. Among the actions identified, this initiative plan identified in particular the need to improve transparency at all stages of the public procurement procedure with a view to better information for economic operators and healthier competition. This plan also stressed the need to simplify the public procurement procedure from the point of view of SMEs.

The detailed content of this draft is not publicly available. However, the highlights of this draft have been published by the government in a recent press release[2]. Based on this press release, it appears that the draft law seems to go beyond these objectives:

• First, the draft law intends to ease the conditions under which a contracting authority may grant advance payments. In principle, advance payments are not allowed in public procurements except in certain (highly restrictive) situations. This rule has been recently attenuated due to the economic situation following the war in Ukraine. Please see our recent post on this issue here: https://www.twobirds.com/en/insights/2022/belgium/advance-payments-in-public-procurements-in-belgium.
  The draft law intends to go one step further by giving to contracting authorities the right to authorize the payment of advances, the amount of which may not exceed 20% of the initial amount of the contract with a maximum of EUR 225,000. As far as SMEs are concerned, the draft law additional rules to increase their cash-flow, including an obligation to make an advance payment of at least 5% of the total amount of the contract, and even 10% or 20% for small enterprises (<50 persons) and micro-enterprises (<10 persons) respectively.
• Second, the draft law will impose to contracting authorities to grant unsuccessful tenderers with a compensation if they had to to make certain intellectual or creative efforts in order to submit a tender.
• Finally, a number of changes will be made to oblige, in certain cases, contracting authorities to already communicate to tenderers, immediately after the opening of the tenders, their individual position in the provisional ranking. This improvement in transparency makes it easier for operators to establish their planning.

The draft law is currently being assessed by the legislation division of the Belgian Council of State. Surely, this law will raise several questions not only for SMEs but also for all potential tenderers.

A crucial question will be the compatibility of the measures provided in the draft law with the principle of equal treatment and of non-discrimination. As far as advance payments are concerned for example, we know that several companies (and not only SMEs) are confronted with this issue in practice, specifically in public procurements the execution of which is spread over several years.

Another crucial aspect concerns the obligation for contracting authorities to provide compensation to unsuccessful tenderers. The press release does not specify the scope of application of this obligation. Will this obligation apply to all tenderers or only to SMEs?

Last but not the least, the obligation to communicate a provisional ranking to tenderers will of course raise several questions, particularly in light of the Council Directives 89/665 and 92/13 with regard to improving the effectiveness of review procedures concerning the award of public contracts.

More to follow...

[1] https://economie.fgov.be/fr/themes/entreprises/developper-et-gerer-une/acces-des-pme-aux-marches/le-plan-daction-commun

[2] https://news.belgium.be/fr/amelioration-de-lacces-des-pme-aux-marches-publics