Procurement Law

We provide advice to contracting authorities as well as private enterprises on all aspects of the procurement process, including questions regarding any obligation to call for tenders or analysis of any basis for a complaint. Since our Procurement Group's specialist skills include IT and real estate, we are able to offer coherent specialist advice before, during and after the procurement and throughout the entire process - from the beginning of the tender right through to project commencement.

Our assistance is characterised by considerable commercial insight and we have extensive experience in advising on both contract and procurement law.

Our expertise encompasses the Procurement Directive and the Utility Contract Directive as well as the Danish Public Tenders Act and advertising rules. We are therefore able to provide professional and accessible assistance to both contracting authorities and private enterprises.

The contracting entity's call for tenders

A surprising number of activities carried out by public authorities are subject to the procurement rules. That is why we focus on achieving efficiency in the procurement process, and work hard to make sure your project is carried out as quickly and smoothly as possible.

In addition to legal advice, we can assist you in a number of other areas, including project management and the selection of external advisers. In our experience, the procurement process is optimised where we assist from the very beginning of the procurement. Involved in solving both commercial and legal issues, we can, as legal advisers, also assist in any subsequent discussions about the contract or handling of any potential complaints. 

Our assistance to contracting entities typically includes:

• assessment of procurement obligations
• planning of the procurement process, including selection of procurement type
• advice on prequalification and selection criteria
• preparation of tender documents, including tender conditions and contracts
• preparation of award criteria
• evaluation of received tenders, negotiation and signing of contracts
• project management.

From the tender's perspective

Contractors are often involved in the procurement process. We have extensive experience in advising such contractors.

We offer assistance from the very start of the process until the decision to award a contract has been made. Following the award of the contract, we can advise on the merits of any complaint and if there has been a breach of the procurement rules, as well as access to documents. We also represent complainants before the Complaints Board for Public Procurement and the ordinary courts, where we have considerable litigation experience. 

Our assistance to tenderers typically includes:

• applying for prequalification
• preparation and quality assurance of tenders
• advice regarding the contents of the contract tendered for
• advice when a tender has been selected, negotiation and signing of contract
• advice when a tender has been rejected / Access to documents
• filing of a complaint 
• commencement of proceedings
• advice during the term of the contract including amendments.

Advice during the term of a contract

Even after having won the call for tender and signed the contract, a number of problems may arise, including whether the contract may be amended, adjusted to reflect new circumstances, or simply extended.

The question of whether contractual amendments will be permitted under procurement law will depend on which elements of the agreement the parties wish to amend and whether amendments are due to external circumstances over which neither party has any control. Questions about the understanding and interpretation of the contract may also arise.

The Procurement Group comprises specialists with extensive experience in procurement law as well as in a particular chosen area, including IT, real estate and the public sector. We can advise on a range of both procurement and contract law aspects during the entire term of the contract.

Assesment of procurement obligation

A contract must be put out for tender if:

• the purchaser is a contracting authority
• the goods, services or the building and construction assignment is covered by the public procurement directives or the Danish Public Tenders Act
• the threshold values have been exceeded.

The procurement rules define a contracting authority as a state, regional or local authority, a body governed by public law, or an association consisting of one or more of the authorities or bodies.

The concept of “bodies governed by public law” often gives rise to some confusion. However, Kromann Reumert’s Procurement Group regularly provides advice to potential contracting authorities to help determine whether they are subject to the procurement rules or not.

The type of services involved is relevant for an assessment of which threshold value to apply under the rules, and importantly, certain services are explicitly exempted from the procurement rules. We ensure you have a clear understanding of whether and how your project is subject to procurement rules.

In order to determine whether the threshold values have been complied with, the value of the contract has to be calculated. But deciding which elements to include in that calculation can be a complex process. The Procurement Group has extensive experience in value calculations and will carefully guide you through the rules.

Award criteria

The contract will be awarded in accordance with the criterion “the most economically advantageous tender” or “the lowest price”. To use “the most economically advantageous tender” criterion, the contracting entity must specify the sub-criteria to which it will attach importance. Usually, sub-criteria must be weighted but may in certain circumstances be listed in order of priority.

It is important that the contracting entity distinguishes between, on the one hand, selection criteria / minimum criteria, which may be applied to assess which tenderers are qualified to perform the work put out for tender, and, on the other hand, the award criteria, which decide which one of the qualified tenderers will win the contract.

In our experience it can be difficult for contracting entities to make a clear distinction between selection criteria and award criteria. Kromann Reumert’s Procurement Group can help by offering advice on which criteria will be most advantageous, and can also assist in the subsequent evaluation of the tenders.

Complaints

On the basis of the contracting entity’s explanation or the overall circumstances it may become apparent that the contracting entity’s decision to award the contract to another tenderer is contrary to the procurement rules. Unsuccessful tenderers can consider making a complaint to the Complaints Board for Public Procurement, contacting the Danish Competition Authority for review of the decision, or instituting formal legal proceedings.

The advantage of choosing to file a complaint with the Complaints Board for Public Procurement over instituting legal proceedings is that the time invested is considerably less than in the courts, and expenses usually lower. Furthermore, in certain circumstances it is possible for a complainant to be granted a stay of execution so that the contracting entity is prevented from entering into a contract with the winning tenderer. It should also be noted that a complaint to the Complaints Board for Public Procurement does not preclude the tenderer from instituting legal proceedings at a later stage.

The Complaints Board for Public Procurement may set aside an unlawful decision, order the contracting entity to change the procurement to comply with the rules, and award damages to a tenderer who can prove a loss caused by non-compliance with the procurement rules.

A less formal option than filing a complaint with the Complaints Board is to request guidance from the Danish Competition Authority regarding the interpretation of the procurement rules. Such guidance is not binding, but in practice such statements are often followed by the contracting entities.

Kromann Reumert’s Procurement Group includes lawyers experienced in conducting cases before the Complaints Board for Public Procurement, and we can advise on whether there is a sound basis for a complaint, as well as the chances of success.

Evaluation, negotiation and signing of contract

On expiry of the time-limit for submission of tenders, the contracting entity must, among other things, assess whether tenders have been received in time and prepared in accordance with the tender document requirements. In addition, the contracting entity must assess whether the tenders contain any reservations which imply that they cannot be taken into consideration.

Subsequently, the contracting entity must evaluate the remaining tenders in accordance with the award criteria, and prepare an evaluation form or a report as proof that evaluation of the tenders has been carried out in accordance with the correct criteria.

It is important to note that it may have far-reaching consequences for a tenderer if the tender is rejected. However, it is impossible for the contracting entity to disregard any deviations from the minimum requirements or the basic requirements of the tender which explicitly appear from the tender documents.

We understand that it is not difficult for a breach of the procurement rules to occur when evaluating the tenders, and therefore we often advise on the pitfalls of this phase of the procurement or provide direct assistance in the evaluation of the tenders received. At the same time, a contracting entity must be aware of the rules regarding access to documents and ensure that it properly documents the evaluation process and any decisions made.

Legal proceedings

Decisions made by the Complaints Board for Public Procurement may be brought before the courts. However, tenderers can also bring an alleged breach of the procurement rules directly before the courts.

We understand that legal proceedings can be costly to businesses in terms of money and time, so before we recommend institution of legal proceedings in court we comprehensively assess the potential outcomes of the case and thoroughly investigate the possibility of reaching an out-of-court settlement.

With the assistance of our Procurement Group lawyers, you can be certain that your litigation will be conducted at the highest possible standard.

The planning of the procurement procedure

The procurement rules cover a number of different types of procurement and prescribe different procedures for the purchase of goods or services.

The contracting entity can always choose between a public and a restricted procedure, which explains why these two types of procurement are the most common. On the other hand, competitive dialogue, negotiated procedure, electronic auction, project competition and dynamic purchasing may only be used in certain circumstances. The choice of procurement type depends on a range of circumstances, and our broad commercial insight will help you make the right choice – one that maximises competition and is the most effective procedure for that specific purchase.

Public procurement allows all interested tenderers to submit a tender, while restricted procurement requires interested tenderers to apply to participate. For the latter process, only applicants which the contracting entity considers “qualified” will be allowed to submit tenders.

The choice of procurement type highly depends on the subject matter of the contemplated contract. Timing can play an important role, especially since each procurement type prescribes different procedures that impact time–limits.

We assist you in this phase of the procurement and in the planning of the tender. We explain the procurement rules in a simple way to ensure you have a sound basis for structuring your tender process. We advise on the timing aspects of the tender and which procurement type will be most suitable for the relevant purchase.

Prequalification

An application for prequalification entails that a potential tenderer requests permission to submit a tender.

The prequalification procedure is only used in connection with certain types of procurement procedures like restricted procedures, competitive dialogues and negotiated procedures after prior tender notice.

In the tender notice, the contracting entity will state the criteria to which it will attach importance when assessing whether each applicant is qualified to perform the contract put out for tender.

We have extensive experience in advising applicants on:

• prequalification conditions
• preparation of the application
• understanding of tender documents.

We help potential tenderers fulfil all the formal requirements of the procurement notice, ensuring the best possibilities of prequalification and participation.

Kromann Reumert’s Procurement Group has extensive experience in advising applicants on the prequalification conditions, preparing the application and understanding the tender documents. We make sure that as a potential tenderer you not only fulfil all the formal requirements of the procurement notice, but also optimise your chances of prequalification and successful participation in the tender.

Project management

The award procedure can be very involved and require a great deal of coordination, especially in connection with major and more complex contracts, such as contracts for the purchase of computer systems or major construction work.

Aside from the provision of legal services, Kromann Reumert’s Procurement Group can also manage or help oversee the entire procurement procedure, including coordination of technical advisers used to assist in the preparation of the technical specifications and the evaluation phase.

Kromann Reumert’s Procurement Group boasts a number of specialists with unique experience in project management and outstanding communication skills. The advantage of letting our Procurement Group handle the procurement procedure is that we, as exclusive advisers, will then be well placed to assist regarding any potential disputes and, ultimately, complaints.

If invited to handle the procurement procedure, we will be involved right from the beginning of the project, which will be a significant advantage in the event that a complaint should arise. More importantly, however, we can help you avoid one.

Selection criteria

Prequalification is the procedure used by the contracting entity to select qualified tenderers, prior to inviting them to submit tenders. Prequalification is used in connection with restricted procedures, competitive dialogues and negotiated procedures.

The contracting entity must use the procurement notice to outline the criteria to which it will attach importance when assessing whether a prequalification applicant is qualified to make a tender.

It is important that qualification decisions are kept separate from any decision to award the contract, and therefore the choice of selection criteria is important. The prequalification serves to find qualified contractors, whereas the contract is awarded to the best contractor. Consequently, it is essential to consider which factors are important to the contracting entity in the two different situations as early as the prequalification stage – because reuse is not permitted.

We have experience in advising contracting entities regarding the prequalification procedure, including which procedure will best serve specific projects, as well as how the selection criteria should be defined to safeguard the interests of the contracting entity – all while complying with the procurement rules.

Tender documents

The tender documents include the tender notice, the tender conditions and, possibly, the contract tendered for. Added to that are the specification of requirements and any other documents required for the contracting entity to describe the contract up for tender and for the contractors to be able to submit a tender.

It is important that the tender documents are clear and explicit, and that the formal requirements of the procurement rules are complied with. Crucially, the tender notice must allow a potential tenderer to assess whether to submit a tender. Precise tender documents greatly increase the chances of tenders meeting the wishes of the contracting entity. Also at this point, matters of importance to the subsequent performance of the contract have to be considered.

It is important to be aware that the tender documents also set restrictions on the contracting entity and therefore it is also important to include only the necessary information and requirements.

We assist in the preparation of the tender documents, and our goal is to make sure you receive multiple qualified and suitable tenders. We also help you determine which award and selection criteria would be most advantageous and provide advice on the wording of the contract to maximize your options.

Tenders

A tender for a contract must be prepared in accordance with the tender conditions. Even minor inconsistencies between a tender and the tender conditions can cause the contracting entity to reject the tender.

We often assist tenderers in the preparation and review of tenders and tender documents, focusing on compliance with the tender conditions and maximisation of your chances of winning the contract. We also help identify any ambiguities in the tender documents, which makes it possible to seek clarifications from the contracting entity early on in the process, thereby optimising preparation of the tender from the beginning and, importantly, satisfying the requirements of the tender documents.

The tender documents describe how the contracting entity will evaluate tenders. We highlight the competitive parameters to which the contracting entity will attach importance, and offer advice on how you can position your business to stand out.

The contract tendered for

The purpose of the procurement rules is to find the best or the most inexpensive tender. The procurement rules stipulate which rules must be followed in to the selection of such a tender.

The contract, on the other hand, regulates the business relationship between the contracting entity and the contractor in the period after the tendering process. Consequently, it is important that the contract clearly and distinctly regulates the parties' relationship during the term of the contract. However, the terms and conditions of the contract should still be considered as early as the preparation of the tender.

The terms and conditions of the contract tendered for may impact the price of the work put out for tender and any assessment of how attractive that work is. If the contract contains onerous terms or implies that the tenderer must assume various risks, this should be reflected in the tender submitted.

The organisation of the Procurement Group ensures that each case is handled by a specialist, and we have the professional insight to fully assess the reasonableness of a tender contract. We help you explore whether it is commercially sound to submit a tender and whether it is necessary – and possible - to make reservations about certain contractual terms.

When a tender has been rejected

Tenderers must be notified as soon as possible of a decision by the contracting entity to award a contract or cancel its call for tenders.

We have extensive experience in assisting unsuccessful tenderers. We help you obtain a detailed explanation from the contracting entity and seek access to documents. We also make it possible for you to gain insight into why the contract was awarded to a competitor; such knowledge is key for future tenders and for assessing the basis for a complaint.

Our experience has shown that we can most effectively safeguard your interests where we are involved early on in the process. Our team are always ready to handle your case in a proficient and thorough manner.

When a tender has been selected

The best outcome is of course the award of a contract and commencement of a business relationship between the contracting entity and you. The procurement rules also regulate the period between the award decision and the conclusion of the contract and indirectly, options for making adjustments during the term of the contract.

In connection with the final conclusion of the contract, it may be necessary to include further details. Certain types of procurement even imply that the final contract is, to a certain extent, subject to negotiation.

With the assistance of the Procurement Group you can be sure that negotiations will produce outcomes that are commercially attractive and leave both parties with a firm foundation to build rewarding business relationship. The experience and expertise of the Procurement Group means that there will always be a skilled negotiator by your side during the conclusive stages of the procurement. The same proficiency is available throughout business cooperation, so any necessary contractual adjustments will be in accordance with the procurement rules.