Abuses in the public procurement system, the coronavirus situation is being exploited

SARAJEVO, (Patria) - The Public Procurement Agency of Bosnia and Herzegovina issued an urgent statement on Friday, April 17, stating that there have been abuses and misunderstandings of the stated items that related to preventing the spread and mitigating the consequences of the coronavirus due to reasons and under conditions of extreme urgency, and they state that the announcement pointed to the fact that it is not necessary to urgently amend the Law on Public Procurement, and that within the existing legal framework there is a possibility for contracting authorities, if there is a valid and demonstrable reason, to carry out procurements under an urgent procedure in order to protect human lives and health in the conditions of the coronavirus pandemic in Bosnia and Herzegovina.

Thus, as they explain, the intention was to professionally assist contracting authorities in Bosnia and Herzegovina to react in a timely manner in accordance with their competencies in order to protect human lives and health in the conditions of the coronavirus pandemic.

They emphasize that the application of the Law on Public Procurement has not been suspended, as some have tried to portray.

"We must also note that unfortunately, in Bosnia and Herzegovina, it has been understood the hard way how important the professionalization of public procurement, timely planning of public procurement, and the existence of an organized efficient way of performing the procurement function within contracting authorities are, and that the absence of the aforementioned can lead to unforeseeable harmful consequences for the public interest, which the Agency has been pointing out for the last few years.

The issued statement with the accompanying interpretation of the Law - which referred to Article 21, paragraph (1), point d) of the Law, according to which the negotiated procedure without prior publication of a contract notice can be used due to force majeure, and Article 10, paragraph (1), point b) of the Law, according to which public procurement may be exempted from the application of the Law due to special security measures in cases of extreme necessity (saving human lives, health, etc.) - primarily referred to procurements that can be demonstrably linked directly to measures necessary to prevent the spread and mitigate the consequences of the Coronavirus.

"However, in the past month, abuses of the issued statement with the accompanying interpretation of the Law have been observed, i.e., it has been observed that some contracting authorities, abusing the newly created situation, use negotiated procedures without prior publication of a contract notice due to reasons of extreme urgency and exemptions from the application of the Law due to special security measures for procurements that cannot in any way be linked directly to measures necessary to prevent the spread and mitigate the consequences of the Coronavirus.

For example, it has been observed that the aforementioned Agency statement is cited as the legal basis and reason for conducting negotiated procedures without prior publication of a contract notice, without any explanation of how the specific public procurement serves the measures necessary to prevent the spread and mitigate the consequences of the coronavirus, which represents a worrying lack of transparency and which we consider an abuse of our statement. Also, for various reasons, such as the impossibility of completing the regular procedure due to an appeal before the Appeals Review Body and therefore bridging that waiting period, negotiated procedures without prior publication of a notice are used, whereby procurements are then carried out that quantitatively represent the needs of the contracting authority for the entire year, and in some cases more than annual needs, which is also an abuse. Furthermore, it has been observed that certain bidders suggest to contracting authorities the application of negotiated procedures without prior publication of a contract notice and exemptions from the application of the Law for procurements that are not related to measures necessary to prevent the spread and mitigate the consequences of the coronavirus and for which the conditions for applying the mentioned procedures are not met at all.

Therefore, in the conditions of the coronavirus pandemic in Bosnia and Herzegovina, the Agency is conducting enhanced monitoring of public procurements through exemptions from the application of the Law and negotiated procedures without prior publication of a contract notice based on urgency, and is holding regular meetings with prosecutorial bodies at all levels in Bosnia and Herzegovina regarding the detection of abuses and violations of the Law on Public Procurement and their judicial processing, in accordance with the conclusions of the High Judicial and Prosecutorial Council of Bosnia and Herzegovina from April 8, 2020," the statement reads. 

In addition to regular detection methods, they state that the Agency has also received a certain number of anonymous reports containing quite quality information about violations of the Law, and that all potential abuses and violations of the Law on Public Procurement will be thoroughly reviewed, and if it is determined that there is a violation of the Law, criminal and misdemeanor charges will be filed against the responsible persons.