The European Single Procurement Document is upon us

The Commission Implementing Regulation (EU) 2016/7 of 5 January 2016 establishing the standard form for the European Single Procurement Document was published yesterday, moving forward the implementation of a hallmark change introduced by Directive 2014/24/EU. The Regulation 2016/7 includes as an annex a model of the ESPD and what users can expect to see and use once the system is live.

The European Single Procurement Document (ESPD) aims to reduce the transaction costs for economic operators and public sector when assessing the conditions of the economic operator to take part in public procurement procedure. This is to be achieved by allowing economic operators to self-declare their compliance with the requirements and not having to immediately submit certificates and supporting evidence. The ESPD is to be a fully online solution (from April 2018 onwards) which should make amending/updating information on it easier.

In addition to mandatory exclusion grounds, the ESPD covers as well certain suitability requirements that may be imposed by the contracting authority (suitability, economic and financial standing, technical and professional ability. QA schemes etc).

There are a few things the ESPD does not do. First, it does not allow economic operators to defer their compliance until the end of the procurement procedure. Personally, I am of the opinion that the later in the process that this compliance is checked, the lower the costs for all involved.

Second, because it is a standard document it does not cover all the areas a contracting authority can ask information about an economic operator. Out of the top of my head, insurance levels come to mind.

Third, although it standardises a lot of questions/information - and that is to be welcome - it will not be suitable in all situations. That is a cost of standardising what can be standardised, but I can imagine mounting criticism in fringe use cases. In a country obsessed with pre-qualification like the UK, those will not be fringe cases.

One of my concerns with the current ESPD structure is the freedom allowed to contracting authorities to require underlying documentation and certificates at any time during the procedure. In the UK, where the job to be done with pre-qualification is indeed to restrict the   number of bids assessed downstream, it is not hard to conceive that a practice will quickly emerge whereby contracting authorities will keep on requesting those documents in all cases. Unfortunately, the Regulation does not close such door completely:

"Contracting authorities or contracting entities may choose or may be required (12) by Member States to limit the information required on selection criteria to a single question whether, yes or no, economic operators meet all the required selection criteria. While this may be followed up by requests for further information and/or documentation, care should be taken to avoid imposing excessive administrative burdens on economic operators through systematic requests of certificates or other forms of documentary evidence of all participants in a given procurement procedure or practices consisting in identifying in a discriminatory manner the economic operators to be requested such documentation."

What does this even mean? Technically that a contracting authority cannot be systematically asking for the documents (ie, every single time) but in practice what is the likelihood ofan authority being dragged over the coals. Plus, any enforcement action would be taken by the Commission against the Member State and not individual authorities...and we know how seldom that happens and the time it takes. In short, the incentives are there for contracting authorities to keep doing business as usual.

Having said that, there are provisions which may change incentives for contracting authorities going forward: "The obligations for the contracting authorities and contracting entities to obtain the documentation concerned directly by accessing a national database in any Member State that is available free of charge also applies where the information initially requested on selection criteria has been limited to a yes or no answer. If such electronic documentation is requested, economic operators will therefore provide the contracting authority or contracting entity with the information needed to obtain the documentation concerned when the selection criteria are being checked rather than directly in the ESPD."

What the above provision makes is reversing the onus of which party needs to come up with the information from the economic operator to the contracting authority. If we multiply this by all economic operators in all public procurement procedures covered by Directive 2014/24/EU, pretty quickly contracting authorities will find the transaction cost (previously borne by the market...) quite high.

I suspect that the learning curve will be steep at the start and that in a few years time we will take it for granted. If only this work had been done 10 years ago...