Public procurement regulation in Serbia

October 2018

• Public Procurements Portal: http://portal.ujn.gov.rs/Default.aspx
• Internet sites of respective contracting authorities

The Law on Public Procurements specifies that a contracting authority need not apply that law for the procurement of goods, services or works whose annual value is less than RSD 500,000 (approx. EUR 4,200), provided that the aggregate annual value of the same type of procurements does not exceed this threshold.

• The contracting authority is free to choose between the open and the restricted procedure.
• The negotiated procedure can be carried out with or without prior publication:
  • The negotiated procedure with prior publication may be used in the following cases:
    • if none of the offers received in the open procedure, restrictive or qualifying procedure or competitive dialogue, is acceptable;
    • in exceptional cases where, due to the nature of goods or services, or due to associated risks, it is not possible to predict the value of the procurement; and
    • for the procurement of services whose nature makes them impossible to specify and that do not meet the conditions for competitive dialogue.
  • The negotiated procedure without prior publication may be used in the following cases:
    • if no offers or applications were received in the open or restrictive procedure, or no offer is acceptable;
    • if, due to technical or artistic reasons relating to the subject of procurement, or due to reasons relating to the protection of exclusive rights, the goods, services or works can only be procured from a specific candidate;
    • if, due to emergency caused by extraordinary circumstances or unpredictable events, the contracting authority prevents the authority from obeying the minimum time periods set out in the Law;
    • if additional deliveries of goods from the same supplier are intended to partially replace products, materials or fittings or to expand the volume of current products materials or fittings;
    • if additional services or works that were not included in the initial project or in the initial public procurement agreement have, due to unforeseeable circumstances, become necessary for the execution of the public procurement agreement;
    • if the public procurement of goods are traded on commodity markets;
    • if goods may be procured under exceptionally favourable terms from a supplier that has entered liquidation or insolvency; and
    • if services are procured that extend a completed design contest, if the contract is concluded with the winning contestant or contestants, and under the condition that the contracting authority includes all prize-winning contestants in the negotiated procedure.
• Competitive dialogue can be applied where the subject of procurement is so complex that the procurement contract cannot be concluded through the open or the restrictive procedure.

An appeal can be submitted at any time during the procurement procedure against any decision reached by the contracting authority, except in specific cases regulated by the law.

An appeal against the decision on the type of procurement procedure, the content of a public call for submission of bids or the content of procurement documents, is subject to the following deadlines:

• 7 days prior to expiration of deadline for submission of bids;
• 3 days in qualification procedure and small value procedure (RSD 5 million threshold - app. EUR 42,300);
• At any time, provided the appellant already pointed out perceived deficiencies to the contracting authority in accordance with the law, and the authority failed to remedy those deficiencies.

After a decision on the award of contract, on the conclusion of a framework agreement, on the recognition of qualified bidders, and on the cessation of procedure has been reached, the appeal is limited by the following deadlines:

• 10 days from the announcement of the decision on the official Public Procurement Portal;
• 5 days from the receipt of the decision for small value procurements, as well as for decisions based on a framework agreement.

However, please note that a contracting authority’s actions cannot be appealed later if the appeal is based on reasons the bidder knew or could have known at a previous time, but failed to appeal separately at that time, and this separate deadline for the appeal has expired.

The contracting authority may only conclude the procurement contract upon expiration of deadlines prescribed for the submission of appeal or, if the appeal has been filed, upon rejection of the appeal.

The State Commission decides on appeals filed against awarding decisions. The State Commission’s decisions cannot be appealed, but a bidder can initiate administrative dispute proceedings before the Administrative Court.

Fees for filing an appeal are as follows:

• RSD 60,000 (app. EUR 500) for appeals filed in small value procedures and in the negotiated procedures without the announcement of a public call;
• RSD 120,000 (app. EUR 1000) for appeals filed in a procedure where the estimated value of the public procurement or the value of all the disputed tranches does not exceed RSD 120 million (app. EUR 1 million);
• RSD 250,000 (app. EUR 2,110) for appeals filed before offers are opened in procedures where the estimated value of the public procurement exceeds RSD 120 million;
• 0.1% of the estimated value of the public procurement or the price offered by the awarded bidder, for appeals filed after offers are opened in a procedure where the estimated value exceeds RSD 120 million;
• 0.1% of the aggregate estimated value of all the tranches of the public procurement, or the price offered by the awarded bidder, for appeals filed after offers are opened in a procedure where the estimated value exceeds RSD 120 million.

The appeal generally has an immediate suspensive effect. It prevents the contracting authority from undertaking any further activities until the decision on the appeal has been adopted.

The procedure is not suspended in the following exceptional circumstances:

• In the negotiated procedure without the announcement of a public call, where the procedure is carried out due to an exceptional emergency caused by extraordinary circumstances or unforeseeable events;
• According to the reasoned decision of the contracting authority’s responsible person, in cases where the delay caused by a suspension would significantly hinder the contracting authority from performing its business activities to an extent disproportional to the scope of the procurement; and
• Upon approval of the State Commission, if the delay caused by a suspension would significantly jeopardize interests of the Republic of Serbia.

Serbia is not yet an EU member state. Therefore, none of the EU directives apply directly to the citizens and entities in Serbia. However, relevant principles contained in the EU directive 66/2007/EC were incorporated into the domestic legal framework.

Based on this:

• The State Commission has the right to consider a procurement contract ineffective, either by its own initiative or upon proposal of an interested party, in cases stipulated by the Public Procurement Law; and
• The State Commission will not consider the contract ineffective if doing so would have excessive detrimental consequences for the business operations or functioning of the contracting party or for interests of the Republic of Serbia. However, in such cases it will instead either shorten the duration of the contract or impose a fine on the contracting authority of up to RSD 1 million (app. EUR 8,450).

The public procurement volume may be changed if the following cumulative conditions are met:

The possibility of such a change must be specified in the tender documents and the contract;
Such a change is limited to 5% of the value of the contract;
The total value of the change cannot exceed RSD 5 million (app. EUR 42,300) or RSD 10 million (EUR 84,600) for public procurements in the sector area.

A change of price or other important element of the contract is permitted only for objective reasons that are clearly and precisely specified in the tender documents and the contract, or in other applicable laws.

The use of e-procurement or e-signatures is voluntary.