Public procurement regulation in Bosnia and Herzegovina

September 2019

1. Where can one find public procurement notifications for Bosnia and Herzegovina (“BiH”)?

2. What are the relevant thresholds for the applicability of the Public Procurement Law of Bosnia and Herzegovina?

  • Contracting authorities may apply one of the procedures prescribed by the Public Procurement Law of BiH (Official Gazette of BiH, no. 39/14) (hereafter “PPL BiH”) if the value of the procurement is lower than BAM 50,000.00 (approx. EUR 25,565.00) for goods and services or BAM 80,000.00 (approx. EUR 40,904.00) for works, except for direct agreement (Art. 14 of the PPL BiH).
  • The requirements regulated for each specific procedure must be met:
    • open procedure (Art. 25 of the PPL BiH);
    • restricted procedure (Art. 26 of the PPL BiH);
    • negotiated procedure with publication of a procurement notice (Art. 27 of the PPL BiH);
    • negotiated procedure without publication of a procurement notice (Art. 28 of the PPL BiH);
    • competitive dialogue (Art. 29 of the PPL BiH);
    • framework agreement (Art. 32 of the PPL BiH); and
    • competition for design of a conceptual solution (Art. 33 of the PPL BiH).
  • The thresholds for application of specific procedure are regulated as follows:
    • The use of open procedure, restricted procedure or negotiated procedure with or without publication of a procurement notice or competition for design of a conceptual solution or competitive dialogue is mandatory if the value of the procurement of goods and services is equal or exceeds (Art. 14 of the PPL BiH):
      • BAM 250,000.00 (approx. EUR 127, 823.00) for contracting authorities such as institution of BiH, F BiH or RS, District Brčko, cantons, cities or municipalities and association established by authorities as prescribed by Art. 4 (1) a), c) of the PPL BiH;
      • BAM 400,000.00 (approx. EUR 204,517.00) for contracting authorities such as legal entities established for a specific purpose with the objective of meeting the needs of the general interest as prescribed by Art. 4 (1) b) of the PPL BiH;
      • BAM 800,000.00 (approx. EUR 409,034.00) for sectoral contracting authorities as prescribed by Art. 5 of the PPL BiH;
    • In case of works when the value of the procurement is equal to or exceeds BAM 9,000,000.00 (approx. EUR 4,601,627.00) the contracting authority is obliged to use open procedure, restricted procedure, or negotiated procedure with or without publication of a procurement notice, competition for design of a conceptual solution or competitive dialogue;
    • When the value of procurement of supplies, services and works amounts to or exceeds the values of BAM 50,000.00 (approx. EUR 25,565.00) for goods and services or BAM 80,000.00 (approx. EUR 40,904.00) for works and is below the values of BAM 250,000.00 (approx. EUR 127, 823.00), BAM 400,000.00 (approx. EUR 204,517.00), BAM 800,000.00 (approx. EUR 409,034.00) and BAM 9,000,000.00 (approx. EUR 4,601,627.00) (as referred to in Art. 14 (2) and (3) of the PPL BiH), the contracting authority is obliged to apply open or restricted procedure, or negotiated procedure with or without publication of notice, or competition for design of a conceptual solution or competitive dialogue.
  • Public procurement procedures for the award of small value contracts are (Art. 87 of the PPL BiH):
    • a competitive request for quotations which is conducted if the estimated value of supplies or service procurement is below BAM 50,000.00 (approx. EUR 25,565.00) or the estimated value set for the procurement of works is below BAM 80,000.00 (approx. EUR 40,904.00).
    • a direct agreement which is conducted for the procurement of supplies, services, or works whose estimated value is equal to or below BAM 6,000.00 (approx. EUR 3,068.00).

3. Under which circumstances can one use the (i) open procedure, (ii) restricted procedure, (iii) negotiated procedure, and (iv) competitive dialogue?

  • An open or restricted procedure for the public procurement contract award is applied as the basic and regular procedure while the negotiated procedure with or without publication of notice and competitive dialogue may be applied exceptionally if all conditions prescribed by PPL BiH have been met (Art. 19 of the PPL BiH) (please also refer to the answer under question 2).
  • A negotiated procedure with publication of notice may be used (Art. 20 of the PPL BiH):
    • for procurement of supplies, services or works:
      • if all the bids submitted in an open or restricted public procurement procedure or competitive dialogue failed to meet the qualification requirements, and the basic conditions for a contract award have not altered significantly; the contracting authority is not obliged to publish the procurement notice again, under the condition that it invites all the bidders, i.e. candidates, to remove the deficiencies in their bids, and render their bids acceptable;
      • in exceptional cases, when due to the nature of supplies, services or works, or risk related to contract subject matter execution, it is not possible to perform prior determination of the total price;
    • if the procurement subject matter concerns intellectual services such as design services or services listed in Annex II, Part A, Category 6 of the PPL BiH and its description cannot be determined with satisfactory precision to allow the contract to be concluded by selecting the most successful bid in an open or restricted procedure;
    • if the subject matter of the contract are works executed exclusively for the purposes of research, testing, or development, and not to gain profit or recovery of research and development costs.
  • The contracting authority may exceptionally award public procurement contracts by applying the negotiated procedure without publication of the procurement notice in the following cases (Art. 21 of the PPL BiH):
    • if no bid or no acceptable bid has been submitted in the open or restricted procedure and when the contract terms have not been altered significantly compared to the terms from the preceding procedure;
    • if no request for participation has been submitted in the restricted procedure and no qualified candidate requested participation in the restricted procedure, and when the contract terms have not altered significantly compared to the terms from the previous procedure;
    • if the contract can only be awarded to a specific supplier due to essential, provable technical or artistic reasons, or due to reasons that relate to the protection of exclusive rights;
    • if, exceptionally, the minimum time limits defined by the PPL BiH for open, restricted, or negotiated procedure with publication of notice cannot be complied with due to provable reasons of ultimate emergency caused by events unforeseeable to the given contracting authority. The circumstances that justify the exceptional emergency of the procedure may not be in any way linked with the contracting authority.
  • Competitive dialogue can be conducted if the procurement subject matter is particularly complex and if the conclusion of the contract would not be possible following an open or restricted public procurement procedure (Art. 30 the PPL BiH).

4. Which contracting authority decisions can be appealed?

  • Challenging the decisions of a contracting authority is made possible through a written appeal where the first appeal instance is the contracting authority, while the second appeal instance is the Public Procurement Review Body (“PPRB”).
  • The PPL BiH does not expressly specify which decisions can be appealed, but states that appeals may be filed by any business entity having or having had an interest in a public procurement contract award, which establishes that it is probable that damage has been or could have been caused to it in the public procurement procedure because of the actions of the contracting authority which are contrary to the applicable regulations. (Art. 97 of the PPL BiH).

5. What are the time limits for appeals? Are further appeals precluded after the expiry of these limits?

  • Time limits for filing appeals to the contracting authority, which acts as the first instance appeal body, are as follows (Art. 101 of the PPL BiH):
    • seven days at the latest prior to the expiry of time limit for the submission of requests for participation or bids in relation to the information in the notice;
    • ten days at the latest from the day of undertaking the tender documentation;
    • ten days at the latest upon receiving the bid opening minutes in relation to the actions, procedures and failures to act in the bid opening procedure;
    • ten days at the latest upon the receipt of the decision that decides on individual right resulting from public procurement in relation to the review and assessment of ability procedure, and the review, assessment and selection procedure of the most successful bidder;
    • ten days at the latest after the expiry of the time limit issuing the decision on individual rights resulting from the public procurement referred to in the previously stated item;
  • In addition, appeals can be filed 30 days at the latest upon learning that the contract was concluded without implementing a public procurement procedure contrary to the PPL BiH and within one year at the latest from the day the contract in that procedure was concluded.
  • If a contract is awarded under a framework agreement or under a dynamic purchasing system, the appeal is filed within 30 days if the contracting authority notifies the bidders that the contract based on framework agreement or if a dynamic purchasing system was awarded in relation to the procedure for awarding a contract under a framework agreement or dynamic purchasing system.
  • Furthermore, for a negotiated procedure without publication of notice and procedure for service contract award, an appeal must be filed within:
    • 10 days after the voluntary ex ante transparency notice is published, if this notice was published;
    • 30 days after the contract award notice is published, if the voluntary ex ante transparency notice was not published.
  • In small-value public procurement procedures an appeal must be filed within five days from the day the decision on selection of the most successful bidder is received.
  • An appellant who fails to file the appeal pursuant to the previously detailed provisions of the PPL BiH will lose the right to question the legality on the same grounds in later stages of the procedure.

6. How long is the standstill period?

  • The contracting authority may not conclude a public procurement contract within the time limit of 15 days from the day on which the bidders were informed about the selection of the most successful bidder (Art. 98 of the PPL BiH).
  • The prohibition on concluding contracts previously stated does not apply:
    • if only one bidder participated in the open procedure, negotiated procedure without publication of notice and in the procedure for service contract award and its bid was selected;
    • if only one bidder participated in the second phase of restricted procedure, negotiated procedure with publication of notice or competitive dialogue, and its bid was selected;
    • if contracts are awarded under a framework agreement or dynamic purchasing system.

7. Which review bodies exist?

  • Generally, an appeal may be filled to the contracting authority which acts as a first instance appeal body, while the PPRB as an independent, autonomous institution with a status of a legal person acts as a second instance appeal body. Also, the contracting authority and parties to the procedure may initiate an administrative dispute before the Court of Bosnia and Herzegovina against a PPRB decision.
  • If the appeal is untimely, inadmissible or filed by an unauthorized person, the contracting authority will dismiss the appeal by issuing a conclusion. The appellant then has the option of filing an appeal against this conclusion to the PPRB within 10 days from the receipt of the conclusion (Art. 100 of the PPL BiH).
  • On the other hand, if the appeal is allowed, and filed in a timely manner by an authorized person, the contracting authority may, in consideration of the appeal, determine whether it is partly or fully grounded and correct the action by issuing a decision, take action or revoke the existing decision or decree and replace it with another decision or decree, or cancel the public procurement procedure and inform all participants in the manner prescribed by the PPL BiH within five days from the day of receipt of the appeal. In this regard an appeal must be filed to the PPRB, through contracting authority, within five days from the day of receipt of the decision (Art. 100 of the PPL BiH).
  • If the contracting authority determines that an appeal is without foundation, the contracting authority is obliged to forward its decision to the PPRB within five days from the day of its receipt together with its opinion on the allegations in the appeal and full documentation related to the procedure subject to the appeal (Art. 100 of the PPL BiH).
  • PPRB is obliged to adopt a conclusion or a decision on the appeal within 15 days from the day of completion of an appeal by the contracting authority, but not later than 30 days from the day of its receipt by the contracting authority (Art. 111. of the PPL BiH).
  • Lastly, the contracting authority and parties to the procedure may initiate an administrative dispute before the Court of Bosnia and Herzegovina against a PPRB’s decision within 30 days from the day of the receipt of the decision (Art. 115 of the PPL BiH).

8. Are there any filing fees for an appeal?

  • A complainant is obliged to pay fees for initiation of appeal proceedings before the PPRB, amounting to (Art. 108 of the PPL BiH):
    • BAM 500.00 (approx. EUR 255.65) for the estimated value of procurement of up to BAM 50,000.00 (approx. EUR 25,565.00);
    • BAM 800.00 (approx. EUR 409.00) for the estimated value of procurement between BAM 50,001.00 (approx. EUR 25,565.10) to BAM 80,000.00 (approx. EUR 40,903.00);
    • BAM 2,000.00 (approx. EUR 1,022.60) for the estimated value of procurement between BAM 80,001.00 (approx. EUR 40,903.80) to BAM 250,000.00 (approx. EUR 127,823.00);
    • BAM 3,500.00 (approx. EUR 1789.50) for the estimated value of procurement between BAM 250,001.00 (approx. EUR 127,823.50) to BAM 400,000.00 (approx. EUR 204,517.00);
    • BAM 5,000.00 (approx. EUR 2556.50) for the estimated value of procurement between BAM 400,001.00 (approx. 204,517.20 EUR) to BAM 800,000.00 (approx. EUR 409,033.5);
    • BAM 7,500.00 (approx. EUR 3,834.60) for the estimated value of procurement between BAM 800,001.00 (approx. EUR 409,034.01) to BAM 9,000,000.00 (approx. EUR 4,601,626.90);
    • BAM 10,000.00 (approx. EUR 5,112.90) when the value of the purchase is equal to or greater than BAM 9,000,000.00 (approx. EUR 4,601,626.90);

9. Does an appeal have a suspensive effect or is it necessary to apply for interim measures?

  • The appeal has an immediate suspensive effect and suspends the public procurement procedure, the conclusion and/or execution of the public procurement contract or framework agreement until the PPRB reaches its decision (Art. 110 of the PPL BiH).

10. Ineffectiveness and alternative penalties according to Dir 66/2007/EC

  • Bosnia and Herzegovina is not yet an EU member state. Therefore, none of the EU directives apply directly to the citizens and entities in Bosnia and Herzegovina. However, in general, the content of the following EU directives has been incorporated into the PPL BiH:
    • Directive 2004/18 / EC, (services, goods and the basic sector) general procurement;
    • Directive 2004/17 / EC (procurement procedures of contracting authorities in the field of water, energy, transport and postal services) sector directives;
    • Directive 2007/66 / EC, legal remedies in public procurement and thus the efficiency in protection of rights in public procurement procedures has been improved;
    • Directive 2009/81 / EC, procurement in the defence sector and security sector;

11. To what extend can procurement contracts be amended after being awarded?

  • The price stated in the most successful bid, as well as the conditions defined in bidding documentation, may not be changed while a procurement contract is being awarded. Exceptionally, if the tender documentation provides for a change of price with the objective rules defined for it, such a provision will be entered in the public procurement contract (Art. 72 of the PPL BiH).

12. Is the use of e-procurement or e-signatures mandatory or voluntary?

  • According to the Rule on Conditions and Methods on the Use of E-auction (Official Gazette of BiH, no. 66/16) (hereafter “Rule on E-auction”), the e-auction is a way of implementing part of the public procurement process which includes submission of new prices, changed prices and new (improved) values referring to certain elements of the bid, and takes place after the offers are initially evaluated and allows the offers to be ranked using automated evaluation methods in the e-procurement information system (Art. 1 of the Rule on E-auction).
  • For public procurement procedures: open procedure, restricted procedure, negotiated procedure with publication of a procurement notice and competitive request for quotations for which the lowest price is used as the criterion for awarding the contract, the contracting authorities are obliged to implement e-auctions on the e-procurement information system for at least:
    • 30% of public procurement procedures in 2017;
    • 50% of public procurement procedures in 2018;
    • 80% of public procurement procedures in 2019;
  • From 1 January 2020, contracting authorities will be obliged use e-auctions on the e-procurement information system for procurement procedures – open procedure, restricted procedure, negotiated procedure with publication of a procurement notice and competitive request for quotations for which the lowest price is used as the criterion for awarding the contract (Art. 10 of the Rule on E-auction).
Belma Hodžić