Public procurement regulation in the Czech Republic

July 2021

• Journal of Public Contracts (Věstník veřejných zakázek) administered by the Ministry for Regional Development, accessible online;
• all Czech public contract notices above the threshold can also be found on Tenders Electronic Daily (ted.europa.eu).

The PPA states also the national thresholds – CZK 2,000,000 (approx. EUR 79,000) for the public supply and service contracts and CZK 6,000,000 (approx. EUR 237,000) for public works contracts. Minor public contracts, whose estimated value does not exceed these national thresholds, do not have to be awarded in the awarding procedure according to the PPA; however, the principles of transparency, non-discrimination and equal treatment must still be fulfilled.

• A contracting authority is free to choose between the open and the restricted procedure (Sec. 55 PPA).
• A negotiated procedure with publication can be carried out (Sec. 60 PPA):
  • if the needs of the contracting authority cannot be met without adapting solutions that are readily available on the market;
  • if the performance of the public contract includes a proposal for a solution or an innovative solution;
  • if the public contract cannot be awarded without prior negotiations because of specific circumstances related to the nature, the complexity or the legal and financial conditions connected with the subject-matter of the contract; or
  • if technical specifications cannot be specified by reference to technical documents.
• A negotiated procedure without publication can be carried out especially if (Sec. 63 PPA):
  • no tenders, no suitable tenders, no requests to participate or no suitable requests to participate were submitted in response to an open or restricted procedure;
  • the performance can only be carried out by a particular contractor for unique artistic or technical reasons, or to protect exclusive rights, including intellectual property rights; or
  • urgent, compelling and unforeseeable reasons do not allow an open or restricted procedure or a negotiated procedure with publication to be implemented.
• a competitive dialogue can be used under the same conditions as for the negotiated procedure with publication (Sec. 68 PPA).

It is possible to submit objections against any decision or action of the contracting authority (Sec. 241 PPA).

• Review by the contracting authority: Objections to the contracting authority (preliminary dispute settlement) must be submitted:
  • within 15 days of the complainant learning about the alleged infringement (general rule);
  • within 15 days of a contracting authority action being published or delivered to a complainant;
  • before the deadline for submission of the requests for participation or bids in case of objections against tender documents;
  • within 30 days of the publication of a voluntary tender notice stating the contracting authority’s intention to conclude a contract without a tender procedure.

• Review before a body responsible for review of the tender procedures: the proposal (written petition) must be submitted to the Office for the Protection of Competition (the "Office"):
  • within 10 days of the delivery of a decision that the contracting authority has rejected the submitted objections;
  • within 25 days of the objection being delivered to the contracting authority in case the contracting authority failed to respond to the objections.
  • A petition to impose a ban on the performance of a public contract must be submitted to the Office at the earlier of the following two dates:
    • 1 month after publishing the notice that a contracting authority concluded a public contract without an awarding procedure;
    • 6 months after the public contract (without any publication of a notice) was concluded.

• Judicial review: Administrative court action
  • An action must be filed to the administrative court (Regional Court in Brno) within 2 months of receiving the Office’s final decision.

Failure to observe these time limits leads to preclusion.

• The contracting authority may not conclude a contract with a bidder (Sec. 246 PPA):
  • prior to the deadline for filing objections against a decision to exclude a participant, against a decision selecting the winning bidder (15 days), or against a voluntary notice expressing the intention to conclude a contract (30 days);
  • prior to the delivery of the decision on the objections to the complainant, where such objections have been filed;
  • prior to the deadline for filing a petition to launch proceedings to review the contracting authority's actions, where the contracting authority has rejected the filed objections;
  • within a period of 60 days after the Office begins proceedings reviewing the actions of the contracting authority.

• The Office for the Protection of Competition;
• The administrative courts and the Supreme Administrative Court.

• There is no fee for submitting objections to the contracting authority.
• For the proceedings before the Office the petitioner must pay a deposit (to be repaid if the petition is successful) of (Sec. 255 PPA):
  • 1% of the tender price quoted by the petitioner for the entire period of performance of the public contract when submitting the petition to the Office (subject to a minimum payment of CZK 50,000 (approx. EUR 2,000) capped at CZK 10,000,000 (approx. EUR 400,000));
  • CZK 100,000 (approx. EUR 4,000) if it is not possible to determine the petitioner’s tender price;
  • CZK 200,000 (approx. EUR 8,000) for a petition to impose a prohibition on the performance of contract.
• At the administrative court proceedings, a court fee of CZK 3,000 (approx. EUR 120) applies.

• A petition to the Office suspends the conclusion of the contract for the period of 60 days; it is necessary to apply for interim measure if it takes the Office longer to reach a decision.
• An appeal to the administrative court does not have a suspensive effect and it is always necessary to apply for interim measures.

• Unlawful contract award without prior publication of a tender notice may result in a petition to the Office to prevent the performance of the contract. As stated above, the petition must be made at the earlier of (a) 1 month after the publication of the contract award notice; and (b) 6 months after entering into the contract. If the Office imposes a ban on the performance of a public contract, the PPA states that the contract is void.
• To protect against the risk of an ineffective challenge to the lawful direct award of a contract, a contracting authority can publish a voluntary ex-ante transparency notice. The purpose of such notice is to notify the market of an intention and justification for a direct award. Provided the contracting authority then observes a 30-day standstill period before entering into the contract, a petition to the Office to prevent the performance of the contract cannot be successful.

Following the Directives, the Czech PPA implements the case law of the CJEU (C-454/06 Pressetext) and allows concluded contracts to be amended where the modification is not considered fundamental or substantial. The contracting authority may implement non-fundamental modifications by a simple agreement with the current supplier without having to carry out a new procurement procedure. This also applies to additional works, services or supplies under the conditions below.

The PPA defines as fundamental, changes to the obligations arising from the existing contract that would:

• allow other bidders to participate or influence the selection of the preferred bidder during the original procurement procedure;
• change the economic balance of the contractual obligation in favour of the selected bidder, or
• lead to a substantial extension to the scope of the performance of the public contract.

The PPA does not consider the following amendments to be fundamental:

• changes stipulated in the original contract and the tender documents;
• de minimis changes below the threshold for public contracts (10-15% of the value of the original public contract);
• de minimis changes below the threshold for public contracts and lower than 10-15% of the value of the original public contract;
• substitution of one or more items in the list of construction works under certain conditions.

A change of supplier is considered a fundamental change; however, the PPA allows such a change under specific circumstances (such as anticipation of such change in the contract and tender documents or legal succession).

The contracting authority is always obliged to act effectively and efficiently when amending the public contracts after awarding. Any changes to the existing contract are, of course, possible if the above conditions are met and, at the same time, if the supplier agrees with such amendments.

In compliance with the Directives, the PPA pushes for mandatory e-procurement. The entire communication between the contracting authority and tenderers must be in electronic form from 18 October 2018, unless the PPA expressly states the contrary. Amongst other things, bidders have to submit their bids and requests for participation electronically. However, the contract itself can be still concluded in a paper form.

During the tender procedure, the contracting authority cannot generally ask for the originals of any documents, apart from those specified in the Public Procurement Act. This means that, as a rule, the contracting authority must accept plain copies of all documents. In other words, the contracting authority cannot require bidders to submit their bids or supporting documents with e-signatures.

Before the execution of a public contract, originals or certified copies must be submitted in electronic form. If a self-declaration (or other signed document) is to be submitted as an original, it must bear a certified e-signature or have a special electronic conversion clause attached (in which case, the document would be regarded as a certified photocopy).

Interested parties need e-signatures to communicate with the Czech Competition Office in review procedures.

An e-signature is unnecessary if the parties communicate through a data box (an electronic storage site for delivering official documents and communicating with public authority bodies). Data boxes are deemed to provide certification equal to certified e-signatures.