LED LAMPS FOR STREET LIGHTING IN SVRLJIG (2018)
This case study refers to the public procurement procedure that was conducted in 2018 as an open procedure for concluding a framework agreement for the procurement, delivery and installation of LED lighting in order to reduce electricity consumption and maintenance costs of the public lighting system in the municipality of Svrljig. The framework agreement was to be concluded with one supplier, for a period of two years, and it provided for the replacement of the existing 900 lamps in Svrljig with new appropriate LED lamps, with the corresponding lamp holders and connection to the existing electrical installation.
An interested party made a request for additional clarification of the tender documentation indicating to the contracting authority that additional conditions regarding technical and business capacity are not logically related to the subject of public procurement, that they are discriminatory and restrict competition.
Namely, when it comes to the additional condition in terms of technical capacity, the contracting authority required the bidders to have 2 truck cranes at least 16 meters high with a man basket. The interested party pointed out that in the municipality of Svrljig there is no public lighting pole that would require a crane 16 meters high, and that the description of the poles listed in the technical specification for which the lamps are procured shows that the installation will not be performed at a height of more than 9 meters.
Regarding the additional condition related to the business capacity, the tender documentation required the bidders to have performed at least 3 contracts in the last 5 years, with the subject related to the delivery and installation of at least 900 LED lamps per contract. Before submitting the bids, the interested party pointed out that the 3 contracts requirement is not disputable: the problematic fact is that the contracting authority required a minimum of 900 lamps per contract, claiming that there is no difference between 100, 700, 850 or 910 lamps that have been delivered and installed.
After the contracting authority rejected the stated suggestions, the interested party submitted a request for protection of rights in which they repeated all the mentioned arguments. However, the Republic Commission rejected that request for protection of rights by accepting all the arguments of the contracting authority by which they tried to justify the reasons for requesting those two additional conditions. It is especially interesting that the Republic Commission on that occasion took a completely illogical and strange position that the technical capacity can be determined on the basis of what is not defined as the subject of public procurement within the tender documentation, namely street lighting poles that are not listed in the technical specifications and which are, apparently, outside the number of 900 poles on which the lamps needed to be replaced.
Also, the Republic Commission accepted the arguments of the contracting authority without any prior verification and without any evidence, although in its response submitted to the Republic Commission the contracting authority stated several illogical claims, such as:
– there are lamp poles that are not included in the tender documentation, and which are relevant to the additional conditions that the contracting authority will require from the bidder;
– in a certain street in Svrljig there are some lamp poles higher than 14 meters, although no such evidence was offered;
– the contracting authority referred to Stefana Sofronijevića Street, the street that doesn’t even exist in Svrljig, which can be easily determined by searching on any online map available;
– for the dismantling of old lamps and the installation of new ones on these “newly discovered” poles, a truck crane at least 12 meters high is necessary, so it is unclear how the contracting authority justified the required height of at least 16 meters with this argument;
– it is not stated how many such lamp poles there are in the mentioned “non-existent” street and why the contracting authority required as many as two truck cranes with a man basket that can be raised to a height of 16 meters.
On the other hand, regarding the second disputable additional condition, the Republic Commission accepted the argument of the contracting authority that there is a logical connection between the required condition of business capacity in the amount of 900 lamps per contract. It is not explained why the Commission rejected the Applicant’s claims that it was acceptable to insist on the total number of 2,700 lamps and 3 contracts, but that there was no reason to insist on the minimum of 900 lamps per contract. It is really unclear why a bidder who, for example, has previously realized two contracts of 1,000 lamps (which is more than the required minimum of 900 per contract) and one of 700 (which is less than the required minimum of 900), would not be able to realize this public procurement.
The Law on Public Procurement stipulates that the contracting authority determines the conditions for participation in the procedure so that these conditions do not discriminate against bidders and that they are logically related to the subject of public procurement. The same Law also stipulates that the contracting authority may not restrict competition, and in particular that they cannot prevent any bidder from participating in the public procurement procedure by using discriminatory conditions.
We believe that in this particular case, the contracting authority requested additional conditions regarding the technical and business capacity of bidders which, due to all the above, are not logically related to the subject of specific public procurement and which restrict competition in terms of the Law on Public Procurement. This is confirmed by the Decision on awarding the contract, which states that only the selected bidder submitted an acceptable bid. So, the contracting authority obtained only one acceptable bid for a procurement that is not so specific as to expect no competition among bidders in the market. In addition to the selected bid, only one other bid was submitted, which had a number of shortcomings and was therefore rejected as unacceptable, and one of the shortcomings was the lack of the evidence of fulfillment of additional conditions.
In this case, it is especially surprising that the Republic Commission did not check the allegations of the contracting authority with which they tried to justify the insistence on the disputed additional conditions. Simply put, the Republic Commission a priori accepted the arguments of the contracting authority without requesting any additional clarifications or evidence, although some of the arguments were contrary not only to the content of the specific tender documentation, but also to the logic.