On December 5, 2022, the National Executive Branch published in the Official Gazette Decree No. 811/2022 (the “Decree”), which introduces amendments to the Regulations of the Procurement Regime of the National Public Administration (the “Regulations”) regarding the grounds for withdrawal of bids, penalties and sanctions.
Grounds for dismissal
- Non-remediable:
The Decree eliminated the cause provided in paragraph a) of Article 66 of the Regulations, which established that the bid would be rejected if it was formulated by individuals or legal entities that were not included in the Supplier Information System, and also eliminated the previous paragraph g) of Article 66, which established as a cause for rejection if the bid was written in pencil or with a means that allows erasure and rewriting without leaving traces.
The Decree incorporated two new grounds for rejection that cannot be remedied: (i) when the bid contains false or adulterated documentation or information (item a) and (ii) for incurring in the unlawful conducts described in Article 10 of Decree No. 1023/2001, which approves the Procurement Regime of the National Public Administration (item k).
On the other hand, the Decree modified paragraph b of Article 66, regarding bids submitted by individuals or legal entities not authorized to enter into contracts, by exempting the application of the rejection of the bid in the event that they have not complied with their tax and social security obligations.
- Remediable:
The Decree amends Article 67 of the Regulations, which provides for the consequence of failure to comply with the deadline set for the correction of errors or omissions in the bids. The addition provides that once the deadline has expired without the errors or omissions being corrected, the bid will be rejected.
Penalties
The Decree amends Article 102 of the Regulations which regulates the types of penalties applicable to breach of contract. The Decree incorporated subcontracting without the authorization of the contracting entity as a cause for loss of the contract performance guarantee and as a cause for termination due to its fault.
In those cases in which the bidder, successful bidder or co-contractor is exempted from submitting a guarantee and a case arises in which the penalty of loss of guarantee must be applied, the penalty shall also be applied and the bidder shall be liable for the amount of the guarantee not furnished in accordance with the order of allocation of penalties established in the Regulations.
Sanctions
The Decree eliminated as a cause for a warning penalty the case of rejection of an offer.
In the cases of suspension from contracting for a term of up to one year provided for in Article 106(b.1), paragraph b.1. ) of Article 106, the Decree adds that the suspension shall apply for the term provided for, except in those cases in which a greater sanction is provided for in cases where: (i) the successful bidder has had the award revoked for causes attributable to it (Section 1.1) and (ii) the co-contractor who has had a contract partially or totally rescinded for causes attributable to it (Section 1.3).
In the cases of suspension from contracting for a term of more than one year and up to two years provided for in section b.2) of article 106, if the bidder has submitted false or adulterated documentation or information, the Decree eliminated the clarification provided in the previous wording that in the event that a criminal case is pending, the statute of limitations for the application of sanctions will not begin to run until the conclusion of such case.
The Decree excluded the application of the suspension in the event that the bidder is ineligible due to non-compliance in previous contracts.
The Decree eliminated as a cause for suspension from one to two years a bidder whose bid had been rejected when it was made by human or legal persons not qualified to enter into a contract.
