The Independent Office for Regulation and Supervision of Contracts interprets the Public Procurement Law to provide greater guarantees for the award of minor contracts

As an exception to the principles of publicity, free competition and transparency in public procurement, contracting authorities are entitled to award directly to a contractor, i.e. without the publication of a tender procedure in which all interested bidders may submit an offer, works contracts with an estimated value of less than 40,000 euros, or supply or service contracts with an estimated value of less than 15,000 euros (the so-called minor contracts).

The new Law 9/2017, of November 8, on Public Procurement Contracts (the "Law 9/2017"), subjects to new requirements the use of minor contracts, motivated by the fact that the direct award, inherent to this procedure, clashes head-on with the principle of free competition.

The new Law 9/2017 maintains the essential characteristics of minor contracts in terms of the limitation of its amount, the maximum duration of one year and the impossibility of extension. However, innovations are introduced that affect the processing of the file and the requirement for more documentation justifying the adequacy of the procedure, its scope, etc.

In view of the legal uncertainty posed by the new regulation of the minor contracts, insofar as certain requirements of the procedure were not perfectly limited, the Independent Office for Regulation and Supervision of Contracting has issued Instruction 1/2019. It details the criteria to be followed by contracting bodies to justify the need to use the procedure, the justification of direct awarding, the content of the file, the temporal scope of the limitations imposed by the new Law 9/2017 and the publicity of these contracts.

Justification of the non-alteration of the object of the contract to avoid the rules of contracting

The file will have to contain the justification of the necessity of the contract, and the reasons for the non-planning of the same, therefore, recurring services, supplies or works, year after year, which can be planned, may not be the subject of this contract.

The absence of splitting of the object of the contract, i.e. that the services forming the "functional unit" have not been separated to avoid the rules of publicity and competition, must be justified. In this sense, the justification must be about the indispensable and intrinsic link between the services, supplies or works in question.

In those cases in which the object of the contracts are completely different and do not involve a division of the object, even if it is the same type of contract, several minor contracts may be concluded with the same contractor, although these circumstances must be duly justified in the file.

Justification of the direct award

The Instruction imposes the need to request at least three quotes, justifying, where appropriate, the impossibility of doing so. It is not required to receive three quotes, but to request them.

The temporal scope of the limitations of article 118.3 of the PSCL.

Article 118.3 states that it must be justified in the file that the contractor has not signed more minor contracts than individually or jointly exceed the figures of the minor contract. The Instruction clarifies that the temporal scope of this limitation of contracts with the same contractor must refer to the budgetary year, given that this criterion facilitates verification by the bodies responsible for auditing public accounts.

Publicity of minor contracts

The contracting authorities must publish quarterly all the minor contracts they have awarded in that period (this obligation does not apply in respect of contracts with a value of less than EUR 5,000, provided that the payment system used by the contracting authorities is a fixed cash advance or another similar system for making minor payments). They must indicate the object, duration, amount and identity of the successful tenderer, and contracts must be ranked according to the identity of the successful tenderer.