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Procurement law

  • We advise and legally represent participants and bidders in tenders and public procurement procedures in Austria.
  • We support our clients in pending tenders as well as in administrative and civil proceedings to challenge unlawful decisions by a contracting authority or entity (e.g. tender, specifications by the contractor during a pending tender, exclusion from tender, award to another candidate or bidder).

Bidders are regularely requested to supply documents on their suitability to pursue the professional activity, the financial and economic as well as the technical and professional ability relevant for the requisite tender.

In preparation of a tender, bidders may require in-depth legal assessment of the legal requirements for participation in a specific tender (esp. with regards to the legal conditions for the performance of the contract in Austria, the legal suitability and professional ability). Eventually, potential bidders will have to take the requisite steps (enrolment in a professional register, see also site “trade law, cross-border services”) in time for the bid in the tender.

Depending on the contract, bidders may form groups of economic contractors and submit a a tender collectively in order to fulfil all the criteria and specifications laid down by the contracting authority or entity. The formation of a group of economic contractors to participate in a tender may require closer scrutiny under Austrian/European cartel law.

We recommend to timely check the requisite professional capacities and proofs of professional ability and reliability in order to participate and bid in a specific tender in Austria in order to avoid exclusion or other failures with regards to Austrian trade, cartel or public procurement legislation.

In Austrian public procurement law, even unlawful specifications by the contracting authority or entity may not be challenged (become „persistent”) unless they are challenged by a bidder or contractor within the legal time-limit at the competent administrative court and successively annulled.

We strongly recommend to instantly contact an attorney specialized in Austrian public procurement law when your company is affected by an unfair or discriminating decision or award by a contracting authority or entity in Austria (e.g. an unfair tender, unfair or discriminatory specifications or further dispositions by the contracting authority in the tender proceedings, an unfair/discriminatory award of a contract to a competitor), so that you may get advice on the chances of legal remedies and the time-limits.

Due to the complexity of Austrian public procurement and administrative trade law, the participation in public tenders needs thorough preparation. Strategic decisions in tenders should only be taken on the basis of a thoroughly comprehensive legal assessment.

Based on our experience, we will provide a short abstract on the legislation on public procurement, i.e. contract awards by public contracting authorities and entities, in Austria, focusing on the provisions of special relevance for bidders and contractors.

Please do not hesitate to contact as today if you have got questions regarding our services in public procurement proceedings!

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Procedures for the award of public contracts in Austria

  • Public contracting authorities/entities

    The „classical“ contracting authorities subject to the specific procedures for the award of public contracts are the Austrian federal state, the regions and the local authorities. Further, legal entities governed by public law as well as entities established for the purpose of meeting needs in the general interest.

    These public contracting parties have to comply with the Austrian legislation on the award of public contracts in Austria. On the federal level, this legislation is codified in the Federal Public Procurement Code (“Bundesvergabegesetz”, short: “BVergG”).

    Further, privately held companies operating in certain industries, that is in the water, energy, transport or postal services sector, are also obliged to apply the relevant legislation on the award of public contracts, even though they do not fall under the definition of “classical” contracting authorities. They have to comply with a simplified, less rigid regime in the award of contracts. On the federal level, this regime is also laid down in the Federal Public Procurement Code (“Bundesvergabegesetz”, short: “BVergG”).

    Specific procurement rules for the defence and security sectors are codified in a separate act, the Federal Public Procurement Code for Defence and Security (“Bundesvergabegesetz Verteidigung und Sicherheit (VergGVS)”).

    Public contracting authorities and private companies operating in the water, energy, transport or postal services sector are interested in maximum flexibility in their award decisions. Some of them interpret the rigid legislation on the award of public contracts as burdensome.

    Prior to participation/bidding in tenders, bidders should get a clear picture if any and which procedural rules for public contracting parties or contracting parties in the water, energy, transport or postal services sector or in the defence and security sectors apply. Infringements of these rules may result in the annulment of the unlawful decisions by the contracting authority/entity (e.g. an unfair tender, unfair or discriminatory specifications or further dispositions by the contracting authority in the tender proceedings, an unfair/discriminatory award of a contract to a competitor).

    We guide you and your company through all the stages of tenders and public procurement procedures, beginning at the publication of the information notice to the award decision and beyond.

    Upon request, we review any decision by the contracting authority/entity with regards to their compliance with the relevant legislation on the award of public contracts.

  • Works contracts, supply contracts, services contracts, framework agreements

    The Austrian Federal Public Procurement Code distinguishes several groups of contracts. The most important distinction refers to the object of the contract. The most important contracts are works contracts, supply contracts, services contracts.

    Depending on the object of the contract, the contracting authority has to consider various threshold amounts. Relating to the object and estimated value of a contract, the contracting authority/entity is restricted to certain procurement procedures. To put it simple: The higher the estimated value of a contract, the more detailed and strict are the legal setting of the procurement procedure, the more requirements for transparency of decisions exist and the more restrictions are in place for the individual decisions of the contracting party.

    Besides the major groups of contracts (works contracts, supply contracts, services contracts), the Austrian Federal Procurement Code also defines framework agreements. These are defined as contracts governing successive awards during a given period.

    The Austrian legislation on the award of public contracts contains specific provisions on the procurement procedures for the award of a framework agreement. Framework agreements limit competition for the given period and may infringe on cartel law.

LINKS:

www.bvwg.gv.at (Federal Administrative Court)

http://verwaltungsgericht.bgld.gv.at (Administrative Court of Burgenland region)

http://www.lvwg.ktn.gv.at/286502_DE (Administrative Court of Carinthia region)

http://www.lvwg.noe.gv.at/ (Administrative Court of the region of Lower Austria)

http://www.lvwg-ooe.gv.at/ (Administrative Court of the region of Upper Austria)

https://www.salzburg.gv.at/lvwg/ (Administrative Court of Salzburg region)

http://www.lvwg-stmk.gv.at/ (Administrative Court of Styria region)

https://www.lvwg-tirol.gv.at/ (Administrative Court of Tyrolea region)

http://www.lvwg-vorarlberg.at/ (Administrative Court of Vorarlberg region)

http://www.verwaltungsgericht.wien.gv.at/Content.Node/ (Administrative Court of Vienna region)

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Action for anullment of decisions by the contracting authority/party

  • Action for anullment of decisions by the contracting authority/party

    In a running procurement procedure, every decision and specifation by the contracing authority/entity (e.g. tender, specifications or further dispositions by the contracting authority in the tender proceedings, decision of award of a contract to a competitor) may be challenged and reviewed with regards to their compliance.

    The challenge of decisions and dispositions by the contracting authority/entity is bound to (relatively tight) time-limits. After expiry of these time-limits, a legal review and annulment of decisions and dispositions is time-barred. Unless unlawful decisions are not challenged in time, they become “persistent” even though they infringe public procurement legislation.

    The tight time-limits for the review of decisions by the contracting authority force the bidders to respond in short time and immediately decide whether to challenge a decision or disposition by the contracting authority/entity.

    Due to the quite complex division of legislative functions between the Austrian federal state and the regions, the time-limits relevant for contracting authorities/entities attributable to the federal level are ruled by the Federal Public Procurement Code. For the contracting authorities/entities attributable to the regions, specific and slightly modified procedural rules apply in each region.

    In order to avoid a status of „accomplished facts“ and successive detrimental and unchallengeable decisions by the contracting authority/entity, a bidder filing an action for annulment of a decision by the contracting authority is well advised to apply for ancillary interim measures to be taken by the administrative court. In case the court adopts the interim measure, the contracting authority can be barred from proceeding with the public procurement and taking further decisions or dispositions detrimental to the bidder/contractor.

    If one bidder contests a decision by the contracting authority/entity, others bidders may join the proceedings before the administrative court, if they can proof a sufficient legal interest in the outcome of the proceedings.

    If for example a non-awarded competitor submits an application for annulment of the decision awarding a contract to another bidder, the presumptively successful bidder (recipient of the award) may join the proceedings in order to defend the decision by the contracting authority.

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  • Application for establishment of an infringement

    As soon as the contract has been awarded by the contracting authority/entity or the tender has been revoked, bidders and tenders may request a verdict by the administrative court establishing an infringement against the Federal Public Procurement Code. The administrative-judicial establishment of an infringement is a crucial prerequisite for the enforcement of damages by succumbing bidders.

    Additionally, the establishment of an infringement against the Federal Public Procurement Code demonstrates to the contracting authority/entity that the infringement has not remained unnoticed by the bidders. It serves the rule of law and evolvement of public procurement legislation and jurisprudence in Austria.

    Grave infringements of public procurement law may build the legal basis for damage claims by the succumbing bidder. Damage claims may be enforced before the Austrian civil courts. However, first the infringement needs to be established by the competent administrative court.

    If your company participates and bids in a tender by a contracting authority/entity, suffers damages through infringements of public procurement law and requests compensation, you are well advised to immediately contact my office. I will readily guide you through the requisite procedural steps before the administrative and civil courts.

  • Court fees

    Proceedings before the administrative courts, be it applications for annulment or establihment of infringements, and applications for interim measures trigger (sometimes high) court fees. The amount of fees for applications to the Federal Administrative Court and the regional administrative courts are ruled by regulations. Upon submission of an application, the applicant has to give proof of remittance of the court fees.

    We keep well-informed about the latest developments in the fields of public procurement law. We follow the latest legislation, case law and legal literature. Further, we regularly publish scientific articles on legal public procurement issues. We ensure that we can advise and represent you comprehensively and effectively in the preparation of, during and in the aftermath of public tenders.

    Wir verfolgen für Sie laufend die aktuellen Entwicklungen auf dem Gebiet des Vergaberechts in der Gesetzgebung, Rechtsprechung und Lehre. Wir publizieren regelmäßig zu vergaberechtlichen Themen. Dadurch stellen wir sicher, dass wir Ihr Unternehmen umfassend, fundiert und am Puls der Zeit vor, während und nach Vergabeverfahren begleiten und vertreten können.

LINKS:

www.bvwg.gv.at (Federal Administrative Court)

http://verwaltungsgericht.bgld.gv.at (Administrative Court of Burgenland region)

http://www.lvwg.ktn.gv.at/286502_DE (Administrative Court of Carinthia region)

http://www.lvwg.noe.gv.at/ (Administrative Court of the region of Lower Austria)

http://www.lvwg-ooe.gv.at/ (Administrative Court of the region of Upper Austria)

https://www.salzburg.gv.at/lvwg/ (Administrative Court of Salzburg region)

http://www.lvwg-stmk.gv.at/ (Administrative Court of Styria region)

https://www.lvwg-tirol.gv.at/ (Administrative Court of Tyrolea region)

http://www.lvwg-vorarlberg.at/ (Administrative Court of Vorarlberg region)

http://www.verwaltungsgericht.wien.gv.at/Content.Node/ (Administrative Court of Vienna region)