On May 1, 2006 in the Republic of Latvia 2006 came into force Public Procurement Law, which transposed the European Parliament and Council Directives 2004/18/ EC from March 31, 2004 regarding coordination of public construction work contract, public supply contract and public service contract concluding right award rules of the procedure.
Therefore the Public Procurement in Latvia is performed on the basis of the Public Procurement Law, the purpose of which is to ensure:
- openness of the procurement procedure;
- free competition of suppliers, as well as equal and fair attitude thereto; and
- effective use of State and local government funds, reducing the
risk of the commissioning authority to the minimum.
Public procurement provisions are applied entering into contracts, if:
- the implementation of a construction works contract is financed by more than 50 % from the contract price directly by the commissioning authority and the estimated contract price of this contract is equal to or exceeds the contract price margins specified by the Cabinet of Ministers – 5 186 000 euros and if this contract relates to engineering works, as construction site preparation, building dismantling and demolition, roof covering and construction installation, test drilling or boring, etc., as well as to building of structures intended for sport, medical treatment and recreation, hospitals, schools, universities and buildings for administrative purposes;
the implementation of a service contract is financed by more than 50 % from the contract price directly by the commissioning authority and the estimated contract price of this contract is equal to or exceeds the contract price margins specified by the Cabinet of Ministers – 207 000 euros and if this contract is associated with construction works contract regarding engineering works, as construction site preparation, building dismantling and demolition, roof covering and construction installation, test drilling or boring, etc., as well as to building of structures intended for sport, medical treatment and recreation, hospitals, schools, universities and buildings for administrative purposes.nbnbn
If the commissioning authority finances the implementation of such contract, which is not mentioned above, from his or her funds or from the funds of the European Union policy instruments or other foreign financial assistance and national co-financing, the procurement procedures and the procedures for application thereof, as well as persons, which apply these procedures, shall be determined by the Cabinet of Ministers.
Commissioning authority according to Law is State or local government institution, a local government, other derived public person or institution thereof, an association, in which all members are commissioning authorities, a foundation, all founders of which are commissioning authorities, as well as such legal person governed by private law, which concurrently conforms with the criteria established in the Law.
The following procurement procedures exist:
- an open procedure - all interested suppliers may submit a tender;
- a restricted procedure - all interested suppliers may request the right to participate, but offers may be submitted only by those who are invited by the commissioning authority;
- a negotiated procedure - the procurement procedure in which the commissioning authority consults with the suppliers he has chosen and with one or more of them enters into negotiations on the terms of the contract;
- a competitive dialogue – procurement procedure, which aims to develop one or more compliant alternative solutions with the help of the suppliers, what is the main difference from other types of procurement procedures;
- a design competition - the procurement procedure what gives the opportunity to the commissioning authority to obtain design (plan or project) what the jury commission has recognized the best in competition with or without the award of prizes, mainly in urban and any other area planning, architecture, construction or data processing (including state information system) field.
Public sector procurement supervision in Latvia is performed by Procurement Monitoring Office, which is direct administration institution subordinate to the Ministry of Finance, the competence of which is determined in the Public Procurement Law, Public service providers Procurement Law, the Public-Private Partnership Law, in the Procurement Monitoring Bureau regulations and other normative acts.
To learn more about procurement procedures, tenders and public supply contracts or service contracts, contract prices, please contact our Law Firm.