PRAG 2021 - An overview of changes and novelties DevelopmentAid

The European Union’s Multiannual Financial Framework is the primary budget document that highlights the overall Union’s budget and related spending areas for a seven-year period. The recently approved MFF for 2021-2027 has a total dedicated budget of €1.211 trillion, out of which €95.75 billion has been allocated to finance activities under the external actions dimension. PRAG is a non-legally binding document that governs public tendering and grants awarding procedures in the context of the EU’s external action plan.

PRAG 2021 applies to all procurement and grant award procedures launched as of 15 December 2021. It marks a series of important changes and novelties that aim to improve the current procedures and complement those encompassed in the previous MFF (2014-2020). Its boundaries do not apply to contracts where the EC features as the contracting authority or those that concern the delivery of humanitarian aid and civil protection operations.

The EC applies specific sets of rules and methodologies to ensure that all activities that involve procurement and grant procedures are correct, transparent, and fair. The application of these will depend on the management mode selected for the execution of the contracts, the contracting authority, and the financing instrument. In this context, PRAG governs only the projects and programs funded under the EU external financing instruments.

The activities financed under the external action plan are executed through various procurement instruments and grant programs. In this context, the types of contracts and grants will depend on the value, applicable conditions, and relevant procedures. Parties interested in participating in any of those award procedures are encouraged to consult the PRAG guidelines and attached annexes before preparing a proposal submission.

DevelopmentAid is the leading provider of business intelligence and recruitment tools for actors operating in the international development sector. As such, we aim to offer our members and followers the most recent and reliable information on procurement and grant procedures from the largest donor organizations. This paper was produced by Ion Ilasco (External Relations and Events at DevelopmentAid) with the purpose of providing those interested in bidding for projects financed under the EU’s external financing instruments with a glimpse of the PRAG 2021 guide, its application, and the relevant changes.

QA on changes in the EU External Actions Procurement (PRAG 2021, 30/06/2022):

1. Question: I understand that with the new PRAG not all candidates will need to be notified about the results at the same time and the awarded candidate can be notified in advance. Is this so?

Answer: Please refer to PRAG section 2.10.1: Regardless of the type of procedure for works and supplies contracts, the contracting authority must notify the award to the successful tenderer (Annexes C8A and D8A) and, at the same time, inform in writing the unsuccessful tenderers using the appropriate template (Annexes C8B or D8B).
The contract with the successful tenderer can only be signed after the expiry of the standstill period. The duration of the standstill period is 10 calendar days when using electronic
means or 15 days when using other means, starting from the day following the date on which the notification to tenderers was sent.
For service contracts, Section 3.4.12.1.: ‘Before the period of validity of tenders expires, and on the basis of the accepted evaluation report, the contracting authority notifies the successful tenderer in writing that its tender has been retained (see format of letter in Annex B13a) and draws attention to any obvious arithmetical errors which were corrected during the evaluation process. At the latest before taking the award decision, the contracting authority has ensured that the relevant third party (i.e. tenderer including partners) is not registered at exclusion level in the early detection and exclusion system nor included in the list of European Union restrictive measures (see Section 2.4). At the same time the result is notified to the second best tenderer (Annex B13b) and the other unsuccessful tenderers (Annex B13c). All notification letters may be sent by e-mail or fax.’ PIC validation: Please note that it is up to the contracting authority to request the legal and financial validation of the PIC data of any organisation applying via eSubmission. The request for supporting documents on PIC in no way implies that the organisation has been successful in a procurement procedure.

2. Question: In case of extension of the validity of a tender (service contract) are all candidates to be requested to confirm that extension at the same time or can that request be only sent to the preferred candidates?

Answer: Please refer to PRAG Section 2.9.5.: Tenderers are bound by their tenders for the period specified in the letter of invitation to tender or in the tender dossier. […] The period of validity of tenders is fixed at 90 days from the deadline for the submission of tenders.
In exceptional cases with prior approval by the competent authority of the European Commission, before this period of validity expires, the contracting
authority may ask the tenderers for a one-off, specific extension, which may not
exceed 40 days.
The successful tenderer is bound by the tender for a further 60 days, irrespective of the date of notification (i.e. 90 (+ 40) + 60 days) of the award of the contract. This period can only be further extended when the contracting authority has referred a potential case of exclusion to the EDES panel mentioned in Section 2.6.11. and for the duration of the procedure before the EDES panel. The contracting authority may also request a one-off extension of the validity of the offers submitted in response to request for services of framework contracts, before the original validity period has expired. For request for services below EUR 300 000, the period of validity can be extended for maximum 14 days. For request for services equal or above EUR 300 000 EUR, the period of validity can be extended for maximum 30 days. Extensions of tender validity are always requested from all tenderers.

3. Question: Submissions can only be done by the LEAR?

Answer: For call for tenders, the user submitting the request to participate/tender (if different from the Contact Person) receives the role Coordinator Contact,(CoCo). If economic operators choose a different contact person, this person will be given the role of Primary Coordinator Contact (PCoCo) for this call. If the user submitting the request to participate/tender is the same as the contact person they will be the Primary Coordinator Contact (PCoCo) for this call. Therefore, the LEAR is not involved. For an overview of roles and responsibilities external partners can go to https://ec.europa.eu/research/participants/docs/h2020-funding-guide/user-account-and-roles/roles-and-access-rights_en.htm.

4. Question: Will there be any restrictions on subcontracting outside of EU?

Answer: The principle is that economic operators on the market are free to organise themselves as they so wish. As a rule, groups of economic operators are authorised to submit a tender or request to participate to a joint tender and
subcontracting is allowed (*). A joint tender may also involve subcontracting.
The number of entities in a joint tender or the number of subcontractors or the
share of subcontracting may be not limited. Please note however that subcontractors in external actions have to respect the same eligibility criteria that are applicable to the contractor.
(*) See in particular the Judgements of the ECJ C-314/01 of 18/03/2004, (Siemens AG Österreich und ARGE Telekom & Partner vs. Hauptverband der Österreichischen Sozialversicherungsträger) and C-176/98 of 02/12/1999 (Holst
Italia SpA vs. Comune di Cagliari). Please note that Point 18(8) of Annex I to the Financial Regulation (FR) foresees the possibility for the contracting authority to require ‘critical tasks’ to be performed by the tenderer itself and not subcontractors, in the case of some contracts (works contracts, service contracts and siting and installation operations in the context of a supply contract).

5. Question: When are tenderers informed that they are not shortlisted? This used to be at the same time as those who are shortlisted.

Answer: Shortlisted and not shortlisted applicants are informed at the same time.

6. Question: Regarding the evaluation of Key Experts in a tender, if a KE meets the mininum criteria in terms of professional experience, will (s)he score less than another candidate exceeding the same criteria in terms of years of experience?

Answer: Please refer to the Evaluation grid https://wikis.ec.europa.eu/display/ExactExternalWiki/Annexes

7. Question: Do PRAG 2021.1 introduces changes in tender forms from PRAG 2021.0 ?

Answer: Yes, please do consult the Matrix of changes at https://wikis.ec.europa.eu/display/ExactExternalWiki/ePRAG

Find all questions raised by the participants and the answers of the European Commission here.

Read and download the report: PRAG 2021 – An overview of the changes and novelties

*This report should be considered as an unofficial overview. Parties are encouraged to consult official EU documents before submitting any proposals or requests.

*Originally published January 27, 2022, updated July 05, 2022 (Table 6: Changes in PRAG 2021.1)