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Mr Juan David Arciniegas Parra

Research Assistant - University Externado of Colombia, Business Law Department

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Public Procurement

I. Definition

1.

Public procurement is the regulation of principles, rules and procedures applied to States in order to implement efficient processes when acquiring goods, services or works, and comply with its’ policy objectives.1 Each public procurement law shall be analysed in accordance with the terms of the particular State or international organization. 

II. Doctrinal scope

2.

Several approaches have been made with regards to Public Procurement. Different topics are applicable to this concept, such as ADR,2 Corruption,3 Arbitration,4 and International Law.5 Given the globalization of contractual and non-contractual obligations, doctrine has developed a common approach in which it is publicly discussed whether States should or not develop global Public procurement regulations so that contractors and other interested parties have a common framework despite the nuances of the State involved. 

III. Public procurement principles

3.

Public procurement has a few principles which illustrate the scope of its’ application. These set of rules have been explained in different instruments such as the General Agreement on Trades and Tariffs,6 the Revised Agreement on Government Procurement,7 the European Union Directive 2014/24/EU,8 the North American Free Trade Agreement (NAFTA),9 the Common Market for Eastern and Southern Africa (COMESA),10 the Asia-Pacific Economic Cooperation Forum (APEC)11 and the Organization for Economic Co-operation and Development (OECD).12 These Agreements have been a common framework in which States around the world may adjust their local public procurement rules.

4.

In short, the principles are as it follows:

  1. Non-Discrimination/Fairness: States, including its procuring entities shall offer no less favourable treatment to another Party, with regards to its’ goods, services and suppliers.
  2. Use of Electronic Means: A State or its procuring entities, when conducting procurement by any electronic means, shall ensure that the procurement is conducted using information technology systems and software available and interoperable with other systems. Also, States must ensure that these mechanisms may not be affected by inappropriate access.13
  3. Conduct of Procurement/Transparency: A State or its procuring entity has to be consistent with the clauses agreed within the respective Agreement. States shall avoid conflicts of interest and corrupt practices.14
  4. Rules of Origin: It is a series of limitations applied to States in which they shall not apply rules of origin to goods or services imported from another Party different from the rules of origin applied normally when dealing imports or supply of the same goods from the same Party.15
  5. Offsets: States shall abstain from offering or enforcing any kind of offset, with regards to a covered procurement.

IV. Case law

5.

The CCJA,16 ICC,17 PCA18 and ICSID19 have considered issues in relation to Public Procurement. Such awards have discussed relevant issues regarding execution, validity and termination of contracts, corruption, among other topics.

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