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Pre-SoEA in Framework contracts?                                                May 2014

In 2010 TACU raised a concern about the use of so-called 'pre-commitment (or pre-contractual) SoEs by some companies/consortia in Framework contracts.

These SoEs were (are) used prior to the selection of experts to be included in the bid. So a company/consortium using these practices 'signs up' as many experts as they can find and take them out of the market and out of competition. After this they start the selection process in which they select one candidate. All the others are of no relevance in the bid as they could not sign up with other consortia. In our contacts with EuropeAid, representatives were quite resolute in stating that these practices were not in compliance with the regulation and that companies / consortia using these practices could be reported to the FWC unit. And so we did for some time and companies did not use this 'pre-SoE' for some time. However, recently this practice 'flamed up' again.

Therefore we have now asked EuropeAid where this prohibition of 'pre-SoE's has been regulated? Specific regulation is necessary, because there is some tention with 'normal' contractual law in which 'every idiot can agree a lot with any other idiot' :-).... So we will have to have a 'lex specialis' to abolish these practices.

The reasons for abolishing these practices in the EuropeAid-domain were (and are):

  1. They affect and limit open competition.

  2. They therefore can limit quality of project outputs (as selection criteria of contractors can are different from EuropeAid's (e.g.: price/ fee rate)

  3. They limit employment opportunities for experts

  4. They are a form of foul play, as companies/consortia are not transparent about the selection proces; they often suggest that the selection is the bid-selection.

To be continued....