Romania has new public procurement laws

The Chamber of Deputies, Parliament's decision-making body, has recently passed a new package of public procurement laws one month later than the deadline imposed by the European Union, which has criticised Romania for the delay. Here's the European Commissioner for Regional Policy, Corina Cretu:

"I welcome the fact that the Romanian Parliament has unanimously passed this public procurement package. The term for enforcing European legislation on public procurement already expired in April. So, this piece of legislation was an emergency and I was worried because the absence of the public procurement law had been blocking all operational programmes."

Economic analyst Valentin Ionescu tells us more about the new package of laws:

"What Parliament has passed is in fact the result of two European directives that came into effect in early 2015. These two directives retain to some extent the spirit of the previous regulations, while also introducing some new mechanisms aimed at making their enforcement more flexible. One example is the fragmentation of big contracts, which means that several companies can have access to procurement and building contracts. On the other hand, raising the threshold for bidders is a bad thing as it cannot contribute to curbing corruption. On the contrary, it may fuel it and foster clientelism in the case of tenders of lower values."

According to the president of the National Association for Public Procurement, Bogdan Puscas, the new legislative package is based on the principle of a better public funding management, similar to that of private money, to achieve a better price-quality ratio. He added that under the new legislation, the best offer translates as the best price, the best cost, and the most appropriate balance between price and quality. Puscas says that in order to facilitate the access of small and medium sized enterprises to contracts, the new legislation includes rules for dividing public procurement contracts. Here is Bogdan Chiritoiu, the president of the Competition Council with more on the new legislation: 

"It's very important to adjust the legislation to the new package of directives. Our legislation has taken over several EU directives. In principle, these new laws should afford greater flexibility, and we've had many complaints in this respect. The public procurement process was very rigid and the focus so far had obstinately been on the idea of the lowest price, which doesn't necessarily mean the best price-quality ratio. It's important how these laws are being enforced. For the Council, however, the most important are the secondary norms and particularly the database in which public procurement is recorded. This database, which is called the Electronic Public Procurement System is much better than in other EU countries, but we'd like to improve it still, so we may easily identify any suspicious behaviour and be able to process the data statistically in order to spot suspicious behaviour patterns, such as agreements or cartels in the case of public procurement that we can thus investigate and punish."

Bogdan Chiritoiu also talked about the public procurement cases currently under analysis by the Competition Council:

"Following discussions with the European Commission, which raised a series of question marks over the public procurement process in Romania, we have started looking at a number of procurement contracts on the IT and medical equipment market. We see the same small number of companies wining tenders in these two sectors, companies that have long-standing relations with the contracting authority. So there must be flaws in the competition system, which cannot be explained by normal market behaviour. I believe we have good legal tools, the same as other EU member state, to deal with the situation. We are more likely to identify cases of corruption that are then for the Prosecutor's Office to investigate. What we can do legally and our area of expertise is to identify agreements between the companies taking part in tenders. If a company bribes the contractor, the latter will do all the work for this company, eliminating the other bidders. That's why most of the problems related to public tenders in Romania are generated by corruption and less so by collusion and cartels."

Economic analyst Valentin Ionescu believes it will take time for the new legislation to be implemented effectively:

"Implementing such a comprehensive set of laws means implementing them in every public organisation. This involves training the entire body of public sector employees, which takes time, at least one hear and a half, in my opinion. This doesn't mean the public procurement laws cannot be implemented, but that it will take time to do it efficiently."

Training the staff of every public institution of the central and local public administration will be a necessary effort so that these new laws should be implemented correctly, Valentin Ionescu also said.