Our procurement expert, Rhiannon Holtham, takes a look at what happens if someone wants to change a public contract.
If you’ve recently been awarded a contract following a procurement process, you might think it’s time to say goodbye to the pesky regulations that made the process so long.
But, what happens if someone wants to change the contract – and the Public Contract Regulations 2015 have to be considered again?
If you’re subject to procurement regulations, you can’t amend a contract without limitation. If the regulations don’t allow the change in the contract that you, or someone else, wants to make, the whole contract will be deemed as ‘new’ – and the procurement process will have to start again. If it doesn’t, the contracting authority could be challenged for breaching the regulations.
Several changes could trigger the regulations:
•extending the term of contract
•change of contractor
•change of control.
These changes might come about unintentionally. If you’re in a contract dispute, for example, you could end up revising the contract to settle it.
Here are some examples of how the regulations can apply:
1.R (Edenred (UK Group) Limited) v HM Treasury and others
In this case, because the procurement documents were clear, certain, and precise in anticipating proposed amendments, the Court ruled that the changes weren’t material. There was no need for a new procurement process.
2. Gottlieb, R v Winchester City Council
In this case, the proposed changes to the contract were significantly different from the original, and offered the contractor a slightly more attractive proposition. As a result, the Court ruled that the Council had breached the procurement rules by not advertising the new contract, and a new procurement process would have to take place.
Essentially, if there’s nothing in the contract that allows for the proposed changes, and there hasn’t been another procurement process, and the change is not permitted by the procurement regulations, changing the contract will breach the regulations.
Although you won’t be able to predict all changes, anticipating your future needs is key when drafting tender and contract documents. You should make sure that you ‘future-proof’ your contracts. Use robust ‘review clauses’, and scope future requirements. Make sure you’ve got control over notice periods, and the consequences of early termination, by including provisions covering this. And, keep the regulations in mind throughout both the procurement process, and the term of the contract.