Act on Public Procurement / Zkon o verejnom obstarvan.

New Act on Public Procurement 2016. Work file.

CHANGE/AMENDMENT AND WITHDRAWAL FROM THE CONTRACT

AWARD PROCEDURES
APPLICABILITY AREA CLARIFICATION OF "IN-HOUSE" CONTRACT AWARD
REGISTRATION OF REFERENCES
OPENING AND EVALUATION OF TENDERS DIVIDED IN TWO ROUNDS
SUBDIVISION OF CONTRACTS
VALIDITY TRANSITIONAL PERIODS IMPLEMENTATION OF THE EU LEGAL STANDARDS

Following the 27 amendments to the old act, a completely new Act on Public Procurement was passed in Slovakia (No.
343/2015), entering into force on 18 April 2016. In addition to implementation of the EU legislation, compared to the old act, the
new Act on Public Procurement also brings novelties such as the contract award procedure, obligation to enforce smaller
companies by subdividing the contracts as well as changes in the legal protection area and numerous clarifications.

Short summary of the significant changes compared to the old Act on Public Procurement No. 25/2006:

1.

The new Act on Public Procurement will enter into force on 18 April 2016. The contract award procedures, for which the
contract notice was sent for publication by 17 April 2016, will be completed pursuant to the old Act on Public Procurement No.
25/2006.

The new Act on Public Procurement implements the current EU legislation. For the most part, the Act reflects the EU standards,
however, also including several Slovak specialties, which deserve special attention.

2. .

The new Act on Public Procurement contains a number of exceptions and restrictions regarding applicability of the public
procurement regulations. The "in-house" award has been clearly defined: A contract may be awarded to a legal entity without the
award procedure if the contracting authority exercises control over the legal entity similar to the control exercised over its own
organisational units, owns 80% of shares and there is no direct participation of private capital.

3. .

The contracting authority may subdivide the contracts into several portions and is obliged to clarify in the contract notice whether
tenders may be submitted for one, several or all portions of the contract. If the contracting authorities waive the subdivision of the
contract, they have to justify doing so.

4. PROOFS OF ABILITY - EUROPEAN SINGLE PROCUREMENT DOCUMENT (ESPD)

Art. 39 Act on Public Procurement introduces the European Single Procurement Document (ESPD) assumed in Art. 59
Directive 2014/24/EU, whereby the European legislator wants to determine the structure in the future, facilitating and simplifying
the verification of ability.

By introducing the European Single Procurement Document, the businesses and organisations in the future will no longer have to
present all the legal and financial proofs of ability when
submitting the tenders. To participate in open procedures, own declaration standardised within the EU will suffice. Only the
company winning the procedure will subsequently have to submit the documents needed.

5. ..

After the contract completion, the contracting authorities are obliged to deliver data on the fulfilment of the contract to the Office,
as defined in the form, along with evaluation, which will be published in the registration of references afterwards. Contractor may
ask for correction of errors in the reference, however it is still difficult to remove a negative assessment.

6. ..

6.1 (insert title)

In accordance with the EU standards, the following award procedures are set out in Art. 29 Act on Public Procurement:

Open procedure,

Restricted procedure,

Negotiated procedure with publication,

Competitive dialogue,

Innovation partnership,

Negotiated procedure.

The following should be mentioned as special features of the open procedure:

Electronic marketplace,

Centralised public procurement technique,

Electronic auction,

Dynamic purchasing system.

6.2 (insert title)

Regarding the contracts below limit, procurement of goods, construction works or services generally available on the market
shall be carried out through the "electronic marketplace" principally (www.eks.sk). For the electronic marketplace, the cheapest
tender is always decisive and no remedies ("objections") may be applied against the procedure.

6.3 (insert title)

Central procurement organisations shall be established at various levels of administration and in public authorities. For contracts
below limit in the Slovak republic, the Ministry of Interior in cooperation with the Ministry of Finance is competent, and all the
state authorities are obliged to utilise the centralised public procurement techniques, unless agreed otherwise in individual cases.

6.4 (insert title)

Pursuant to Art. 54 Act on Public Procurement, in electronic auction the contract shall be awarded to the bidders by using the
electronic system, which following the initial complete evaluation of tenders, will arrange the new prices and/or new values
regarding some features of the tenders downwards, and which enables automated evaluation of the tenders.

In the case of simple electronic auction, the contract shall be awarded to the tender with lowest price. In the case of other
electronic auctions, the contract shall be awarded to the technically and economically best offer. The contracting authority may
freely select whether to carry out a simple or other electronic auction.
6.5 (insert title)

Pursuant to Art. 58 Act on Public Procurement, the dynamic purchasing system is an electronic procedure for the procurement of
contracts for which the commonly available indicators suffice the requirements of the contracting authority. Within the dynamic
purchasing system, an unlimited number of bidders will be invited publically to submit non-binding declarations on the
performance provision and all the suitable enterprises who will have submitted admissible declarations on the performance
provision will be allowed to participate in the system. Within the dynamic purchasing system, the performance will be purchased
after separate call for submission of a tender from the dynamic purchasing system participant.

7. .

The principle of opening of tenders in two rounds, additionally introduced in the old Act on Public Procurement, was preserved.

The tenders have to be divided to "Others" and "Criteria", which is also the way they will be opened by the committee.

First, the committee will open the part of the tender identified as "Others", containing criteria for participation in the
procurement, such as integrity, technical and financial equipment. The committee will verify this area, possibly ask the bidder for
explanation and exclude tenderers who do not meet the "other" criteria.

Only after any possible remedy proceedings against the committee arising from the first round of the tender opening will have
been completed, the part of tenders identified as "Criteria" will be opened, containing details of the particular tenders (price,
price/quality ratio). Only the bidders not excluded in the first round may participate in the second round of tender opening.

8. .

8.1

The new Act on Public Procurement has left out the necessity to obtain consent from the Office to make amendments or changes
to contracts. The contract may be amended during the contract period without new public procurement if:

the original contract contains clear terms and conditions for amendments and changes,

the complementary goods/performance are concerned and no other goods/performance may be used due to economic or
technical reasons,

unforeseen circumstances arise,

the original supplier will be replaced by another supplier defined in the contract or by the legal successor of the existing
supplier, or

no substantial change to the original contract is made,

the value of all changes is lower than the financial limit and at the same time lower than 10% of the contract value, in the case
of goods supply contracts or service contracts or lower than 15% of the contract value in the case of construction works contracts.

8.2

The contracting authority is entitled to withdraw from the contract if:

it is established that there was a reason for excluding the contractor at the time of conclusion of the contract, or

the Court of Justice of the European Union discovered a breach of legally binding EU law.

9. DIRECT PAYMENTS TO SUBCONTRACTORS

It is possible to determine the terms and conditions (the "mechanism") of making direct payments to subcontractors in the
contract concluded between the contracting authority and the contractor.

10. CHANGES TO LEGAL PROTECTION

10.1 Request for Remedy and Objections

The system of requests remained unchanged. The requests for remedy have to be addressed to the contracting authority while the
objections have to be delivered to the Office directly.

10.2 Request for Remedy

The request for remedy is only possibly in two cases now:

Against the contract award notice and the conditions listed therein,

Against the conditions listed in the procurement documents.

The request for remedy has to be delivered to the contracting authority within 10 days from publication or takeover of the
procurement conditions.

10.3 Objections

Objections against the award procedure are admissible in the cases clearly defined in Art. 170 par. 3 Act on Public Procurement
and the objections in the aforementioned cases have to be preceded by the delivery of the request for remedy.

Objections have to be delivered to the Office and the controlled entity in paper or electronic form within 10 days from the event
in question at the latest.

Filing of objections is also linked to the payment of a deposit, which has to be credited to the Office's account at the latest on the
next working day following expiration of the period determined for delivery of the objections. The deposit amount of the deposit
depends on the contract and the contract value, and ranges from EUR 600.00 to 150,000.00. Should the Office reject the
objections, the deposit becomes the state budget income.

The rejection of objections by the Office may be appealed within 10 days, with the appeal being decided by the Office board. The
appeal procedure is linked to an additional deposit.

Should the board reject the appeal, a complaint may be filed at court within 30 days.

11. OTHER

The new Act on Public Procurement consists of 189 extensive articles, with only the most important changes being discussed in
this document. This document does not make any claims for completeness and may not replace studying the Act on Public
Procurement or authorisation of an experienced legal representative