From 1 February 2022, the calculation rules in Chapter 5 LOU apply to all procurements, regardless of their value. That means that there will no longer be an obligation to include previous direct procurements “of the same type” carried out during the financial year when estimating the value of a direct procurement. The provisions of Chapter 5 LOU are applied instead.
Although the amendment to the Act aims to simplify the calculation of the estimated value, questions are raised as to how a procuring authority must actually determine whether or not a procurement is below the direct procurement limit. For example, will it be free to procure directly as long as each individual direct procurement is below the direct procurement limit? The question is not very easy to answer and must be decided on a case-by-case basis.
The prohibition on dividing up a procurement in order to circumvent the provisions on procurements subject to an obligation to advertise will continue to apply. There is also a specific provision in Chapter 5. Section 11 LOU on how the value of a goods or service contract that is regularly recurring or that is to be renewed within a certain period of time must be calculated. The provision entails an obligation to include the total value of similar contracts procured during the previous twelve-month period or to include the estimated total value of a series of contracts that will be procured in the next twelve-month period after the first delivery. It must be noted that both advertised and unadvertised procurements must be included in the value in accordance with Chapter 5, section 11 LOU.
Summary
To sum up, it may be stated that, under certain conditions, there will also be an obligation in future to include the value of other procurements when calculating the value of a direct procurement.
If you want to know more about the new simplified regulations or how the value of a direct procurement must be calculated, you are of course very welcome to contact one of us or your regular contact person at Lindahl.
