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December 16, 2022

Meeting with the State Secretary Nataša Mikuš Žigman

AmCham representatives met with Ms. Nataša Mikuš Žigman, State Secretary and Ms. Nina Čulina, Head of the Directorate for Trade and Public Procurement Policy in the Ministry of Economy and Sustainable Development, and Ms. Maja Štefok from the State Commission for Supervision of Public Procurement Procedures.

The topic of the meeting was AmCham's position paper „Discrepancy Between the Estimated Value of Procurement and the Amounts of Tenders in Public Procurement Procedures in the Republic of Croatia“

For many years, in the public procurement procedures carried out in Croatia according to the Public Procurement Act and related by-laws, there has been a trend of a significant discrepancy between the estimated value of the procurement determined by the public contracting authority and the bids received, the price of which is dictated by the market. In this position paper, AmCham provides an overview of the applicable legislative framework, concrete examples from practice in Croatia and from the practice of other countries, and ultimately proposes for solving or alleviating the existing problems in Croatia.

In this regard, the following changes to the applicable legal framework are proposed:
• Legal Obligation of Performing a Preliminary Market Analysis in Order for Contracting Authorities to Adequately Determine the Estimated Value of the Procurement
• The Review/Analysis of the Price of an Abnormally Low Tender Should Be Envisaged as a Legal Obligation, Not Just an Optional Step for the Contracting Authority
• Prescribing an obligation to the contracting authority that when accepting a tender that appears to be abnormally low, requiring it to state the reasons for accepting such a tender in the Minutes on the Review and Evaluation, especially taking into account the circumstances specified in Article 289(2) of the 2016 PPA 

Furthermore, a reference is made to the implementation of measures, which are achieved as follows:
• Carry Out Activities to Raise Awareness of Contracting Authorities About Their Insufficiently Exercised Capabilities and Rights
• Spread Public Awareness About the Use of the Tender Selection Criteria in Order to Comply With the Principles of Economic and Purposeful Spending of Public Funds
• Expand the Circle of Authorized Persons Who Can Question Abnormally Low Tenders 

Ms. Mikuš Žigman, Ms. Čulina and Ms. Štefok pointed out that the Ministry has been dealing with the issue of low prices for ten years and expressed openness to cooperation with AmCham on this issue, especially in the part of introducing the obligation to conduct a preliminary market analysis and the obligation to analyze the price of abnormally low tender.

At the meeting, changes to the Public Procurement Act, planned for 2023, were announced. AmCham and the Ministry of Economy and Sustainable Development will cooperate in this issue together.

AmCham representatives included Andrea Doko Jelušić, Executive Director, Jelena Markulin, Vice-Chair of the Public Procurement Committee, Danijela Trgovčić, member of the Public Procurement Committee and Dražen Malbašić, Policy Manager.

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