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Press Release - AmCham presents Recommendations on the announced Amendments to the Public Procurement Act
October 5, 2021

Press Release - AmCham presents Recommendations on the announced Amendments to the Public Procurement Act

AmCham has presented Recommendations for the Improvement of the Legal Protection System in Public Procurement as well as Recommendations for Public Procurement Training to State Secretary Nataša Mikuš Žigman and Head of the Directorate for Trade and Public Procurement Policy Nina Čulina, the Ministry of Economy and Sustainable Development.

“The annual amounts that the public sector spends on the procurement of goods, works and services from private sector actors through public procurement procedures exceeds several tens of billions HRK, which is equivalent to 16% of Croatia’s total GDP in 2019. This being substantial expenditure of budget funds, it is necessary to establish efficient mechanisms that shall correct the shortcomings in public procurement procedures and thus improve the competitiveness of Croatian economy,” emphasized Executive Director of AmCham Andrea Doko Jelušić at the meeting.

Certain shortcomings have been identified in the public procurement system, including, but not limited to, the lack of consistency between the bodies responsible for making decisions on the rights and the obligations of the participants in public procurement procedures, the lack of capacity of the supervisory bodies in the public sector responsible for legality control regarding public procurement procedures, as well as a significant lack in conducting supervision over legal execution of the contracts allocated through public procurement procedures.

AmCham believes it is necessary to work systematically on empowering the institutions legally entrusted with the function of legality control regarding public procurement procedures. Additionally, special attention should be paid to the roles of the Ministry of Economy and Sustainable Development and the State Attorney’s Office in implementing such supervision.

It is also necessary to permanently enhance the capacities of the High Administrative Court in order to improve the quality of legal protection in judicial proceedings. Therefore, AmCham proposes establishing a new judicial department specialized only for judicial proceedings related to public procurement by appointing special judicial councils responsible for making decisions in such proceedings.

The legal protection system in public procurement procedures does not enable all cases to have timely and efficient way of controlling the expenditure of the budget funds. For this reason, AmCham believes that expanding the circle of people authorized to make appeals to the State Commission for Supervision of Public Procurement Procedures (DKOM) would substantially improve the legal protection system in that regard.

Legal security, as one of the highest standards of a democratic society, and a basic precondition of economic growth, is realized primarily through the predictability of the operation of courts and national authorities. The institution of reasoned opinion has significantly increased the predictability of the operation of the Tax Administration in specific cases. Introducing a similar concept into the operation of the State Commission for Supervision of Public Procurement Procedures would eliminate inconsistent practices and ambivalence in law implementation, as well as remove the responsibility of decision making regarding crucial problems from the domain of the Directorate for Trade and Public Procurement Policy. AmCham strongly supports this. To ensure that the State Commission for Supervision of Public Procurement Procedures has sufficient capacities to take over such duty, AmCham suggests that issuing opinions is subject to paying an administration fee (like the Tax Administration), which could be considered their revenue.

“We believe that training of higher quality is, if not a prerequisite, then certainly a crucial and necessary first step in the successful implementation of further professionalization of the entire public procurement system. The people employed in the public procurement system should be continuously and appropriately trained, as well as motivated to work in the system. It is crucial to raise the awareness of the importance of transparency and integrity as core values in public procurement both in principle and in practice, among the employees, as well as to emphasize that those values are the most commonly breached ones,” concluded Ms. Doko Jelusić.

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