Legal News

Dutch Upper House rejects Public Procurement Act

11-07-2008

The Upper House of the Dutch Parliament threw out a bill relating to the Public Procurement Act on 8 July 2008. Although the bill had been unanimously adopted by the Lower House, three main opposition parties (SP, D66 and VVD) and one government party (PvdA) in the Upper House voted it down.

Their main objection was that the bill was for a ‘skeleton' Act, which would be fleshed out at a later date with Orders in Council. The bill's opponents believe that such a framework Act offers little in the way of parliamentary leverage in respect of the detail. Furthermore, they are of the opinion that the ensuing legislation (the Orders in Council) is too complex. It runs to over 600 pages in total. It is allegedly too complicated, and the result will be longer and more expensive procurement procedures.

Tellingly, Minister Van der Hoeven, who holds the portfolio in question (Economic Affairs), admitted that the bill was "perhaps less than ideal", but added that current practice was "not up to standard." For the Upper House, that was clearly not enough to sway the vote in favour of the bill.

There are just two options open to the Upper House: it can vote in favour of a bill, or against it. It does not have the power to amend a bill. This means that a new bill will have to be drafted that will again have to navigate the choppy waters of the Lower House, before being put to the Upper House. This will, of course, take time. It would therefore be unwise to expect a new Public Procurement Act before 1 January 2010. Until then, the Procurement (Regulations for Public Works Contracts) Decree (Besluit aanbestedingsregels voor overheidsopdrachten) will remain in force; this is the implementation of Directive 2004/18/EC (Public contracts for supplies, works and services) in the Netherlands. In other words, there will be no change or reinforcement to the current regulations for public procurement.

For more information, please contact Gijs Verberne, T: +31 (0)20 6789 585, E: verberne@van-doorne.com.

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