Procurement: PPN 02/21 - Requirements for contracts covered by the WTO GPA and the UK-EU TCA.

The Cabinet Office has published Procurement Policy Note PPN 02/21: Requirements for contracts covered by the WTO Government Procurement Agreement and the UK-EU Trade and Co-operation Agreement.

PPN 02/21 applies to all contracting authorities, including Central Government Bodies, Executive Agencies, Non-Departmental Public Bodies, the wider public sector, local authority and NHS bodies and utilities.[1]

The PPN explains the position in respect of the UK's membership of the WTO Government Procurement Agreement (GPA) and confirms the ongoing procurement requirements for contracting authorities arising out of GPA membership. It also sets out the actions needed to apply the public procurement rules in the EU-UK Trade and Co-operation Agreement (TCA). 

Contracting authorities are required to familiarise themselves with the commitments in the GPA and TCA as set out in the PPN.

GPA

The PPN confirms that the GPA applies to procurement opportunities undertaken by certain types of authorities for certain types of contract with a value above certain thresholds.  In broad terms, this means that it applies to contracts procured by public sector contracting authorities which are above what were commonly referred to as the “EU thresholds” (the thresholds set out in Section 5 of the Public Contracts Regulations 2015 (PCR)).   However, the types of contracts covered by the GPA, particularly in respect of services, are more limited than under the PCR.

The aim of the GPA is to ensure an open government procurement market for GPA members.  It sets out principles of fairness, impartiality, transparency and non-discrimination and basic requirements such as obligations to advertise contracts and observe minimum timescales which facilitate this.

The PPN explains that these GPA requirements are not new for UK contracting authorities.  The UK participated in the GPA through its membership of the EU and the UK’s existing public procurement regulations therefore comply with the GPA. Contracting authorities will continue to meet the GPA requirements by fully complying with the PCR.

TCA

The procurement provisions of the TCA are set out in Title VI (Public Procurement) and Annex PPROC-1: Public Procurement. 

The TCA is intended to deliver market access which goes beyond the level set in the GPA.  In essence, for public sector procurement, it is GPA+: covering a wider range of services and containing some additional obligations which provide wider market access and rights on a reciprocal basis for the benefit of EU and UK suppliers. The TCA applies to procurement covered by the GPA and also to additional services listed in the TCA at Annex PPROC-1.

Annex A of PPN 02/21 summarises the TCA provisions as they apply to the UK.  It makes clear that the applicable financial thresholds are the same as those contained in the PCR and confirms that TCA procurement rules are largely consistent with the PCR such that contracting authorities will be compliant with the TCA in following the PCR in respect of specific procurement activities.

However, PPN 02/21 also highlights that there are certain requirements under the TCA which are not specifically stated in the PCR.  It explains that contracting authorities will need to treat the PCR as if they have been amended to reflect these requirements.  In particular, there are additional rules in respect of abnormally low tenders and ensuring in all procurement activity that EU-owned suppliers based in the UK are treated no less favourably than UK-owned suppliers based in the UK (see paragraphs 10-13 of Annex A to the PPN).

Summary

As we have highlighted in previous articles, the PCR continue to apply to public procurement following the expiry of the Brexit transition period and the conclusion of the TCA.  The message in this PPN, that in most areas compliance with the PCR will ensure compliance for GPA and TCA covered procurements, will no doubt provide welcome reassurance to contracting authorities.  However, it is nevertheless important for contracting authorities to have a clear understanding of which contracts are covered by the GPA and TCA and to apply the additional TCA rules outlined in the PPN.   

[1]               This article comments on the position in PPN 02/21 for public sector bodies and not the position in respect of utilities.