TIRANA, April 18 – One of the main doing business barriers for local and foreign investors in Albania, public procurement continues to face issues related to limited competition and discriminatory criteria although the country has been offering e-procurement procedures since eight years in a bid to reduce corruption and increase transparency.
Reports by the Public Procurement Agency and the Procurement Commission appeals body show state-run institutions continue abusing public tender procedures awarding contracts with no race and placing discriminatory criteria apparently to select pre-determined winners.
An annual report by the Public Procurement Agency has shown state-run institutions carried out some 2,186 procedures with negotiation without prior notice of the contract, worth about 8.1 billion lek (€59 mln), down only 7 percent compared to last year when an extra 520 such negotiations were held. The procedures represent about 10 percent of the total public procurement budget.
About two-thirds of such procedures were carried out in the first quarter of the year, mainly in extensions to existing contracts by up to 20 percent value.
As a rule, negotiations without prior notice of the contract are carried out to meet year start needs at an amount of 20 percent of the previous contract, in case contracting authorities have not had their budgets disbursed yet or due to prolonged procurement procedures because of appeals with the Public Procurement Commission.
“In most cases contracting authorities use this procedure claiming they are under emergency procurement conditions, but do not justify the envisaged circumstances leading them to inability to plan their needs in time and meet these needs under competitive procedures under legal provisions,” says the Public Procurement Agency.
“Being held in a written form and limited to a few economic operators invited by the contracting authority, the use of negotiation without prior notice of the contract leads to lack of competition and discrimination of candidates,” adds the agency monitoring public procurement.
The e-procurement system in Albania is mandatory, including for low-value procurement. A central public procurement portal is in place and all tender documents are available in e-form.
Some 4,000 public procurement contracts worth 87.3 billion lek (€636 mln) were signed in 2016, up 35 percent compared to 2015, representing about 5 percent of the country’s GDP.
The Public Procurement Commission, examining complaints by economic operators, also noted irregularities in tender procedures, mainly related to the discriminatory criteria.
“The drafting of tender documents, mainly the drafting of qualifying criteria and technical specifications not complying with legislation in force or the scope of the contract continue to remain issues for the Public Procurement Commission. The determination of discriminatory or technical specifications has a direct or indirect impact on the creation of conditions for avoiding competition or favoring specific operators, this way violating the fundamental principles of public procurement law,” said the watchdog whose decisions are corrective and can be challenged in the Administrative Court.
The complaints filed with the public procurement watchdog also unveiled cases of exaggerated economic requirements by contracting authorities, openly discriminating against small or newly established businesses.
About 1,400 complaints were filed with the Public Procurement Commission in 2016, up 20 percent compared to 2015, mainly related to procurement procedures in private physical security and cash transportation.
The Procurement Commission says it accepted half of the complaints, ordering cancellation of procedures, reassessment of procedures and modification of criteria.
In one case, the Public Procurement Commission also ruled the change of the winning bidder on a 30-year concession contract to upgrade and manage a 114-km highway segment linking Albania to Kosovo, making it the country’s first toll road.
Last September, the watchdog ruled the transport ministry’s bid evaluation commission must invalidate the bid by a Turkish consortium led by Vendeka Bilgi Teknolojileri Ltd and announce a United Arab Emirates-consortium led by Catalyst Viva Das General Contracting LLC which also included several Albanian partners as winner.
Meanwhile, public tenders with a sole bidder continue getting a considerable number of contracts and huge amounts of money from Albania’s local government units even more than a year after a territorial reform merged a previous 373 communes and municipalities into 61 municipalities.
Data obtained by Open Data research center shows municipalities held a total 207 public tenders with a sole bidder for a total amount of 1.9 billion lek (€13.7 million) over a one-year period from July 2015 when new mayors took office following the June 2015 local elections to September 2016.
