Belgian public procurement regulation in the traditional sectors applies to "contracting authorities", which are defined by art. 2, 1°, of the Public Procurement Act in a twofold way.

Firstly, a non-exhaustive group of traditional contracting authorities are listed explicitly: the federal State, the Regions and Communities, the local authorities (provinces and municipalities) and associations consisting of one or more of such public entities.

Secondly, the Belgian legislator also enacted a catch-all clause, which gives an abstract definition of a contracting authority. Not only public entities but also many private companies or associations qualify as contracting authorities under this definition, which is further discussed under 2.b. below.

A different personal scope of application is used for the public procurement regime applicable to the utility sectors. This is further discussed under 2.b. below.

Examples of public agencies covered by the law are: Federal Real Estate Agency (Régie des Bâtiments/Regie der Gebouwen), the National Social Security Agency (Office national de Sécurité sociale/ Rijksdienst voor sociale Zekerheid), the National Social Insurance Institute for Self-employed Workers (Institut national d'Assurance sociales pour travailleurs indépendants/Rijksinstituut voor de sociale Verzekeringen der Zelfstandigen).

The catch-all definition in art. 2, 1°, c) of the Public Procurement Act considers as contracting authorities each entity that cumulatively (a) has been established for meeting needs in the general interest without an industrial or commercial character, (b) is a legal entity and (c) is controlled by one or more other contracting authorities via dominant management supervision, receiving more than 50 % of funding from public sources and/or appointment of a majority of the members of an administrative, supervisory or managerial board. This definition matches the definition of "bodies governed by public law" used in the EU directives. The precise scope of the concept of a contracting authority has given rise to a large amount of case law by the European Court of Justice.

As a consequence of the broad definition of contracting authorities, many Belgian companies and associations, regardless of their private-sector origin, are considered as contracting authorities and are subject to the public procurement regulation for the traditional sectors. Examples are state-owned entities, hospitals, educational and research institutions, cultural institutions and certain NGO's.

Legal entities subject to the public procurement regulation in the sectors of water, energy, transport and postal services fall into two different groups, i.e. (i) the so-called "public undertakings", which are active in the aforementioned utility sectors and are subject to a dominant control by contracting authorities as defined by art. 2, 1° of the Public Procurement Act, and (ii) the private entities which operate in one of the aforementioned sectors on the basis of one or more "special or exclusive rights" awarded on a statutory or administrative basis via an award procedure not preceded by adequate publicity and/or not based on objective grounds.

Yes. The procurement by a contracting authority of works, supplies or services from a private or public legal entity can be exempted from public procurement obligations when the conditions for so-called "in-house control" are met.

Firstly, the control by the controlling entity or entities over the other entity needs to be exercised in a way similar as the control these entities can exercise over their own departments. Secondly, more than 80 % of the activities of the controlled entity must be carried out in the performance of tasks entrusted to it by the controlling entity or entities, or by other legal persons under such control. Thirdly, there can be no direct private capital participation in the controlled legal person, with the exception of a non-controlling and non-blocking participation which does not exercise a decisive influence and which is required by Belgian legislation. As a result, several contracting relationships may qualify for the so-called "in-house control" exemption.

Furthermore, non-institutional public-public cooperation between contracting authorities without a relationship of control, is also exempted from public procurement regulation if the subject matter of the contract aims to ensure that the authorities perform their public service missions with a view to achieving common objectives, if the cooperation is implemented solely by public interest considerations and if the cooperating authorities perform less than 20 % of the concerned activities on the market.

Lastly, a transfer or a delegation of powers between contracting authorities, in accordance with Belgian public law, is also exempted from the scope of public procurement regulation.

Belgian public procurement legislation applies to contracts for procuring works, the supply of products and/or the performance of services. Contracts such as the sale of goods, the purchase of shares, as well as concessions fall outside its scope. The Public Procurement Act also lists several exemptions, such as employment contracts, contracts for works, supplies or services regarding public telecommunication networks, certain contracts for financial and legal services and service contracts regarding audiovisual media and regarding acquiring or leasing real estate. Those contracts are not subject to public procurement rules but contracting authorities are nevertheless required to comply with the general principles of non-discrimination, transparency, free competition and proportionality.

To be considered as a public procurement subject to the legislation, the contract requires a 'consideration' for the contractor. Such consideration does, however, not necessarily consist of a payment obligation but may also take another form, where the contractor will retrieve a financial benefit from the performance of the contract.

In addition to traditional single procurement contracts, public procurement regulations also cover framework contracts (please refer to 2.f. below) and design contests. Concession contracts are subject to distinct albeit similar sets of rule (please refer to 2.h. below).

Based on Directive 2014/24/EU, the Royal Decree of 14 January 2013 now includes several possibilities subject to strict conditions which allow changes to an existing contract without the requirement of a new procurement procedure:

• changes are possible to the extent that these have been foreseen in clear, precise and unequivocal review clauses in the tender documents;
• the contract can be expanded to supplementary works, supplies or services with a maximum cost of 50 % of the original contract value, if a change of contractor would be technically or economically impossible or would cause a significant inconvenience or a substantial duplication of costs;
• a contract can be changed on the basis of new circumstances that were unforeseeable by a diligent contracting authority, if the value of the change has a maximum cost of 50 % of the original contract value;
• a contract can also be changed without a new procurement procedure if the value of the change is below certain minimum thresholds;
• the contractor can be replaced as a result of a corporate restructuring (including a merger, acquisition, takeover, …) or insolvency, if the new entity meets the original selection criteria, if there are no other changes to the contract and if this is not aimed at circumventing the public procurement regulation;
• lastly, all non-substantial changes to the contract are allowed; substantial changes are defined in the Royal Decree of 14 January 2013 in accordance with the Pressetext jurisprudence of the European Court of Justice.

All these changes can under no circumstances result in a change of the overall nature of the contract. If this happens, a new call for tender is warranted.

The actual application of the above rules is subject to a case-by-case review of the situation, including the content of applicable tender documents, which may provide for different procedures or conditions.

Framework agreements, which constitute the framework for future procurements during a given period of time and on the basis of pre-agreed terms, are allowed but need to be awarded in accordance with public procurement regulation.

In principle, framework agreements have a maximum duration of 4 years. They can be entered into between one or more clearly identified contracting authorities and one or more contractors. Where a framework agreement has been awarded to multiple contractors and where not all the conditions for the individual orders have been detailed in the framework agreement, the award of individual orders requires a new competitive award procedure limited to these contractors.

Non-institutional public-private cooperation is subject to the regulatory framework for public procurement contracts for works, supplies or services or for concession contracts, to the extent that these contractual arrangements include such contracts.

Institutional public-private cooperation, which involves the joint creation by the public and private partner(s) of a "special-purpose vehicle", is subject to public procurement and concession regulation if the participating contracting authority simultaneously awards to the new legal entity a procurement or concession contract.

Regardless of public procurement and concession regulations, it is worth noting that all phases of both contractual and institutional public-private cooperation remain subject to the fundamental principles discussed under 1.c.

EU Directive 2014/23/EU on the award of concession contracts has been implemented in Belgium by the Act of 17 June 2016 regarding concession contracts and the Royal Decree of 25 June 2017. This regulatory framework applies to concessions for works or services in both the traditional, utility and defense and security sectors.

The scope of the concessions regulation is limited to concession contracts that are characterized by the transfer of the operating risk of constructions or services to the concessionaire. Furthermore, the scope is limited to (i) services concessions with a value in excess of EUR 5.225.000 and (ii) works concession with a value above the same threshold which are awarded in the utility sectors either by public undertakings for other purposes than their public service missions or by private entities operating on the basis of "special or exclusive rights".

The concession contracts legislation is based on the same basic principles as the public procurement law, but is less detailed and gives contracting authorities greater autonomy to choose and organize the award procedure. The legislation lists mandatory minimum requirements, which for example relate to the preparation of the concession contract, the contract notice and transparency of the proceedings, as well as exclusion, selection and award criteria. Certain rules are specific to the nature of concession contracts, such as the limitation of the term of concessions which have a longer duration than 5 years to the estimated time necessary for recovering investment costs together with a profit margin.

It is prohibited for contracting authorities to design a procurement with the aim to exempt it from the regulation or to limit competition artificially. For contractors, it is in general prohibited to make arrangements that can distort normal competition. A violation of these broad prohibitions needs to be curated if the contract has not yet been concluded and can lead to several sanctions afterwards.

The fraudulent distortion of competition in tender proceedings is a criminal offense. The same goes for usual offenses I that field such as forgery and public or private bribery. Furthermore, public procurement contracts are also subject to the general rules and enforcement mechanisms of antitrust law.

As mentioned, the regulation imposes several limitations to changing the contractor or amending the contract during the execution phase, frames strictly the "in-house" exemption and prohibits practices such as artificially dividing contracts in order to fall under certain thresholds.