The Office for the Protection of Competition supervises the compliance with the Act, including reviews of lawfulness of conduct performed by the contracting entity. The Office decides on whether the contracting entity proceeded according to the Act in awarding public contracts, imposes remedies and sanctions and reviews administrative offences.
If the contracting authority fails to comply with the procedure stipulated in the Act for the award of public contacts and if such conduct has or could have substantially affected the selection of the most suitable tender, and the relevant contract has not yet been concluded, the Office imposes remedies by cancelling the award of the public contract or any single act performed by the contracting authority, or otherwise suspends the proceedings. The Office may ban the contracting authority from conclusion or performance of the public contract.
In case of an infringement of procurement rules bidders can claim damages according to general civil law provisions. This may include not only reimbursement of the costs for preparation of the bid and participation in the procurement procedure but also consequential damages caused by the unlawful award.
Disputes are heard by the Office for the Protection of Competition which may commence proceedings ex officio or based on written request of the contractor. The decision of the Office may be reviewed by administrative courts.
Generally, objections against any act of the contracting authority must be submitted within 15 days after the contractor acquires knowledge of such unlawful act. Objections against the decision on the most suitable offer must be submitted within 15 days after delivery of the information on the selection of the most suitable offer to the contractor. The contracting authority is obliged to review the objections within 15 days after submission and decide whether it allows or denies the objection. If the contracting authority does not allow the objection, the contractor may submit an application for review with the Office for the Protection of Competition within 10 days after delivery of the decision denying the objections.
An application for review of the procurement procedure may be submitted against all acts of the contracting authority (including omission) which are not compliant with the Act if the applicant has suffered or is likely to suffer damage as a result of such acts. In addition, prior to submitting an application for review with the Office for the Protection of Competition, the applicant is obliged to submit objections with the contracting authority under the conditions stated hereinabove. Without meeting this requirement, the review proceedings cannot be successfully initiated.
As discussed above, the review proceedings may be initiated if the contracting authority acts in conflict with the Act which results, or may result, in damage incurred by a bidder. Violation of procedural rules is likely to be one of the most common grounds for initiating the review proceedings.
The contracting authority may not conclude the public contract during the period for submission of objections. If the contracting authority denied the objections of a contractor, the contracting authority may not conclude the contract during the period for submission of an application for review with the Office and if such application was submitted, within 60 days after the review proceedings has been initiated.
Measures that may be imposed by a decision of the Office for the Protection of Competition on the contracting authority which has been found to be in breach of the Act are as follows:
- Cancellation of the entire procurement procedure;
- Cancellation of a particular act of the contracting authority;
- Prohibition to proceed with the procurement procedure; or
- Prohibition to award the public contract.
In addition, if the Office imposes one of the said measures, it shall also prohibit the contracting authority to award the contract until the decision becomes final and cannot be appealed against.
In the event that the public contract has already been awarded, the Office shall prohibit its performance.
As a general rule, the Office for the Protection of Competition should issue its decision within 60 days after the initiation of the review proceedings. This conclusion follows from the provision stipulating that the contracting authority cannot award the contract within the said period. In exceptional cases, however, the 60-day period during which the contracting authority is prevented from awarding the contract may be extended by a preliminary injunction imposed by the Office.
The Act does not provide for any specific time frame for the review of the first instance decision.
Yes, the contracting authority must notify all bidders without undue delay after the contractor has been selected (i.e. before award of the public contract). Subject to statutory exceptions, the notification shall include report on bids assessment and assessment of the participation conditions in relation to the selected contractor.
As regards the objections against acts of the contracting authority, it is quite common that bidders challenge decisions of the contracting authority which prevents them from taking part in the procurement procedure. The review proceedings before the Office for the Protection of Competition is, however, less common as the entity seeking the protection is obliged to pay a guarantee in the amount of up to CZK 10,000,000 (approx. USD 404,370) depending on the offered bid price in case of a proposal filed by the bidders or in the amount of CZK 10,000 (approx. USD 400) in case of a complaint to initiate the review proceedings ex officio. In the latter case the guarantee is not refundable.