7. Exemptions to Competitive Bidding
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7. Exemptions to Competitive Bidding Start Comparison
a. Are there any exemptions to competitive bidding, i.e. under what conditions is a direct award/single sourcing permissible?

The Direct Award is permissible regardless of the amount of the contracting, provided that the maximum authority of the contractor, through a reasoned act, adequately justifies its origin, in the following cases:

  • In supplying goods, providing services, or executing works required for the continuity of the production process, and could be seriously affected by the delay in opening a procurement procedure
  • Where the technical conditions of a particular good, service or work so require or exclude any possibility of competition, or if having purchased goods, equipment, technology, services or works from a particular supplier or contractor, the contractor decides to purchase more supplier or contractor for reasons of standardization or the need to ensure compatibility with the goods, equipment, technology or services already in use, and also take into account the effectiveness with which the original contract has Contractor's needs, the relatively low volume of the proposed contract compared to that of the original contract, the reasonableness of the price and the absence of another appropriate source of supply
  • In contracts for the acquisition of goods and the rendering of services, in which it is not possible to apply the other contracting modalities, under the special conditions under which the bidders agree to supply such goods, or provide the services or special conditions of the request of the contractor, and where the application of a contractor selection modality other than that provided herein does not allow obtaining the goods or services under the required conditions (The reasons for which the opening of a new procurement procedure could cause damage to the contractor must be indicated by a motivated act.)
  • In case of a proven emergency
  • In the execution of works, acquisition of goods, or provision of services regulated by contracts terminated in advance, where the opening of a procedure for selection of contractors could be harmful to the body or contracting entity
  • Contracting goods, services or works for marketing, donation or any other form of alienation to third parties, provided that the goods or services are associated with the contractor's own activity and do not permanently enter its heritage
  • In contracts for the acquisition of goods, provision of services, or execution of works on which a method of selection of contractors could compromise the contractor's trade secrets or strategies, the knowledge of which would offer an advantage to its competitors
  • In the acquisition of goods produced by companies with which the contractor subscribes commercial agreements of manufacture, assembly or supply, provided that such agreements have been signed to develop the national industry on said goods, in compliance with plans dictated by the National Executive
  • When contracting works, goods or services required for the immediate restoration or continuation of public services or activities of general interest that have been subject to interruption or failure, regardless of their recurrence
  • In activities required for works that are in direct execution by the contracting bodies and entities and which, according to their capacity for execution, is necessary for strategic reasons of construction, which are partially carried out by a third party, provided this assignment does not exceed 50% of the original contract
  • In the acquisition of goods and contracting services to small and medium-sized economic actors that are indispensable to ensure the development of the food chain
  • In supplying goods, providing services, or executing works for which the price consultation modality has been applied and has been declared deserted
  • In recruiting for socio-productive organizations created within the framework of the Law governing the communal economic system or organized communities by awarding projects to promote their development
  • When contracting with joint ventures or conglomerates created under the law that promotes and regulates the new joint associative forms between the state and the private community initiative, as long as the advantages of contracting are established, based on the principles that regulate the rules for the creation of these joint associative forms
b. What are the consequences for violation of the competitive bidding requirement?

When the granting of the award or any other act issued in execution of the Public Procurement Regime has been based on false information or documentation, fraud, or in violation of legal provisions, the contracting entity shall declare the act null and void.

In addition, individuals could be sanctioned with a fine of 300 Tax Units and the prohibition to enter into contracts with the state for up to four years.