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Amendments to Public Contracts

posted 3 years ago

In 2021, new Instructions on the amendment of public contracts entered into force. They set up rules which apply when public contracts awarded by a public authority need to be modified.

The Instructions contain detailed regulations on the procedure, material and non-material contract amendments, price adjustments, as well as amendments in special cases (concession contracts, agreements related to special sectors like water, energy and postal services, etc.)

In principle, amendments which are deemed material require a new public procurement procedure, whereas non-material amendments are possible based on legal provisions or on clear and unambiguous review clauses provided in the awarding documentation.

Amendments based on review clauses

Review clauses in the awarding documentation usually provide for an option of the awarding authority to modify (mainly) the object or the volume of an awarded contract.

Typical examples are:

  • the modification of the products in case the contractor introduces updated or new product versions
  • price adjustments covering a necessary extension of the procurement procedure beyond the original period of validity.

Amendments based on the legislation

Some contract modifications have an express legal basis in the applicable primary legislation. Good examples are

  • the necessity for additional works, services or supplies
  • the replacement of a contractor or a consortium leader, or changes related to the majority in a consortium
  • the introduction of a subcontractor
  • unforeseeable circumstances, changes of low value, etc.

The Instructions specify acceptable and inacceptable amendments, offering practical examples, and also provide provisions regarding the increase of the contract price for different scenarios.

We welcome the newly introduced rules which, in principle, are practice-oriented and pragmatic. We will see how the practice adapts to the them.

For more information, please visit our website:

https://stalfort.ro/wp-content/uploads/2017/09/20210318-VV_Amendments-to-public-contracts-1.pdf

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