On November 19th, the new Public-Sector Contracts Law was finally published in the Official State Gazette (BOE) transposing, after the deadline, the last two European public procurement directives. For public mercantile companies which do not operate subject to strict competition rules and are regarded as contracting authorities, the regulation of administrative law is stepped up both with regard to the acts of preparation and award of their contracts and with regard to certain aspects of their substantive legal regime, i. e. with regard to the rights and duties of the parties. This makes contracting these entities subject to transparent procedures.

Thus, in any event, they are subject to the rules that shape public sector contracting and the structural elements of contracts. The preparation and award of the higher value contracts, which are subject to European regulations, will be carried out as if they were public administrations, which implies a higher level of subjection than in the previous law. The battle fought by the experts to ensure that these same rules, and not only the principles derived from the advertising, equality and non-discrimination treaty carried out by the guidelines, were also applicable to non-harmonised or smaller contracts, has only been partially won. Thus, non-harmonised contracts must be awarded following any of the procedures laid down in the Law. This implies that the procedures with negotiation, provided they are advertised, can be used like the rest, leaving the negotiated procedure without advertising as the only exceptional procedure for this type of contracts. It must be the instructions that determine the applicable procedures since, although they have disappeared in the precept governing the award of these contracts, they have reappeared in the transitional provisions, which means they have to be updated within four months. Finally, for small-scale contracts, the abandoned direct award procedure has been rescued since the previous contract law, for, as is well known, did not correspond to the negotiated procedure. The acts issued in connection with the preparation and award of contracts, regardless of whether or not they involve harmonised contracts, are referred to in the contentious-administrative jurisdiction in the new law, either because it is the responsibility of that jurisdiction to review the decisions which resolve the special appeal against certain acts of preparation and award, or because they must first be appealed to the public body to which the company is attached.

With regard to the effects and termination of contracts concluded by these public companies, although basically subject to private law, they share certain substantive rules imposed by European legislation with administrative contracts. These are those relating to modification, social or laboral obligations, special conditions of execution, assignment and subcontracting, technical rationalization of contracting and payment conditions. In any case, except for the amendments which may be challenged by means of special appeal, the acts implementing the contract may be managed by the ordinary courts.

From the new regulatory environment, there is greater administrative intervention in the contracts concluded by public companies. Thus, the flight to "own principles" is avoided by means of the "privatization of forms" technique, imposing a corrector functional criterion that must provide a certain coherence to the Spanish public contractual model in relation to this type of companies.

For further information, please contact:

José Vicente Morote Sarrión

jvicente.morote@AndersenTaxLegal.es