Insights | October 9, 2020

Roschier Insights Webinar, key takeaways: Current topics in public procurement

During the past year, both Finnish courts and the European Court of Justice have issued several decisions concerning public procurement. To provide an overview of the key developments, Roschier's experts hosted a webinar earlier this week covering the most interesting topics in public procurement and foreign direct investment (FDI) screening in Finland.

Roschier’s public procurement experts, Senior Associate Juhani Matinlassi and Partner Ami Paanajärvi, addressed relevant interfaces of procurement law and competition law, including framework agreements, in-house procurements, and cooperation between bidders. In addition, Associate Mira Eklund introduced the new FDI regulation and the key amendments it brings to the current national regime in Finland.

Key takeaways

Cooperation between bidders: To comply with both public procurement and competition law requirements, tenderers must self-assess whether their cooperation could be considered as prohibited cooperation between tenderers, especially if the tenderers are actual or potential competitors. In public procurement, this should especially be observed where an invitation to tender includes terms explicitly prohibiting competition restraints, as non-conformity may lead to exclusion from the procurement process.

In-house procurements: Following a request for a preliminary ruling by the Finnish Supreme Administrative Court, the European Court of Justice handed down a preliminary ruling according to which, in addition to owning shares, the necessary criterion of exercising control over the in-house entity may be met based on a contract. The contract should, however, establish similar control over the in-house entity as the contracting authority exercises over its own entities.

Framework agreements: While, as a general rule in public procurements, a contracting entity can rely on the affirmations a tenderer has made in its offer, the contracting authority may not be able to rely on the affirmations in the tender concerning the offer’s compliance with the invitation to tender where there are inconsistencies found in the tender. This principle also applies to mini-competitions under a framework agreement, even where a tenderer’s products have been found to comply with the requirements when the framework agreement was first established. Even in light of the same requirements, a tender may nevertheless be found to be irregular during a mini-competition.

Amendments to FDI screening in Finland: The reformed Act on the Monitoring of Foreign Corporate Acquisitions enters into force on 11 October 2020. Considering the recent developments caused by the global Covid-19 pandemic, the need to protect critical national businesses, infrastructure and technology has been further underlined. However, the government still asserts its positive attitude towards foreign investment. Following the entry into force of the amended Act, foreign investment in companies operating in the area of national security will be subject to mandatory pre-approval by the Ministry of Economic Affairs and Employment. Further, it is expected that the review period will be extended somewhat as, following the simultaneous entry into force of the EU Screening Regulation, the Ministry is obliged to exchange information on notified acquisitions with the EU Commission and other EU member states.