The Public Contracts Regulations 2015

SUB-SECTION 3 U.K. Exclusions

[F1 Contracts in the water, energy, transport and postal services sectors U.K.

7.— (1) This Part does not apply to public contracts or design contests which—

(a) under the UCR 2016 are awarded or organised by contracting authorities—

(i) exercising one or more of the activities referred to in regulations 9 to 15 of those Regulations, and

(ii) for the pursuit of those activities;

(b) are excluded from the scope of the UCR 2016 by regulations 18, 23 or 34 of those Regulations; or

(c) are awarded or organised—

(i) by a contracting authority which provides postal services within the meaning of regulation 14 of the UCR 2016, and

(ii) for the pursuit of any of the following activities—

(aa) added value services linked to and provided entirely by electronic means (including the secure transmission of coded documents by electronic means, address management services and transmission of registered electronic mail);

(bb) financial services which are covered by CPV codes 66100000-1 to 66720000-3 and by regulation 21(1)(d) of the UCR 2016, including in particular postal money orders and postal giro transfers;

(cc) philatelic services;

(dd) logistics services (services combining physical delivery and warehousing, or either of them, with other non-postal functions).

(2) In this regulation, “the UCR 2016” means the Utilities Contracts Regulations 2016.]

Textual Amendments

F1 Reg. 7 substituted (18.4.2016) by The Public Procurement (Amendments, Repeals and Revocations) Regulations 2016 (S.I. 2016/275), reg. 1(1), Sch. 2 para. 5 (with reg. 5)

Specific exclusions in the field of electronic communications U.K.

8.—(1) This Part does not apply to public contracts, or design contests, for the principal purpose of permitting contracting authorities to provide or exploit public communications networks or to provide to the public one or more electronic communications services.

(2) In this regulation, “public communications network” and “electronic communications service” have the same meanings as in Directive 2002/21/EC of the European Parliament and of the Council M1 as amended from time to time.

Marginal Citations

M1 OJ No L 108, 24.4.2002, p33, last amended by Directive 2009/140/EC of the European Parliament and of the Council (OJ No L 337, 18.12.2009, p37).

Public contracts awarded, and design contests organised, pursuant to international rules U.K.

9.—(1) This Part does not apply to public contracts, or design contests, which the contracting authority is obliged to award or organise in accordance with procurement procedures which are different from those laid down by this Part and are established by any of the following:—

(a) a legal instrument creating international law obligations, such as an international agreement, concluded in conformity with the Treaties, between a member State and one or more third countries (or subdivisions of such countries) and covering works, supplies or services intended for the joint implementation or exploitation of a project by its signatories;

(b) an international organisation.

(2) This Part does not apply to public contracts, or design contests, which the contracting authority awards or organises in accordance with procurement rules provided by an international organisation or international financing institution where the public contracts or design contests concerned are fully financed by that organisation or institution.

(3) In the case of public contracts, or design contests, co-financed for the most part by an international organisation or international financing institution, the parties shall agree on applicable procurement procedures.

(4) In the case of contracts and design contests involving defence or security aspects which are awarded or organised pursuant to international rules, regulation 17 applies instead of paragraphs (1) to (3) of this regulation.

Specific exclusions for service contracts U.K.

10.—(1) This Part does not apply to public service contracts—

(a) for the acquisition or rental, by whatever financial means, of land, existing buildings or other immovable property, or which concern interests in or rights over any of them;

(b) for—

(i) the acquisition, development, production or co-production of programme material intended for audiovisual media services or radio media services, that are awarded by audiovisual or radio media service providers, or

(ii) broadcasting time or programme provision that are awarded to audiovisual or radio media service providers;

(c) for arbitration or conciliation services;

(d) for any of the following legal services:—

(i) legal representation of a client by a lawyer within the meaning of Article 1 of Council Directive 77/249/EEC M2 , as amended from time to time, in—

(aa) an arbitration or conciliation held in a member State, a third country or before an international arbitration or conciliation instance, or

(bb) judicial proceedings before the courts, tribunals or public authorities of a member State or a third country or before international courts, tribunals or institutions;

(ii) legal advice given—

(aa) in preparation of any of the proceedings referred to in paragraph (i), or

(bb) where there is a tangible indication and high probability that the matter to which the advice relates will become the subject of such proceedings,

provided that the advice is given by a lawyer within the meaning of Article 1 of Council Directive 77/249/EEC as amended from time to time;

(iii) document certification and authentication services which must be provided by notaries;

(iv) legal services provided by trustees or appointed guardians or other legal services the providers of which are designated by a court or tribunal in the member State concerned or are designated by law to carry out specific tasks under the supervision of such tribunals or courts;

(v) other legal services which in the member State concerned are connected, even occasionally, with the exercise of official authority;

(e) for—

(i) financial services in connection with the issue, sale, purchase or transfer of securities or other financial instruments within the meaning of[F2 Directive 2004/39/EC] [F2 Directive 2014/65/EU] of the European Parliament and of the Council M3 as amended from time to time,

(ii) central bank services, or

(iii) operations conducted with the European Financial Stability Facility and the European Stability Mechanism;

(f) for loans, whether or not in connection with the issue, sale, purchase or transfer of securities or other financial instruments;

(g) which are employment contracts;

(h) for civil defence, civil protection, and danger prevention services that are provided by non-profit organisations or associations, and which are covered by CPV codes 75250000-3, 75251000-0, 75251100-1, 75251110-4, 75251120-7, 75252000-7, 75222000-8, 98113100-9 and 85143000-3 except patient transport ambulance services;

(i) for public passenger transport services by rail or metro; or

(j) for political campaign services covered by CPV codes 79341400-0, 92111230-3 and 92111240-6, when awarded by a political party in the context of an election campaign.

(2) In this Regulation—

(a) “audiovisual media services” and “media service providers” have, respectively, the meanings given by Articles 1(1)(a) and 1(1)(d) of Directive 2010/13/EU of the European Parliament and of the Council M4 as amended from time to time;

(b) “programme” has the meaning given by Article 1(1)(b) of that Directive as amended from time to time, but also includes radio programmes and radio programme materials; and

(c) “programme material” has the same meaning as “programme”.

Textual Amendments

F2 Words in reg. 10(1)(e)(i) substituted (29.6.2017 for specified purposes, 3.7.2017 for specified purposes, 31.7.2017 for specified purposes) by The Financial Services and Markets Act 2000 (Markets in Financial Instruments) Regulations 2017 (S.I. 2017/701), reg. 1(2)(3)(4)(6), Sch. 5 para. 23 (with reg. 7)

Marginal Citations

M2 OJ No L 78, 26.3.1977, p17, last amended by Council Directive 2013/25/EU (OJ No L 158, 10.6.2013, p368).

M3 OJ No L 145, 30.4.2004, p1, last amended by Directive 2010/78/EU of the European Parliament and of the Council (OJ No L 331, 15.12.2010, p120).

M4 OJ No L 95, 15.3.2010, p1.

Service contracts awarded on the basis of an exclusive right U.K.

11.  This Part does not apply to public service contracts awarded by a contracting authority to another contracting authority on the basis of an exclusive right which the latter enjoys pursuant to a law, regulation or published administrative provision which is compatible with TFEU.

Public contracts between entities within the public sector U.K.

Award of contracts to controlled persons

12.—(1) A public contract awarded by a contracting authority to a legal person falls outside the scope of this Part where all of the following conditions are fulfilled:—

(a) the contracting authority exercises over the legal person concerned a control which is similar to that which it exercises over its own departments;

(b) more than 80% of the activities of the controlled legal person are carried out in the performance of tasks entrusted to it by the controlling contracting authority or by other legal persons controlled by that contracting authority; and

(c) there is no direct private capital participation in the controlled legal person with the exception of non-controlling and non-blocking forms of private capital participation required by national legislative provisions, in conformity with the Treaties, which do not exert a decisive influence on the controlled legal person.

(2) A public contract also falls outside the scope of this Part where a controlled legal person which is a contracting authority awards the contract to—

(a) its controlling contracting authority, or

(b) another legal person controlled by the same contracting authority,

provided that there is no direct private capital participation in the legal person being awarded the contract with the exception of non-controlling and non-blocking forms of private capital participation required by national legislative provisions, in conformity with the Treaties, which do not exert a decisive influence on the legal person being awarded the contract.

(3) A contracting authority shall be deemed to exercise over a legal person a control similar to that which it exercises over its own departments within the meaning of paragraph (1)(a) where—

(a) it exercises a decisive influence over both strategic objectives and significant decisions of the controlled legal person, or

(b) the control is exercised by another legal person which is itself controlled in the same way by the contracting authority,

and references to “control”, “controlled” and “controlling” in paragraphs (1) to (3) shall be interpreted accordingly.

Award of contracts where there is joint control

(4) A contracting authority which does not exercise over a legal person control within the meaning of paragraph (3) may nevertheless award a public contract to that legal person without applying this Part where all of the following conditions are fulfilled:—

(a) the contracting authority exercises jointly with other contracting authorities a control over that legal person which is similar to that which they exercise over their own departments;

(b) more than 80% of the activities of that legal person are carried out in the performance of tasks entrusted to it by the controlling contracting authorities or by other legal persons controlled by the same contracting authorities; and

(c) there is no direct private capital participation in the controlled legal person with the exception of non-controlling and non-blocking forms of private capital participation required by national legislative provisions, in conformity with the Treaties, which do not exert a decisive influence on the controlled legal person.

(5) For the purposes of paragraph (4)(a), contracting authorities exercise joint control over a legal person where all of the following conditions are fulfilled:—

(a) the decision-making bodies of the controlled legal person are composed of representatives of all participating contracting authorities;

(b) those contracting authorities are able to jointly exert decisive influence over the strategic objectives and significant decisions of the controlled legal person; and

(c) the controlled legal person does not pursue any interests which are contrary to those of the controlling contracting authorities.

(6) For the purposes of paragraph (5)(a), individual representatives may represent several or all of the participating contracting authorities.

Contracts which establish or implement co-operation between contracting authorities

(7) A contract concluded exclusively between two or more contracting authorities falls outside the scope of this Part where all of the following conditions are fulfilled:—

(a) the contract establishes or implements a co-operation between the participating contracting authorities with the aim of ensuring that public services they have to perform are provided with a view to achieving objectives they have in common;

(b) the implementation of that co-operation is governed solely by considerations relating to the public interest; and

(c) the participating contracting authorities perform on the open market less than 20% of the activities concerned by the co-operation.

Determination of percentages

(8) For the determination of the percentage of activities referred to in paragraphs (1)(b), (4)(b) and (7)(c), the average total turnover, or an appropriate alternative activity-based measure such as costs incurred by the relevant legal person or contracting authority with respect to services, supplies and works for the 3 years preceding the contract award shall be taken into consideration.

(9) Where, because of—

(a) the date on which the relevant legal person or contracting authority was created or commenced activities, or

(b) a reorganisation of its activities,

the turnover, or alternative activity-based measure such as costs, are either not available for the preceding 3 years or no longer relevant, it shall be sufficient to show that the measurement of activity is credible, particularly by means of business projections.