PART 3RULES ON THE PROCUREMENT FOR THE AWARD OF CONCESSION CONTRACTS

CHAPTER 7PROCEDURAL GUARANTEES

Exclusion grounds40.

(1)

A contracting authority or utility referred to in regulation 5(1)(a) (meaning of “utility”) must exclude an economic operator from participation in a procurement for the award of a concession contract if the contracting authority or utility establishes that an economic operator or a person to whom paragraph (2) applies has been convicted of any of the following offences—

(a)

the common law offence of conspiracy if that conspiracy relates to participation in a criminal organisation as defined in Article 2 of Council Framework Decision 2008/841/JHA40 or an offence under sections 28 or 30 of the Criminal Justice and Licensing (Scotland) Act 201041;

(b)

corruption within the meaning of section 1(2) of the Public Bodies Corrupt Practices Act 188942 or section 1 of the Prevention of Corruption Act 190643, where the offence relates to active corruption as defined in Article 3 of the Council Act of 26th May 199744 and Article 3(1) of Council Joint Action 98/742/JHA45;

(c)

bribery or corruption within the meaning of sections 68 and 69 of the Criminal Justice (Scotland) Act 200346, if the offence relates to active bribery or corruption;

(d)

bribery within the meaning of sections 1 or 6 of the Bribery Act 201047;

(e)

if the offence relates to fraud affecting the European Communities’ financial interests as defined by Article 1 of the Convention on the protection of the financial interests of the European Communities48—

(i)

the offence of cheating the Revenue;

(ii)

the common law offence of fraud;

(iii)

the common law offence of theft or fraud;

(iv)

fraudulent trading within the meaning of section 458 of the Companies Act 198549, or section 993 of the Companies Act 200650;

(v)

fraudulent evasion within the meaning of section 170 of the Customs and Excise Management Act 197951 or section 72 of the Value Added Tax Act 199452;

(vi)

an offence in connection with taxation in the European Union within the meaning of section 71 of the Criminal Justice Act 199353;

(vii)

the common law offence of uttering; or

(viii)

the common law offence of attempting to pervert the course of justice;

(f)

any offence listed in—

(i)

section 41 of the Counter-Terrorism Act 200854; or

(ii)

Schedule 2 to that Act where the court has determined that there is a terrorist connection;

(g)

money laundering within the meaning of sections 340(11) and 415 of the Proceeds of Crime Act 200255;

(h)

an offence in connection with the proceeds of criminal conduct within the meaning of section 93A, 93B or 93C of the Criminal Justice Act 198856;

(i)

any offence under Part 1 of the Human Trafficking and Exploitation (Scotland) Act 201557 or under any provision referred to in the Schedule to that Act;

(j)

an offence in connection with the proceeds of drug trafficking within the meaning of section 49, 50 or 51 of the Drug Trafficking Act 199458;

(k)

any other offence within the meaning of Article 38(4) of the Concessions Contracts Directive as defined by the national law of any EEA state.

(2)

This regulation applies if the person convicted is a member of the administrative, management or supervisory body of the economic operator referred to in paragraph (1) or has powers of representation, decision or control in the economic operator.

(3)

A contracting authority or utility referred to in regulation 5(1)(a) (meaning of “utility”) must exclude an economic operator from participation in a procurement if—

(a)

subject to paragraphs (6) to (8), the contracting authority or utility referred to in regulation 5(1)(a) is aware that the economic operator is in breach of its obligations relating to the payment of taxes or social security contributions and this has been established by a judicial or administrative decision having final and binding effect in accordance with the legal provisions of the country in which it is established or in accordance with those of any of the jurisdictions of the United Kingdom; or

(b)

the contracting authority or utility referred to in regulation 5(1)(a) is aware that the economic operator has committed an act prohibited under the Employment Relations Act 1999 (Blacklists) Regulations 201059 and the commission of such an act has been admitted by the economic operator or established by a judicial decision having final and binding effect.

(4)

Subject to paragraph (5), a contracting entity may exclude an economic operator from participation in the procurement for the award of a concession contract if the contracting authority or utility can demonstrate by any appropriate means that the economic operator is in breach of its obligations relating to the payment of taxes or social security contributions.

(5)

A utility other than one referred to in regulation 5(1)(a) may exclude an economic operator from participation in the procurement for an award of a concession contract if it is aware that the economic operator has been convicted of any offence in paragraph (1) or committed a prohibited act referred to in paragraph (3)(b).

(6)

A contracting entity may not exclude an economic operator pursuant to paragraphs (3)(a) or (4) if—

(a)

the economic operator has fulfilled its obligations by paying, or entering into a binding arrangement with a view to paying, the taxes or social security contributions due, including, where applicable, any interest accrued or fines; or

(b)

the obligation to make repayment otherwise ceases.

(7)

A contracting entity may disregard any of the prohibitions imposed by paragraphs (1) to (3), on an exceptional basis, for overriding reasons relating to the public interest such as public health or protection of the environment.

(8)

A contracting entity may also disregard the prohibition imposed by paragraph (3)(a) if an exclusion would be clearly disproportionate, in particular—

(a)

if only minor amounts of taxes or social security contributions are unpaid; or

(b)

if the economic operator was informed of the exact amount due following its breach of its obligations relating to the payment of taxes or social security contributions at such time that it did not have the possibility of fulfilling its obligations in a manner described in paragraph (6) before expiration of the deadline for requesting participation or the deadline for submitting its tender.

(9)

A contracting entity may exclude an economic operator from participation in a procurement for the award of a concession contract if—

(a)

the contracting entity can demonstrate by any appropriate means a violation by the economic operator of applicable obligations referred to in the fields of environmental, social and labour law established by European Union law, national law, collective agreements or by the international environmental, social and labour law provisions listed in Schedule 4 to these Regulations;

(b)

the economic operator is bankrupt or is the subject of insolvency or winding-up proceedings, if its assets are being administered by a liquidator or by the court, if it is in an arrangement with creditors, if its business activities are suspended or it is in any analogous situation arising from a similar procedure under national laws and regulations to which the economic operator may be subject;

(c)

the contracting entity can demonstrate by any appropriate means that the economic operator is guilty of grave professional misconduct, which renders its integrity questionable;

(d)

the contracting entity has sufficiently plausible indications to conclude that the economic operator has entered into agreements with other economic operators aimed at distorting competition;

(e)

a conflict of interest within the meaning of regulation 37 (conflict of interest) cannot be effectively remedied by other less intrusive measures;

(f)

the economic operator has shown significant or persistent deficiencies in the performance of a substantive requirement under a prior concession contract or a prior contract with a contracting authority or a utility as defined under these Regulations or under the Public Contracts (Scotland) Regulations 2015 or the Utilities Contracts (Scotland) Regulations 2016 which led to early termination of that prior contract, damages or other comparable sanctions;

(g)

if the economic operator—

(i)

has been guilty of serious misrepresentation in supplying the information required for the verification of the absence of grounds for exclusion or the fulfilment of the selection criteria set out by the contracting entity in accordance with regulation 41 (1) to (3) (selection of and qualitative assessment of candidates); or

(ii)

the economic operator has withheld such information or is unable to submit the supporting documents required;

(h)

the economic operator—

(i)

has or has sought to unduly influence the decision-making process of the contracting entity;

(ii)

has or has sought to obtain confidential information that may confer upon it undue advantages in the procurement for the award of a concession contract; or

(iii)

has negligently provided misleading information that may have a material influence on decisions concerning exclusion, selection or award;

(i)

in the case of a concession contract in the fields of defence and security as referred to in the Defence and Security Regulations, if the economic operator has been found, on the basis of any means of evidence, including protected data sources, not to possess the reliability necessary to exclude risks to the security of the United Kingdom.

(10)

A contracting authority and utility referred to in regulation 5(1)(a) (meaning of “utility”)—

(a)

must exclude an economic operator if it becomes aware, at any time during the procurement for the award of a concession contract, that the economic operator is, in view of acts committed or omitted either before or during the procedure, in one of the situations referred to in paragraphs (1) to (3);

(b)

may exclude an economic operator if it becomes aware, at any time during a procurement for the award of a concession contract, that the economic operator is, in view of acts committed or omitted either before or during the procurement, in one of the situations referred to in paragraphs (4) and (9).

(11)

A utility other than one referred to in regulation 5(1)(a) (meaning of “utility”) may exclude an economic operator if it becomes aware, at any time during a procurement for the award of a concession contract, that the economic operator is, in view of acts committed or omitted either before or during the procurement, in one of the situations referred to in paragraphs (1) to (4) and (9).

(12)

In the cases referred to in paragraph (1) and subject to paragraph (7), the period during which the economic operator must be excluded is 5 years from the date of the conviction by final judgement.

(13)

In the cases referred to in paragraphs (3)(b) and (9) and subject to paragraph (15), the period during which the economic operator may be excluded is 3 years from the date of the relevant event.

(14)

Any economic operator that is in one of the situations referred to in paragraph (1), (3)(b) or (9) may provide evidence to the effect that measures taken by the economic operator are sufficient to demonstrate its reliability despite the existence of a relevant ground for exclusion.

(15)

If the contracting entity is satisfied that the evidence proves that the measures are sufficient for the purpose referred to in paragraph (14), the contracting entity must not exclude the economic operator from the procurement of the award of a concession contract.

(16)

For that purpose, the economic operator must prove that it has—

(a)

paid or undertaken to pay compensation in respect of any damage caused by the criminal offence or misconduct;

(b)

clarified the facts and circumstances in a comprehensive manner by actively collaborating with the investigating authorities; and

(c)

taken concrete technical, organisational and personnel measures that are appropriate to prevent further criminal offences or misconduct.

(17)

The measures taken by the economic operator must be evaluated by the contracting entity taking into account the gravity and particular circumstances of the criminal offence or misconduct.

(18)

If the contracting entity considers that the measures are insufficient, the contracting entity must give the economic operator a statement of the reasons for that decision.