Government Response to Consultations: Utilities Contracts Regulations 2016 and Concessions Contracts Regulations 2016

On 3 February 2016 the Government published its response to the consultations on the new Utilities Contracts Regulations 2016 and the Concessions Contracts Regulations 2016. The consultations ran from 21 August 2015 to 18 September 2015.

We are now a step closer to the new Utilities Contracts Regulations 2016 and Concession Contracts Regulations 2016 being implemented, with the Government intending to meet the implementation deadline of 18 April 2016 (as required by Directives 2014/25/EU and 2014/23/EU).

A total of twenty (20) responses were received during the consultation period, the majority of which related to the UCR. A summary of the Government's responses to both consultations is set out below:

Summary of responses in relation to the Utilities Contracts Regulations 2016 ("UCR"):

1.  A generally positive reaction was received in relation to the "copy-out" approach adopted. As such there will not be a list of Utilities included in the UCR because it would need regular updating - Utilities will need to form their own view as to whether they meet the relevant criteria.
2.  The correct position on when the rules on contract modifications come into force will be clarified in the UCR and is also set out in guidance entitled "Guidance on Amendments to Contracts during their Term".
3.  Information about which procurement documents need to be published at the time of the OJEU Contract Notice is set out in guidance entitled "Guidance on Electronic Procurement and Communication".
4.  Appropriate measures on avoiding conflicts of interest will be set out in future guidance.
5.  The maximum time possible for adjustment to full electronic communication is provided for in Regulation 1(3) of the UCR.
6.  The drafting in Regulation 29(4) concerning affiliated undertakings is currently the subject of further consideration.
7.  There is an anomaly regarding how the use of a Prior Information Notice as a call for competition fits with the Competitive Dialogue procedure. This issue has been taken up with the European Commission.
8.  To ensure consistency across the suite of procurement regulations (the UCR, the CCR and the Public Contracts Regulations 2015) the wording in Regulation 88(1)(b) will be changed from "or" to "and".
9.  References to previous exemptions decisions will be included in the UCR.
10.  The option for Utilities to apply for an exemption directly to the European Commission will be provided for in the UCR.
11.  The final Impact Assessment will reflect additional views and cost estimates given during the consultation concerning the monetisation of benefits.

Summary of responses in relation to the Concessions Contracts Regulations 2016 ("CCR"):

1.  The recitals set out in EU Directive 2014/23/EU (Concessions Directive) will not be included in the CCR but will be used when drafting guidance.
2.  The duration of concessions contracts is limited in the CCR, but Regulation 17 allows for an extension beyond the limit where this is needed in order to recoup investments made in operating the concession together with a return on invested capital.
3.  Guidance on the Public Contracts Regulations 2015 may be updated to include specific sections on concessions. Alternatively, new concession specific guidance may be drafted.
4.  The position on when contract modifications come into force will be detailed in the CCR and in accompanying guidance.
5.  To ensure consistency across the suite of procurement regulations (the UCR, the CCR and the Public Contracts Regulations 2015) the wording in Regulation 43(1)(b) will be changed from "or" to "and".
6.  The drafting of Regulation 64 will be amended to narrow the scope that the Cabinet Office will have to request information.
7.  The final Impact Assessment will reflect:

a. Additional views and cost estimates given during the consultation concerning the cost and benefit assumptions set out in the Impact Assessment itself;
b. The fact that all respondents stated that the CCR will not speed up the procurement of concessions contracts;
c. Mixed responses as to the benefits of the CCR (including whether it would result in an increase in the number of concessions awarded on a cross-border basis or an increase in bid prices);
d. Additional views and cost estimates about the impact of the CCR procedures on the potential loss of profit and the extent of familiarisation costs; and
e. Mixed views as to whether there will be an increased number of challenges to a concession.

Click here to view the full Government response to these consultations.