Thursday, 18 December 2008

EU procurement: Economic operator

Economic operator is a term used to cover a contractor, supplier or service provider in the context of the Procurement Directive or Classic Directive 2004/18/EC. Article 1.8 also defines the terms tenderer and candidate:


8. The terms ‘contractor’, ‘supplier’ and ‘service provider’ mean any natural or legal person or public entity or group of such persons and/or bodies which offers on the market, respectively, the execution of works and/or a work, products or services.

The term ‘economic operator’ shall cover equally the concepts of contractor, supplier and service provider. It is used merely in the interest of simplification.

An economic operator who has submitted a tender shall be designated a ‘tenderer’. One which has sought an invitation to take part in a restricted or negotiated procedure or a competitive dialogue shall be designated a ‘candidate’.

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Article 4

Since economic operator covers the different roles of a party selling or wanting to sell works, products or services, it appears throughout the Procurement Directive. However, Article 4 adds some features worth noting:

Article 4
Economic operators

1. Candidates or tenderers who, under the law of the Member State in which they are established, are entitled to provide the relevant service, shall not be rejected solely on the ground that, under the law of the Member State in which the contract is awarded, they would be required to be either natural or legal persons.

However, in the case of public service and public works contracts as well as public supply contracts covering in addition services and/or siting and installation operations, legal persons may be required to indicate in the tender or the request to participate, the names and relevant professional qualifications of the staff to be responsible for the performance of the contract in question.

2. Groups of economic operators may submit tenders or put themselves forward as candidates. In order to submit a tender or a request to participate, these groups may not be required by the contracting authorities to assume a specific legal form; however, the group selected may be required to do so when it has been awarded the contract, to the extent that this change is necessary for the satisfactory performance of the contract.

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Contractor

Because we are not looking at the substantive provisions at this moment, only short and general descriptions of the terms are presented.

Contractor is used in the context of public works contracts. The Commission’s Guide to community rules on public works contracts (based on the old Directive 93/37/EEC) presents the following general characteristics (page 9):

1.2 The contractor

As the Court has stated, the concept of the contractor must be interpreted so as to include not only a natural or legal person who will himself carry out the works but also a person who will have the contract carried out through agencies or branches or will have recourse to technicians or outside technical divisions. or even a group of undertakings, whatever its legal form. In the case in point, the Court ruled that “a holding company which does not itself execute works may not, because its subsidiaries which do not carry out works are separate legal persons, be precluded on that ground from participation in public works contract procedures”.


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Supplier

Supplier is used in relation to products. The Commission’s Guide to the Community rules on public supply contracts (based on the old Directive 93/36/EEC) makes the briefest introductory comment on supplier:

1.2 The supplier

The supplier may be a natural or legal person or a group of suppliers.


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Service provider

Service provider is evidently used with regard to service contracts. The Commission’s Guide to the Community rules on public procurement of services (based on the old Directive 92/50/EEC) gives the following brief description:

1.2 Service providers

A service provider is any natural or legal person which offers to provide services. A public body may also be a service provider within the meaning of the Services Directive.

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Tenderer

An economic operator who has submitted a tender is called a ‘tenderer’.

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Candidate

An economic operator who has sought an invitation to take part in a restricted or negotiated procedure or a competitive dialogue shall be designated a ‘candidate’.


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Key procurement terms: Glossaries

Public procurement is a tricky field with a number of specific terms. There are a number of glossaries available to find quick answers to key terms. Here are a few UK examples for practical use.


The North East Regional Portal (TNERP): Procurement Glossary

http://www.n-e-life.com/uploadedFiles/Procurement%20glossary%20final(1).pdf


Tendering for Care (TfC): The TfC Glossary of Terms for Tendering and Procurement

http://www.tenderingforcare.com/system/files/Glossary%200208.pdf


North Hertfordshire District Council: Glossary of Procurement Terms

http://www.north-herts.gov.uk/index/working/procurement/glossary_of_procurement_terms.htm


Sustainable Procurement Information Network (SPIN): Glossary

http://www.s-p-i-n.co.uk/glossary.asp


Tony Zemaitis Associates Limited: Tender Terminology / Tendering Glossary

http://www.zemaitis-uk.com/pdfs/Tender-Terms-and-Glossary-Tony-Zemaitis-Associates.pdf


National Council for Voluntary Organisations (NVCO): Glossary of Procurement and Commissioning Terms

http://www.ncvo-vol.org.uk/sfp/?id=10694



Ralf Grahn