Procurement rotation: let’s analyse the rule to provide some clarity

The principle of rotation in awarding contracts has always been a cardinal principle in public law. The legislator’s rationale is clear and unmistakable: to subtract from the availability of contracting authorities as much discretion as possible in the choice of contractors and to discourage the fidelity of economic relations between entities and private entities that is ill-suited to public law principles. The principle in question is not the child of the latest reform but can already be found both in the ‘old code’ and in the ANAC directive no. 4, points 3.6. and 3.7, widely recognised as a reference for legislative integration. In point 3.6 ANAC emphasised that ‘the principle of rotation of awards and invitations shall be applied, with reference to the award immediately preceding the one in question, in cases where the two awards, the previous one and the current one, have as their object a contract falling within the same commodity sector, or within the same category of works, or even within the same sector of services. In any case, the application of the rotation principle cannot be circumvented, with reference to the assignments made in the last three calendar years…”. Point 3.7 specified how the re-invitation of the outgoing contractor should in any case be of an exceptional nature and thus carry a “stringent justification”.

The modern Article 49 paragraph I reiterates the principle of rotation as a universal rule, but then gives way to a series of exceptions a moment later. Let us begin with Paragraph II, according to which “it is forbidden to award or award a contract to the outgoing contractor in cases where two consecutive awards have as their object a contract falling within the same product sector, or the same category of works, or the same service sector”.

If at a first reading it seems to be a recalculation of the previous legislation, this is not the case, since it is clear that according to Guideline No. 4 the outgoing contractor had to be excluded for at least three years, whereas now he only has to skip one round of tenders and again he can be in like everyone else! But let us move on.

Paragraph III of the same article states that ‘the contracting station, by its own measure, may divide the assignments into bands on the basis of economic value and rotation shall apply with reference to each band’. Therefore, if the contracting stations draw up such a regulation, the general principle of rotation becomes a relative principle limited to each band, thus enabling the entities, with a minimum variation in the amounts of the award, to continue the collaboration with the outgoing user…(!).

Paragraph IV: “In justified cases with reference to the structure of the market and the actual absence of alternatives, as well as the accurate performance of the previous contract, the outgoing contracting party may be re-invited or be identified as the direct contractor”.

The novelty is evident since it is now merely stated that “in justified cases” (a wording that alone leaves a wide scope for action, losing even the qualification of the stringent justifications required in the past) the outgoing contractor may be reinvited.

The attempt to limit discretion by reference to market structure and the actual absence of alternatives is decidedly bland as these are expressions that can potentially contain everything but also its opposite.

So, to recapitulate, the new code has deliberately opened a window (but perhaps also a door) both to the freedom of choice of the contractor (for example, for assignments below EUR 5,000.00, the principle of rotation may also be waived) and to the possible continuity in collaborations with public administrations. This is without wishing to judge the choice made, but only to focus on the principles with which contracting officers must interface.