PROCUREMENT AND SUPPLY CHAIN
deemed unlikely to attract interest from providers outside the awarding nation and so it has not been mandatory to follow the full OJEU process. Historically, reports suggest that some awarding organisations were assigning opportunities incorrectly as a Part B service to shortcut the more lengthy process! In future, almost all of the previously separated services will be covered by the full force of the regulations. Only a much smaller number of services will be excluded – and subject to a lighter regime, identifi ed by specifi c Common Procurement Vocabulary (CPV) codes. This could broaden the scope for many businesses. Buyers in the rail industry must get to know these CPV codes, and suppliers should know their rights...
• Finally, timescales will be reduced, providing the opportunity to speed up stages along the procurement process, giving both buyers and suppliers the chance to change the dynamics of the process.
2. Understand the implications and risks
Once the new directives are published, each member state has up to 24 months to enter them into their own legislation. However, UK
businesses should act quickly – the Cabinet Offi ce has suggested its deadline will be 12-18 months. Therefore it is critical that both buyers and suppliers to the rail sector get ahead of the game and act early before they become law.
Research undertaken by Achilles and the University of Nottingham indicated that there has been a substantial rise in the number of supplier challenges reaching the courts, since reforms to the remedies system in December 2009. The number jumped from a long- running average of two challenges a year, to 26 in 2012.
It is reasonable to assume this is just the ‘tip of the iceberg’ and that a far greater number of challenges are settled out of court and that many procurement exercises are re-started or scrapped.
3. Take action
To reduce exposure to risk of challenge, buyers within the rail industry must take pre-emptive action now by ensuring that their procedures and contracts are ‘watertight’, in line with expected legislative requirements, well communicated and monitored.
Although the directives are
yet to be enshrined in law, it is likely that the courts may take a view that they
should be moving in expected legislation.
the direction of
Rail companies will need to ensure there is no ambiguity over what is required from a supplier and they will have to check that the right procedures are in place to prevent the contract changing ‘substantially’ over time. That can be challenging; particularly when those responsible for setting the contract, ensuring compliance and
managing
arrangements on an on-going basis are from different departments. Businesses in the rail sector need to take action to ensure responsibility for compliance remains fi rmly with the contracts department, or risk an expensive mistake.
In our experience, companies in the rail sector should review their current provision, get the right processes in place, up-skill their procurement teams and make sure that they are fully aware of all the changes and impacts by getting specialist advice and training.
constantly Liz Wilson-Lamb
www.achilles.com FOR MORE INFORMATION
rail technology magazine Dec/Jan 14 | 55
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