Public procurement is a legally defined system in which all entities funded by taxpayers’ money (called contracting authorities) must procure everything needed for their operations publicly and transparently. This means that cities, counties, schools, kindergartens, hospitals, state and local companies (HEP, water utilities, sanitation services, etc.), and others publicly publish notices (so-called tenders) for the procurement of:
- goods (e.g. office supplies, electricity, medical consumables, construction materials, IT equipment, etc.)
- works (construction, road repairs, bridges, buildings, etc.)
- services (employee medical check-ups, organization of excursions, etc.)
Since public funds—collected through taxes—are being spent, the basic principles of public procurement are:
- efficient spending (best value for money)
- equal access for all businesses (so-called bidders) and a real opportunity to win contracts
- a transparent process
- development of the market and competitiveness of the private sector
In short, public procurement is a legally regulated way to ensure that taxpayers’ money is spent responsibly and fairly for all participants in the process.
Who is public procurement intended for?
Contracting authorities publish tenders for goods, works, and services, while companies—limited liability companies, joint-stock companies, sole proprietors, etc.—apply as bidders. This is a form of B2B (business-to-business) activity.
Public procurement is intended for private companies (bidders) who compete by submitting offers, with the contract awarded to the most advantageous bid according to the criteria defined in the tender.
What is a tender?
A tender is a public announcement or invitation through which a contracting authority declares that it is procuring something. A tender includes legally defined elements:
- name of the contracting authority
- address and contact details
- subject of procurement
- deadlines for submitting bids
- estimated value (excluding VAT)
- whether it is financed by EU funds
According to the Public Procurement Act, tenders are published in the official online bulletin called the Electronic Public Procurement Classifieds (EOJN), specifically for higher-value procurements based on EU criteria.
Simple procurement is currently published on contracting authorities’ websites and involves lower-value procurements with simpler procedures.
Tenders may also be published in public media such as daily newspapers, although this is now extremely rare.
Author: Briefing e-servisi d.o.o.
