Tendering for public procurement contracts in Finland

Contracting entities of major infrastructure projects in Finland are practically always public authorities or equivalent organisations and are consequently subject to the strict requirements of public procurement law. As such, application of these regulations perceptively opens up the market for cross-border tenderers.

Contracts that exceed certain sector-based thresholds (for example, EUR 5,548,000 for construction contracts, EUR 443,000 for infrastructure planning services) and are consequently of particular interest in terms of international tenders are published in the Official Journal of the EU. These procurement notices can be accessed via the TED database (ted.europa.eu).

Procurement notices falling below the respective threshold are published exclusively in the Finnish HILMA database (www.hankintailmoitukset.fi); however, tenderers from any country may also bid for these contracts.

Rules of thumbs for bidders

The rigidity of the procedure requires tenderers to disengage somewhat from the typical mind-set of a businessperson.

Completeness. The tender must meet all requirements defined in the call for tender from the outset. Subsequent amendment is not possible.

Consistency. Should the tender contain contradictory information, the contracting entity may ask for a clarification – but it does not need to. Tenderers should expect that in cases of contradictions and ambiguities, the least favourable values will be applied for the purposes of tender comparison. This is also be the case where such values are stated in a subordinate appendix to the offer.

Form. The procurement notice will often stipulate a specific structure for the tender or may even prescribe the use of a commensurate form. The use of an alternative individual form of presentation by the provider will be disadvantageous in practically all cases and may even result in elimination from the tender.

Improvements? Resist the temptation to offer an even better product than that requested. This will not gain any advantage within the tender comparison process. Independent replacement of the required functionality by a better (but different) alternative frequently results in exclusion from the tendering process.

Procurement notice specifications as a benchmark

When participating in public procurement procedures, the providers of infrastructural services and products face the necessity to set aside their business instincts – to some extent. The procurement procedure is strictly designed to ensure equal opportunity amongst those tendering. As a result, tenders should not deviate in any respect from the specifications determined in the tender document.

Occasionally, in the process of developing their technical solutions, companies may have already achieved a technical level superior to that specified in the procurement notice. The temptation to offer the ‘better’ solution is considerable.

This may be encouraged by the fact that, rather than price alone, the decisive award criterion defined in most Finnish calls for tender is the “most economically advantageous tender” criterion. However, this criterion must not be interpreted to mean that the tenderer should bring each and every merit offered by their individual product to bear. On the contrary, the evaluation criteria are clearly specified in the procurement document and defined under an objective scoring system. Deficiencies in the defined criteria cannot be compensated by other benefits.

In principle, Finnish public procurement law allows for deviation from the specified standards if the technical characteristics of the solution offered are commensurate with those of the solution required. Nevertheless, specifically with regard to the comparability of such deviations, award decisions have increasingly been the subject of (often successful) appeals in recent years. As a consequence, when concluding their award decisions, public procurers currently tend to steer well clear of grey areas that run the risk of the decision being subsequently reversed by judicial proceedings. In any case, any risk on the part of the tenderer in this respect is entirely needless.

Defeating ambiguity in technology-based projects

In the field of technology-driven intelligent infrastructure and industry projects, appeals against contract award decisions are a frequent occurrence. This essentially results from the fact that, on the one hand, public procurement law requires clear criteria regarding the contract award that are uniform for all tenderers, while at the same time, in this rapidly developing area, two individual products are rarely entirely comparable.

To fulfil the requirements of public procurement law, the contracting authorities are forced to allow a high degree of abstraction in terms of the description of services and products. This frequently proves unsuccessful not only because the authorities in question lack the sufficient resources in terms of technical know-how, but also due to the fact that technical concepts and terms can often be interpreted in different ways.

Tenderers can contribute considerably to eliminating uncertainties and ensuring that subsequent award decisions are less likely to be the subject of appeal. In all procurement procedures, questions on the part of tenderers are permitted and answered. The respective answers are made available to all tenderers and form a basis of the tender proposal.

Through carefully targeted questions, a tenderer can simultaneously counter hidden competitive advantages for competitors. In essence, ambiguities in the tender document can effectively lead to a situation where offers of poorer technical quality have to be evaluated and permitted as being of equal merit.