Chairman of the Office for the Protection of Competition: the Ministry committed one of the most serious offenses

Chairman of the  Office for the Protection of Competition: the Ministry committed one of the most serious offenses
Author: USMC|Caption: Venom and Viper helicopters
19 / 04 / 2021, 10:00

The Office for the Protection of Competition (UOHS) imposed a fine of 550 million crowns on the Ministry of Defense for errors in the purchase of Venom and Viper multi-purpose and attack helicopters. After an appeal filed by the Ministry, UOHS confirmed it. "There were no reasons for imposing a symbolic fine, as the ministry committed one of the most serious offenses, moreover, it repeatedly makes mistakes in awarding contracts," Petr Mlsna, chairman of the Office, said in an interview with Security Magazine.

  • Following your leadership, the Office issued perhaps its historically highest fine in the area of ​​public procurement. This is a case of the Ministry of Defense, which concluded a contract with the United States Government for the supply of multi-purpose helicopters, without first settling the objections of the Italian company Leonardo, which was another bidder for this supply. On April 7, 2021, you also confirmed the first-instance decision in the second instance. What led the Office to impose such a record fine, the Ministry of Defense considered that only a symbolic fine should be imposed?

The fine for an offense when awarding public contracts always depends on the value of the contract. In the present case, it was a multi-billion contract and the amount of the fine therefore corresponds to that. There were no reasons to impose a symbolic fine, as the ministry committed one of the most serious offenses, and it repeatedly makes mistakes in awarding contracts.

See also: The Ministry of Defense must pay the fine of half a billion for the Venom and Viper helicopter acquisition

  • What does this decision mean for the Ministry of Defense, apart from the obligation to pay the fine imposed? Should the Ministry derive any systemic or personnel measures from this decision?

For the Office, the case is closed by issuing a final decision on the fine. It is up to the contracting authority to affect the persons responsible for this contract in some way. The Office cannot intervene in these issues in any way.

  • Do you expect this decision to be challenged in the administrative judiciary? Is it possible to expect the European Commission to investigate the whole matter?

Again, it is up to the contracting authority to bring an action against our decision before an administrative court. We are, of course, ready to defend the decision in court. I believe that the Ministry's error in this case is absolutely clear, as it acted in direct conflict with what is required by law when concluding the contract without properly settling the objections raised.

  • Compared to the first-instance decision, there was a minor change to the statement. What led to this?

It was a mere technique when it was stated in the first-instance decision that the offense was the conclusion of a contract before the decision on objections. I clarified this in my decision and stated that the offense was committed by concluding a contract before the delivery of the decision on objections to the complainant, which better corresponds to the wording of the law.

  • In terms of public procurement, how do you perceive the wide application of exemptions from the Public Procurement Act in relation to military acquisitions?

The main purpose of the rules set out in the Public Procurement Act is to ensure the widest possible competition for public procurement. It is desirable that contracting authorities allow this competition and always have objective reasons for its possible restrictions. In some areas, the law provides for the possibility of using exceptions, however, this does not mean that the contracting authority will completely ignore the law when using the exception. Certain obligations, such as the settlement of objections, fall on him, even if he follows an exception.

  • What is your vision for the future in the field of public procurement? Can you briefly outline them to our readers?

One of the first steps after I became head of the Office was the replacement of the appeals commissions. I had candidates for new members nominated by a number of institutions in the field of public administration, academia, professional associations and non-governmental organizations. All members of appeal committees must meet relatively demanding professional and qualification criteria. I believe that in this way I have contributed to increasing the transparency of the Office's activities in the eyes of the public.

See also: MoD did violate the Public Procurement Act – but the purchase of the Venom and Viper helicopters stays confirmed by the OPC

Directly in the area of ​​public procurement, I want to speed up decision-making, because the public investor and suppliers must know the result of the procedure in a reasonable time, when it still makes sense for them. Regardless of whether the result is positive or negative for them. In this regard, we have already shortened the time for the so-called handover of a file between instances, and appeals commissions also meet at shorter intervals. Furthermore, we pay more attention to methodological activities for the contracting authority, already in March we held a methodological day concerning the definition of the subject of performance of the contract and we are preparing other methodological days. A big topic for this year is, of course, responsible assignment, which we will address during the methodological days.

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