Check whether the agreement does not contain prohibited provisions

Suppliers applying for public procurement should carefully analyze the draft agreement. Public procurement law protects suppliers against so-called abusive clauses, which are provisions that grossly violate the balance of the parties to the agreement and are impermissible from the outset. Such provisions should not appear in draft procurement agreements, and if they do, they can be challenged.

Abusive clauses include in particular:

• assigning the supplier liability for delays, unless this is justified by the specifics or scope of the order,
• penalizing the supplier with contractual penalties for actions unrelated to the subject of the contract or its proper execution,
• placing liability on the supplier for situations for which the buyer bears sole fault,
• allowing the buyer to unilaterally reduce the scope of the contract without specifying the minimum scope that will be performed.

If the supplier notices such a provision in the draft contract, they have the right to request its deletion from the buyer, and if the buyer refuses, they have the right to file an appeal with the National Appeals Chamber. If the KIO determines that the provision violates the provisions of the Public Procurement Law, it will order its removal or amendment. Importantly, however, the KIO cannot impose the specific wording of a new provision, only eliminate the non-compliant one.

In practice, this means that the supplier is not defenseless against unfair provisions in contracts. Key is quick reaction, already at the stage of the procedure, before the deadline for submitting bids.

Summary

Abusive clauses are contract provisions that violate the balance of the parties and are prohibited by the Public Procurement Law. The supplier has the right to challenge them before the KIO before the contract is signed. Knowledge of these regulations allows for effectively protecting one's own interests and avoiding unfair conditions imposed by the buyer.