Our desktop survey shows that all EU Member States have now transposed the Procurement Directive into their national procurement laws and that almost all of them have implemented national laws dealing with procurements under the competitive dialogue procedure.
Although PPP projects will often fit in the category of "particularly complex contracts" for which the competitive dialogue procedure has been designed, the Procurement Directive does not provide for exclusive use of this method for PPP procurements. Many countries have therefore chosen to resort to other procurement routes in their procurement practices, even in some cases for complex PPPs. The review of OJEU notices and the results of our survey show that all four major procurement procedures available under EU legislation, i.e. open, restricted, negotiated procedures and competitive dialogue, are currently being used to procure PPPs, although to a different extent. Competitive dialogue appears to be the most commonly used, with over 70% of respondents reporting using it "frequently" or "occasionally".
The following positive aspects of the competitive dialogue procedure are reported by the countries that use it relatively frequently compared to alternative procurement procedures:
■ Improved communication between the contracting authority and the bidders during the dialogue, which allows to better define the contracting authority's needs and come up with better design and innovative solutions;
■ Enhanced competitive tension during the dialogue period which allows the contracting authority to achieve better value for money and agree on all vital commercial issues while there is still competition among participating bidders;
■ Better price discipline which leaves less room for "price creep" at the post preferred bidder stage.
In addition, there seems to be a general perception that competitive dialogue does not expose the contracting authority to greater risk of legal challenges than alternative procurement procedures.
On the other hand, most respondents expressed the following main concerns regarding the use of competitive dialogue:
■ Competitive dialogue is perceived as a complex procedure, with a negative impact on procurement cost and time. The process is perceived as resource-intensive and lengthy (half of the respondents report that procurement under competitive dialogue normally lasts between 1 and 2 years). Most contracting authorities admit that their staff are not well prepared to conduct such complex proceedings and has to rely excessively on external advisors;
■ Competitive dialogue is perceived as lacking flexibility and/or clarity and having insufficient ability to adjust to changed circumstances. The concepts of "fine-tuning" and "confirmation of commitments" set out in the Procurement Directive are interpreted in very different ways in different jurisdictions. A strict interpretation is perceived as leading to insufficient flexibility, particularly for complex projects. A loose interpretation may, on the opposite, undermine the benefit of the competitive and price discipline and expose the contracting authority to an increased legal risk.
Finally, there was a shared concern between both "supporters" and "sceptics" of the competitive dialogue procedure that the recent financial crisis has created conditions which make the application of competitive dialogue more problematic. This is because the procedure calls for final offers being submitted before the selection of a preferred bidder, with limited room for further adjustments. At the same time, over 60% of our respondents report being currently unable to secure committed financial offers before financial close. This situation may lead to extensive adjustments of the selected offer after the financing package is eventually confirmed, which could be seen as going beyond the terms of the Procurement Directive.
Many contracting authorities, however, take a pragmatic approach to this issue and allow amendments to tenders post preferred bidder if this is necessary to reflect the terms of the financial offers, as long as such amendments do not modify substantial aspects of the tender, distort competition or cause discrimination among bidders.