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Public Procurement Serbia

Public procurement in the Republic of Serbia is governed by the Law on Public Procurement of 22 December 2008 (Official Gazette of the Republic of Serbia, No 116/08) and a set of implementing regulations, mostly rulebooks that further regulate the public procurement procedures for low-value contracts, criteria for establishing public procurement commissions, contents of tender documentation, rules on procedure for opening of bids, manner of keeping records on public procurement and other issues specified in the Law.
Institutions responsible for adopting, implementing and supervising implementation of the public procurement policy are the Ministry of Finance (Law on Ministries, Official Gazette of the Republic of Serbia, No 16/11) and the Public Procurement Office (Law on Public Procurement). The Public Procurement Office was established as a special organisation that performs expert activities in the area of public procurement, provides conditions for economical, efficient and transparent use of public funds for public procurement, and promotes competition and equality of bidders in the public procurement procedures. In addition, the Law on Public Procurement established the Republic Commission for the Protection of Rights in Public Procurement Procedures, as an autonomous and independent body of the Republic of Serbia, which ensures the protection of bidders’ rights and public interest in the public procurement procedures.

For the purposes of the Law on Public Procurement, subject of public procurement may be goods (purchase of goods, renting of goods and leasing of goods), services (lists of services subject to the provisions of this Law are provided in Annexes IA and IB that form an integral part of the Law), and works (execution of works, design and execution of works, construction works on a facility), while procuring entities for such procurements are: state authorities, organisations, institutions and other direct or indirect budget beneficiaries; compulsory social insurance organisations; public undertakings; legal persons also involved in activities of general interest; and legal persons founded by procuring entities that also perform activities of general interest, under the conditions prescribed by the Law. The Law also specifies procurement that is not subject to the provisions of the Law.

General principles of public procurement are principle of economical and efficient use of public funds, principle of ensuring competition among the bidders, principle of transparency of public procurement procedure, and principle of equality of bidders.
Tender Procedures

Article 20 of the Law on Public Procurement provides for the following public procurement procedures:

  • open procedure;
  • restricted procedure;
  • negotiated procedure with prior notice;
  • negotiated procedure without prior notice;
  • design contest; and
  • low-value public procurement procedure.

Low-value public procurement procedure is regulated in more detail by the Rulebook on Public Procurement Procedure for Low-Value Contracts of 6 July 2009.As a rule, selection of the most advantageous bid is conducted in open public procurement procedure, and it may also be conducted in other types of procedures provided the conditions prescribed in the Law have been met. Value of the procurement below which procuring entities are not required to implement the provisions of this Law, as well as value below which low-value public procurement procedure is to be applied, are specified by the law regulating the Republic of Serbia annual budget. Therefore, according to the Law on Budget for 2011 (Official Gazette of the Republic of Serbia, No 101/10), low-value public procurement is procurement estimated to value from RSD 318,000 to RSD 3,175,000. Procurement with value below RSD 318.000 is not subject to mandatory implementation of the Law on Public Procurement.

Public procurement procedure commences by initiating the procedure (issuing a decision to initiate the procedure and form a public procurement commission) and by preparation of tender documentation (content of tender documentation is specified by the Law and further defined by the Rulebook issued by the Minister of Finance). As of the day of publication of the call for competition, tender documentation are to be made accessible to interested parties by way of directly presenting such documents or allowing for taking over or delivery of such documents within two days from the day of receiving a request for delivery of tender documents (in case of takeover or delivery, procuring entity charges only the costs of copying and delivering the documents).
The procuring entity is obliged to publish an invitation to tender or for applications for public procurement in the following cases: open procedure; the first phase of restricted procedure; qualification procedure; negotiated procedure with prior notice; and contest procedure. Public procurement notices are published in the Official Gazette of the Republic of Serbia, and in case of public procurement with value exceeding the ceiling value for low-value public procurement, notices are published also at the Public Procurement Portal. Procuring entities may also publish notices for low-value procurement at the Public Procurement Portal. All public procurement notices are published in Serbian language, and if the value of public procurement exceeds the amount of RSD 150 million for goods and services and the amount of RSD 300 million for works, public procurement notices are published also in the language commonly used in international trade.

Only bids that are found to meet the requirements for bidders to take part in public procurement procedure (the Law defines mandatory requirements for participation, while specific requirements are further defined in tender documentation) and that are timely submitted are evaluated under public procurement procedure. Criteria for evaluation and selection of the most advantageous bid are the economically most advantageous bid or the lowest price offered. Although the Law lays down that in selecting the most advantageous bid domestic producers are to be given favour over foreign ones, as well as that bidders offering goods of domestic origin are to be favoured over the ones offering goods of foreign origin (if the difference of the sums of weighted points is less than 20, or if the price offered is up to 20% higher than the price offered by the foreign bidder), it is provided that in public procurement where bidders from CEFTA signatories participate, the provisions of that Agreement shall apply. This Agreement provides that each signatory will ensure equal treatment in public procurement procedures to all bidders from other parties to the Agreement, i.e. that goods, services and bidders from other parties will have the same treatment which is no less favourable than the treatment granted to domestic products, services and bidders. After the decision on selection of the most advantageous bid is made, the public procurement contract is to be concluded.A request for protection of rights may be submitted throughout the entire public procurement procedure and with regard to any action of the procuring entity, unless the Law provides otherwise. This request is to be submitted to the procuring entity directly or by registered post, and a copy is to be submitted to the Republic Commission for the Protection of Rights in Public Procurement Procedures.

The Law provides for specific elements referring to public procurement in the areas of water management, energy, mining, telecommunications and transport.

Tender Documents

Pursuant to the Rulebook on Mandatory Elements of Tender Documentation in Public Procurement Procedures of 6 July 2009, tender documentation contain: invitation to tender; instructions to bidders on how to prepare a bid; a bid form; a form for evaluation of compliance with the requirements referred to in Article 44 of the Law on Public Procurement and an instruction on how to prove such compliance; model contract; type, technical characteristics (specifications), quality, quantity and description of goods, services or works, manner of control and quality assurance, time limit, place of performance or delivery of goods, any additional services, and the like; technical documentation and plans, or documents on solvency of the procuring entity in case of public procurement of a loan as financial service; a price structure form, with an instruction how to complete it. Tender documentation for the first phase of restricted procedure and for qualification procedure contains: an invitation for submitting applications; instructions to applicants on how to prepare an application; an application form and form for recognizing qualifications and instructions on how to prove the qualifications of applicants. Tender documentation may also include other elements that are, with regard to the subject of public procurement, necessary to prepare a bid or an application.

Content of tender documentation for low-value public procurement procedures are defined by the Rulebook on Public Procurement Procedures for Low-Value Contracts, and it includes: an invitation to bid; instructions to bidders on how to prepare a bid; a bid form; requirements specified by the law that the bidder must comply with; a form for evaluation of compliance with such requirements and an instruction on how to prove such compliance; technical characteristics (specifications) of the subject of low-value public procurement. Tender documentation may also include other elements that are necessary, in view of subject of public procurement, for preparation of the bid.

Time Terms

In the invitation to bid and in tender documentation, the procuring entity is to specify a deadline (day and hour) for the submission of bids. The time periods start running from the day of publication of the invitation in the Official Gazette of the Republic of Serbia, or from the day when an invitation to tender was sent to the bidders. The general time period for submission of bids in an open procedure may not be shorter than 30 days from the day an invitation was published in the Official Gazette of the Republic of Serbia, except in cases specified by the Law, but even in such cases it may not be shorter than 22 days from the day of publication of the public invitation.The time period for submitting applications to participate in a restricted procedure, or for submitting bids in a negotiated procedure with prior notice, may not be shorter than 25 days from the day the public invitation was published in the Official Gazette of the Republic of Serbia. The time period for submitting bids in a restricted procedure may not be shorter than 30 days from the day the procuring entity sent a written invitation, except in cases specified by the Law, but even then it may not be shorter than 22 days from the day the procuring entity sent a written invitation. The Law also lays down the conditions for additional shortening of deadlines for submitting applications and bids in a restricted procedure.

The procuring entity is to deliver to the bidders the minutes on bid/application opening within 3 days of the completion of the bid opening procedure, and also to deliver the decision on selection of the most advantageous bid to all bidders within 3 days of the day such decision was made. The time limit for submitting a request for protection of rights is 8 days from the day of receipt of such decision.