As a rule, our Constitution requires administrative contracts to be managed through public tender or bidding. Public bidding is a transparent and competitive process that compels the Administration to widely advertise purchases of goods and services and promote healthy competition among interested companies. This is how the government ensures that contracts are awarded to the most competent companies, in technical, legal and financial terms; this, in turn, guarantees that the contractors will fulfill their obligations, in compliance with the public interest. The time frames, conditions and formalities of this type of competition are extensive, precisely to guarantee a proper analysis of the offers that ends with the selection of the most appropriate contractor for the public interest.

However, there are exceptions that allow the Administration to exempt itself from the public bidding procedure and what it entails. In the context of a declared National Emergency, asking public institutions such as the CCSS (the Costa Rican public universal healthcare provider) to carry out a cumbersome public tender to obtain enough medical equipment, tests or medications to attend to the emergency, would be contrary to the public interest.

Therefore, for situations like the one we are currently facing, with a declared National Emergency state due to de COVID-19 pandemic, our legal system provides the “direct public procurement for reasons of urgency” as a solution.

  1. What is “direct public procurement for reasons of urgency”?

It is a quick public procurement procedure that allows any public institution to directly sign with a specific company, without having to follow the usual bidding procedure with its implications and formalities. It is regulated in articles 80 of the Public Procurement Law and 140 of its Regulations.

Furthermore, Executive Decree No. 42227-MP-S, by which the State of Emergency due to COVID-19 was declared, urges institutions to manage, through this emergency procedure, any purchases required to attend the emergency.

  1. What are the requirements for Public Institutions to utilize the direct public procurement for reasons of urgency procedure?

The Institution must be able to justify and demonstrate the urgency behind the request. It must indicate why this emergency requires a quick purchase of goods and/or services and why the tender procedure is incompatible with the level of need and urgency.

In the case of the COVID-19 pandemic, the sole state of National Emergency declared by the Government through Executive Decree No. 42227 – MP – S, constitutes ideal proof of the urgency. However, the interested Institution must reasonably justify its request.

  1. Could the Public Institution unilaterally decide to use this procedure? Does it require any authorization?

The Public Institution must request authorization from the General Comptroller’s Office (CGR), prior to using this procedure. The CGR evaluates on a case-by-case basis whether there is indeed urgency that merits dispensing from the formalities of the usual public procurement procedure.

  1. Are appeals or objections against the tender poster or against the awards applicable in this type of procedure?

There are no objections to the cartel or appeals against the award, precisely to guarantee prompt attention to the emergency.

  1. Is the Institution allowed to choose any company based solely on its discretion?

No. The Institution is responsible for previously verifying that the potential contractor is “ideal” or at least capable of providing the good or service required.

  1. What Public Institutions have used this procedure during the COVID-19 outbreak emergency?

As expected, in this pandemic, the CCSS is the public institution that has purchased the most for reasons of urgency using this procedure, especially for the acquisition of medical equipment and the adaptation of CENARE to receive COVID-19 patients, among others. It is important to point out that, for the sale of medicines or reagents to the CCSS, the interested seller must be previously registered in the CCSS’s Registry of Prequalified Suppliers.

The National Emergency Commission is also expected to use this procedure for purchases of goods and services necessary to deal with the pandemic and financed by the National Emergency Fund.

In any case, any public institution that requires goods or services to function in this pandemic or in order to manage or contain it, can use this special procedure, once it is authorized by the CGR to do so.

  1. Sites available to check on the public purchases processed by public institutions related to the COVID-19 emergency?

The CGR has designed a specific website dedicated to the Covid-19 emergency. On this site you can access all public purchases managed by public institutions, including the CCSS, as well as those that have been authorized to be processed through direct emergency procurement: https://sites.google.com/cgr.go. cr / covid-19

Additionally, the Integrated System of Public Procurement (SICOP) contains all kinds of information about purchases required by most public institutions and can be accessed through the link: https://www.sicop.go.cr/index.jsp

 

We have a 24/7 service to address your legal queries related to the effects of COVID-19 in your company. Contact us through our Help Desk for immediate assistance at: helpcovid19@blplegal.comAccess to our Media Room for further information about legal aspects related to Coronavirus in Central America at this link.