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Global Government Contracting: Americas

Identifying Procurement Opportunities. Delivering Procurement Needs.

Procurement information for jurisdictions in Africa, the Americas, Asia-Pacific, Europe and the Middle East in respect of: 

  • how to find procurement opportunities;
  • the structure of procurement laws and key content; and
  • in-country resources and relevant publications.

Country Contacts

Marcelo Etchelbarne
Partner, DLA Piper

Justo Seguro
Partner, DLA Piper

Government Procurement

Where are government tenders advertised? Are there any different sources for government announcements of 'green' contracting opportunities?

Government tenders are advertised in the Third Section of the Official Gazette of the Argentine Republic (see here), COMPR.AR platform (see here) and CONTRAT.AR platform (see here).

We are not aware of a different source for government announcements regarding green contracting opportunities.

Are there any requirements for bidders to be established in the jurisdiction in order to bid or execute a contract with the procuring entity?

Each bidding process may establish specific requirements, including the establishment of an SPV or the registration of a corporate subsidiary in the country. Therefore, the specific bidding documents for the particular bid need to be consulted on a case-by-case basis.

Foreign bidders are defined by Legislative Decree No. 1,023/2001 as those whose principal place of business is abroad and do not have a duly registered branch in Argentina. They may only submit bids in the context of an international tender, which takes place when, given the specifications of the goods to be acquired or the complexity of the service to be rendered, the invitation to bid is extended to foreign bidders.

Implementing Decree No. 1,030/2016 provides that international tenders shall be additionally advertised on the UN Development Business website or the World Bank's DG Market website, at least forty (40) calendar days before the date fixed for the opening of the bids.

Is there any requirement for 'local content'?

There are several regulations providing preferences or priorities to local contractors and providers.

Laws No. 18,875 and 27,437 grant an acquisition priority to goods of Argentine origin under the so-called "national purchase regime". Under certain conditions, the National Executive Branch, its agencies and social security institutions, among others, are required to award preference to bids involving national origin goods when the estimated amount of the selection procedure is equal to or greater than 1,000 measurement units (M$), as updated from time to time (as of June 2022, Administrative Decision No. 1,191/2021 provides that M$ 1 equals AR$ 4,000). They are also required, under certain conditions, to award their contracts to local micro, small and medium-sized companies (MIPyMEs) that offer goods or works of national origin, regarding the acquisition, rental or leasing of goods for amounts less than M$ 1,300. Law No. 25,300 grants MIPyMEs a 5% preferential right to match the best offer of the tender.

A good is considered to be of national origin when it has been produced or extracted in the territory of the Republic of Argentina, provided that the cost of imported raw materials, inputs or materials does not exceed forty percent (40%) of its gross production value.

A company will be considered as a MIPyME on the basis of multiple criteria, depending on the industry in which they operate, the number of employees, the amount of total annual sales, value of their assets, and corporate control relationships.

The Legal Procurement Framework

What is the applicable procurement legislation?

The legal framework for public procurement in Argentina is defined by Legislative Decree No. 1,023/2001 (the General Public Procurement Regime, GPPR – see here) and its Implementing Decree No. 1,030/16 (GPPR Decree – see here). Disposition No. 63/2016 (see here) issued by the National Procurement Office (NPO) sets the General Conditions and Bidding Terms for Public Procurement.

Additionally, NPO Disposition No. 62/2016 (see here) approved the Contracting Procedure Manual, while NPO Disposition No. 65/2016 (see here) enacted the COMPR.AR Platform Procedure Manual.

Moreover, Laws No. 18,875 (see here) and 27,437 (see here) grant an acquisition priority to goods of Argentine origin under the so-called "national purchase regime". At the same time, Law No. 25,300 (see here) grants micro, small and medium sized companies (MIPyMEs) a 5% preferential right to match the best offer of the tender.

Both GPPR and GPPR Decree govern the bidding process. General Office of the Comptroller (SIGEN for its Spanish acronym) Resolution No. 36-E/2017 (see here) also establishes a price control system according to market values.

Law No. 27,401 (see here) sets forth certain circumstances that will require the implementation of an integrity program by the contractor as an eligibility requirement.

In addition, public works contracts are governed by Law No. 13,064 (see here), and related regulations; and public-private partnerships are governed by Law No. 27,328 (see here) and Implementing Decree No. 118/2017 (see here), among others.

Has your country ratified the WTO Government Procurement Agreement (GPA), or any bilateral trade agreement with Government Procurement commitments?

While Argentina is an observer to the GPA, it is not a party to the agreement.

Argentina, Brazil, Paraguay and Uruguay, in the framework of the Mercosur, signed the Mercosur Public Procurement Protocol (Common Market Council Decision No. 31/17 - see here).

It is worth mentioning that, while not yet in force, the EU-Mercosur Trade Agreement provides for a Government Procurement chapter (see here).

If so, how do these international trade agreements interact with the domestic procurement legislation?

Pursuant to Article 75 of the Federal Constitution, treaties have superior hierarchy than laws. Within the framework of Mercosur, Protocols such as the Public Procurement Protocol are subordinated to the provisions of its founding treaties and their complementary instruments, but prevail over domestic laws of the member parties.

The Mercosur Public Procurement Protocol grants national treatment to companies from Mercosur member parties in bids for government purchases of goods, services and public works in other Mercosur member parties.

What types of procuring entity need to comply with the procurement legislation?

As provided in GPPR section 2 and GPPR Decree section 2, GPPR covers contracts entered into by the National Executive Branch, its agencies, social security institutions and national universities. Thus, contracts entered into by other government branches, or by any corporations in which the National Executive Branch is a shareholder, regardless of its ownership interest, are excluded in principle.

Which types of contracts are covered?

The GPPR applies to any type of agreement that is not expressly excluded. Among others, it applies to sales, supplies, services, consulting, leasing, swaps and concessions of state goods and assets agreements. On the contrary, the GPPR does not apply to public employment, public works contracts, public works concessions, public private partnerships, and public credit transactions, among others.

Are there any exemptions to competitive bidding?

Section 25.c) of the GPPR and section 12 of the GPPR Decree provide for the possibility of a private bidding exclusively addressed to suppliers registered in a special registry before the NPO, and provided that the estimated amount of the contract to be awarded does not exceed the amount of M 5,000 (as of June 2022, Administrative Decision No. 1191/2021 sets that M$ 1 equals AR$ 4,000).

Additionally, section 25.d) of the GPPR and section 14 of the GPPR Decree provide for the possibility of direct award in specific cases, such as the following:

  • When the estimated amount of the contract does not exceed M$ 1,000.
  • When the performance of the contract shall be entrusted to parties whose expertise and skills are of the essence.
  • When the goods or services may only be acquired from a certain person, provided that there are no convenient substitutes.
  • After two (2) unsuccessful public tenders.
  • When proven reasons of urgency or emergency responding to objective circumstances prevent another selection procedure from being carried out in a timely manner.
  • When the National Executive Branch has declared the contractual operation secret for reasons of national security or defence.
  • In the case of repairs of machinery, vehicles, equipment, or engines whose disassembly, removal or prior examination is essential to determine the required repair, and provided that it would be more costly if another procurement procedure were adopted.
  • Contracts entered into with parties registered in the National Registry of Local Development and Social Economy Actors.

    Are there any proposals to amend the applicable procurement legislation?

We are not aware of any current relevant proposals.

Key procurement resources

See here for the full regulation on government procurement.

Country Contacts

Carolina Caiado
Partner, Campos Mello Advogados, in cooperation with DLA Piper

Paulo Renato Barroso
Partner, Campos Mello Advogados, in cooperation with DLA Piper

Marjorie Iacoponi
Associate, Campos Mello Advogados, in cooperation with DLA Piper

Government Procurement

Where are government tenders advertised? Are there any different sources for government announcements of 'green' contracting opportunities?

The administrative organization of the Brazilian government comprises: (i) the federal government, (ii) the 26 states and a federal district and (iii) the municipalities.

In view of the large amount of states, municipalities and governmental bodies, the information about the infrastructure and government purchases opportunities is spread over several websites and sources.

We have set out below information about the main sources.

Federal scope:

At the federal level, government tenders and infrastructure projects can be accessed through:

The Ministry of Economy has recently developed the Comprasnet Mobile, a mobile phone application, which enables these searches to be made in a more practical manner. The app can be downloaded for free in Google Play or AppleStore.

State scope:

In the state of São Paulo, for example, government tenders are announced on the State's transparency portal.

Information in respect of PPP and common concession projects can also be found at the online platform of partnerships:

Municipal scope:

In the municipality of São Paulo, for example, government tenders are announced on the e‑negocioscidadesp which is the system for searching purchases/public procurement proceedings carried out by the municipality.

There is no specific official government website/public source for advertising green opportunities.

There are some private companies, such as ConLicitação that provide services in respect of the identification of public procurement opportunities.

Are there any requirements for bidders to be established in the jurisdiction in order to bid or execute a contract with the procuring entity?

According to Normative Instruction No. 10 of 10 February 2020 of the Ministry of Economy, foreign companies interested in international public procurement proceedings must be enrolled in the Unified Suppliers Registration System (SICAF)

Foreign companies that do not operate in the country must submit equivalent documents in SICAF, authenticated by their respective consulates and translated by a sworn translator, and must have legal representation in Brazil with express powers to receive a subpoena and respond administratively or judicially (art. 32, paragraph 4 of Federal Law No. 8,666).

A deeper analysis can be made on a case‑by‑case basis, which considers the tax and labour risks involved, particularly, if a foreign company must be enrolled at the Brazilian Federal Taxpayers' Registry of Legal Entities (CNPJ). Also, Brazilian Law imposes some regulatory sectorial restrictions depending on the business activity.

Is there any requirement for 'local content'?

No.

The Legal Procurement Framework

What is the applicable procurement legislation?

The main procurement legislation is the following:

Federal Law No. 8.666/93 (Public Procurement Act): Regulates art. 37, item XXI, of the Federal Constitution, establishes rules for bidding and contracts of the Government and makes other provisions.

Federal Law No. 13,133/2021 (the New Public Procurement Act) will replace, after two years of vacatio legis Federal Law No. 8.666/93, which has been in force for almost 30 years, and other disparate laws regarding procurement and administrative contracts.

Federal Law No. 8987/1995: Law of common concession of public services.

Federal Law No. 10.520/2002: Establishes, within the scope of the Union, the States, the Federal District and the Municipalities, the bidding modality known as auction (pregão), for the acquisition of common goods and services.

Federal Law No. 11,079/04: Establishes general rules for bidding and contracting public‑private partnerships within the scope of government.

Federal Decree No. 3.722/01: Regulates art. 34 of Law no. 8.666, of 21 June 1993, and provides for the Unified Suppliers Registration System - SICAF.

Has your country ratified the WTO Government Procurement Agreement (GPA), or any bilateral trade agreement with Government Procurement commitments?

Not yet. Brazil has shown interest in ratifying the GPA and submitted a formal request to the GPA Committee in 2020.

In November of 2021, Brazil presented its revised offer of market access to the members of the GPA:

If so, how do these international trade agreements interact with the domestic procurement legislation?

Not applicable.

What types of procuring entity need to comply with the procurement legislation?

All the government entities, except for state-owned companies.

More precisely, according to article 1, I and II of Law 8.666/93: (i) the bodies of the Legislative and Judiciary Branches of the Union, the States and the Federal District and the bodies of the Legislative Branch of the Municipalities, when performing administrative functions; and (ii) the special funds and other entities controlled directly or indirectly by the Government.

The Federal, State and Municipal Governments must also comply with the laws applicable to public services (Federal Law No. 8.987).

Such legislation establishes general rules.

State‑owned companies, such as Petrobras, follow their own regulation for bidding proceedings and agreements, according to the rules of Federal Law No. 13.303/2016.

Which types of contracts are covered?

Construction works, public services, purchases, alienations, and leases within the Branches of the Union, States, the Federal District, and Municipalities.

Are there any exemptions to competitive bidding?

Yes, in Brazil there are  exemptions to competitive bidding (art. 24 of Law 8.666/93) and cases of bidding ineligibility (art. 25 of Law 8.666/93).

For example, pursuant to art. 25, the bidding process is not applicable when competition is unfeasible, especially:

  • to acquire materials, equipment, or genres that can only be supplied by producer, company, or exclusive commercial representative;
  • to contract technical services of a singular nature, with specialised professionals or companies;
  • to hire a professional from any artistic sector, directly or through an exclusive entrepreneur, under such conditions.

Also, bidding may be exempted in purchases that require strategic information and communication, air defence equipment, technology systems, purchases for emergency or public calamity, amongst other cases.

Are there any proposals to amend the applicable procurement legislation?

Yes, as examples there is Draft Legislative Decree (DCP) no. 60/2020, which aims to declare null and void the normative instruction of the Ministry of Economy that changed the rules of operation of SICAF:

Also, in the Congress, there is the Bill to change the Federal Law of public services.

Key procurement resources

Country Contacts

Elizabeth Mayer

Partner, DLA Piper

 

Ian Bendell

Partner, DLA Piper

 

Government Procurement

 

Canada’s government consists of both the federal government and separate provincial governments. For the purpose of this summary, we have referenced primarily the federal government, with reference where appropriate to the larger jurisdictions of Ontario, Quebec, British Columbia and Alberta.

Where are government tenders advertised? Are there any different sources for government announcements of ‘green’ contracting opportunities?

Federal opportunities are advertised at Canada Buys.

Each province also has its own website:

There are no different sources for ‘green’ contracting opportunities.

Are there any requirements for bidders to be established in the jurisdiction in order to bid or execute a contract with the procuring entity?

There are generally no requirements in Canada for an entity to be incorporated in Canada or in a particular province, although there may be tax withholdings made on payments to a non-Canadian entity. Each of the procurement sites listed above require bidders to register in order to submit electronic bids. Some also require registration to browse.

Is there any requirement for ‘local content’?

There is usually no requirement for local content. Some procurements have requirements to provide opportunities for indigenous employees or contractors.

The Legal Procurement Framework

What is the applicable procurement legislation?

There is no overriding procurement legislation in Canada. The legal framework for procurement has been developed primarily through case law.

There is an internal Canadian Free Trade Agreement (CFTA), which binds the federal government and each province. While not statutory, each government is bound by its terms, which largely mirror international trade agreements.

There are some statutes in certain provinces that impact procurement.  The terms of these statutes will generally be reflected in the procurement documents.

Has your country ratified the WTO Government Procurement Agreement (GPA), or any bilateral trade agreement with Government Procurement commitments?

Yes, Canada federally has ratified the GPA. ‎Canada is also subject to a number of other ‎international trade agreements that deal with ‎procurement, including the Comprehensive and ‎Progressive Agreement for Trans-Pacific ‎Partnership (CPTPP), the Canada-European ‎Union Comprehensive Economic and Trade ‎Agreement (CETA) and the Canada-UK Trade ‎Continuity Agreement. Canada also has a number ‎of bilateral trade agreements.  Care needs to be ‎taken in each case to establish which level of ‎government is bound by the relevant agreement, ‎and the relevant thresholds. ‎

A list of the countries with which the Canada has Free Trade Agreements can be found on the Canadian government’s website.

If so, how do these international trade agreements interact with the domestic procurement legislation?

Each of the trade agreements has been implemented by way of a federal statute. Government bodies are required to comply both with the international trade agreements and relevant domestic legislation. We are not aware of any conflicting provisions.

What types of procuring entity need to comply with the CFTA?

Most public sector entities are required to comply with the CFTA. There are various exceptions set out in the agreement.

Which types of contracts are covered by the CFTA?

For the federal government and provinces, the thresholds are currently (adjusted annually by inflation):

  • $30,300 or greater for goods, if the largest portion of the procurement is for goods.
  • $121,200 or greater for services, excluding construction, if the largest portion of the procurement is for services.
  • $121,200 or greater for construction.

Slightly higher thresholds apply to the territories, municipal entities and crown corporations.

Some limited types of contract are excluded from the procurement requirements in the CFTA.

Are there any exemptions to competitive bidding?

There are limited exemptions that would allow for a direct award, including for unforeseen emergencies.

Are there any proposals to amend the applicable procurement legislation?

There are no public proposals for amending the CFTA.

Key procurement resources

The Canadian Government’s "Doing Business with Government" website contains a range of information for doing business with the federal government. The other sites listed above provide similar resources for the main provinces.

Country Contact

Diego Pena Diez
Partner, DLA Piper

Government Procurement

Where are government tenders advertised? Are there any different sources for government announcements of 'green' contracting opportunities?

With respect to the public procurement of goods and services:

Government procurement tenders are announced on the “Public Market” website:

This page is managed by the "Chile Compra" Directorate, which is part of the Ministry of Finance. It contains the needs for the purchase of goods and contracting of services of 850 public entities.

There are currently no separate sources for "green" contracting advertisements.

With respect to public works concessions, see:

With respect to public works constructions, see:

In addition, it should be taken into consideration that the website of the Ministry of Public Works (MOP) provides information on contracts for works, studies, and consulting services to be tendered during the year.

The list is updated at the beginning of each semester.

Are there any requirements for bidders to be established in the jurisdiction in order to bid or execute a contract with the procuring entity?

With respect to the public procurement of goods and services:

  • The law states that the public administration may contract with natural and legal persons, Chilean or foreign.
  • Each bidding entity may establish in the respective bidding conditions, the obligation of the successful bidder to grant and constitute, at the time of award, a mandate with sufficient power of attorney; or the incorporation of a Chilean company; or the Agency of a foreign company, as appropriate, with which the contract will be executed and whose purpose must influence the execution of such contract under the terms established in the law.
  • To participate in the public procurement processes of the web platform it is necessary to be registered on it. This basic access is free and simple and allows the company or the Natural Person (as appropriate) to be a supplier of the State and bid in purchasing processes that are open on the mentioned web.
  • It should be noted that for such registration it is necessary to initiate activities before the Internal Tax Service (SII), which requires obtaining a Chilean taxpayer identification number previously, which will involve designating a legal representative and domicile in Chile.

With respect to public works concessions:

  • Any natural or legal personal national or foreign may submit a proposal in the tender process. However, in order to subsequently contract with the state, it will be necessary to incorporate a company of Chilean nationality or foreign agency, with whom the contract will be entered into, and whose object will be execution, repair, conservation and exploitation of the public works.

With respect to public works constructions:

  • In order to subsequently contract with the state, it will be necessary to incorporate a company of Chilean nationality or foreign agency, with whom the contract will be entered into

Is there any requirement for 'local content'?

With respect to the public procurement of goods and services:

No.

With respect to public works concessions:

No.

With respect to public works constructions:

No.

However, it should be noted that the Chilean Labor Code (available here) requires that at least 85% of the workers working for the same employer must be Chilean nationals when the number of employees exceeds 25 people. There are specific conditions in the law to account for this percentage.

The Legal Procurement Framework

What is the applicable procurement legislation?

With respect to the public procurement of goods and services the main legislation is: 

  • Law No. 19,886 "Law of Bases on Administrative Contracts for the Provision of Supplies and Services".
  • Decree No. 250/2004, of the Ministry of Finance, which specifies the regulations of Law No. 19,886.

However, the following are not covered in the regulations:

  • contracts relating to the execution and concession of public works.
  • works contracts entered into by the Housing and Urbanization Services for the fulfillment of its purposes.
  • contracts for the execution, operation, and maintenance of urban works, with the participation of third parties (Law No. 19,865 of shared urban financing) within the framework of the Shared Urban Financing System.

  • contracts that deal with war material; specific elements indicated in the law, for the country's Armed Forces; and procurement of goods and services necessary to prevent exceptional risks to national security or public safety.

With respect to public works concessions:

  • Decree No. 900/1996, of the MOP, which establishes the text of the Public Works Concessions Law.

With respect to public works constructions:

Has your country ratified the WTO Government Procurement Agreement (GPA), or any bilateral trade agreement with Government Procurement commitments?

Chile has not ratified the WTO Government Procurement Agreement (GPA).

However, Chile has entered the following treaties, which establish commitments in public procurement:

  • Free Trade Agreement (FTA) between Chile and the European Union 2.
  • Free Trade Agreement (FTA) between Chile and the United States.
  • Public Procurement Agreement between Chile and Paraguay.
  • Free Trade Agreement (FTA) between Chile and Australia.
  • Free Trade Agreement (FTA) between Chile and Canada.
  • Free Trade Agreement (FTA) between Chile and Central America.
  • Free Trade Agreement (FTA) between Chile and Colombia.
  • Free Trade Agreement (FTA) between Chile and Korea.
  • Free Trade Agreement (FTA) between Chile and EFTA.
  • Free Trade Agreement (FTA) between Chile and Japan.
  • Free Trade Agreement (FTA) between Chile and Mexico.
  • Free Trade Agreement (FTA) between Chile and the Trans-Pacific Agreement.

If so, how do these international trade agreements interact with the domestic procurement legislation?

In their Free Trade Agreements (FTA), Chile has signed broad public procurement chapters covering most of the procurements made by central, regional, and local governments on a reciprocal basis.

Once a chapter on public procurement is approved within the framework of FTA, its rules also become the law of the Republic. Likewise, in cases of incompatibility or contradictions between a norm of a treaty and a previous national law in force, it is understood that the national law has been tacitly repealed or modified.

In this context, the beginning of the negotiation of the first FTAs that included public procurement chapters (United States, European Union, and Korea) coincided with the drafting, processing, and implementation of the first procurement law in Chile (Law No. 19,866). Therefore, feedback was generated between the rules of the project and the disciplines contained in the International Agreements on public procurement topics so that many of their regulations were duly incorporated from the beginning in the new Chilean Procurement Law (Law No. 19,886).

In fact, the enactment of Law No. 19,886 considered and ultimately incorporated most of the principles contained in the procurement chapters and, therefore, no major legal amendments have been required for the negotiation and signing of public procurement chapters.

What types of procuring entity need to comply with the procurement legislation?

With respect to public procurement of goods and services

The public administration entities that are subject to the Public Procurement rules regulated by Law No. 19.886 are as follows: 

  • The Ministries. 
  • Regional Ministerial Secretariats.
  • Regional Governments.
  • The Governorships.
  • All public bodies and services created for the fulfillment of the administrative function: this includes the Office of the Comptroller General of the Republic, the Central Bank, the Armed Forces, the Public Order and Security Forces, and the Municipalities.
  • The National Television Council.
  • Public Universities.

Public companies created by the law are expressly excluded. 

However, public entities that are outside the application of this Law are also governed by the provisions that procurement and contracting must be carried out by electronic means and must be subject to the information system (public market), to provide basic information in respect of the procurement of goods, services, and works. 

With respect to public works concessions:

  • Ministry of Public Works.

With respect to public works constructions:

  • Ministry of Public Works.

Which types of contracts are covered?

With respect to the public procurement of goods and services: 

  • All contracts entered by the Public Administration (the entities mentioned above), for valuable consideration, for the supply of movable goods and services required for the performance of their functions, are subject to the Public Procurement Law.
  • There is no limitation on the financial thresholds of these contracts. The amounts will define the forms of contracting that may or may not be used.

With respect to public works concessions:

  • All contracts.

With respect to public works constructions:

  • All contracts

    Are there any exemptions to competitive bidding?

With respect to the public procurement of goods and services

There are four procedures through which the State can purchase directly:

  • Framework Agreements: an electronic catalogue containing a list of the products and services most in demand by the State, with an indication of the corresponding contracting terms and conditions. It is the first option reviewed by public entities at the time of contracting and is the result of a previous bidding process carried out by the ChileCompra Directorate.
  • Private bidding: in which a specific call for participation is made to companies or individuals, establishing a minimum of three suppliers. There are specific grounds for submitting a purchase to this process.
  • Direct Contracting Procedure: This is an exceptional contracting procedure that has grounds established in the Public Procurement regulations to select a supplier without calling for bids. In this case, a well-founded administrative act approving the procedure and three quotations (in most cases) is required.
  • With respect to public works constructions: As a general rule, contracts must be awarded by public bidding in which contractors registered in the Contractors' Registry of the Ministry of Public Works may participate. However, they may be awarded by direct or private bidding, in the cases indicated in Article 86 of the D.F.L. MOP Nº850/1998: (i) there are no interested parties in the public bidding process; (ii) for the termination of a contract that was terminated early due to non-compliance of the contractor; (iii) in cases of emergency qualified by Supreme Decree; (iv) in the case of regular conservation, repair or improvement works of the Public Service; (v) in the case of commissioning works to the Military Labor Corps; (vi) in the case of works to be executed by the community; (vii) in the case of works to be executed in Easter Island.

Are there any proposals to amend the applicable procurement legislation?

Yes, there are several pending bills in Congress that intend to modify the regulation on procurement legislation, here we highlight those we consider most important:

  • Bill No. 14137-05: Aims to amend Law No. 19,886. Among its proposals we highlight that increases the application of the Law to more state-owned entities (for example, the Judicial Power); it incorporates the online procurement information system to the MOP works and concessions contracts; it increases standards of probity and transparency; it improves opportunities for small companies; it incorporates environmental sustainability as a bid award criterion.
  • Bill No. 12178-12: Aims to amend Law No. 19.886, to promote sustainable public procurement, modifying bid award criteria.

Key procurement resources

Country Contact

Olga Lucía Ramírez
Partner, DLA Piper Martinez Beltran

Government Procurement

Where are government tenders advertised? Are there any different sources for government announcements of "green" contracting opportunities?

Colombia's government has an Electronic System for Public Procurement (SECOP is its acronym in Spanish) which is the official means of conveying information related to public procurement included in the General Statute on Public Administration Procurement comprised mainly by Law 80 of 1993 and Law 1150 of 2007.

According to the Law, the SECOP shall,

  • have the technological functionalities to carry out electronic contracting processes under the public tender, abbreviated selection proceedings, merit-based competition, direct award, or minimum amount procurement (methods included in article 2 of Law 1150 of 2007).
  • serve as a single point of information and reporting for state entities and citizens.
  • hold the official information of public contracts which will be circulated through electronic channels.
  • integrate the Single Business Register of the Chambers of Commerce, the Single Journal of State Contracting and the other systems that involve public contract management; likewise, it shall integrate the Information System for the Surveillance of State Contracting, SICE.

SECOP is divided into two platforms:

  • SECOP I:  is a platform exclusively for advertising information related to contracting processes.

The entities which must advertise on this platform are:

  • State entities such as the Nation, the regions, departments, provinces, the capital district and special districts, metropolitan areas, associations of municipalities, indigenous territories and municipalities, public establishments, the Senate of the Republic, the House of Representatives, the Superior Council of the Judiciary, the General Attorney of the Nation, the General Comptroller of the Republic, the General Procurator of the Nation, the departmental, district and municipal comptrollers' offices, the National Registry of Civil Status Office, ministries, administrative departments, superintendencies, special administrative units and, in general, state bodies or agencies to which the law grants the capacity to enter into contracts (article 2 of Law 80 of 1993). However, there are some public bodies that are governed by the rules of civil and commercial law because of their characteristics or because they compete in open markets, such entities are in a special contracting regime even when they shall advertise in SECOP II.
  • Cooperatives and associations of local entities, entities contracting with international or multilateral entities (articles 10 and 20 of Law 1150 of 2007).
  • Private persons contracting with public funds.

  • SECOP II: Transactional platform to manage all procurement processes online, with accounts for entities and suppliers; and public view for any third party interested in monitoring public procurement.  The mandatory use of SECOP II by the state entities which apply the contracting regime aims to promote the principles that govern fiscal management, the administrative function, and state procurement.

Colombia Compra Eficiente, as the main agency for public procurement, oversees the management of the SECOP and issues the rules to incorporate new entities in SECOP II after a training phase. Some proceedings like public-private partnerships, among others, are excluded from publishing on SECOP I.

However, as stated before, there are some entities which must advertise in SECOP II regardless of the procedure carried out and the rules set forth by Colombia Compra Eficiente. These entities are the public bodies that are governed by the rules of civil and commercial law or that compete in open markets.

The link to access SECOP I and SECOP II is here.  In addition, public tenders might be published on the websites of the contracting entities.

Other than SECOP I and SECOP II, there are no other government platforms to search for "green" contracting opportunities.

Are there any requirements for bidders to be established in the jurisdiction in order to bid or execute a contract with the procuring entity?

There is no requirement to be established in Colombia's jurisdiction to bid to a state entity. According to Colombian Law, contracts with state entities may be entered into by persons considered legally capable under the provisions in force, and national and foreign legal persons must prove that their duration will not be less than the term of the contract plus one year (this rule may change according to the project) (Article 6 of Law 80 of 1993).

However, even when is not necessary to have a subsidiary or an SPV to bid, it is necessary for a foreign company that wants to undertake permanent business in Colombia, to establish a branch with its domicile in the national territory (Article 471, Commercial Code). The activities which are considered as permanent are, among others, to perform works as a contractor and to be awarded with a concession by any state entity or that participate in the operation of the concession in any manner (Article 474, Commercial Code).

For public-private partnerships (PPPs), which include concessions, it is mandatory for a bidder which is awarded a contract to constitute a special purpose vehicle (SPV) with unique purpose to execute the contract with the state entity and to perform the obligations contained in it. This SPV will be a company regulated under the Colombian Law.

Is there any requirement for "local content"?

Yes, there are some requirements for local content.

State entities must assign in the selection proceedings a score related to the promotion of national goods and services or those which are considered as national according to the national treatment principle. This requirement will be fulfilled by any of the following:

  • Promotion of national goods and services: national goods are those registered in the Register of National Asset Producers – (RPBN for its acronym in Spanish). National services are those provided by Colombian natural persons or residents in Colombia or by legal persons constituted in accordance with Colombian legislation.
  • Promoting the incorporation of domestic components in foreign goods and services: the incorporation of goods is carried out through the incorporation of Colombian components in foreign goods. The incorporation of services is carried out by linking natural or legal persons who provide professional, technical, or operational services.
  • Foreign goods and services with national treatment: State entities must assign the national goods and services score to those goods and services to which the state entity must grant national treatment

This score must be included in all procurement processes, except (i) where there is a direct award of the contractor, whatever the applicable contracting regime; (ii) in the abbreviated selection proceeding for the acquisition or supply of goods and services of uniform technical characteristics; and (iii) in the minimum amount proceedings.

Additionally, in public bidding proceedings and merit-based competitions, State entities must assign 1% of the total score to compliance with the promotion of the preference system in favour of persons with disabilities (Law 1618 of 2013 and Decree 392 of 2018). State entities must verify whether the bidder accredits that it has hired persons with disabilities in its staff to proceed with the allocation of the score. The accreditation must be done through the expedition of a certificate by the Colombian Labour Ministry, which means only Colombian companies or branch established in Colombia may accredit this requirement.

The Legal Procurement Framework

What is the applicable procurement legislation?

The following is the main applicable procurement legislation in Colombia:

  • Law 80 of 1993 "Whereby the general statute on public administration procurement is issued"
  • Law 816 of 2003 "Whereby the domestic industry is supported through public procurement"
  • Law 1150 of 2007 "Whereby measures for efficiency and transparency are introduced in Law 80 of 1993 and other general provisions on contracting with public resources are enacted"
  • Law 1474 of 2011 "Whereby regulations are issued to strengthen the mechanisms for the prevention, investigation and punishment of acts of corruption and the effectiveness of public management control."
  • Law 1508 of 2012 "Whereby the legal regime for Public Private Partnerships, organic budget rules and other provisions are established"
  • Law 1882 of 2018 "By which provisions are added, modified and dictated to strengthen public procurement in Colombia, the Infrastructure Law and other provisions are dictated."
  • Decree 1082 of 2015 "Whereby the single regulatory decree of the administrative sector of national planning is issued"

Has your country ratified the WTO Government Procurement Agreement (GPA), or any bilateral trade agreement with Government Procurement commitments?

Colombia is not part of the Government Procurement Agreement but is an observer since February 27, 1996. In this sense, the Agreement is not binding for Colombia, but it is part of the main forum for the exchange of experiences and best practices in public procurement which could be used, enabling it to implement policies or programmes based on these experiences and practices.

Likewise, Colombia has signed several bilateral trade agreements which include government procurement commitments. Some of the agreements which contains these commitments are those executed with United States of America, European Union, Chile, the Pacific Alliance (Perú, Chile, México, Colombia), and Mercosur (Argentina, Brazil, Paraguay, Uruguay, Venezuela).

The main provisions in these agreements are the following:

  • National treatment and non-discrimination principle.
  • Selection process.
  • Selection requirements.
  • Contracting documents.
  • Public procurement advertisement.
  • Conditions for participation.
  • Principles of transparency.
  • Cooperation between countries.
  • Use of technology systems.

If so, how do these international trade agreements interact with the domestic procurement legislation?

Free trade agreements, like any other international treaty Colombia enters into, must be approved by law. After the approval of the law by the Congress of the Republic, it must pass the prior control of constitutionality before the Constitutional Court. For the agreement to be approved by the Senate and the Constitutional Court, it must be in harmony with the Colombian legal system, which means that it cannot go against the Constitution or other existing laws.

Once the trade agreement is approved, it has the same status as a law and its application is mandatory within the Colombian legal system.

Additionally, most of the provisions agreed in international trade agreements are already included in Colombian procurement legislation.

What types of procuring entity need to comply with the procurement legislation?

All state entities defined in article 2 of Law 80 of 1993 must comply with the procurement legislation. Within this definition are included the following entities:

  • The Nation, the regions, departments, provinces, the capital district and special districts, metropolitan areas, associations of municipalities, indigenous territories and municipalities; public establishments, industrial and commercial enterprises of the State, mixed economy companies in which the State has a participation of more than 50%, as well as indirect decentralised entities and other legal entities in which there is such majority public participation, whatever name they adopt, at all levels and orders.
  • The Senate of the Republic, the House of Representatives, the Superior Council of the Judiciary, the Office of the Attorney General of the Nation, the Office of the Comptroller General of the Republic, the departmental, district and municipal comptrollers' offices, the Office of the Attorney General of the Nation, the National Registry of Civil Status, ministries, administrative departments, superintendencies, special administrative units and, in general, state bodies or agencies to which the law grants the capacity to enter into contracts.
  • As referenced before, there are some entities which, by express legal provision and due to their nature or situation of competence, the legislator chose to assign a contractual regime different from that of the General Statute on Public Administration Procurement. This means that they are not subject to these general laws and their contractual procedures have their own rules . However, even these special contracting regimes, must apply the principles of public administration and fiscal management and they must apply the inabilities and incompatibilities regime.

Which types of contracts are covered?

All contracts entered into by state entities indicated in the previous answer must comply with public procurement legislation without any financial thresholds or limits. However, according to financial thresholds, the selection process could vary (please refer to the following answer). The special contracting entities must apply the rules set forth in their contracting manuals..

Are there any exemptions to competitive bidding?

Yes, there are some exemptions to competitive bidding. According to Law 1150 of 2007, there are different selection modalities as follows:

  • Public tender: the choice of the contractor shall be made as a general rule by public tender.
  • Abbreviated selection procedure: applies when, due to the characteristics of contract, it is possible to carry out a simplified procedure to guarantee the efficiency of the contractual management. Some of the cases in which the abbreviated selection procedure is applied are:
  • The procurement or supply of goods and services of uniform technical characteristics and of common use by entities.
  • Minor amount procurement (the minor amount is determined according to the budget of the state entity).
  • Agreements for the provision of health services (with some exceptions).
  • When the public tender has been declared void.
  • Disposal of state properties (with exceptions).
  • Merit-based competition: this selection procedure applies mainly for the selection of consultants for projects, in which open competition or pre-qualification systems may be used. In the latter case, the list of pre-qualified candidates will be drawn up by means of a public call for tenders.
  • Direct award: can only proceed in the following cases:
  • Manifest urgency.
  • Contracting of loans.
  • Inter-administrative contracts (according to the conditions and the exceptions set forth in the Law).
  • Procurement of goods and services in the defence sector that need to be reserved for their acquisition.
  • Contracts for the performance of scientific and technological activities.
  • Trust contracts executed by local and regional entities.
  • When there is no plurality of bidders on the market.
  • For the provision of professional and management support services.
  • The leasing or acquisition of real estate.
  • The contracting of goods and services of the Dirección Nacional de Inteligencia, which require reservation for their acquisition.
  • The selection of expert witnesses or technical advisors for legal proceedings.
  • Agreements that state entities execute with councils and associations of traditional indigenous authorities.
  • The contracts that state entities execute with the councils of the Afro-Colombian, Palenqueras or Raizal communities.
  • Minimum amount procurement: procurement whose value does not exceed 10 per cent of the entity's minor amount regardless of the subject matter of the procurement.

Procedures for state entities within the special contracting regimes may have different selection procedures .

Are there any proposals to amend the applicable procurement legislation?

There is currently no proposal to amend the procurement legislation in Colombia.

Key procurement resources

  • National Public Procurement Agency Colombia Compra Eficiente – website: public website in which it is possible to find laws, norms, concepts, tutorial, instructive, and other resources related to procurement in Colombia
  • Contratación en Línea website: private website which provide information and documentation related to procurement in Colombia.
  • Artículo 20 website: virtual newspaper dedicated to the coverage of legal information on the public authorities of the Republic of Colombia. Include a special category of state procurement.

Country Contacts

Edgar Romo
Partner, DLA Piper

Roberto Ríos
Partner, DLA Piper

Marcelo Páramo
Partner, DLA Piper

Javier Pichardini
Associate, DLA Piper

Melissa Martínez Echeverría
Associate, DLA Piper

Carlos Guerrero
Associate, DLA Piper

Government Procurement

Where are government tenders advertised? Are there any different sources for government announcements of 'green' contracting opportunities?

In Mexico, bidding for infrastructure projects is carried out by the federal government, the local state or municipal agency in charge of each project:

  • At the federal level, bidding processes are completely public and transparent, through an online digital system called CompraNet.[1]
  • Local state or municipal agencies in charge of each project publish the bidding processes in their corresponding online sites.

As a result of the Energy Reform, the State Productive Companies (Empresas Productivas del Estado) developed their own platforms for bidding processes, eg, the Federal Electricity Commission (Comisión Federal de Electricidad (CFE), and Petróleos Mexicanos (PEMEX).

With respect to green contracting opportunities, they are also published in the online sites of the Energy Regulatory Commission (Comisión Reguladora de Energía) and the National Hydrocarbons Commission (Comisión Nacional De Hidrocarburos).

Are there any requirements for bidders to be established in the jurisdiction in order to bid or execute a contract with the procuring entity?

According to the type of bidder, bids may be classified as follows:

  • National bids: are those in which only Mexican nationals and companies may participate and that the goods to be acquired are produced in Mexico and have at least 50% national content, which is determined taking into account labor, inputs and other aspects determined by the Ministry of Economy.
  • International bids under the coverage of treaties: are those in which only Mexican and foreign companies from countries with which Mexico has trade agreements with government procurement chapter may participate.
  • Open international bids: are those in which Mexican and foreign bidders may participate, regardless of the origin of the goods to be acquired, leased or services to be contracted.

With respect to the bidding stage, except for national bids, foreign investors would be able to participate in international bids under the coverage of treaties and open international bids, so it would not be necessary for them to be established in the Mexican jurisdiction to participate in the bidding process.

Nonetheless, if the bidding process is awarded, under Mexican law, the entity entering into the contract with the corresponding Mexican agency, would need to be a company with full capacity and established under Mexican law.

The aforementioned can be achieved through the incorporation of a special purpose vehicle or a Mexican corporate subsidiary incorporated under Mexican law and complying with all applicable requirements provided in each of the bidding terms for each bid.

Is there any requirement for 'local content'?

The level of requirement for local content depends on each bidding process, but specifically, the National bids (see above) establish the degree of national content, which refers to the percentage of national content that the goods that the agencies and entities intend to procure and acquire through the goods that agencies and entities intend to acquire and acquire through national procurement procedures.

The Legal Procurement Framework

What is the applicable procurement legislation?

Mexico is organized as a federal republic with three levels of government: federal, state and municipal. The Mexican Constitution (Constitución Política de los Estados Unidos Mexicanos) sets forth the competence of each one of them).

As a result, each level of government has its own regulations regarding public procurement, though municipalities are normally subject to state laws.

On a federal level:

  • Projects that involve construction of infrastructure and provision of services in which the infrastructure is provided, in whole or in part, by the private sector are regulated under the Public Private Partnerships Law (Ley de Asociaciones Público Privadas)

Further, hydrocarbon exploration and production contracts are regulated in the Hydrocarbons Law (Ley de Hidrocarburos) and the framework for private participation in the Mexican electricity-market is set forth in the Electric Industry Law (Ley de la Industria Eléctrica).[3]

It should be noted that Pemex (Petróleos Mexicanos), CFE (Comisión Federal de Electricidad) and their respective subsidiaries, all 100% State-owned entities, have their own regulations regarding procurement. Finally, acquisitions, leases and services contracted by constitutional autonomous bodies, such as the Mexican Central Bank (Banco de México) are regulated by the Federal Procurement Laws only to the extent that is not foreseen in the regulations that govern such autonomous bodies.

Has your country ratified the WTO Government Procurement Agreement (GPA), or any bilateral trade agreement with Government Procurement commitments?

WTO Government Procurement Agreement (GPA)

  • Mexico is not a party nor observer of the WTO GPA.

Multilateral Treaties with Public Procurement Commitments

  • On 2021, the Mexican federal government executed an agreement with the United Nations Office for Project Services (UNOPS) for the acquisition of medicines.
  • The United States-Mexico Canada Agreement's (USMCA) Chapter 13 covers public procurement between the U.S. and Mexico.
  • Public procurement between Mexico and Australia, Brunei Darussalam, Canada, Chile, Japan, Malaysia, New Zealand, Peru, Singapore, and Vietnam is covered by Chapter 15 of the Comprehensive and Progressive Agreement for the Trans-Pacific Partnership (CPTPP).
  • Mexico is a party to the Pacific Alliance (Alianza del Pacífico) with Peru, Colombia and Chile; Chapter 8 of the Additional Protocol to the Framework Agreement of the Pacific Alliance (Protocolo Adicional al Acuerdo Marco de la Alianza del Pacífico) covers public procurement.
  • Pursuant to the Free Trade Agreements (FTA) between Mexico and the European Union, the EU-Mexico Joint Council issued Decision No. 2/2000, which covers public procurement.[4]
  • Finally, the FTA between Mexico and the European Free Trade Association (EFTA[5]) covers public procurement in its Chapter V.

Bilateral Treaties with Public Procurement Commitments

The following FTAs to which Mexico is a party cover public procurement:

  • Mexico-Israel FTA (Chapter VI);
  • Mexico-Japan FTA (Chapter 11); and
  • Mexico-Chile (Chapter 15 bis).

If so, how do these international trade agreements interact with the domestic procurement legislation?

Application of Mexican laws are without prejudice to international treaties to which Mexico is a party to and which contain a chapter regarding public procurement (see above).

Accordingly, any public procurement process carried out by Mexican federal government, in principle, shall be performed under the coverage of such treaties and, by exception, a national tender or an open tender shall take place.

What types of procuring entity need to comply with the procurement legislation?

Pursuant to the Mexican Federal Procurement Laws[6], the following public entities are subject to their provisions:

  • The administrative units of the Mexican Federal Executive;
  • The Secretaries of State and the Legal Department of the Federal Executive;
  • Decentralized public entities (organismos descentralizados);
  • Majority state-owned companies and trusts in which the settlor is the federal government or a public-owned entity, and
  • Mexican States, municipalities and the public entities therefrom, in case of total or partial contribution of federal resources.

In the case of the Public Private Partnerships Law, it is applicable to:

  • The agencies and entities of the Federal Public Administration;
  • Federal public trusts not considered parastatal entities (organismos paraestatales);
  • Constitutional autonomous bodies;[7] and,
  • The states, municipalities and public entities therefrom, with federal resources, in accordance with the agreements entered into with agencies or entities of the Federal Public Administration.[8]

As mentioned, Pemex, CFE and their respective subsidiaries, as well as the constitutional autonomous bodies have specific rules.

Which types of contracts are covered?

Acquisitions, Leases and Public Services Contracts

The Federal Acquisitions, Leases and Public Services Law (Ley de Adquisiciones, Arrendamientos y Servicios del Sector Público) sets forth the legal framework applicable to:

  • Contracts for acquisitions, leases or services; and
  • In general, contracts that involve services of any nature that generate a payment obligation for agencies and entities, [9]unless the contracting is specifically regulated by other legal provisions (eg hydrocarbons exploration and production contracts).

Public Works and Related Services Contracts

The Public Works and Related Services Law (Ley de Obras Públicas y Servicios Relacionados con las Mismas) regulates:

  • Public works contracts, which involve building, installing, expanding, adapting, remodelling, restoring, conserving, maintaining, modifying, and demolishing real estate, and all those of a similar nature, unless their contracting is specifically regulated by other legal provisions;[10]
  • Services contracts related to public works, which involve: (i) conceiving, designing and calculating the elements that make up a public works project; (ii) investigations, studies, advice and consultancies that are linked to the actions regulated by that Law; (iii) the direction or supervision of the execution of the works and the studies whose purpose is to rehabilitate, correct or increase the efficiency of the facilities; and (iv) all those of a similar nature.[11]

Public Private Partnerships Contracts

Based on the type of public private partnership (PPP), a particular legal framework will apply. Under Mexican Law, there are different structures to develop PPP projects (lato sensu), including the following:

  • Concessions, where a private party – concessionaire – builds and operates the project owned by the public sector and the investment is recovered through the fees or tariffs paid by the project's end users;
  • Financed public works, in which the private developer invests in a project, and once it is constructed and operating, the public entity repays the total investment;
  • Joint ventures, involving particular risk-sharing models; and
  • PPP contracts (stricto sensu), which regulatory framework consists of the PPP Law and its Regulations.

Regarding PPP contracts, the Public Private Partnerships Law and its Regulations set forth a classification related to the funding used for the project:

  • Pure PPP Projects:completely funded with public resources, either: (i) provided in the annual Federal Government Expenditure Budget; or (ii) resources different from budgetary funds, including those granted by agencies, such as Fonadin (the government agency responsible for coordinating the financing and development of infrastructure);
  • Combined PPP Projects: using both public funds and any other source of funding; and
  • Self-financed PPP Projects: funded exclusively with private funds, other non-financial resources or with the cash flow generated by the project itself.
  • For projects that are not regulated by the Public Private Partnerships Law, there is a specific legal framework for each infrastructure sector (eg, oil and gas, power, etc.).

Financial Thresholds

The Fiscal Year's Federal Government Expenditure Budget establishes the applicable financial thresholds. currently, the 2022 Federal Government Expenditure Budget (Presupuesto de Egresos de la Federación para el Ejercicio Fiscal 2022) applies.

Although any public acquisition below the thresholds provided therein may be awarded through a restricted invitation or a direct award, such acquisition shall comply with the Mexican Federal Procurement Laws or the applicable public procurement rules.

Are there any exemptions to competitive bidding?

Article 134 of Mexico's Federal Constitution and Mexican Federal Procurement Laws[12] provides that acquisitions, leases and services shall be awarded by means of a public bidding process.

However, such laws establish two exceptions to the public bidding process: (i) invitation made to at least three persons or entities (so-called restricted invitation) and (ii) direct award.

Mexican Federal Procurement Laws, list situations or cases in which a restricted invitation or direct award can be justified including, among other scenarios:

  • If no alternative or substitute assets exist, or there is only one possible seller in the market, or the product's patent or license is held exclusively by one person;
  • Social order, economy, public services, sanitation, security or the environment of any area or region of the country are endangered or altered as a result of acts of God or force majeure; and
  • If circumstances exist that may cause significant additional losses or costs, quantified and justified.

Direct awards shall be granted exclusively for (i) military purposes or is necessary to preserve national security; and (ii) due to force majeure events, it is not possible to obtain in time the goods or services through a public bidding process to address the urgency in question.[13]

Are there any proposals to amend the applicable procurement legislation?

Yes. Below please find some initiatives submitted during the second ordinary period of the first year of the LXV Legislature in the Parliamentary Gazette of the House of representatives (Cámara de Diputados) updated as of April 19, 2022.

  • Initiative that amends and adds various provisions of the Political Constitution of the United Mexican States as well as of the Law of Acquisitions, Leasing and Services of the Public Sector, and Public Works and Related Services Law (Leyes de Adquisiciones, Arrendamientos y Servicios del Sector Público, y de Obras Públicas y Servicios Relacionados con las Mismas), in order to limit the awarding of public contracts in direct awarding procedures.
  • Initiative that amends and adds various provisions of the Law of Acquisitions, Leasing and Services of the Public Sector (Ley de Adquisiciones, Arrendamientos y Servicios del Sector Público), in order to promote the participation of cooperative societies in public sector procurement, leasing and services.
  • Initiative that adds Articles 62 of the Public Works and Related Services Law (Ley de Obras Públicas y Servicios Relacionados con las Mismas) and 89 of the Law of Auditing and Accountability of the Federation (Ley de Fiscalización y Rendición de Cuentas de la Federación), regarding administrative rescission or early termination of public works.
  • Initiative that amends and adds various provisions of the Public-Private Partnerships Law (Ley de Asociaciones Público Privadas), regarding non-compliance with contractual obligations, supervision and oversight of projects.
  • Reforming and adding various provisions of the Public-Private Partnerships Law (Ley de Asociaciones Público Privadas) for the Transparency and Regulation of Financial Services, in order to include the concepts of innovation and financial inclusion, and technological neutrality.

Key procurement resources

 


[1] Which is a transactional system that allows public institutions to carry out contracting procedures electronically, mixed or in person; bidders, suppliers or contractors are able to access functionalities in the system that allow them to consult contracting procedures and send their technical and economic proposals in a secure manner.

[2] Other than materials to be used in the construction, maintenance, remodeling and/or installation of public works.

[3] It should be noted that, since 2018, the Mexican government has adopted a series of measures that have impaired private projects in the Mexican energy sector and have hindered investment. https://www.dlapiper.com/en/us/insights/publications/2022/04/mexican-congress-rejects-electricity-constitutional-reform/

[4] Such treaty is currently being modernized and, according to the draft text, Chapter 21 of the revised treaty will cover public procurement.

[5] Comprising Island, Norway, Switzerland and Lichtenstein.

[6] Federal Acquisitions, Leases and Public Services Law (Ley de Adquisiciones, Arrendamientos y Servicios del Sector Público) and the Public Works and Related Services Law (Ley de Obras Públicas y Servicios Relacionados con las Mismas).

[7] The criteria and procedures provided for that Law apply only to the extents that is not provided for in the regulations that govern them and as long as they do not conflict with them, in which case they will be subject to their own control bodies.

[8] For these purposes, it shall be understood that the projects are carried out with federal resources, when the contributions from the federal entities, municipalities and public entities of each other, as a whole, are lower in relation to federal contributions.

[9] The Federal Acquisitions, Leases and Public Services Law expressly mentions the following contracts: (i) acquisitions and leases of personal property in general and/or related to public works contracts; (ii) services related to personal property that is incorporated or attached to real estate; (iii) reconstruction and maintenance of personal property; (iv) maquila; (v) insurance; (vi) transportation of personal property or people; (vii) contracting of cleaning and surveillance services; (viii) provision of long-term services that involve resources from several fiscal years; (ix) provision of services of natural persons, except the contracting of subordinate personal services or under the salary regime; and (x) contracting of consultancies, advice, studies and investigations.

[10] The Public Works and Related Services Law expressly refers to the following public works contracts: (i) maintenance and restoration of personal property incorporated or attached to real estate, that implies modifying the later; (ii) comprehensive projects (proyectos integrales), whereby the contractor undertakes from the design of the work to its total completion, including, when required, the transfer of technology; (iii) exploration, location and drilling work other than oil and gas extraction; soil and subsoil improvement; clearings; extraction and those similar, with the purpose of exploiting and developing natural resources found on the ground or in the subsoil; (iv) installation of artificial islands and platforms used directly or indirectly in the exploitation of natural resources; (v) agricultural infrastructure works; (vi) installation, assembly, placement or application, including the tests of operation of personal property that must be incorporated, adhered or assigned to real estate property; and (vii) those associated with infrastructure projects that involve long-term investment and scheduled amortization under the terms of that Law, in which the contractor undertakes from the execution of the work, its start-up, maintenance and operation of the same.

[11] The Public Works and Related Services Law expressly refers to the following related services contracts: (i) planning and design, including services aimed at conceiving, designing, projecting and calculating the elements that involve an engineering, urban, architectural, graphic or artistic design required to integrate a public works executive project; (ii) technical studies of agrology and livestock development, hydrology, soil mechanics, seismology, topography, geology, geodesy, geotechnics, geophysics, geothermal, oceanography, meteorology, aero-photogrammetry, environmental, ecological, and traffic engineering; (iii) economic studies and pre-investment planning, technical, economic, ecological or social feasibility, evaluation, adaptation, land tenure, financial, development and restoration of the efficiency of the facilities; (iv) coordination, supervision, and control work; (v) analysis and quality control laboratory; geotechnical laboratory, strength of materials and industrial radiography; preparation of construction specifications, budgeting or the preparation of any other document or work for the award of the corresponding contract; (vi) work on organization, information technology, communications, cybernetics and systems applied to the matters regulated by that Law; (vii) opinions, expert reports, appraisals and regulatory technical audits, and studies applicable to the matters regulated by that Law; (viii) studies to rehabilitate, correct, replace or increase the efficiency of real estate installations; and (ix) technological support studies, including technology development and transfer, among others.

[12] Federal Acquisitions, Leases and Public Services Law (Ley de Adquisiciones, Arrendamientos y Servicios del Sector Público) and the Public Works and Related Services Law (Ley de Obras Públicas y Servicios Relacionados con las Mismas).

[13] In such event, the amount or concepts shall be limited to what is strictly necessary to take care of such urgency.

Country Contacts

Carlos Nuñez
Partner, DLA Piper

Julio Villanueva
Partner, DLA Piper

Government Procurement

Where are government tenders advertised? Are there any different sources for government announcements of 'green' contracting opportunities?
Government tenders are advertised on:

Are there any requirements for bidders to be established in the jurisdiction in order to bid or execute a contract with the procuring entity? 
All bidders have to be registered in the National Register of Suppliers (RNP). Previously, they had to register a representative in SUNARP or set up a branch.

Is there any requirement for 'local content'?

No.

The Legal Procurement Framework

What is the applicable procurement legislation? 

Has your country ratified the WTO Government Procurement Agreement (GPA), or any bilateral trade agreement with Government Procurement commitments?

No. Peru is not part of the WTO Government Procurement Agreement (GPA), but it has signed a government‑to‑government (G2G) agreements with the UK, France and Korea for the contracting of works in the health, education, and transportation sectors.

If so, how do these international trade agreements interact with the domestic procurement legislation?

There is no inconsistency with the domestic procurement legislation since the G2G agreement regulations are incorporated. 

What types of procuring entity need to comply with the procurement legislation?

The G2G regulations must be applied by the entity who signed the G2G agreements. For example, in the case of the G2G agreement signed with the UK, that entity is the Autoridad para la Reconstrucción con Cambios.

Which types of contracts are covered? 

The G2G agreements relate mostly to contracts to execute works.

Are there any exemptions to competitive bidding? 

No. Under the G2G agreements there is no possibility of a direct award. But, in the case of the general public contracting regime, it is possible to contract directly in certain circumstances. Examples of such circumstances are those of military secrecy, emergency situations, shortages, single supplier.

Are there any proposals to amend the applicable procurement legislation?

There is a proposed Bill to modify the public procurement regulations but it is still under review.

Key procurement resources

See links above.

Country Contact

Miriam Figueroa
Partner, DLA Piper Puerto Rico LLC 

Government Procurement

Where are government tenders advertised? Are there any different sources for government announcements of "green" contracting opportunities?

There is no one single site where all procurements are advertised, and newspapers are also used to advertise tenders. Below are a few of the most active entities and their websites for procurement advertisements:

  • Puerto Rico Public Private Partnerships Authority (P3):

Are there any requirements for bidders to be established in the jurisdiction in order to bid or execute a contract with the procuring entity?

First: there is no such general statutory requirement to be a legal entity organized under the laws of the Commonwealth of Puerto Rico to participate in bids. However, Requests for Proposals/ bids may require it.

Second, in order to execute the actual contract if successful in the procurement process, counterparties must either establish an SPV or a local entity, or obtain an authorization to do business in Puerto Rico.

Also, as a general rule (with certain exceptions), bidders will need to comply with Puerto Rico General Services Administration (PR-GSA) regulations in order to bid, which provide as follows:

For Bids of Goods, Works and Nonprofessional Services bids and contracts, applicants must follow Regulation 9230 of November 18, 2020, known as the "Uniform Regulation for Purchases and Bids of Goods, Works and Nonprofessional Services of the General Services Administration of the Government of Puerto Rico".

The PR-GSA adopted this Regulation with the purpose of establishing the rules and procedures to be followed by the PR-GSA for processing purchases and bids of goods, works, and non-professional services.

The PR-GSA issues a certificate of eligibility, certifying the compliance on the part of a supplier, provider, bidder, or proponent in order to become part of the Unique Bidder Registry or Sole Registry of Professional Services Providers.

The Regulations also establish a "Bids or Proposals Evaluating Committee" which is constituted for each bidding process in particular, whose principal function is to evaluate the compliance with the bidding requirements established for each bid or proposal.

The PR-GSA also adopted Regulation 9301 of August 26. 2021, known as the "Regulation on the Sole Registry of Bidders for the Government of Puerto Rico".

The purpose of adopting this regulation was to establish the guidelines and procedures by way of which the PR-GSA shall prepare, administer, maintain, and manage the Sole Registry of Bidders for the Government of Puerto Rico (RUL for its Spanish acronym, or Registry).

The RUL is an electronic registry which shall include the names, addresses, and all information required by the PR-GSA of the natural or legal persons qualified and classified to contract with the Government of Puerto Rico. The fundamental purpose of the Registry is to ensure that all government entities and participating municipalities contract solely with legal persons who are of proven moral character and who have not been convicted of or pleaded guilty to crimes constituting fraud, embezzlement, or misappropriation of public funds, and who comply with their fiscal/tax related obligations in Puerto Rico.

The Registry is also a tool available and accessible on the Administration's web portal, which in turn allows each bidder to effectively comply in real time with the necessary requirements to be able to contract with the Government of Puerto Rico; so that a provider or contractor can, in one centralized process and repository, show compliance with the same requirements and use it for multiple government entities during the same period.

Therefore, the accessibility provided by the Registry simplifies and streamlines the process of conducting business with the Government of PR.

The PR-GSA also adopted Regulation 9302 of August 26. 2021, known as the "Regulation on the Sole Registry of Professional Service Providers for the Government of Puerto Rico"

Similar to the RUL, the Sole Registry of Professional Service Providers (RUP, for its Spanish acronym) is an electronic registry which includes all the information required by the GSA of the natural or legal persons qualified and classified to contract for professional services with the Government of Puerto Rico.

Additionally, Regulation 9333 of December 10, 2021, known as the "Regulations on the Imposition of Fines and Adjudicative Process of the General Services Administration" establishes the standards and procedures with regard to the exercise of the following powers:

  • Decide the disputes that arise on the application of Act 73-2019 and the above-referenced regulations;

  • Oversee compliance with public policy, laws, and regulations, and punish the conduct of those who do not comply with the foregoing;
  • Establish and administer procedures to identify violations of public policy laws, and regulations relating to the purchase of goods and services, and;
  • To appoint Examining Officers to preside over the administrative review process of fines/infractions imposed by the GSA.

Is there any requirement for "local content"?

Among other laws, including United States federal laws and regulations that apply when the projects are funded with federal grants and may require to "buy American", we highlight the following:

  • Act No. 14-2004, as amended, known as the "Puerto Rican Industry Investment Act"
  • Establishes a requirement for government agencies to give preference to local manufacturers on purchases of furniture, services, and other goods assembled or otherwise distributed in Puerto Rico.
  • Establishes a requirement for government agencies and other government instrumentalities to reserve, at least, 40% of the funds destined for food purchases for products extracted, produced, manufactured, or assembled in Puerto Rico.
  • Act No. 109 of July 12, 1985, as amended, known as the "Construction Materials Manufactured in Puerto Rico Act"
  • Establishes a requirement to add local construction materials to the specifications sheet on every public (government) bid.
  • If the construction project is being built by the Government, the law requires locally manufactured construction materials be used during construction.
  • There are exceptions to this rule, such as limited availability of materials or excessive cost in the purchase of local construction materials.
  • Act No. 62-2014, as amended, known as the "Act to Support Microbusinesses and Small and Medium-Size Businesses"
  • Establishes a requirement for government agencies to direct 20% of purchases budget to microbusinesses, and small/medium sized businesses.
  • Creates a preferential rate program for microbusinesses, and small/medium businesses to rent property from the Industrial Development Company of Puerto Rico at an annual rent of $1 for the first two years.
  • Act No. 42-2018, as amended, known as the "Local Construction Contractors and Suppliers Preference Act" Establishes that it is the Government's public policy to reserve at least 20% of total purchases for the hiring if construction services.

The Legal Procurement Framework

What is the applicable procurement legislation?

Depending on the project and the entity that is issuing the procurement, and depending on the source of funding (US federal or local funds), other legislation may also apply, but as a general matter, for government procurement, the most common procurement laws applied are these: 

  • The  Regulations referenced above.

Has your country ratified the WTO Government Procurement Agreement (GPA), or any bilateral trade agreement with Government Procurement commitments?

The Commonwealth of Puerto Rico is an unincorporated territory of the United States, thus it is subject to federal action of the United States in this regard.

If so, how do these international trade agreements interact with the domestic procurement legislation?

See above.

What types of procuring entity need to comply with the procurement legislation?

All government entities must comply with procurement laws and regulations that are applicable to them. As to the competitive element of these processes, in the contracting of professional and highly specialized services, certain exceptions apply, allowing for direct negotiations with the government entity. In these cases, however, requirements of contract content and certifications to be presented by the vendor, or registry in the RUP (see above) still apply, e.g., representations and confirmation regarding ethical obligations and no conviction of corruption in other jurisdictions.

Which types of contracts are covered?

Regulations and laws referenced above are applicable to all entities and contracts, although for certain de minimis purchases and in emergency situations some requirements may be waived.

Are there any exemptions to competitive bidding?

Yes.

In the case of professional and highly specialized services, as described above, although the government entity can voluntarily decide to issue a competitive procurement process for these types of services, which is not uncommon.

In some instances, sole source providers may be exempt.

Also, competitive procurements may be waived under exceptional conditions in case of a disaster or emergency declaration by the Government of Puerto Rico (i.e., recent hurricanes, earthquakes, COVID-19 pandemic, etc.).

Are there any proposals to amend the applicable procurement legislation?

No, not at the moment.

However, there have been some proposals mentioned to prohibit recently created corporate entities (less than two years since organized) to contract with the Government of Puerto Rico.

Key procurement resources

As stated above, as a general matter (with certain exceptions), the following Puerto Rico General Services Administration regulations need to be complied with:

  • Regulation 9230 of November 18, 2020
  • A copy of the "Uniform Regulation for Purchases and Bids of Goods, Works and Nonprofessional Services of the General Services Administration of the Government of Puerto Rico" (Regulation 9301 of August 26, 2021) is available here.
  • A copy of the "Regulation on the Sole Registry of Bidders for the Government of Puerto Rico" ( Regulation 9302 of August 26, 2021) is available here.
  • A copy of the "Regulation on the Sole Registry of Professional Service Providers for the Government of Puerto Rico" (Regulation 9333 of December 10, 2021) is available here.
  • A copy of the "Regulations on the Imposition of Fines and Adjudicative Process of the General Services Administration" is available here.

Country Contacts

Rich Rector
Partner, DLA Piper

Brad Jorgensen
Partner, DLA Piper

Danny Cook
Partner, DLA Piper

Benedetta Audia
Partner, DLA Piper

Government Procurement

Where are government tenders advertised?  Are there any different sources for government announcements of ‘green’ contracting opportunities?

Contracting opportunities with the U.S. government are posted on a centralized, searchable website: SAM.gov.  In addition to solicitations (i.e., tenders), the website contains pre-solicitation notices concerning future requirements and procurements.

Contracting opportunities with state and local governments in the U.S. are generally posted on the public website, or otherwise made publicly available, in each specific state or local government.  The laws of each jurisdiction must be consulted. 

There are no different sources for government announcements of “green” contracting opportunities.

Are there any requirements for bidders to be established in the jurisdiction in order to bid or execute a contract with the procuring entity?

All companies that bid on U.S. government contracts must be registered in SAM.gov at the time of proposal submission; however, there generally are no requirements that a contractor be established in the United States.

State and local governments have varying rules on business registration and establishment.  The specific law of each jurisdiction must be consulted.

Is there any requirement for ‘local content’?

On U.S. government contracts, there is a detailed statutory and regulatory framework that establishes a preference for local content.  These requirements are generally implemented on a government-wide basis through the Buy American Act (“BAA”), 41 U.S.C. § 8301 et seq., and the Trade Agreements Act (“TAA”), 19 U.S.C. § 2501 et seq.  Note, however, that some U.S. agencies have separate, agency-specific requirements for domestic content.  See, e.g., 49 U.S.C. § 5323(j) (Department of Transportation). Additionally, there are several statutes that impose domestic preference requirements on purchases of certain specific categories of products (e.g., 10 U.S.C. § 4862, which imposes a preference for domestically produced textiles and certain metals).

The BAA operates by establishing a pricing preference for goods and construction materials that are “domestic end products.”  Under the BAA, items are generally defined as “domestic end products” if (1) they are manufactured in the U.S.; and (2) the cost of components produced in the U.S. exceeds 55% of the cost of all components used in the item (increasing to 65% in 2024 and 75% in 2029).

The TAA waives the requirements of the BAA on contracts for goods, construction materials, and services that: (1) are valued over certain established monetary thresholds (currently US$183,000 for goods and services contracts and US$7,032,000 for construction contracts for WTO GPA purposes); and (2) are substantially transformed in a “designated country” with whom the U.S. has entered into a bilateral or multilateral free trade agreement.  Designated countries include signatories to the World Trade Organization Government Procurement Agreement (“WTO GPA”). 

State and local governments in the U.S. have varying rules on local content and preferences.  The specific law of each jurisdiction must be consulted.

The Legal Procurement Framework

What is the applicable procurement legislation?

Procurement of goods and services by the U.S. government is highly structured and governed by numerous statutes and regulations.

Federal Procurement

Title 41 (“Public Contracts”) and Title 10 (“Armed Forces”) of the United States Code provide the statutory framework for most Federal procurements.  These portions of the United States Code incorporate key procurement statutes passed over the years, including the Contract Disputes Act of 1978, the Competition in Contracting Act of 1984, the Federal Acquisition Streamlining Act of 1994, and the Federal Acquisition Reform Act of 1995. 

These statutory requirements are implemented through the Federal Acquisition Regulation system, which codifies uniform policies, procedures, and standard terms to be used in acquisitions by executive agencies of the U.S. government.  The system consists of: (1) the Federal Acquisition Regulation (“FAR”) which is the primary document that applies to all executive agencies as set forth in Title 48 of the Code of Federal Regulations; and (2) agency-specific acquisition regulations that supplement the FAR.  For example, the Defense FAR Supplement (“DFARS”) sets forth the additional rules that apply to defense procurements.  Utility procurements are governed by the FAR, with special rules set forth in FAR Part 41.

In addition, some agencies have authority to acquire goods and services through non-procurement agreements that are exempt from the FAR.  In particular certain Federal agencies including the Department of Defense (“DoD”) and the National Aeronautics and Space Administration (“NASA”) have the authority to enter into Other Transaction Agreements (“OTAs”), which are flexible business agreements to acquire research and development to support technology advancement or to quickly develop a prototype.  Each of the agencies with OTA authority relies on a different enabling statute.  For example, the DoD’s OTA authority is codified at 10 U.S.C. § 2371b, whereas NASA’s authority is codified at 51 U.S.C. § 20113(e). Other agencies with OTA authority include the Department of Health and Human Services (42 U.S.C. § 247d-7e) and the Department of Energy (42 U.S.C. § 7256).

Beyond OTAs, there are other types of agreements between the Federal government and private companies that also fall outside the FAR.  For example, concession contracts are not governed by the FAR, but by regulations established by the agency responsible for awarding such contracts.  For example, the Department of the Interior has regulations for park concessions and timber sales (51 C.F.R. § 51), and the Department of Transportation has regulations for airport concessions (49 C.F.R. § 23).

State and Local Procurements

State and local governments in the U.S. have their own procurement codes and regulations.  The specific law of each jurisdiction must be consulted.

Public-Private Partnerships

Historically, the use of PPP agreements by the U.S. government has been minimal.  Although various statutes provide federal agencies with the authority to enter into PPPs for specific purposes (see, e.g., 10 U.S.C. 2474 and 15 U.S.C. 3710a), there is no uniform, consolidated set of PPP rules under Federal law.

That said, the Federal government has used PPP projects for certain energy and social infrastructure projects and, more recently, has encouraged PPP agreements in the transportation sector through financing and grant programs.

In contrast to the Federal Government, state and local governments routinely utilize PPP arrangements for transportation, water, information technology, and other forms of public infrastructure.  Some states have specific PPP laws (which can be limited to certain types of projects), while others rely on their general procurement authority. 

Has your country ratified the WTO Government Procurement Agreement (GPA) or any bilateral trade agreement with Government Procurement commitments?

The United States has ratified the WTO GPA and has thirteen bilateral Free Trade Agreements with government procurement commitments.  A list of the countries with which the United States has Free Trade Agreements can be found on the U.S. Department of Commerce’s website.

If so, how do these international trade agreements interact with the domestic procurement legislation?

The WTO GPA and the Free Trade Agreements have been implemented through statute and, as described above, via the TAA and its implementing provisions in FAR Part 25.

When there is conflict between U.S. law and WTO GPA obligations, United States law prevails. Disputes between state law and WTO GPA obligations is a grey area: the United States has agreed to work with states to resolve disputes, but no state law may be declared invalid based on a WTO decision unless the U.S. government brings a case against a state seeking a ruling that a state law violates the WTO GPA.

FAR subpart 25.4 mandates inclusion of a clause exempting FTAs when acquisitions are covered by the WTO GPA.

What types of procuring entity need to comply with the procurement legislation?

All “executive agencies” of the U.S. Government must comply with the FAR in any acquisition.  See FAR 1.101.  An acquisition is defined as the procurement by contract, with funds appropriated by Congress, of supplies or services (including construction) by and for the use of the Federal Government through purchase or lease.  See FAR 2.101.

Note, however, that legislative and judicial agencies, as well as certain Federal entities (e.g., Federal Aviation Administration, Central Intelligence Agency, United States Postal Service, Federal Deposit Insurance Corporation) are not subject to the FAR; instead, they have their own binding acquisition rules that are loosely modelled on the FAR.

In procurements by state and local governments, the entities covered by procurement statutes and regulations are specifically defined in local law.  The specific law of each jurisdiction must be consulted.

Which types of contracts are covered?

All contracts awarded by U.S. executive agencies are covered by the FAR system to some degree.

Federal contracts valued at less than US$250,000 are below the Simplified Acquisition Threshold (“SAT”) and, as such, are subject to the simplified acquisition procedures set forth in FAR Part 13.  Pursuant to FAR 19.502, contracts under the SAT are generally reserved for small businesses.

In addition, pursuant to FAR subpart 13.5, simplified acquisition procedures may be used by executive agencies for the acquisition of “commercial items” valued at up to US$7 million (or up to US$13 million for certain contingency and emergency acquisitions).

Federal contracts valued at less than US $10,000 are under the “micro-purchase threshold” and are subject to even fewer procurement requirements.  For example, micro-purchases may be awarded without competition if the contracting officer considers the price to be reasonable.

In procurements by state and local governments, the covered contracts are defined by local law.  The specific law of each jurisdiction must be consulted.

Are there any exemptions to competitive bidding?

Federal law mandates, with certain exceptions, that executive agencies shall promote and provide for “full and open competition” in soliciting offers and awarding U.S. government contracts.  See FAR 6.101.

The exceptions to this requirement, which are set forth in FAR Part 6, include:

  • certain contracts awarded using simplified acquisition procedures;
  • certain contracts set aside for small or disadvantaged businesses;
  • certain contracts set aside for local firms during a major disaster or emergency;
  • orders placed under requirements or definite-quantity contracts;
  • certain task orders and delivery orders awarded under indefinite-quantity contracts;
  • contracts for which there is only one responsible source;
  • contracts involving unusual or compelling urgency;
  • contracts to ensure industrial-mobilization capability or essential engineering, research, or development capability;
  • contracts for expert or neutral services in any litigation or dispute;
  • contracts authorized by international agreement;
  • contracts expressly authorized by statute;
  • contracts for which disclosure of the government’s needs would compromise national security; and
  • contracts for which the agency head has determined that competition is not in the public interest.

Agency-specific regulations may supplement these exceptions.

Note also that the statutory requirement for “full and open competition” does not necessarily obligate agencies to conduct an acquisition using traditional “bidding” processes.  Various statutory and regulatory authorities allow agencies to conduct “competitive” procurements using processes that don’t necessarily pit prospective contractors directly against one another (e.g., the Federal Supply Schedule program operated by the General Services Administration; the “Broad Agency Announcement” process under FAR 35.016).

In procurements by state and local governments, competition is also typically required, and exceptions to competition requirements are defined by local law.  The specific law of each jurisdiction must be consulted.

Are there any proposals to amend the applicable procurement legislation?

Federal procurement law in the U.S. is constantly evolving to reflect policy changes and contracting priorities, and there are multiple statutory and regulatory changes every year.  For example, significant changes to “Buy American” laws and supply-chain restrictions are currently in process.  Contractors should monitor these changes on an ongoing basis to ensure compliance.

In state/local government procurement, the pace of change is not as robust, but changes are nonetheless common.  The specific law of each jurisdiction must be consulted.

Key procurement resources

  • SAM.gov is the U.S. government’s centralized acquisition management website where information on contractors, as well as procurement opportunities, is listed.
  • Acquisition.gov contains the FAR and all agency-specific FAR supplements.