Module 4: Competitive flexible procedure

Question 1

Preliminary market engagement and preliminary market engagement notice

Accepted Answer

For an effective competitive flexible procedure, preliminary market engagement (section 16) is not only encouraged but is recommended as it provides the opportunity to understand: the market, the deliverability of requirements, feasibility of alternative options and identify whether innovative solutions could help to deliver better public services and deliver value for money.

Preliminary market engagement can also be used to inform the development of the future procurement procedure, possible award criteria, and overall project timetable to ensure that when going to the market, potential suppliers have sufficient time to respond to requests to participate and prepare tenders.

Where a process has already been scoped out , preliminary market engagement can be used to explain this and obtain feedback as to whether it is relevant and proportionate to the requirement and the market and gauge whether it would encourage supplier participation, particularly small and medium-sized enterprises (SMEs), and whether it would generate sufficient competition and achieve value for money.

As a reminder, the preliminary market engagement notice must be published to inform the market when a contracting authority intends to conduct or have already conducted any preliminary market engagement activities. If a preliminary market engagement notice is not published, the contracting authority must provide reasons for not publishing a preliminary market engagement notice in the tender notice (section 17) .

Remember that good, transparent and open communication with potential suppliers builds trust and can reduce the risk of issues or challenges arising during or after the procedure.

See procedures summary document for more information on preliminary market engagement and the preliminary market engagement notice.

Question 2

Tender Notice and associated tender documents

Accepted Answer

The competitive flexible procedure is centred on the tender notice and associated tender documents (section 21); these must clearly explain how the procedure will be carried out. The tender notice is used to invite suppliers to submit a request to participate or submit their first or only tender as part of the competitive flexible procedure.

As set out in the procedures summary document, the minimum requirements for the tender notice and associated tender documents are set out in the Procurement Regulations 2024. For the open procedure, these requirements include:

The subject matter and estimated value of the contract
How the tenders will be assessed including any conditions of participation and the criteria for awarding the contract
The timescales for both the procurement process and delivery of requirements
Any other relevant information
Where preliminary market engagement has been undertaken but a preliminary market engagement notice has not been published, the reasons why a preliminary market notice was not published
Where the contract is not to be awarded in lots, but it would have been reasonable and appropriate to do so, the reasons for not doing so
Confirmation that a conflicts assessment has been undertaken

For the competitive flexible procedure the tender notice must also include:

A description of the process to be followed during the procedure, including whether there is negotiation at any stage
Any conditions of participation that will be used to reduce or limit the number of suppliers progressing to the next stage of the process
Any other criteria (for example, award criteria) that will be used to reduce or limit the number or suppliers progressing to the next stage of the process
Whether the award criteria may be refined during the process (see assessment and award summary document)

Failure to comply with the procedure described in the tender notice, unless modified as covered later in this module, could be grounds for legal challenge against the authority and subject to the relevant remedies.

In a competitive flexible procedure, the contracting authority may not have all the tender documents available at the point at which the tender notice is published, particularly in circumstances where elements of the final documents may necessarily depend on the outcomes of negotiations or dialogue. Therefore, as the procurement and competition develops, it is likely more documents will be generated.

The contracting authority will be required by the tender notice to set out minimum information which must be provided about the requirement, this may be supported by tender documents provided with the tender notice; in any case, there should be enough detail provided to allow suppliers to determine whether or not they wish to participate and respond appropriately.

What’s the benefit:

Contracting authorities have the discretion to utilise and release associated tender documents as they see fit, subject to the requirements in the Procurement Regulations 2024
Allows for additional information to be provided at different stages of the competitive flexible procedure
Although there are mandatory information fields in the tender notice, contracting authorities can determine the level of detail they wish to provide in the tender notice and how much they will supplement that information with the tender documents.

For example, for a simple procurement a contracting authority may choose to provide all of the award criteria in the tender notice and the tender documents may be less substantial. Whereas for a complex procurement, they may choose to keep the award criteria high level in the tender notice and detail all of the sub-criteria in the associated tender documents.

It is worth noting that the issue of tender documentation will have an impact on the deadlines for tender return, covered later in this summary document.

5. Designing a process

There are a number of factors that should be considered when designing a procurement process under the competitive flexible procedure:

Number of stages

There is no limit to the number of stages or supplementary processes that can be included in the competitive flexible procedure. However, contracting authorities:

Should consider the costs and complexity of the procedure for both themselves and the suppliers.
Have a duty to ensure that the procedure is proportionate having regard to the nature, complexity and cost of the contract - overly complicated procedures can limit competition and fail to achieve best value
Must comply with certain minimum time periods
Should sufficiently plan each of the stages to avoid unnecessary delays which can impact on time and therefore costs
Should determine whether they wish to set and assess conditions of participation and / or include a participation stage
Should determine whether they wish to include stages for product development or prototypes, which encourages innovative solutions.

Exclusions

Whether a supplier is an excluded or excludable supplier must always be considered before suppliers are permitted to participate beyond the initial submission of tenders or requests to participate in a competitive flexible procedure. There will therefore need to be an appropriate time in all competitive flexible procedure procurements to consider exclusions.

Conditions of participation

There is no requirement to include a selection stage as tenders can be invited as the first stage
Contracting authorities may wish to invite requests to participate which require potential suppliers to meet conditions of participation to reduce the number of suppliers proceeding to the next stage in the process (section 20 (5)(a))
Conditions of participation, where set but not used as a formal stage in order to exclude suppliers earlier in the process, must be met by the supplier to be awarded the contract.

What can a stage be used for?

To reduce the number of suppliers who progress to the next stage through a selection process (down selection) (section 20(4)(a))
To undertake an intermediate assessment of tenders to exclude suppliers (section 20(5)(b)) who do not meet the assessment criteria in accordance with the assessment methodology and provide feedback to those who do to allow suppliers to improve their proposals, i.e. assessing draft tenders in order to identify items which require dialogue or negotiation
To provide feedback on draft tenders/presentations etc without reducing the number of suppliers and then signify the move to the next stage in the procurement process.

The intention of each stage, i.e. whether it is to reduce the number of suppliers, and any use of selection or intermediate assessment criteria should be clearly set out in the tender notice and any associated tender documents.

Supplementary processes

Whilst the procedures similar to the restricted procedure or competitive dialogue under the PCR 2015, can be undertaken using the competitive flexible procedure, contracting authorities are encouraged to consider and, where appropriate, take full advantage of the additional flexibilities this new procedure offers. Contracting authorities can design a bespoke process that best meets their requirements and will offer the most advantageous tender through the use of different supplementary processes.

Supplementary process	Description
Participation Stage	Inviting suppliers to participate and using published criteria (such as conditions of participation) to reduce the number of suppliers proceeding to the next stage
Non Disclosure Agreement / Confidentiality agreement	Enables the contracting authority to share information with suppliers which is deemed sensitive but is needed to inform a supplier’s decision to participate or inform their tender
Supplier funding	For more complex or novel requirements (and subject to complying with all relevant rules on subsidy control) some funding may be provided to chosen suppliers to support them in participating in a procurement process. This supplementary process is unlikely to be applicable other than when significant and costly product development is required by the contracting authority to test the deliverability of tenders.
Clarification Process	Questions can be raised by suppliers about the procurement process or any element of the procurement pack, or by the contracting authority where information is unclear, contains obvious error, false statements, abnormal offers or where items are missing
Dialogue	Aimed at improving all parties’ understanding of the requirement, can happen at any or all stages of the procurement.
Negotiation	A strategic discussion aimed at improving the supplier’s offer and creating an agreeable set of terms
Supplier Presentations	Aimed at confirming that the proposals being made are deliverable.
Product Demonstrations	Aimed at testing the deliverability of key aspects of tenders.
Site Visits	Aimed at identifying whether key supporting processes have been developed, necessary equipment has been obtained or configured or that systems and processes are in place to deal with the required demands / volumes.
Audits and other checks	Used to see, confirm and check what is being offered is compliant with any requirements and/or accurately described. They are used to confirm statements made in writing by suppliers.
e-Auctions	Process used to derive the lowest price.
Preferred supplier stage	Allows the contracting authority to clarify or confirm any commitments made or engage in post-tender negotiation
Intermediate assessment of tenders to narrow competition	Reduces the number of suppliers based on the quality of their current proposals. This can reduce the administrative effort and cost for all parties. It can also exclude suppliers who are least competitive. Such assessment can take place more than once, so that the number of suppliers is gradually reduced whilst maintaining a level of competition.
Assessment of tenders with the option to award prior to negotiation or dialogue	The option to award a contract to a supplier based on the assessment of the tender without undertaking any negotiation or dialogue which may have been intended to be part of the process. For example, the contracting authority may feel confident that it is possible to accept tenders without the need for negotiation, however, there is risk that the tenders may not be optimum due to the complexity which can be resolved through dialogue and/or negotiation.
Final tenders	Drives a focus on price, so the stage must be used carefully to avoid abnormally low tenders (also known as best and final offer – BAFO).
Variant tenders	Allows suppliers to tender one or more alternative solution which meets the requirements

This list is not exhaustive and is used as an example only see Summary of competitive flexible supplementary processes learning aid for other examples

Number of suppliers

There is no specified minimum or maximum number of suppliers who can be invited to participate at any stage of the procedure. Contracting authorities may limit the number of suppliers (section 20(4)(a)) provided it is set out in the tender notice and any associated tender documents, along with the criteria which will be used to reduce the number of suppliers.

Contracting authorities should use their findings from preliminary market engagement to determine whether the number of suppliers should be limited throughout the process.

By limiting the number of suppliers, contracting authorities can:

ensure that the process is manageable particularly where a large market exists;
help to reduce the administrative costs and time associated with the procurement, particularly if the evaluation is likely to be complex;
make the procurement more attractive to suppliers by removing the need for them to submit time consuming and expensive tenders and increase their potential to be successful due to reduced competition .

However, reducing the number of suppliers can also be a barrier to start-ups and new entrants, who may have the ability to offer the most advantageous solutions but lack experience of delivery due to being new to the market.

In carrying out the procedure, a contracting authority must have regard to the fact that small and medium-sized enterprises may face particular barriers to participation, and consider whether such barriers can be removed or reduced. This may be, for example, ensuring that the conditions of participation set are accessible for SMEs, such as by ensuring that insurance and turnover requirements are reasonable.

Therefore, careful consideration should be given to limiting the number of suppliers and should be informed by preliminary market engagement.

Notifying suppliers

Where a participation stage or intermediate assessment is being used to reduce the number of suppliers, contracting authorities must have regard to the importance of sharing information as part of the procurement objectives. This means that:

Suppliers should, as best-practice, be notified of the outcome as soon as possible following the conclusion of the assessment.
It is considered best practice to provide feedback to suppliers who have taken the time to submit a tender. Although it is not a requirement to provide an assessment summary to suppliers who are unsuccessful at an intermediate assessment stage, it is recommended that contracting authorities follow the assessment summary requirements, as doing so should demonstrate compliance with the regime and provide suppliers sufficient explanation for the outcome of assessment, which may help suppliers to improve any future tender responses and avoid legal challenges.

For suppliers who reach the final tender stage, the requirements of awarding a contract apply - see assessment and award summary document.

Time limits

The minimum time periods under the competitive flexible procedure are as follows^{[footnote 1]}:

Participation period (section 54(3)) (where including a participation stage) - 25 days

→ Unless

The contracting authority considers there to be a state of urgency - 10 days

Tendering period (section 54(4)) - applies to each stage where a tender is submitted unless the contracting authority considers supplier responses to e.g. simply be an update to an earlier tender (for example as an outcome of negotiations rather than new information); in which case a reasonable time limit which is the same for all suppliers would be required. Minimum tendering periods are:

25 days where tenders may be submitted electronically and the tender notice and associated tender documents are all provided at the same time, or
30 days where tenders may be submitted electronically and the tender notice and associated tender documents are not all provided at the same time

The tendering period can be reduced to 10 days where:

a qualifying planned procurement notice has been published, or
the contracting authority considers there to be a state of urgency that means any other applicable minimum tender period is impractical

However for contracting authorities that are not central government authorities, tendering periods can also be reduced to:

10 days where:

- a condition of participation stage has been included and only pre-selected suppliers are invited to submit a tender

No minimum timescales where:

- a conditions of participation / participation stage has been included and only pre-selected suppliers are invited to submit a tender, and

- A timescale has been agreed with those suppliers

Whilst the Procurement Act prescribes minimum time periods for the key stages of the procedure, when setting time limits contracting authorities should think about the time required to undertake each of the stages and must, where relevant, have regard to:

The nature and complexity of the contract
The need for site visits, physical inspections and other practical steps eg where scheduling and availability needs to be considered
The need for sub-contracting;
The nature and complexity of any modification to the tender notice or associated tender documents for example to allow suppliers to consider and respond
The importance of avoiding unnecessary delays - for example not making the process longer than it needs to be, costing time and resource for both the contracting authority and the suppliers

6. Example Processes

Regardless of the process that is designed and undertaken, contracting authorities must always consider whether any supplier is an excluded or excludable supplier before suppliers are permitted to participate in a competitive flexible procedure meaning participating beyond the initial submission of tenders or requests to participate.

Two - stage process

In its simplest form, the competitive flexible procedure could be a two-stage process. The example below is similar to that of the restricted procedure (PCR 2015). The key difference between an open procedure and this example process under the competitive flexible procedure is the introduction of a participation stage.

This example process could be used for standard requirements where:

a large market exists and the scale of competition will impact on a supplier’s decision to tender
a large market exists and the cost of the procedure to the contracting authority would impact on value for money unless the number of tenders is manageable

or

there is sharing of sensitive information and the number of suppliers needs to be restricted to allow it to be shared in a controlled manner i.e under a confidentiality agreement or non-disclosure agreement

Two-stage process using a supplementary process

In the competitive flexible procedure there is no requirement for a conditions of participation / participation stage.

Tenders can be invited in the first stage, as per the open procedure. Following an intermediate assessment of the tenders received, the highest scoring tenders may be taken forward to a further stage before having a final assessment stage.

Contracting authorities are to be able to engage with suppliers under the competitive flexible procedure to discuss the requirement and improve tenders as long as they do so in accordance with the tender notice and any associated tender documents.

This example process could be used where there is no need to undertake a formal participation stage, but it would be beneficial to include stages to engage with suppliers to help them understand the requirement or help the contracting authority to understand their solution further in order to achieve value for money, for example for simple or niche requirements:

Where an ‘off the shelf’ solution exists but may need some configuration for a specific purpose
When procuring creative or design services and solutions, where the requirement or solution needs to be brought to life
Specialist consultancy or specific services

In this process, the second tender stage could include the following different supplementary processes. Examples include:

Presentations
A reverse auction for high volume standardised ICT equipment
A demonstration for low carbon specialist vehicles
A site visit for waste management and recycling services

Multi-stage processes

The next example demonstrates how the process can be designed using the supplementary processes to address complex requirements, where a participation stage would be needed and engagement with suppliers would be beneficial in helping to understand the requirements and / or in delivering better value for money.

Following the conditions of participation / participation stage, the number of suppliers would be reduced by assessing whether they meet certain standards.

Successful suppliers would be invited to Tender Stage 1 and following an intermediate assessment, the highest scoring suppliers would then be taken forward to Tender stage 2

Tender stage 2 would involve demonstrations and following another assessment, the highest scoring suppliers would be taken to Tender stage 3.

Tender stage 3 is a Best and Final Offer (BAFO) stage to determine the Most Advantageous Tender.

This example could be used where:

there is a need to ensure suppliers meet certain standards and to demonstrate their capability
there is a need to reduce the numbers of suppliers invited to submit a tender, and
engagement with suppliers during the process would be beneficial in helping suppliers understand the requirements and/or helping to understand the solution being presented, for example:

- where the requirement is clear but negotiations or dialogue etc. may enhance value for money

- where the detailed requirements may be complex which means there needs to be additional engagement throughout the process to explain or clarify to ensure suppliers can submit clear and fit for purpose tenders

- where the potential solution may be complex or may attract risk, which means engagement throughout the process will ensure compliant and fit for purpose tenders

The time, cost and resources required for a successful dialogue and/or negotiation will vary enormously, from a single meeting with all suppliers on one subject to multiple meetings on many subjects. The time and cost expended is dependent on the scale and complexity of the requirement and identified solutions, and the capacity and capability of all those involved. The general duty to ensure a competitive tendering procedure is proportionate will be particularly relevant in the use of dialogue or negotiation stages.

Preferred supplier stage and post tender negotiation

Using the competitive flexible procedure there is the ability to include what is sometimes known as a preferred supplier stage. This allows a contracting authority to clarify or confirm any commitments made in the tender or engage in post-tender negotiation with the final supplier(s), as long as it does not have the effect of altering the competition outcome and it follows the process outlined in the tender notice and any associated tender documents.

A preferred supplier stage can be useful, particularly for complex procurements, for example to ensure that there is an agreed understanding of how the contract will operate and reduce the risk of issues arising once the contract has been entered into.

The preferred supplier stage:

Is conducted after final tenders have been received and assessed, and prior to the award of the contract
Should not change the outcome of the procurement process
Can be used to refine and improve a tender to drive additional value
Should not distort the competition - meaning the discussions/negotiations would have no impact on the outcome of the procurement
Should be conducted in a transparent and auditable manner. Contracting authorities should ensure that any details of discussions/negotiations, key points or outcomes are recorded and kept (Scope summary document).

Following this stage, the contracting authority should review any agreed changes to ensure that it is still appropriate to award the contract to the preferred supplier and any agreed changes should be reflected in the contract that is entered into..

Procuring innovation

What is innovation?

The design and implementation of goods and services which do not yet exist
Testing of solutions that exist but not currently used for the required purpose
Bespoking or developing goods and services in order for them to meet the requirement.

Change:

Within the competitive flexible procedure, a bespoke multi-stage process can be designed which allows for ‘pre-commercial procurement’ such as research and development, the development of a prototype and the purchase of the innovative goods or services under one continuous process.

Benefits:

End to end process removing additional administrative burden and resource for contracting authorities
Can be a fully agile process, which can be modified or concluded at any stage provided it is set out in the tender notice and associated documents
More attractive and easier for small and medium-sized enterprises and new entrants to access and participate
Reduces risk of solution failure and result in better proposals

The example below demonstrates how a process can be designed to run as a multi stage competition for the design, development and purchase of innovative goods, works or services under one continuous process.

This process could be used where:

The goods or services are available in the market but not in the form or utilised in the way that is required and therefore development may be needed
The solution does not yet exist but is needed to address a new challenge or need and requires research, design or development. A staged approach is required in order to enable competition, test ideas and solutions, and eliminate weak/unworkable solutions.

This process allows both the contracting authority and the market to understand the requirement or solution fully, reducing delivery risks and resulting in better proposals which the contracting authority can have confidence in. It also allows for an agile process which can be concluded at any stage, provided this process has been described in the tender notice and the associated documents.

7. Modifications during a competitive flexible procedure

Change:

There is the ability to make modifications during the competitive flexible procedure following the publication of the tender notice and associated tender documents.

Any modification can be made provided that the deadline to participate or submit a first or only tender has not passed (section 31(1)(b))
^{[footnote 2]}Non substantial modifications can be made up to the deadline of the final tendering stage (section 31(2)(a))

A modification is considered substantial if it would mean that suppliers who could not participate could now do so or where participating suppliers can no longer participate (section 31(3)).

Benefits:

Amendments to the tender documents which may provide clarification
Refining specification as the competitive flexible procedure progresses
Reducing timescales (where all pre-selected suppliers are in agreement)
Adding in additional stages (where doing so would not have impacted the initial market response)

A contracting authority:

Must notify suppliers of any changes, which may include revising the tender notice and any associated tender documents as required, making it clear what changes have been made (section 31(5))
Must make details of the changes available to all suppliers at the same time (section 31(6));
Must consider revising submission deadlines and any other timescales to ensure that appropriate time is given to suppliers to acknowledge and respond to the change (section 31(4))
Must treat all suppliers the same e.g. not change the requirements or award criteria as a result of having seen suppliers’ tenders or in any other manner that favours certain supplier/s
Should ensure that any modifications made do not distort competition
Must ensure the modification does not impact the market response where the modification is made after the deadline for requests to participate/submitting first or only tender (section 31(2))

The provision to modify a procurement is in addition to the ability to refine or supplement the award criteria in a competitive flexible procedure, as long as this is provided for in the tender notice or associated tender documents (section 24(1)).

8. Top tips and key takeaways

Consider the requirements and what outcome needs to be achieved - this should drive the design of the process
Design a process that is proportionate to the requirement and will encourage suppliers to participate
Be mindful of the associated costs and resources on both the contracting authority and suppliers
Preliminary market engagement is recommended to set the context of the procurement, the objectives and explain how the process is intended to run to obtain feedback from suppliers
Focus on functional or output based specifications and consider allowing for more innovative solutions to be proposed
Make use of commercial skills - contracting authorities now have the ability to use a variety of tools within a competitive procedure to get to the best outcome or solution.

34. Reserving contracts: Decision tree and checklist

This learning aid is designed to assist you in determining whether you can reserve your procurement under the Procurement Act 2023.

Decision tree

Checklist

Action

1. You have identified that there is sufficient level of competition that will offer value for money and maximise public benefit when reserving the contract.

2. You have checked that the contract can be reserved (based on CPV codes for light touch contracts).

3. You have designed a competitive flexible procedure to allow for the procurement to be restricted to these suppliers (supported employment provider or public service mutual).

4. You have set out in your tender notice that it is a reserved procurement.

5. You have clearly set out in your tender notice or associated tender documents the requirement for a supplier to meet the criteria to qualify for the specific type of supplier you are reserving for (supported employment provider or public service mutual).

6. You have clearly set out in your assessment methodology (within your associated tender documents) that you will exclude any supplier that does not qualify as the particular type of supplier you are reserving for (supported employment provider or public service mutual).

35. Summary of supplementary processes for the competitive flexible procedure

Supplementary process	Description
Non disclosure agreement (NDA) / confidentiality agreement	Enables the contracting authority to share information with suppliers, which is deemed sensitive but is needed to inform a suppliers decision to participate or inform their tender.
Supplier funding	For more complex or novel requirements (subject to subsidy controls) funding may be provided, on equal terms, to all suppliers to support them in participating in a procurement process. This tool is unlikely to be applicable other than when significant and costly product development is required by the contracting authority to test the deliverability of a tender.
Clarification process	Questions can be raised by suppliers about the procurement process or any element of the procurement pack, or by the contracting authority where information is unclear, contains obvious error, false statements, abnormal offers or where items are missing.
Dialogue	Aimed at improving all parties’ understanding of the requirement, can happen at any or all stages of the procurement.
Negotiation	A strategic discussion aimed at creating an agreeable set of terms but not used in a competitive procedure to obtain the lowest offer or negotiate down a price.
Supplier presentations	Aimed at confirming that the proposals being made are deliverable.
Product demonstrations	Allows to test the deliverability of key aspects of tenders.
Site visits	Aimed at identifying whether key supporting processes have been developed, necessary equipment has been obtained or configured or that systems and processes are in place to deal with the required demands / volumes.
Audits and other checks	Used to try to see, confirm and check what is being offered is compliant with any requirements and/or accurately described. They are used to confirm statements made in writing by suppliers.
eAuctions	Process used to derive the lowest price e.g. reverse auction.
Preferred supplier stage	To confirm solutions and/or finalise the draft contract. This stage may include post tender negotiation with the objective of improving the final tender but without changing requirements.
Interim assessment of tenders to narrow competition	Reduces the number of suppliers based on the quality of their current proposals. This can reduce the administrative effort and cost for all parties. It can also eliminate suppliers who are least competitive. Such assessments can take place more than once, so that the number of suppliers is gradually reduced whilst maintaining a level of competition.
Assessment of tenders with the option to award prior to negotiation or dialogue	The option to award a contract to a supplier based on the assessment of the tender without undertaking any negotiation or dialogue which may have been intended to be part of the process. For example, the contracting authority may feel confident that it is possible to accept tenders without the need for negotiation, however, there is risk that the tenders may not be optimum due to the complexity which can be resolved through dialogue and/or negotiation.
Final tender / best and final offer (BAFO)	Intended to drive a focus on price, so the stage must be used carefully to avoid abnormally low tenders.
Variant tenders	Allows suppliers to tender one or more alternative solution which meets the requirements.

36. Competitive flexible procedure: Process flows

An example of a two-stage process

1. Publish planned procurement notice (optional) or qualifying planned procurement notice (min 40 days before tender notice if using to reduce timescales).

2. Publish preliminary market engagement notice and undertake preliminary market engagement (optional).

3. Publish tender notice and associated tender documents - explaining the two stage process.

4. Observe tendering period minimum timescales.

5. Determine whether the supplier is an excluded or excludable supplier.

6. Assess whether the tender is suitable, including where appropriate:

a. assessing the conditions of participation

b. where a supplier or any of their nominated subcontractor is not a UK or treaty state supplier whether you choose to disregard the tender c. whether the tendered price is abnormally low

d. whether there is evidence of corruption or collusion

e. whether the tender meets all of the requirements

f. whether the tender has breached any procedural requirements

7. Undertake intermediate assessment and exclude any suppliers who do not meet the minimum requirements (or quality threshold if set).

8. Notify suppliers and invite to the next stage.

9. Conduct presentations and assess based on criteria set.

10. Issue assessment summaries.

11. Publish contract award notice.

12. Observe mandatory standstill period - minimum 8 working days.

13. Enter into contract (providing no issues were raised during standstill).

14. Publish contract details notice and contract where applicable (contracts over £5m).

15. Could happen at any time during the term of the contract:

a. publish contract payment notice (where applicable - individual payments over £30k)

b. publish contract performance notice (where applicable)

c. publish payments compliance notice

d. publish contract change notice (if / when modifications are made) and copy of the modified contract (contracts over £5m)

e. observe any voluntary standstill period (minimum 8 working days) if and when modifications are made and a contract change notice has been published

16. Publish contract termination notice.

Note - assessing any conditions of participation set or other suitability requirements may be carried out at any point prior to contract award as described in the tender notice and/or associated tender documents.

An example of a two-stage process with participation stage

1. Publish planned procurement notice (optional) or qualifying planned procurement notice (min 40 days before tender notice if using to reduce timescales).

2. Publish preliminary market engagement notice and undertake preliminary market engagement (optional).

3. Publish tender notice and associated tender documents - explaining the two stage process.

4. Observe minimum participation period timescales.

5. Determine whether the supplier is an excluded or excludable supplier.

6. Assess whether the tender is suitable, including where appropriate:

a. where a supplier or any of their nominated subcontractor is not a UK or treaty state supplier whether you choose to disregard the tender

b. whether the tendered price is abnormally low

c. whether there is evidence of corruption or collusion

d. whether the tender meets all of the requirements

e. whether the tender has breached any procedural requirements

7. Undertake conditions of participation assessment and exclude any suppliers who do not meet the minimum requirements (or quality threshold if set).

8. Notify suppliers and invite to the next stage.

9. Observe minimum tendering period timescales.

10. Undertake tender assessment based on award criteria set.

11. Issue assessment summaries.

12. Publish contract award notice.

13. Observe mandatory standstill period - minimum 8 working days.

14. Enter into contract (providing no issues were raised during standstill).

15. Publish contract details notice and contract where applicable (contracts over £5m).

16. Could happen at any time during the term of the contract:

a. publish contract payment notice (where applicable - individual payments over £30k)

b. publish contract performance notice (where applicable)

c. publish payments compliance notice

d. publish contract change notice (if / when modifications are made) and copy of the modified contract (contracts over £5m)

e. observe any voluntary standstill period (minimum 8 working days) if and when modifications are made and a contract change notice has been published

17. Publish contract termination notice.

Note - assessing suitability requirements may be carried out at any point prior to contract award as described in the tender notice and/or associated tender documents.

An example of a multi-stage process

1. Publish planned procurement notice (optional) or qualifying planned procurement notice (min 40 days before tender notice if using to reduce timescales).

2. Publish preliminary market engagement notice and undertake preliminary market engagement (optional).

3. Publish tender notice and associated tender documents - explaining the multi-stage process.

4. Observe minimum participation period timescales.

5. Determine whether the supplier is an excluded or excludable supplier.

Assess whether the tender is suitable, including where appropriate:

a. where a supplier or any of their nominated subcontractor is not a UK or treaty state supplier whether you choose to disregard the tender

b. whether the tendered price is abnormally low

c. whether there is evidence of corruption or collusion

d. whether the tender meets all of the requirements

e. whether the tender has breached any procedural requirements

7. Undertake conditions of participation assessment and exclude any suppliers who do not meet the minimum requirements (or quality threshold if set).

8. Notify suppliers and invite to tender.

9. Observe minimum tendering period timescales.

10. Undertake intermediate assessment and exclude any suppliers who do not meet the minimum requirements (or quality threshold if set).

11. Notify suppliers and invite to next stage.

12. Conduct demonstrations and assess based on criteria set.

13. Notify suppliers and invite to next stage.

14. Conduct negotiation with selected suppliers.

15. Invite final tenders.

16. Observe minimum tendering period timescales where appropriate.

17. Assess tenders based on award criteria (which may be refined provided it is allowed for in the tender notice).

18. Issue assessment summaries.

19. Publish contract award notice.

20. Observe mandatory standstill period - minimum 8 working days.

21. Enter into contract (providing no issues were raised during standstill).

22. Publish contract details notice and contract where applicable (contracts over £5m).

23. Could happen at any time during the term of the contract:

a. publish contract payment notice (where applicable - individual payments over £30k)

b. publish contract performance notice (where applicable)

c. publish payments compliance notice

d. publish contract change notice (if / when modifications are made) and copy of the modified contract (where applicable - contracts over £5m)

e. observe any voluntary standstill period (minimum 8 working days) if and when modifications are made and a contract change notice has been published

24. Publish contract termination notice.

Note - assessing suitability requirements may be carried out at any point prior to contract award as described in the tender notice and/or associated tender documents.

An example of a process with post tender negotiation

1. Publish planned procurement notice (optional) or qualifying planned procurement notice (min 40 days before tender notice if using to reduce timescales).

2. Publish preliminary market engagement notice and undertake preliminary market engagement (optional).

3. Publish tender notice and associated tender documents - explaining the multi-stage process.

4. Observe minimum participation period timescales.

5. Determine whether the supplier is an excluded or excludable supplier.

6. Assess whether the tender is suitable, including where appropriate:

a. where a supplier or any of their nominated subcontractor is not a UK or treaty state supplier whether you choose to disregard the tender

b. whether the tendered price is abnormally low

c. whether there is evidence of corruption or collusion

d. whether the tender meets all of the requirements

e. whether the tender has breached any procedural requirements

7. Undertake conditions of participation assessment and exclude any suppliers who do not meet the minimum requirements (or quality threshold if set).

8. Notify suppliers and invite to the next stage.

9. Observe minimum tendering period timescales.

10. Assess tenders based on award criteria.

11. Issue assessment summaries.

12. Publish contract award notice.

13. Observe mandatory standstill period - minimum 8 working days.

14. Undertake post tender negotiation with winning supplier.

15. Enter into contract (providing no issues were raised during standstill).

16. Publish contract details notice and contract where applicable (contracts over £5m).

17. Could happen at any time during the term of the contract:

a. publish contract payment notice (where applicable - individual payments over £30k)

b. publish contract performance notice (where applicable)

c. publish payments compliance notice

d. publish contract change notice (if / when modifications are made) and copy of the modified contract (where applicable - contracts over £5m)

e. observe any voluntary standstill period (minimum 8 working days) if and when modifications are made and a contract change notice has been published 18. Publish contract termination notice.

Note - assessing suitability requirements may be carried out at any point prior to contract award as described in the tender notice and/or associated tender documents.

An example of innovation process

1. Publish planned procurement notice (optional) or qualifying planned procurement notice (min 40 days before tender notice if using to reduce timescales).

2. Publish preliminary market engagement notice and undertake preliminary market engagement (optional).

3. Publish tender notice and associated tender documents - explaining the multi-stage process.

4. Observe minimum participation period timescales.

5. Determine whether the supplier is an excluded or excludable supplier.

6. Assess whether the tender is suitable, including where appropriate:

a. where a supplier or any of their nominated subcontractor is not a UK or treaty state supplier whether you choose to disregard the tender

b. whether the tendered price is abnormally low

c. whether there is evidence of corruption or collusion

d. whether the tender meets all of the requirements

e. whether the tender has breached any procedural requirements

7. Undertake conditions of participation assessment and exclude any suppliers who do not meet the minimum requirements (or quality threshold if set).

8. Notify suppliers and invite to the next stage.

9. Undertake the iterative design and development phase, reducing the number of suppliers until there are viable solutions and sufficient competition.

10. Invite remaining suppliers to tender.

11. Observe minimum tendering period timescales.

12. Assess tenders based on award criteria.

13. Issue assessment summaries.

14. Publish contract award notice.

15. Observe mandatory standstill period - minimum 8 working days.

16. Enter into contract (providing no issues were raised during standstill).

17. Publish contract details notice and contract where applicable (contracts over £5m).

18. Could happen at any time during the term of the contract:

a. publish contract payment notice (where applicable - individual payments over £30k)

b. publish contract performance notice (where applicable)

c. publish payments compliance notice

d. publish contract change notice (if / when modifications are made) and copy of the modified contract (where applicable - contracts over £5m)

e. observe any voluntary standstill period (minimum 8 working days) if and when modifications are made and a contract change notice has been published

19. Publish contract termination notice.

Note - assessing suitability requirements may be carried out at any point prior to contract award as described in the tender notice and/or associated tender documents.

37. Tender notice fields: Competitive flexible procedure

Tender notices: competitive flexible procedure

Regulation 19 - (1) This regulation sets out other information which must be included in a tender notice for the award of a public contract through a competitive flexible procedure published in accordance with section 21(1) of the PA 2023.

(2) The information is:

(a) the same information referred to in regulation 18(2) except sub-paragraphs (d) and (j)

The initial fields of regulation 19(1) are the same as the fields set out in regulation 18(2), the tender notice for the open procedure with 2 exceptions.

(b) a statement that the tender notice is for the award of a public contract through a competitive flexible procedure in accordance with section 20(1) and (2)(b) of the PA 2023

State and copy on any issued associated tender docuements: This tender notice is for the award of a public contract through a competitive flexible procedure in accordance with section 20(1) and (2)(b) of the Procurement Act 2023.

(c) a description of the process to be followed during the procedure, including:

i. whether the procedure may include negotiation at any stage,
ii. if the contracting authority proposes to rely on section 24 of the PA 2023 (refining award criteria), a summary of how it will rely on that section

Clearly describe the process and stages, including where appropriate any conditions of participation (CoP) or negotiation stage.

If you intend to refine the award criteria then provision for the refinement must be made here.

(d) where the number of suppliers is, or may be, no more than a maximum number of suppliers, generally or in respect of particular tendering rounds or other selection processes, the maximum number of suppliers and the criteria used to select the limited number of suppliers

Confirm the maximum numbers of suppliers to be carried forward after each stage e.g. CoP, Dialogue, intermediate assessment of tenders. You must describe the process used in each stage.

(e) where the number of suppliers is, or may be, no less than an intended minimum number of suppliers, generally or in respect of particular tendering rounds or other selection processes, the intended minimum number of suppliers

Confirm any minimum acceptable number of suppliers you intend to accept at each stage.

(f) where the tender notice is being used for the purpose of inviting suppliers to submit a request to participate, how requests to participate may be submitted and the date by when they must be submitted

This field requires the deadline for requests to participate and usually confirms any instructions if using eSenders. Other details such as attachments or other returned information can be defined here.

(g) where the tender notice is being used for the purpose of inviting suppliers to submit their first, or only, tender, how tenders may be submitted and the date by when they must be submitted

This field requires the deadline for submissions of tenders and usually confirms any instructions if using eSenders.

(h) whether the tender notice is being used:

i. to reserve a contract to supported employment providers in accordance with section 32 of the PA 2023, or
ii. to reserve a contract to public service mutuals in accordance with section 33 of the PA 2023

This is where contracting authorities indicate the reserving of procurement participation for

a. supported employment providers or

b. public service mutual

(3) Nothing in this regulation prevents a contracting authority from publishing other information that relates to the same procurement in the notice.

This means the detail in tender notice and associate tender documents can be far more detailed than required in the tender notice.

(4) This regulation does not apply to:

a. a tender notice for the award of a framework through a competitive flexible procedure (see instead regulation 20), or

b. a tender notice for the award of a public contract by reference to suppliers’ membership of a dynamic market (see instead regulation 21)

This confirms a different tender notice is required for establishing frameworks or contracts awarded under dynamic markets.

Exemptions apply ↩
Exemptions apply ↩

Question 3

Number of stages

Accepted Answer

There is no limit to the number of stages or supplementary processes that can be included in the competitive flexible procedure. However, contracting authorities:

Should consider the costs and complexity of the procedure for both themselves and the suppliers.
Have a duty to ensure that the procedure is proportionate having regard to the nature, complexity and cost of the contract - overly complicated procedures can limit competition and fail to achieve best value
Must comply with certain minimum time periods
Should sufficiently plan each of the stages to avoid unnecessary delays which can impact on time and therefore costs
Should determine whether they wish to set and assess conditions of participation and / or include a participation stage
Should determine whether they wish to include stages for product development or prototypes, which encourages innovative solutions.

Exclusions

Whether a supplier is an excluded or excludable supplier must always be considered before suppliers are permitted to participate beyond the initial submission of tenders or requests to participate in a competitive flexible procedure. There will therefore need to be an appropriate time in all competitive flexible procedure procurements to consider exclusions.

Conditions of participation

There is no requirement to include a selection stage as tenders can be invited as the first stage
Contracting authorities may wish to invite requests to participate which require potential suppliers to meet conditions of participation to reduce the number of suppliers proceeding to the next stage in the process (section 20 (5)(a))
Conditions of participation, where set but not used as a formal stage in order to exclude suppliers earlier in the process, must be met by the supplier to be awarded the contract.

What can a stage be used for?

To reduce the number of suppliers who progress to the next stage through a selection process (down selection) (section 20(4)(a))
To undertake an intermediate assessment of tenders to exclude suppliers (section 20(5)(b)) who do not meet the assessment criteria in accordance with the assessment methodology and provide feedback to those who do to allow suppliers to improve their proposals, i.e. assessing draft tenders in order to identify items which require dialogue or negotiation
To provide feedback on draft tenders/presentations etc without reducing the number of suppliers and then signify the move to the next stage in the procurement process.

The intention of each stage, i.e. whether it is to reduce the number of suppliers, and any use of selection or intermediate assessment criteria should be clearly set out in the tender notice and any associated tender documents.

Question 4

Supplementary processes

Accepted Answer

Whilst the procedures similar to the restricted procedure or competitive dialogue under the PCR 2015, can be undertaken using the competitive flexible procedure, contracting authorities are encouraged to consider and, where appropriate, take full advantage of the additional flexibilities this new procedure offers. Contracting authorities can design a bespoke process that best meets their requirements and will offer the most advantageous tender through the use of different supplementary processes.

Supplementary process	Description
Participation Stage	Inviting suppliers to participate and using published criteria (such as conditions of participation) to reduce the number of suppliers proceeding to the next stage
Non Disclosure Agreement / Confidentiality agreement	Enables the contracting authority to share information with suppliers which is deemed sensitive but is needed to inform a supplier’s decision to participate or inform their tender
Supplier funding	For more complex or novel requirements (and subject to complying with all relevant rules on subsidy control) some funding may be provided to chosen suppliers to support them in participating in a procurement process. This supplementary process is unlikely to be applicable other than when significant and costly product development is required by the contracting authority to test the deliverability of tenders.
Clarification Process	Questions can be raised by suppliers about the procurement process or any element of the procurement pack, or by the contracting authority where information is unclear, contains obvious error, false statements, abnormal offers or where items are missing
Dialogue	Aimed at improving all parties’ understanding of the requirement, can happen at any or all stages of the procurement.
Negotiation	A strategic discussion aimed at improving the supplier’s offer and creating an agreeable set of terms
Supplier Presentations	Aimed at confirming that the proposals being made are deliverable.
Product Demonstrations	Aimed at testing the deliverability of key aspects of tenders.
Site Visits	Aimed at identifying whether key supporting processes have been developed, necessary equipment has been obtained or configured or that systems and processes are in place to deal with the required demands / volumes.
Audits and other checks	Used to see, confirm and check what is being offered is compliant with any requirements and/or accurately described. They are used to confirm statements made in writing by suppliers.
e-Auctions	Process used to derive the lowest price.
Preferred supplier stage	Allows the contracting authority to clarify or confirm any commitments made or engage in post-tender negotiation
Intermediate assessment of tenders to narrow competition	Reduces the number of suppliers based on the quality of their current proposals. This can reduce the administrative effort and cost for all parties. It can also exclude suppliers who are least competitive. Such assessment can take place more than once, so that the number of suppliers is gradually reduced whilst maintaining a level of competition.
Assessment of tenders with the option to award prior to negotiation or dialogue	The option to award a contract to a supplier based on the assessment of the tender without undertaking any negotiation or dialogue which may have been intended to be part of the process. For example, the contracting authority may feel confident that it is possible to accept tenders without the need for negotiation, however, there is risk that the tenders may not be optimum due to the complexity which can be resolved through dialogue and/or negotiation.
Final tenders	Drives a focus on price, so the stage must be used carefully to avoid abnormally low tenders (also known as best and final offer – BAFO).
Variant tenders	Allows suppliers to tender one or more alternative solution which meets the requirements

This list is not exhaustive and is used as an example only see Summary of competitive flexible supplementary processes learning aid for other examples

Number of suppliers

There is no specified minimum or maximum number of suppliers who can be invited to participate at any stage of the procedure. Contracting authorities may limit the number of suppliers (section 20(4)(a)) provided it is set out in the tender notice and any associated tender documents, along with the criteria which will be used to reduce the number of suppliers.

Contracting authorities should use their findings from preliminary market engagement to determine whether the number of suppliers should be limited throughout the process.

By limiting the number of suppliers, contracting authorities can:

ensure that the process is manageable particularly where a large market exists;
help to reduce the administrative costs and time associated with the procurement, particularly if the evaluation is likely to be complex;
make the procurement more attractive to suppliers by removing the need for them to submit time consuming and expensive tenders and increase their potential to be successful due to reduced competition .

However, reducing the number of suppliers can also be a barrier to start-ups and new entrants, who may have the ability to offer the most advantageous solutions but lack experience of delivery due to being new to the market.

In carrying out the procedure, a contracting authority must have regard to the fact that small and medium-sized enterprises may face particular barriers to participation, and consider whether such barriers can be removed or reduced. This may be, for example, ensuring that the conditions of participation set are accessible for SMEs, such as by ensuring that insurance and turnover requirements are reasonable.

Therefore, careful consideration should be given to limiting the number of suppliers and should be informed by preliminary market engagement.

Notifying suppliers

Where a participation stage or intermediate assessment is being used to reduce the number of suppliers, contracting authorities must have regard to the importance of sharing information as part of the procurement objectives. This means that:

Suppliers should, as best-practice, be notified of the outcome as soon as possible following the conclusion of the assessment.
It is considered best practice to provide feedback to suppliers who have taken the time to submit a tender. Although it is not a requirement to provide an assessment summary to suppliers who are unsuccessful at an intermediate assessment stage, it is recommended that contracting authorities follow the assessment summary requirements, as doing so should demonstrate compliance with the regime and provide suppliers sufficient explanation for the outcome of assessment, which may help suppliers to improve any future tender responses and avoid legal challenges.

For suppliers who reach the final tender stage, the requirements of awarding a contract apply - see assessment and award summary document.

Time limits

The minimum time periods under the competitive flexible procedure are as follows^{[footnote 1]}:

Participation period (section 54(3)) (where including a participation stage) - 25 days

→ Unless

The contracting authority considers there to be a state of urgency - 10 days

Tendering period (section 54(4)) - applies to each stage where a tender is submitted unless the contracting authority considers supplier responses to e.g. simply be an update to an earlier tender (for example as an outcome of negotiations rather than new information); in which case a reasonable time limit which is the same for all suppliers would be required. Minimum tendering periods are:

25 days where tenders may be submitted electronically and the tender notice and associated tender documents are all provided at the same time, or
30 days where tenders may be submitted electronically and the tender notice and associated tender documents are not all provided at the same time

The tendering period can be reduced to 10 days where:

a qualifying planned procurement notice has been published, or
the contracting authority considers there to be a state of urgency that means any other applicable minimum tender period is impractical

However for contracting authorities that are not central government authorities, tendering periods can also be reduced to:

10 days where:

- a condition of participation stage has been included and only pre-selected suppliers are invited to submit a tender

No minimum timescales where:

- a conditions of participation / participation stage has been included and only pre-selected suppliers are invited to submit a tender, and

- A timescale has been agreed with those suppliers

Whilst the Procurement Act prescribes minimum time periods for the key stages of the procedure, when setting time limits contracting authorities should think about the time required to undertake each of the stages and must, where relevant, have regard to:

The nature and complexity of the contract
The need for site visits, physical inspections and other practical steps eg where scheduling and availability needs to be considered
The need for sub-contracting;
The nature and complexity of any modification to the tender notice or associated tender documents for example to allow suppliers to consider and respond
The importance of avoiding unnecessary delays - for example not making the process longer than it needs to be, costing time and resource for both the contracting authority and the suppliers

6. Example Processes

Regardless of the process that is designed and undertaken, contracting authorities must always consider whether any supplier is an excluded or excludable supplier before suppliers are permitted to participate in a competitive flexible procedure meaning participating beyond the initial submission of tenders or requests to participate.

Two - stage process

In its simplest form, the competitive flexible procedure could be a two-stage process. The example below is similar to that of the restricted procedure (PCR 2015). The key difference between an open procedure and this example process under the competitive flexible procedure is the introduction of a participation stage.

This example process could be used for standard requirements where:

a large market exists and the scale of competition will impact on a supplier’s decision to tender
a large market exists and the cost of the procedure to the contracting authority would impact on value for money unless the number of tenders is manageable

or

there is sharing of sensitive information and the number of suppliers needs to be restricted to allow it to be shared in a controlled manner i.e under a confidentiality agreement or non-disclosure agreement

Two-stage process using a supplementary process

In the competitive flexible procedure there is no requirement for a conditions of participation / participation stage.

Tenders can be invited in the first stage, as per the open procedure. Following an intermediate assessment of the tenders received, the highest scoring tenders may be taken forward to a further stage before having a final assessment stage.

Contracting authorities are to be able to engage with suppliers under the competitive flexible procedure to discuss the requirement and improve tenders as long as they do so in accordance with the tender notice and any associated tender documents.

This example process could be used where there is no need to undertake a formal participation stage, but it would be beneficial to include stages to engage with suppliers to help them understand the requirement or help the contracting authority to understand their solution further in order to achieve value for money, for example for simple or niche requirements:

Where an ‘off the shelf’ solution exists but may need some configuration for a specific purpose
When procuring creative or design services and solutions, where the requirement or solution needs to be brought to life
Specialist consultancy or specific services

In this process, the second tender stage could include the following different supplementary processes. Examples include:

Presentations
A reverse auction for high volume standardised ICT equipment
A demonstration for low carbon specialist vehicles
A site visit for waste management and recycling services

Multi-stage processes

The next example demonstrates how the process can be designed using the supplementary processes to address complex requirements, where a participation stage would be needed and engagement with suppliers would be beneficial in helping to understand the requirements and / or in delivering better value for money.

Following the conditions of participation / participation stage, the number of suppliers would be reduced by assessing whether they meet certain standards.

Successful suppliers would be invited to Tender Stage 1 and following an intermediate assessment, the highest scoring suppliers would then be taken forward to Tender stage 2

Tender stage 2 would involve demonstrations and following another assessment, the highest scoring suppliers would be taken to Tender stage 3.

Tender stage 3 is a Best and Final Offer (BAFO) stage to determine the Most Advantageous Tender.

This example could be used where:

there is a need to ensure suppliers meet certain standards and to demonstrate their capability
there is a need to reduce the numbers of suppliers invited to submit a tender, and
engagement with suppliers during the process would be beneficial in helping suppliers understand the requirements and/or helping to understand the solution being presented, for example:

- where the requirement is clear but negotiations or dialogue etc. may enhance value for money

- where the detailed requirements may be complex which means there needs to be additional engagement throughout the process to explain or clarify to ensure suppliers can submit clear and fit for purpose tenders

- where the potential solution may be complex or may attract risk, which means engagement throughout the process will ensure compliant and fit for purpose tenders

The time, cost and resources required for a successful dialogue and/or negotiation will vary enormously, from a single meeting with all suppliers on one subject to multiple meetings on many subjects. The time and cost expended is dependent on the scale and complexity of the requirement and identified solutions, and the capacity and capability of all those involved. The general duty to ensure a competitive tendering procedure is proportionate will be particularly relevant in the use of dialogue or negotiation stages.

Preferred supplier stage and post tender negotiation

Using the competitive flexible procedure there is the ability to include what is sometimes known as a preferred supplier stage. This allows a contracting authority to clarify or confirm any commitments made in the tender or engage in post-tender negotiation with the final supplier(s), as long as it does not have the effect of altering the competition outcome and it follows the process outlined in the tender notice and any associated tender documents.

A preferred supplier stage can be useful, particularly for complex procurements, for example to ensure that there is an agreed understanding of how the contract will operate and reduce the risk of issues arising once the contract has been entered into.

The preferred supplier stage:

Is conducted after final tenders have been received and assessed, and prior to the award of the contract
Should not change the outcome of the procurement process
Can be used to refine and improve a tender to drive additional value
Should not distort the competition - meaning the discussions/negotiations would have no impact on the outcome of the procurement
Should be conducted in a transparent and auditable manner. Contracting authorities should ensure that any details of discussions/negotiations, key points or outcomes are recorded and kept (Scope summary document).

Following this stage, the contracting authority should review any agreed changes to ensure that it is still appropriate to award the contract to the preferred supplier and any agreed changes should be reflected in the contract that is entered into..

Procuring innovation

What is innovation?

The design and implementation of goods and services which do not yet exist
Testing of solutions that exist but not currently used for the required purpose
Bespoking or developing goods and services in order for them to meet the requirement.

Change:

Within the competitive flexible procedure, a bespoke multi-stage process can be designed which allows for ‘pre-commercial procurement’ such as research and development, the development of a prototype and the purchase of the innovative goods or services under one continuous process.

Benefits:

End to end process removing additional administrative burden and resource for contracting authorities
Can be a fully agile process, which can be modified or concluded at any stage provided it is set out in the tender notice and associated documents
More attractive and easier for small and medium-sized enterprises and new entrants to access and participate
Reduces risk of solution failure and result in better proposals

The example below demonstrates how a process can be designed to run as a multi stage competition for the design, development and purchase of innovative goods, works or services under one continuous process.

This process could be used where:

The goods or services are available in the market but not in the form or utilised in the way that is required and therefore development may be needed
The solution does not yet exist but is needed to address a new challenge or need and requires research, design or development. A staged approach is required in order to enable competition, test ideas and solutions, and eliminate weak/unworkable solutions.

This process allows both the contracting authority and the market to understand the requirement or solution fully, reducing delivery risks and resulting in better proposals which the contracting authority can have confidence in. It also allows for an agile process which can be concluded at any stage, provided this process has been described in the tender notice and the associated documents.

7. Modifications during a competitive flexible procedure

Change:

There is the ability to make modifications during the competitive flexible procedure following the publication of the tender notice and associated tender documents.

Any modification can be made provided that the deadline to participate or submit a first or only tender has not passed (section 31(1)(b))
^{[footnote 2]}Non substantial modifications can be made up to the deadline of the final tendering stage (section 31(2)(a))

A modification is considered substantial if it would mean that suppliers who could not participate could now do so or where participating suppliers can no longer participate (section 31(3)).

Benefits:

Amendments to the tender documents which may provide clarification
Refining specification as the competitive flexible procedure progresses
Reducing timescales (where all pre-selected suppliers are in agreement)
Adding in additional stages (where doing so would not have impacted the initial market response)

A contracting authority:

Must notify suppliers of any changes, which may include revising the tender notice and any associated tender documents as required, making it clear what changes have been made (section 31(5))
Must make details of the changes available to all suppliers at the same time (section 31(6));
Must consider revising submission deadlines and any other timescales to ensure that appropriate time is given to suppliers to acknowledge and respond to the change (section 31(4))
Must treat all suppliers the same e.g. not change the requirements or award criteria as a result of having seen suppliers’ tenders or in any other manner that favours certain supplier/s
Should ensure that any modifications made do not distort competition
Must ensure the modification does not impact the market response where the modification is made after the deadline for requests to participate/submitting first or only tender (section 31(2))

The provision to modify a procurement is in addition to the ability to refine or supplement the award criteria in a competitive flexible procedure, as long as this is provided for in the tender notice or associated tender documents (section 24(1)).

8. Top tips and key takeaways

Consider the requirements and what outcome needs to be achieved - this should drive the design of the process
Design a process that is proportionate to the requirement and will encourage suppliers to participate
Be mindful of the associated costs and resources on both the contracting authority and suppliers
Preliminary market engagement is recommended to set the context of the procurement, the objectives and explain how the process is intended to run to obtain feedback from suppliers
Focus on functional or output based specifications and consider allowing for more innovative solutions to be proposed
Make use of commercial skills - contracting authorities now have the ability to use a variety of tools within a competitive procedure to get to the best outcome or solution.

34. Reserving contracts: Decision tree and checklist

This learning aid is designed to assist you in determining whether you can reserve your procurement under the Procurement Act 2023.

Decision tree

Checklist

Action

1. You have identified that there is sufficient level of competition that will offer value for money and maximise public benefit when reserving the contract.

2. You have checked that the contract can be reserved (based on CPV codes for light touch contracts).

3. You have designed a competitive flexible procedure to allow for the procurement to be restricted to these suppliers (supported employment provider or public service mutual).

4. You have set out in your tender notice that it is a reserved procurement.

5. You have clearly set out in your tender notice or associated tender documents the requirement for a supplier to meet the criteria to qualify for the specific type of supplier you are reserving for (supported employment provider or public service mutual).

6. You have clearly set out in your assessment methodology (within your associated tender documents) that you will exclude any supplier that does not qualify as the particular type of supplier you are reserving for (supported employment provider or public service mutual).

35. Summary of supplementary processes for the competitive flexible procedure

Supplementary process	Description
Non disclosure agreement (NDA) / confidentiality agreement	Enables the contracting authority to share information with suppliers, which is deemed sensitive but is needed to inform a suppliers decision to participate or inform their tender.
Supplier funding	For more complex or novel requirements (subject to subsidy controls) funding may be provided, on equal terms, to all suppliers to support them in participating in a procurement process. This tool is unlikely to be applicable other than when significant and costly product development is required by the contracting authority to test the deliverability of a tender.
Clarification process	Questions can be raised by suppliers about the procurement process or any element of the procurement pack, or by the contracting authority where information is unclear, contains obvious error, false statements, abnormal offers or where items are missing.
Dialogue	Aimed at improving all parties’ understanding of the requirement, can happen at any or all stages of the procurement.
Negotiation	A strategic discussion aimed at creating an agreeable set of terms but not used in a competitive procedure to obtain the lowest offer or negotiate down a price.
Supplier presentations	Aimed at confirming that the proposals being made are deliverable.
Product demonstrations	Allows to test the deliverability of key aspects of tenders.
Site visits	Aimed at identifying whether key supporting processes have been developed, necessary equipment has been obtained or configured or that systems and processes are in place to deal with the required demands / volumes.
Audits and other checks	Used to try to see, confirm and check what is being offered is compliant with any requirements and/or accurately described. They are used to confirm statements made in writing by suppliers.
eAuctions	Process used to derive the lowest price e.g. reverse auction.
Preferred supplier stage	To confirm solutions and/or finalise the draft contract. This stage may include post tender negotiation with the objective of improving the final tender but without changing requirements.
Interim assessment of tenders to narrow competition	Reduces the number of suppliers based on the quality of their current proposals. This can reduce the administrative effort and cost for all parties. It can also eliminate suppliers who are least competitive. Such assessments can take place more than once, so that the number of suppliers is gradually reduced whilst maintaining a level of competition.
Assessment of tenders with the option to award prior to negotiation or dialogue	The option to award a contract to a supplier based on the assessment of the tender without undertaking any negotiation or dialogue which may have been intended to be part of the process. For example, the contracting authority may feel confident that it is possible to accept tenders without the need for negotiation, however, there is risk that the tenders may not be optimum due to the complexity which can be resolved through dialogue and/or negotiation.
Final tender / best and final offer (BAFO)	Intended to drive a focus on price, so the stage must be used carefully to avoid abnormally low tenders.
Variant tenders	Allows suppliers to tender one or more alternative solution which meets the requirements.

36. Competitive flexible procedure: Process flows

An example of a two-stage process

1. Publish planned procurement notice (optional) or qualifying planned procurement notice (min 40 days before tender notice if using to reduce timescales).

2. Publish preliminary market engagement notice and undertake preliminary market engagement (optional).

3. Publish tender notice and associated tender documents - explaining the two stage process.

4. Observe tendering period minimum timescales.

5. Determine whether the supplier is an excluded or excludable supplier.

6. Assess whether the tender is suitable, including where appropriate:

a. assessing the conditions of participation

b. where a supplier or any of their nominated subcontractor is not a UK or treaty state supplier whether you choose to disregard the tender c. whether the tendered price is abnormally low

d. whether there is evidence of corruption or collusion

e. whether the tender meets all of the requirements

f. whether the tender has breached any procedural requirements

7. Undertake intermediate assessment and exclude any suppliers who do not meet the minimum requirements (or quality threshold if set).

8. Notify suppliers and invite to the next stage.

9. Conduct presentations and assess based on criteria set.

10. Issue assessment summaries.

11. Publish contract award notice.

12. Observe mandatory standstill period - minimum 8 working days.

13. Enter into contract (providing no issues were raised during standstill).

14. Publish contract details notice and contract where applicable (contracts over £5m).

15. Could happen at any time during the term of the contract:

a. publish contract payment notice (where applicable - individual payments over £30k)

b. publish contract performance notice (where applicable)

c. publish payments compliance notice

d. publish contract change notice (if / when modifications are made) and copy of the modified contract (contracts over £5m)

e. observe any voluntary standstill period (minimum 8 working days) if and when modifications are made and a contract change notice has been published

16. Publish contract termination notice.

Note - assessing any conditions of participation set or other suitability requirements may be carried out at any point prior to contract award as described in the tender notice and/or associated tender documents.

An example of a two-stage process with participation stage

1. Publish planned procurement notice (optional) or qualifying planned procurement notice (min 40 days before tender notice if using to reduce timescales).

2. Publish preliminary market engagement notice and undertake preliminary market engagement (optional).

3. Publish tender notice and associated tender documents - explaining the two stage process.

4. Observe minimum participation period timescales.

5. Determine whether the supplier is an excluded or excludable supplier.

6. Assess whether the tender is suitable, including where appropriate:

a. where a supplier or any of their nominated subcontractor is not a UK or treaty state supplier whether you choose to disregard the tender

b. whether the tendered price is abnormally low

c. whether there is evidence of corruption or collusion

d. whether the tender meets all of the requirements

e. whether the tender has breached any procedural requirements

7. Undertake conditions of participation assessment and exclude any suppliers who do not meet the minimum requirements (or quality threshold if set).

8. Notify suppliers and invite to the next stage.

9. Observe minimum tendering period timescales.

10. Undertake tender assessment based on award criteria set.

11. Issue assessment summaries.

12. Publish contract award notice.

13. Observe mandatory standstill period - minimum 8 working days.

14. Enter into contract (providing no issues were raised during standstill).

15. Publish contract details notice and contract where applicable (contracts over £5m).

16. Could happen at any time during the term of the contract:

a. publish contract payment notice (where applicable - individual payments over £30k)

b. publish contract performance notice (where applicable)

c. publish payments compliance notice

d. publish contract change notice (if / when modifications are made) and copy of the modified contract (contracts over £5m)

e. observe any voluntary standstill period (minimum 8 working days) if and when modifications are made and a contract change notice has been published

17. Publish contract termination notice.

Note - assessing suitability requirements may be carried out at any point prior to contract award as described in the tender notice and/or associated tender documents.

An example of a multi-stage process

1. Publish planned procurement notice (optional) or qualifying planned procurement notice (min 40 days before tender notice if using to reduce timescales).

2. Publish preliminary market engagement notice and undertake preliminary market engagement (optional).

3. Publish tender notice and associated tender documents - explaining the multi-stage process.

4. Observe minimum participation period timescales.

5. Determine whether the supplier is an excluded or excludable supplier.

Assess whether the tender is suitable, including where appropriate:

a. where a supplier or any of their nominated subcontractor is not a UK or treaty state supplier whether you choose to disregard the tender

b. whether the tendered price is abnormally low

c. whether there is evidence of corruption or collusion

d. whether the tender meets all of the requirements

e. whether the tender has breached any procedural requirements

7. Undertake conditions of participation assessment and exclude any suppliers who do not meet the minimum requirements (or quality threshold if set).

8. Notify suppliers and invite to tender.

9. Observe minimum tendering period timescales.

10. Undertake intermediate assessment and exclude any suppliers who do not meet the minimum requirements (or quality threshold if set).

11. Notify suppliers and invite to next stage.

12. Conduct demonstrations and assess based on criteria set.

13. Notify suppliers and invite to next stage.

14. Conduct negotiation with selected suppliers.

15. Invite final tenders.

16. Observe minimum tendering period timescales where appropriate.

17. Assess tenders based on award criteria (which may be refined provided it is allowed for in the tender notice).

18. Issue assessment summaries.

19. Publish contract award notice.

20. Observe mandatory standstill period - minimum 8 working days.

21. Enter into contract (providing no issues were raised during standstill).

22. Publish contract details notice and contract where applicable (contracts over £5m).

23. Could happen at any time during the term of the contract:

a. publish contract payment notice (where applicable - individual payments over £30k)

b. publish contract performance notice (where applicable)

c. publish payments compliance notice

d. publish contract change notice (if / when modifications are made) and copy of the modified contract (where applicable - contracts over £5m)

e. observe any voluntary standstill period (minimum 8 working days) if and when modifications are made and a contract change notice has been published

24. Publish contract termination notice.

Note - assessing suitability requirements may be carried out at any point prior to contract award as described in the tender notice and/or associated tender documents.

An example of a process with post tender negotiation

1. Publish planned procurement notice (optional) or qualifying planned procurement notice (min 40 days before tender notice if using to reduce timescales).

2. Publish preliminary market engagement notice and undertake preliminary market engagement (optional).

3. Publish tender notice and associated tender documents - explaining the multi-stage process.

4. Observe minimum participation period timescales.

5. Determine whether the supplier is an excluded or excludable supplier.

6. Assess whether the tender is suitable, including where appropriate:

a. where a supplier or any of their nominated subcontractor is not a UK or treaty state supplier whether you choose to disregard the tender

b. whether the tendered price is abnormally low

c. whether there is evidence of corruption or collusion

d. whether the tender meets all of the requirements

e. whether the tender has breached any procedural requirements

7. Undertake conditions of participation assessment and exclude any suppliers who do not meet the minimum requirements (or quality threshold if set).

8. Notify suppliers and invite to the next stage.

9. Observe minimum tendering period timescales.

10. Assess tenders based on award criteria.

11. Issue assessment summaries.

12. Publish contract award notice.

13. Observe mandatory standstill period - minimum 8 working days.

14. Undertake post tender negotiation with winning supplier.

15. Enter into contract (providing no issues were raised during standstill).

16. Publish contract details notice and contract where applicable (contracts over £5m).

17. Could happen at any time during the term of the contract:

a. publish contract payment notice (where applicable - individual payments over £30k)

b. publish contract performance notice (where applicable)

c. publish payments compliance notice

d. publish contract change notice (if / when modifications are made) and copy of the modified contract (where applicable - contracts over £5m)

e. observe any voluntary standstill period (minimum 8 working days) if and when modifications are made and a contract change notice has been published 18. Publish contract termination notice.

Note - assessing suitability requirements may be carried out at any point prior to contract award as described in the tender notice and/or associated tender documents.

An example of innovation process

1. Publish planned procurement notice (optional) or qualifying planned procurement notice (min 40 days before tender notice if using to reduce timescales).

2. Publish preliminary market engagement notice and undertake preliminary market engagement (optional).

3. Publish tender notice and associated tender documents - explaining the multi-stage process.

4. Observe minimum participation period timescales.

5. Determine whether the supplier is an excluded or excludable supplier.

6. Assess whether the tender is suitable, including where appropriate:

a. where a supplier or any of their nominated subcontractor is not a UK or treaty state supplier whether you choose to disregard the tender

b. whether the tendered price is abnormally low

c. whether there is evidence of corruption or collusion

d. whether the tender meets all of the requirements

e. whether the tender has breached any procedural requirements

7. Undertake conditions of participation assessment and exclude any suppliers who do not meet the minimum requirements (or quality threshold if set).

8. Notify suppliers and invite to the next stage.

9. Undertake the iterative design and development phase, reducing the number of suppliers until there are viable solutions and sufficient competition.

10. Invite remaining suppliers to tender.

11. Observe minimum tendering period timescales.

12. Assess tenders based on award criteria.

13. Issue assessment summaries.

14. Publish contract award notice.

15. Observe mandatory standstill period - minimum 8 working days.

16. Enter into contract (providing no issues were raised during standstill).

17. Publish contract details notice and contract where applicable (contracts over £5m).

18. Could happen at any time during the term of the contract:

a. publish contract payment notice (where applicable - individual payments over £30k)

b. publish contract performance notice (where applicable)

c. publish payments compliance notice

d. publish contract change notice (if / when modifications are made) and copy of the modified contract (where applicable - contracts over £5m)

e. observe any voluntary standstill period (minimum 8 working days) if and when modifications are made and a contract change notice has been published

19. Publish contract termination notice.

Note - assessing suitability requirements may be carried out at any point prior to contract award as described in the tender notice and/or associated tender documents.

37. Tender notice fields: Competitive flexible procedure

Tender notices: competitive flexible procedure

Regulation 19 - (1) This regulation sets out other information which must be included in a tender notice for the award of a public contract through a competitive flexible procedure published in accordance with section 21(1) of the PA 2023.

(2) The information is:

(a) the same information referred to in regulation 18(2) except sub-paragraphs (d) and (j)

The initial fields of regulation 19(1) are the same as the fields set out in regulation 18(2), the tender notice for the open procedure with 2 exceptions.

(b) a statement that the tender notice is for the award of a public contract through a competitive flexible procedure in accordance with section 20(1) and (2)(b) of the PA 2023

State and copy on any issued associated tender docuements: This tender notice is for the award of a public contract through a competitive flexible procedure in accordance with section 20(1) and (2)(b) of the Procurement Act 2023.

(c) a description of the process to be followed during the procedure, including:

i. whether the procedure may include negotiation at any stage,
ii. if the contracting authority proposes to rely on section 24 of the PA 2023 (refining award criteria), a summary of how it will rely on that section