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Public Procurement Directorate
CHAPTER 5: NEGOTIATED PROCEDURES
1-01-2008

TABLE OF CONTENTS
TABLE OF CONTENTS.................................................................................................. 1
CHAPTER 5: NEGOTIATED PROCEDURES .......................................................... 2
INTRODUCTION............................................................................................................ 2
5.1 WHAT IS THE NEGOTIATED PROCEDURE? .............................................................. 3
5.2 CASES JUSTIFYING USE OF THE NEGOTIATED PROCEDURE..................................... 5
5.2.1 Negotiated procedure with publication of a contract notice.......................... 5
5.2.2 Negotiated procedure without publication of a contract notice ..................... 9
5.3 HOW IS THE NEGOTIATED PROCEDURE CARRIED OUT? ......................................... 15
5.3.1 Stages of the procedure ............................................................................ 15
5.3.2 Tender documents .................................................................................... 21
5.3.3 Negotiation techniques.............................................................................. 23
5.4 APPLICATION OF THE NEGOTIATED PROCEDURE................................................... 25
5.4.1 Negotiated procedure with one (1) economic operator .............................. 25
5.4.2 Two cases of a negotiated procedure........................................................ 25
5.4.3 Negotiated procedures with reduction of the number of
economic operators................................................................................... 28
5.5 GENERAL REFERENCE TO THE NEGOTIATED PROCEDURE FOR PUBLIC
CONTRACTS IN THE WATER, ENERGY, TRANSPORT AND POSTAL
SERVICES SECTORS (DIRECTIVE 2004/17/EC & LAW 11()2006)......................... 31

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CHAPTER 5: NEGOTIATED PROCEDURES
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CHAPTER 5: NEGOTIATED PROCEDURES
INTRODUCTION
This Chapter describes the use of negotiated procedures (with and without publication of a
contract notice) in public procurement.
Moreover, Appendix 5-1 presents the procedure of the competitive dialogue, a new form
of procurement procedure introduced by the new institutional framework.
These two procedures, together with the "conventional procedures", i.e. the open procedure
and the restricted procedure, make up the entire set of procedures provided for under the
Community legislation on the award of public supply contracts, public service contracts and
public works contracts. These procedures have been transposed into the national law and
are applied accordingly.
Finally, Appendix 5-2 examines two special cases of public contracts:
concessions, and
public-private partnerships, also known as PPPs.
Reference to these two types of contracts is made because in these cases the
Contracting Authorities usually follow procedures that involve consultations and
negotiations with the economic operators.
It should be noted that the discussion of the competitive dialogue and of concessions
and PPPs is included in this Guide with the aim of providing information to
Contracting Authorities about the new possibilities offered to them, together with
general guidelines and instructions on their application.
Contracting Authorities should bear in mind that the procedures involving
consultations, negotiations and dialogue with the economic operators are particularly
demanding, in terms of care and skills, on the Contracting Authority officials who conduct
them. These officials should be familiar with both the national and the Community legislation,
so as to be able to apply the principles and provisions of the institutional framework and thus
minimise the likelihood of appeals and objections. In such cases, Contracting Authorities
should seek the assistance of specialised legal, financial and technical consultants.
The negotiated procedures may also be applied in cases of complex contracts, when these
are subject to restrictions of the Law, and may also be applied by analogy in cases of
ordinary low-value contracts which are subject to the same restrictions of the Law.
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More particularly, in this Chapter the Guide provides Contracting Authorities with practical
instructions and guidelines on how to use the negotiated procedure in a way which will
ensure full compliance with the requirements of the institutional framework and will be
suitably adapted to the specific characteristics of the contract to be awarded. In order to
make effective use of the procedure, Contracting Authorities should:
Understand the key characteristics of the procedure (types, options, flexibility limits).
Be aware of the cases justifying use of the negotiated procedure with or without
publication of a contract notice.
Be able to prepare, organise and conduct successfully a negotiation process.
More specifically, they should be able to:
Determine the different stages of the negotiated procedure.
Prepare the tender documents in support of the procedure.
Make use of effective negotiation techniques.
Be aware of the options available under the negotiated procedure for reducing the
number of tenders to be negotiated.
5.1 WHAT IS THE NEGOTIATED PROCEDURE?
According to the Community and national legislation, "negotiated procedure means the
procedure whereby the Contracting Authorities consult the economic operators of their
choice and negotiate the terms of the contract with one or more of these."
1

In the negotiated procedure, "Contracting Authorities shall negotiate with tenderers the
tenders submitted by them in order to adapt them to the requirements which they have set
out in the contract notice, the tender documents and the additional documents, if any, and to
seek out the best tender."
In this procedure, the Contracting Authority should determine in the tender documents the
individual negotiation steps and the terms to be the subject of negotiations.
The negotiated procedure is an exceptional procedure and may be applied only to
cases limited to those specified by the Law.
From its definition, it follows that the key characteristic of the negotiated procedure is that the
Contracting Authorities negotiate the terms of the contract with the tenderers.
This means that, when using the negotiated procedure, Contracting Authorities may:
Invite candidates with the purpose of awarding a public works contract, a public supply
contract or a public service contract, while at the same time they may also

1
Directives 2004/18/EC and 2004/17/EC of the European Parliament and of the Council, and Laws
12(I)/2006 and 11(I)/2006 of the Republic of Cyprus.
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Discuss and negotiate with the candidates who have responded to the invitation, the
terms of the contract as specified in the relevant invitation.
Types, characteristics and options of the negotiated procedure
There are two types of negotiated procedure:
The negotiated procedure with publication of a contract notice in the Official Journal of
the European Union (OJEU) and in the Official Gazette of the Republic of Cyprus
(OGRC) or, if the estimated value of the contract is below the thresholds of article 19 of
Law 12()/2006, only in the OGRC.
The negotiated procedure without publication of a contract notice.
The negotiated procedure (the same applies to the competitive dialogue) may lead
either to the appointment of an "Interim Contractor", with whom final negotiations will
take place and the contractual documents will be finalised, or, in cases where all contract-
related issues have been clarified during the preceding procedure, directly to the
appointment of the Final Contractor for the project. The above option or choice made must
be determined in advance and must be stated in the tender documents.
In case of failure of the negotiations with the Interim Contractor, the Contracting Authority
may proceed to negotiations with the second candidate on the list, and so on. The
Contracting Authority is obliged to state these provisions in the tender documents.
The procedure for appointment of an "Interim Contractor" is not possible in the open and
restricted procedures, where the tendering procedure leads directly to the appointment of the
"final Contractor for the project" without any possibility of consultations or negotiations.
During the negotiated procedure (the same applies to the competitive dialogue), the
Contracting Authority has the option to proceed to consultations as well as to negotiations
with the candidates regarding the tender documents and their tenders. It is stressed that this
option is not allowed in the case of the open procedure nor in that of the restricted procedure.
The limits of the Contracting Authoritys flexibility during the negotiated procedure
During the negotiated procedure, the Contracting Authority may act with a certain degree of
flexibility not only in terms of the award of the contract but also during the procedure followed
in connection with a relevant invitation or with a relevant a tender procedure.
When using the negotiated procedure for public procurement, however, this flexibility is
limited to specific cases and is subject to specific rules.
During the negotiated procedure, the Contracting Authority must adhere to the
provisions of the applicable legislation and act as a public authority by applying these
provisions, together with the principles governing public procurement (e.g. transparency,
equality of treatment) and the principles of proper and ethical governance (e.g. codes of
ethics), especially when:
Specifying the contractual terms of the tender documents (technical specifications,
prices, schedules, material or non-material terms of the contract etc.).
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Evaluating the tenders and their comparative advantages, and negotiating these
tenders (Directives 2004/18/EC and 2004/17; Law 12()/2006, Chapter IV, Article 32,
par. 2, p. 41; Law 11()/2006, Chapter V, Article 38, paragraphs 2 & 3, p. 286).
During the negotiated procedure, the Contracting Authority must apply the principles of
equality of treatment and of transparency in its negotiations with economic operators.
Restrictions in the use of the negotiated procedure
Although pursuant to the national and Community legislation Contracting Authorities
are free to choose the open or restricted procedure whenever they see fit, they should
opt for the negotiated procedure only in the cases listed exhaustively in the relevant
Community Directives and in the transposition law. These cases must be interpreted strictly,
and the burden of proving their existence lies on the Contracting Authority invoking them.
For these reasons, Contracting Authorities may use the negotiated procedure only in the
specific cases listed exhaustively in the Directives and in the national legislation. The
following paragraphs provide a detailed description of these cases.
5.2 CASES JUSTIFYING USE OF THE NEGOTIATED PROCEDURE
5.2.1 Negotiated procedure with publication of a contract notice
Pursuant to the Community Directives and the national legislation, use of the negotiated
procedure with publication of a contract notice is justified in four cases.
These cases are summarised in the table below:
FIELD OF APPLICATION
No.
CASES JUSTIFYING USE OF THE NEGOTIATED
PROCEDURE WITH PUBLICATION OF A CONTRACT NOTICE
SUPPLIES SERVICES WORKS
1 The case of irregular tenders or unacceptable tenders being
submitted in response to an open or restricted procedure or a
competitive dialogue

2 The case where prior overall pricing is not possible
3 The case where the contract specifications cannot be established
with sufficient precision

4 The case of works performed solely for purposes of research,
testing or development

The case of irregular or unacceptable tenders
This case refers to the submission of irregular or unacceptable tenders in response to
an open or restricted tender procedure or to a competitive dialogue, and is applied
only insofar as the original terms of the contract are not substantially altered.
The table below lists examples of irregular tenders:


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EXAMPLES OF IRREGULAR TENDERS
Tenders that do not comply with the terms of the tender documents. For example, tenders whose
technical envelopes contain variants, when this is not authorised in the tender documents, or tenders
that fail to supply (either intentionally or not) key information required in the tender documents and
thus cannot be evaluated by the Contracting Authority.
Tenders made with reservations or tenders containing intentional or systematic errors. For example, if
the financial offer of a tenderer contains reservations, such as conditions regarding currency exchange
rates, inflation etc., when these are explicitly forbidden by the tender documents.
Tenders whose prices are demonstrably the product of collusion between the tenderers and are
sheltered from competitive forces, or if more generally there are serious indications of collusion
between the tenderers with the purpose of circumventing genuine competition or if, in the opinion of
the Contracting Authority, there was not sufficient competition during the tendering procedure.

The table below lists examples of unacceptable tenders:
EXAMPLES OF UNACCEPTABLE TENDERS
Tenders not submitted within the specified time limit.
Tenders that do not meet the qualitative selection criteria (e.g. failure to submit a certificate or
document regarding the tenderers personal situation, thus making it impossible to obtain additional
information or clarifications) or the requirements of the award criteria.
Financial offers that exceed the estimated budget of the Contracting Authority (when this budget is set
as the ceiling in the tender documents, i.e. when negative reductions are not acceptable).
Abnormally low tenders that cannot be justified in writing by the tenderers following a request by the
Contracting Authority.
In both cases the Contracting Authority may cancel the tender procedure and repeat it using
the negotiated procedure with publication of a relevant contract notice, provided that the
original terms of the contract are not substantially altered, as already mentioned.
In the same cases, the Contracting Authority may not publish a contract notice if it includes in
the negotiations all economic operators who meet the qualitative selection criteria and who,
during the previous open or restricted procedure or competitive dialogue, have submitted
tenders complying with the formal requirements (submission of tender guarantee, submission
of tenders within the specified time limit, completeness of the tender envelope etc.) of the
contract award procedure.
An essential condition for using the negotiated procedure, in the case of irregular or
unacceptable tenders (and in the case of lack of tenders, which is examined further below),
is that the original terms of the contract must not be substantially altered.
The term "original terms" of the contract includes all technical, administrative, financial and
other terms contained in the tender documents (European Commission, Guide to the
Community Rules on Public Works Contracts, Office for Official Publications of the EU, 1997,
p. 30).
The above terms of the original tender procedure must not be "substantially altered" during
the negotiated procedure, to prove that this second tender procedure is essentially a
continuation of the previous open or restricted procedure and not a new tender procedure.
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The term "substantial alteration" is an abstract legal term widely used by the Community law
on public contracts. A substantial alteration is a change that may violate a specific principle
of community law, especially the principles of free and undistorted competition, of equality of
treatment of the tenderers, and above all the principle of ensuring the effectiveness of the
Community Directives.
For example, changes to the technical specifications, the financing of the contract or the
payment of the contractor, the execution deadlines, the conditions for acceptance of the
deliverables or the construction techniques, are to be regarded as substantial alterations to
those terms (European Commission, Guide to the Community Rules on Public Works
Contracts, Office for Official Publications of the EU, 1997, p. 30).
The Court of Justice of the European Communities has had the opportunity to point out that
price is also included in the original terms of a contract that cannot be substantially altered in
case the negotiated procedure is used. An increase of the pre-estimated value of the original
contract, even if such increase does not exceed 10%, is considered a substantial alteration,
in the view of the Court, that does not justify the use of the negotiated procedure (Judgment
of 13.01.05 in Case C-84/03 Commission v Spain, not yet published, point 47 and ff.).
The Court's arguments are clear. The negotiated procedure is exceptional in nature
and, therefore, must be applied only in the cases listed exhaustively by the Directives.
Precisely because of this exceptional nature, the relevant provisions of the Community
Directives must be interpreted strictly, while the burden of proving the actual existence of
exceptional circumstances justifying the derogation lies always on the party invoking the
existence of these circumstances, i.e. on the Contracting Authority (Judgments in Cases C-
385/02 Commission v Italy, not yet published, point 19; C-126/03 Commission v Germany,
not yet published, point 23; and C-394/02 Commission v Greece, not yet published, point 33,
where reference is made to previous judgements).
Therefore, the term "non-substantial alteration" must also "be interpreted strictly" (Judgement
in Case C-84/03 Commission v Spain, not yet published, point 48) to prevent the Directives
being deprived of their effectiveness. A substantial alteration is therefore considered to be
every alteration of a term of the original tender procedure "which is capable of undermining
both the scope and the exceptional character of articles 30 and 31 of Directive 2004/18/EC
(Judgement of 13.01.05 in Case C-84/03 Commission v Spain, not yet published, point 49).
The case where prior overall pricing is not possible
This option refers to exceptional cases, when the nature of the works, supplies or
services whose nature or other imponderable factors do not allow prior overall
pricing, which would enable the Contracting Authority to determine in the tender documents
the budget for the work, service or supply. In such a case, tenderers cannot estimate
beforehand the total value of the project in their tenders and thus offer a pre-determined
price, but they are obliged to include in their tenders conditions that reflect the risks resulting
from the nature of the project or from various imponderable factors which the Contracting
Authority does not assume.
This option also refers to exceptional circumstances, for example in cases of projects whose
geological and geotechnical conditions can not be established in a way that would allow prior
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overall pricing of the project, or in cases of an element of archaeology whose extent and
severity cannot be assessed in advance.
The negotiated procedure can be used on the above basis in exceptional cases, such as in
"Public-Private Partnerships (PPP)" & "Public Finance Initiative (PFI)" contracts, and has
been widely used in the United Kingdom, where these types of contracts were first developed
and applied. However, the negotiated procedure can also be used for awarding other types
of contracts for which similar reasons apply, such as in the case of public "concession
contracts".
For example, there are cases where the long-term financing of a work, supply or
service by the contractor or the long-term operation and maintenance of a work or
supply by the contractor do not allow prior overall pricing, as information which relates to
financial and legal planning and to the allocation of risks regarding funding and operation and
which is crucial for determining the final cost, can only be determined through negotiations
with the candidate contractors.
There are also cases where various elements, such as the party (the State or the
Private Sector entity) to assume the risk of force majeure, or the interest rate and
inflation risks which affect the operational cost of a work or supply, cannot be determined
beforehand and without prior negotiations with the candidate contractors
There are also other issues which the Contracting Authority is not in a position to determine
in advance in the tender documents, such as:
The exact operating specifications of a project and the method to be used for monitoring
their application.
The possibility (or lack thereof) of potential claims of the Contracting Authority resulting
from breaches of contract regarding the operation of the project, being offset against
Contractor claims regarding the construction or supply.
The possibility (or lack thereof) of the Contracting Authority taking on direct contractual
commitments towards the contractor's funding agencies etc.
All of the above are factors that determine the cost of a project, while the option of
negotiation allows the specification of the most effective cost-to-benefit ratio for every risk
that the Contracting Authority assumes or transfers to the Contractor.
There are certain risks, such as adjustments of collective labour agreements at the
national and sectoral level, which, if assumed by the Contracting Authority, may result
in uncertainty as to the total price of the project even at the contract signature stage. This will
occur, for example, if the contractor's payment for maintenance and operation of a building is
agreed using a price-index adjustment based on the collective labour agreements.
From the above, it follows that prior overall pricing by the Contracting Authority is not
possible for some project contracts and, therefore, the use of the negotiated procedure is
justified.

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The case where the contract specifications cannot be established with sufficient
precision
This option refers to cases of service contracts whose nature, especially if it
involves intellectual services (compilation of special reports, opinions, project designs
etc.) or financial services (insurance, banking and investment services), is such that the
contract specifications cannot be established with sufficient precision to permit the award of
the contract by selecting the best tender according to the rules governing the open or
restricted procedure.
A typical example here are the loan agreements which Municipal Authorities intend to
conclude with banks for financing the implementation of works or the purchase of equipment.
In these cases, Municipalities may take advantage of the provisions of the law and address
the banking market in order to negotiate the terms of such loans.
The case of works performed solely for purposes of research, testing or development
This case refers to public works contracts for works which are performed solely for
purposes of research, testing or development of a project and not with the aim of
ensuring the projects operation and maintenance or recovering research and development
costs.
An example here is the construction or extension of a research centre, where the
projects construction and operation specifications are directly related to, affect or are
affected by, confidential information about the research conducted or to be conducted in that
centre. In such a case, even the contractors nationality may be a factor restricting selection.
To assist Contracting Authorities in documenting the fulfilment of the terms and
conditions justifying use of the negotiated procedure with publication of a contract
notice, a relevant Checklist is given in Annex 5-3.
5.2.2 Negotiated procedure without publication of a contract notice
Pursuant to the Community Directives and the national legislation, use of the negotiated
procedure without publication of a contract notice is justified in ten cases.
These cases are summarised in the table below:
FIELD OF APPLICATION
No.
CASES JUSTIFYING USE OF THE NEGOTIATED
PROCEDURE WITHOUT PUBLICATION OF A CONTRACT
NOTICE
SUPPLIES SERVICES WORKS
1 The case of lack of tenders
2 The case where the contract may be awarded only to a
particular economic operator

3 The case of extreme urgency
4 The case where the products involved are manufactured
purely for the purpose of research, experiment, study or
development

5 The case of additional deliveries by the original supplier
6 The case of supplies quoted and purchased on a commodity
market

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FIELD OF APPLICATION
No.
CASES JUSTIFYING USE OF THE NEGOTIATED
PROCEDURE WITHOUT PUBLICATION OF A CONTRACT
NOTICE
SUPPLIES SERVICES WORKS
7 The case of supplies being purchased on particularly
advantageous terms

8 The case of contracts that follow a design contest
9 The case of additional works or services not included in the
original contract

10 The case of new works and services consisting in the
repetition of similar works or services of the original contract

The case of lack of tenders
This case refers to tender procedures for the award of public works contracts, public
supply contracts and public service contracts conducted using the open or restricted
procedure, in response to which no tenders or no suitable tenders or no applications have
been submitted. All these three sub-cases are considered as cases of lack of tenders.
In this case, the Contracting Authority may cancel the tender procedure with a relevant
advertisement in the OJEU and in the OGRC and, if it so wishes, repeat it using the
negotiated procedure without publication of a contract notice, insofar as the original terms
of the contract are not substantially altered (in what regards the definition of substantial
alteration, the discussion presented above in the case of irregular or unacceptable tenders
applies).
Tenders are considered unsuitable when their contents are not in agreement with the
terms and scope of the tender documents and thus do not meet the requirements of
the Contracting Authority as laid down in these documents. For this reason, submission of
such tenders is considered as lack of tenders. The table below lists some examples of
unsuitable tenders.

EXAMPLES OF UNSUITABLE TENDERS
Tenders that do not meet the qualitative selection criteria (e.g. failure to submit a certificate or
document regarding the tenderers personal situation, thus making it impossible to obtain additional
information or clarifications) or the requirements of the award criteria.
Tenders made with reservations or tenders containing intentional or systematic errors.
Tenders made conditionally or containing conditions for counter-offers.
Tenders whose prices are demonstrably the product of collusion between the tenderers and are
sheltered from competitive forces, or if more generally there are serious indications of collusion
between the tenderers with the purpose of circumventing genuine competition or if, in the opinion of
the Contracting Authority, there was not sufficient competition during the tendering procedure.
Financial offers that exceed the estimated budget of the Contracting Authority (when this budget is set
as the ceiling in the tender documents, i.e. when negative reductions are not acceptable).
Abnormally low tenders that cannot be justified in writing by the tenderers following a request by the
Contracting Authority.


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The case where the contract may be awarded only to a particular economic operator
This case refers to public works contracts, public supply contracts and public service
contracts which, for technical or artistic reasons, or for reasons connected with the protection
of exclusive rights, may be awarded only to a particular economic operator.
This particular case is extremely restrictive and is applied only in cases where
Contracting Authorities are able to demonstrate that the specific work, supply or
service may be implemented only by a particular economic operator.
The cases where this exception may be applied most safely are those where an
economic operator has the exclusive right to execute, supply or provide a particular
work, product or service.
Nevertheless, this exception does not apply in cases where the particular exclusive right has
also been granted to other economic operators, or may reasonably be obtained by other
economic operators through licensing
For example, a sculptor may have the exclusive right to repair or reconstruct a work of
art of his own, but he may not have the exclusive right to take pictures of it and
reproduce these pictures, if he has already granted this right also to other entities or persons.
A characteristic example is the case of a complaint filed with the European Court of
Justice for violation of the Community Directives in connection with the supply of
pharmaceutical products and specialities. The defendant (in this case, Spain) invoked the
exclusive right conferred to it under the national law regarding the purchase of
pharmaceutical products and specialities by the public hospitals within the social security
system, to justify the direct award of a contract for the supply of such products to
Farmaindustria, the national association of pharmaceutical companies. The Court pointed out
that the justification that the said products may be covered by exclusive rights is not
adequate, on the grounds that it is not sufficient for the pharmaceutical products and
specialities in question to be protected by exclusive rights, but they must also be capable of
being manufactured or delivered only by a particular supplier. Since this requirement is
satisfied only with respect to those products and specialities for which there is no competition
in the market, the grounds invoked cannot in any way justify general and indiscriminate
recourse to a single-tender procedure for all supplies of pharmaceutical products and
specialities (Judgement of 3 May 1994 in Case C-328/92 Commission v Spain [1994] ECR I-
1569, point 17).
The case of extreme urgency
This case refers to tender procedures for the award of public works contracts, public
supply contracts and public service contracts where, for reasons of extreme
urgency brought about by events unforeseeable by the Contracting Authority, the time
limits laid down by the other procedures cannot be complied with.
The circumstances invoked by the Contracting Authority to justify the occurrence of
extreme urgency must not in any event be attributable to the Contracting Authority.
Unforeseeable events are considered to be events transcending the normal bounds
of economic and social life (for example, earthquakes or flooding) and requiring
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immediate action for relief and assistance to those affected.
It should be noted that this case may only be invoked to justify putting out to tender the
works, supplies and services which are necessary for meeting and alleviating the immediate
needs which have resulted from the unforeseeable events, and not as a pretext to fulfil
additional needs.
As the practice of invoking occurrence of unforeseeable events is common among
Contracting Authorities, who use single-tender procedures to meet their needs and thus
circumvent the conventional procedures provided for by the Community Directives (open and
restricted procedure etc.), which impose specific selection and award constraints and specific
time limits, the Community law is particularly strict regarding the application and
interpretation of the corresponding provisions of the Directives.
The Contracting Authorities should bear in mind that the minimum time limits laid
down by both the Community Directives and the national transposition law for urgent
circumstances due to unforeseeable events may meet their requirements without the need
for recourse to the case of extreme urgency discussed here.
Furthermore, it should be taken into account that recourse to extreme urgency is
justified for actions which the Contracting Authority may carry out during a limited
period of time (shorter than the minimum time limits for urgent cases under the conventional
procedures).
For works, services and supplies required beyond this period of time, Contracting Authorities
have sufficient time in which to publish a contract notice and award the contract using the
conventional procedures (open or restricted etc.) (Case C-24/91 Commission v Spain, [1992]
ECR I-1989, where the European Court of Justice held the extreme urgency relied on by the
Spanish Government to be incompatible, because the time limits specified exceeded those
laid down by the Community Directives for cases of extreme urgency).
However, in the health sector for example, the Court judged that extreme urgency was
correctly invoked by hospitals to justify use of the negotiated procedure without publication of
a contract notice for the supply of pharmaceutical products, as an urgent need for a particular
pharmaceutical speciality may well arise in a hospital, and taking also into account the
freedom of doctors in these hospitals to prescribe the pharmaceutical products they consider
necessary. The Court however noted that this cannot justify the a priori systematic recourse
to private contracting for all supplies of pharmaceutical products and specialities to hospitals.
The case where the products involved are manufactured purely for the purpose of
research, experiment, study or development
This case refers only to tender procedures for the award of public supply contracts
where the involved products are manufactured purely for the purpose of research,
experimentation, study or development. This provision does not extend to quantity production
to establish commercial viability or to recover research and development costs.
Furthermore, this case does not cover the purchase of research or laboratory equipment (the
purchase of microscopes, personal computers etc.).
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The case of additional deliveries by the original supplier
This case too refers only to tender procedures for the award of public supply contracts
and concerns additional deliveries by the original supplier which are intended either
as a partial replacement of normal supplies or installations in use or as the extension of
existing supplies or installations where a change of supplier would oblige the Contracting
Authority to acquire material having different technical characteristics which would result in
incompatibility or disproportionate technical difficulties in operation and maintenance.
The length of such contracts as well as that of recurrent contracts may not, as a general rule,
exceed three years.
The case of supplies quoted and purchased on a commodity market
This case too refers only to tender procedures for the award of public supply contracts
and concerns supplies quoted and purchased on a commodity market such as crude
oil, cotton, cereals etc.
The case of supplies purchased on particularly advantageous terms
This case too refers only to tender procedures for the award of public supply contracts
and concerns the purchase of products on particularly advantageous terms, from
either a supplier who is definitively winding up its business activities, or from the receivers or
liquidators of a bankruptcy, a court settlement, or a similar procedure under national laws or
regulations.
The case where a contract follows a design contest
This case refers only to tender procedures for the award of public service contracts,
when the contract concerned follows a design contest and must, under the applicable
rules, be awarded to the successful candidate or to one of the successful candidates. In the
latter case, all successful candidates must be invited to participate in the negotiations. This
provision should be included in the original tender documents.
The case of additional works or services not included in the original contract
This case refers to tender procedures for the award of public works contracts and
public service contracts, and concerns additional works or services not included in the
approved design (in case of technical works) or in the original contract but which have,
through unforeseen circumstances, become necessary for the performance of the works or
services described in the original contract, on condition that the award is made to the
economic operator performing such works or services:
When such additional works or services cannot be technically or economically separated
from the original contract without major inconvenience to the Contracting Authorities, or
When such works or services, although separable from the performance of the original
contract, are strictly necessary for its completion.
The aggregate value of contracts awarded for additional works or services may not
exceed 50% of the amount of the original contract.
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It should be noted that in this case additional works or services due to
unforeseen events can be works and services that become necessary through
events or circumstances which did not exist prior to the original contract or which could
not be identified and included in the scope of the work/service of the original contract,
although applicable provisions were adhered to (e.g. in the development of the relevant
designs or in the conduct of the necessary investigations in the case of technical works), and
due care and diligence was applied in accordance with the rules of workmanship and
science". These rules are related to the official (approved) regulations and specifications
currently applicable in the Republic of Cyprus as well as to the respective internationally
applicable regulations which form the scientific and technical foundations and practices
regarding the scope of the work or service.
If, for example, the quantity of earthworks (excavations or embankments) in a road
works project increases compared to that foreseen by the approved design as a result
of geotechnical problems during the construction stage, the Contracting Authority must prove
that, although the specifications for the geotechnical investigations were adhered to, the new
situation was unforeseeable. If, for example, the specifications required exploratory
boreholes to be drilled every 100m, but according to the design these were required every
200m, then the additional earthworks for the project cannot be justified as a result of
unforeseeable circumstances. If however the above specifications were adhered to and an
unforeseen soil subsidence takes place, then the additional earthworks are justified as
additional works.
It is pointed out that works or services concerning the extension of the physical scope
of the original contract or the improvement of its quality (e.g. by using materials of
better quality or methods that are not specified in the original tender documents) cannot in
any way be considered as additional works/services.
The designation of the above additional works or services as works/services made
necessary by unforeseeable circumstances must be justified by actual and detailed
information by the Contracting Authority. Insufficient justifications or vague statements
invoking the need for completion of the scope as defined in the original contracts are contrary
to the rules of Community law, which apply as national law in the Republic of Cyprus, and
may cause problems in the smooth progress of the works/services and particularly in their
financing by the Community Funds.
The case of new works or services consisting in the repetition of similar works or
services included in the original contract
This case too refers only to tender procedures for the award of public works contracts
and public service contracts, and concerns new works or services consisting in the
repetition of similar works or services entrusted to the economic operator to whom the same
Contracting Authorities awarded an original contract, provided that such works or services
are in conformity with a basic design for which the original contract was awarded according
to the open or restricted procedure.
As soon as the first project is put up for tender, the possible use of this procedure shall be
disclosed and the total estimated cost of subsequent works or services shall be taken into
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consideration by the Contracting Authorities when they apply the thresholds for public
contracts. This procedure may be used only during the three years following the conclusion
of the original contract.
In the case of public works contracts, for example, this procedure applies when a contract for
a series of recurrent works is put up for tender but only a part of these works are awarded
through the original contract (completed section), while the extension or completion of the
works (recurrent works) are awarded to the original contractor through a new contract on the
same or improved terms after negotiations.
Respectively, in the case of service contracts, this procedure applies when for example a
contract for Programme Management services for a particular Community Programme is put
up for tender but only a part of the contract is awarded, while the new contract refers to
similar services within this Programme which are performed on a recurring basis for the
Programmes finalisation or completion.
To assist Contracting Authorities in documenting the fulfilment of the terms and
conditions justifying use of the negotiated procedure without publication of a contract
notice, a relevant Checklist is given in Annex 5-3.
5.3 HOW IS THE NEGOTIATED PROCEDURE CARRIED OUT?
5.3.1 Stages of the procedure
The main purpose of negotiations between the Contracting Authority and the economic
operators participating in the tender procedure is to negotiate the tenders within a single
award procedure with the aim to eventually permit the award of a contract.
As already mentioned in the beginning of this chapter, the Contracting Authorities negotiate
with the economic operators the tenders submitted by them, in order to adapt them to the
requirements and terms specified in the tender documents (Directive 2004/18/EC, article 30
and Law 12()/2006, Chapter IV, article 32, and Directive 2004/17/EC and Law 11()/2006,
respectively).
In practice this procedure involves a number of risks regarding the violation of the
principles and rules of national and Community laws on public contracts by the
Contracting Authority and its officials as well as by the economic operators, through their
actions.
The negotiated procedure includes several stages and individual steps, during which the
Contracting Authority invites, negotiates with, evaluates and selects the economic operator
whose tender meets its requirements.
The stages and steps of a typical negotiated procedure with publication of a contract notice
are presented in the next paragraphs, followed by a discussion of the differences in the case
of the negotiated procedure without publication of a contract notice.

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Possible stages and steps of the negotiated procedure with publication of a contract
notice
Although the responsibility to determine the stages of the procedure on a case by case basis
belongs to the Contracting Authority, the negotiated procedure is usually conducted in two
stages (as is also the case with the restricted procedure):
The first stage refers to the invitation of requests to participate.
The second stage refers to the invitation to negotiate.
First stage: Invitation of requests to participate
As is also the case in the restricted procedure, the negotiated procedure starts with the
publication of the contract notice, using the relevant standardised forms, in the Official
Journal of the European Union (OJEU) and the Official Gazette of the Republic of Cyprus
(OGRC) or, if the estimated value of the contract is below the thresholds of article 19 of Law
12()/2006, only in the OGRC.
After the contract notice has been published, the Contracting Authority releases to the
interested economic operators the Request to Participate documents, using which these
will submit their requests to participate in the negotiated procedure.
The Contracting Authority then selects the candidates to participate in the negotiations, using
the selection criteria which have been determined in advance.
The prequalification of economic operators is conducted exactly as in the respective
stage of the restricted procedure, the only difference being that the minimum number
of prequalified economic operators must be three (3), instead of five (5) in the restricted
procedure. In all cases, however, the number of candidates to be invited to negotiate must
be sufficient to ensure genuine competition.
This means that in the negotiated procedure (and in the competitive dialogue, which is
presented in Annex 5-1) the tender documents cannot provide that only two (2) candidates or
only one (1) candidate will be invited to negotiate.
The prequalification of the candidates to be invited to negotiate concludes the first stage of
the procedure.
Second stage: Invitation to negotiate
The second stage commences with the invitation which the Contracting Authority sends to
the prequalified economic operators, inviting them to submit proposals for negotiation. The
Contracting Authority must make sure that the terms which it intends to negotiate have been
included in the tender documents (negotiation documents).
In the negotiated procedure with publication of a contract notice (as is also the case in
the competitive dialogue), the Contracting Authorities invite a number of candidates
which is at least equal to the minimum number of candidates specified in advance. In the
event that the number of candidates meeting the selection criteria and the minimum levels is
less than the minimum number (e.g. less than 3 or only 1), the Contracting Authority may
proceed with the procedure by inviting the candidate(s) meeting the required capacity levels.
The Contracting Authority cannot include in the negotiation procedure other economic
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operators who have not submitted a request to participate or candidates who do not meet the
selection criteria.
The prequalified candidates submit to the Contracting Authority their proposals for
negotiation and the Contracting Authority, after examining them, invites the economic
operators to negotiate by means of a written invitation.
The negotiation starts with the submission of clarification questions about the contents of the
tender documents, and of comments on the draft contract. The Contracting Authority then
negotiates with the economic operators their proposals. During the negotiation, the
Contracting Authority shall ensure the equality of treatment of all participating economic
operators, and shall not provide information in a discriminatory manner which may give some
economic operators an advantage over others.
Once the negotiation has been concluded, the Contracting Authority examines and assesses
the comments submitted by the economic operators, and evaluates their proposals on the
basis of the results of the negotiation. At this point, the Contracting Authority may, at its
absolute discretion, modify the tender documents.
Depending on the extent of the modifications to be required, the Contracting Authority may
publish a Modifications Document for the tender documents, in order to ensure full
coverage of its requirements.
The Contracting Authority sends the Modifications Document to the prequalified economic
operators and invites them to submit their binding tenders.
If the Contracting Authority considers that further modifications to the tender documents are
required, it may issue a new "Modifications Document. In this case, the Contracting
Authority may allow the submission by the economic operators of new comments on the
terms of the draft contract as this may have been modified, and so on.
Until the date of publication of the last "Modifications Document", the Contracting Authority
reserves the right to modify unilaterally the tender documents at its discretion and regardless
of the comments made by the economic operators.
It is very important to point out that the tender documents cannot be substantially
altered and, therefore, a "Modifications Document" cannot be published in the case of
negotiated procedures following the cancellation of an open or restricted procedure or of a
competitive dialogue in which either no tenders were submitted or the tenders submitted
were irregular or unacceptable, as their repetition using the negotiated procedure
presupposes that the original terms of the contact are not substantially altered (see above
5.2.1, 1
st
case, and 5.2.2, 1
st
case).
Once the above procedure has been completed, it is followed by the steps below:
Submission of binding tenders by the participants in the negotiation, on the basis of
the final tender documents.
Evaluation of these tenders, and
Award of the contract to the best tender, in accordance with the tender documents.
The above stages are identical to the respective stages of the restricted procedure.
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The award of the contract in the negotiated procedure takes place using as an award
criterion:
The most economically advantageous tender, or
Exclusively the lowest price.
This procedure leads to the appointment of the "Interim Contractor" (as opposed to the final
Contractor in the restricted procedure), with whom the Contracting Authority negotiates the
final terms of the contract, which cannot be substantially altered in relation with the original
terms specified in the tender documents. The finalisation of these documents involves the
provision of additions or clarifications in connection with submitted documents, updating the
formal supporting documents, providing guarantees, insurances etc.
A similar procedure is applied in cases where Contracting Authority opts to conduct the
negotiated procedure in successive stages, in order to reduce the number of economic
operators to participate in the negotiation. The negotiated procedure in successive stages
with a reduction of the number of participants is carried out by applying the award criteria
specified in the tender documents. Recourse to this option, together with the award criteria
which govern it, must be stated in the contract notice and in the tender documents. A
detailed description of this case is presented in paragraph 5.4.2.
The Figure below presents in detail the individual steps of the negotiated procedure
with publication of a contract notice:

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Figure 5-1: Individual steps of the negotiated procedure with publication of a contract notice
Stages and steps of the negotiated procedure without publication of a contract notice
The key differences in the stages and individual steps of this procedure, compared to
the negotiated procedure with publication of a contract notice, are the following:
The invitation to the economic operators is not published but is sent to specific
economic operators who, in the opinion of the Contracting Authority, are in a position
to execute the work, offer the supply or provide the service.
The first stage (Invitation of Requests to Participate) is usually omitted, and the
Contracting Authority invites the candidates which it has selected at its discretion, to
directly submit their proposals for negotiation. The first stage is omitted on the
grounds that the economic operators have been selected by the Contracting Authority
itself and, therefore, are presumed to meet the qualitative selection criteria.
Nevertheless, if the Contracting Authority has not sufficient knowledge of the situation
of the economic operators which it invites, then it should verify the fulfilment of the
qualitative selection criteria. The second stage ("Invitation to Negotiate") is organised
Negotiated procedure with publication of a contract notice
Publication of Contract Notice in the OJEU (if required)
& in the Official Gazette of the Republic of Cyprus
Prequalification of Candidates to be invited to negotiate
Definition of procedures &
Invitation to Negotiate
Tenders Negotiation Phase
Submission of Tenders by Prequalified Candidates
Selection of Interim Contractor
Finalisation of Interim Contractors Tender
Contract Signature
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in exactly the same steps as those of the negotiated procedure with publication of the
contract notice, the only difference being that if the first stage has been omitted, then
before the contract is signed the Contracting Authority verifies that the Interim
Contractor meets the qualitative selection criteria specified in the tender documents,
by requesting the Interim Contractor to provide additional information or clarifications
on the certificates and documents required by the invitation.
The Figure below presents in detail the individual steps of the negotiated procedure
without publication of a contract notice:


Figure 5-2: Individual steps of the negotiated procedure without publication of a contract
notice
Negotiated procedure without publication of a contract notice
Written invitation of the economic operators to negotiate
Submission of Tenders by the Economic Operators
Tenders Negotiation Phase
Selection of Interim Contractor
Finalisation of Interim Contractors Tender
Review of Formal Supporting Documents
Contract Signature
Option for
prequalification of
the economic
operators to be
invited to negotiate
using selection
criteria
Determination of the number and capabilities
of the Economic Operators to be invited to negotiate
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5.3.2 Tender documents
The tender documents for the negotiated procedure share the same structure and
organisation with those used in the restricted procedure. Thus, the model draft tender
documents given in Chapter 3 for the restricted procedure can be easily adapted to take
account of the particularities of the negotiated procedure.
The following paragraphs provide guidelines and instructions on how to make the appropriate
adaptations to the tender documents for each one of the two stages of the negotiated
procedure.
Stage of invitation of requests to participate
The Figure below presents the tender documents for the first stage of the negotiated
procedure.
TENDER DOCUMENTS
INVITATION OF REQUESTS TO PARTICIPATE (NEGOTIATED PROCEDURE)
Annex
Invitation of requests to participate Request to Participate Template
SUBMISSION OF REQUESTS TO PARTICIPATE
BY CANDIDATE ECONOMIC OPERATORS
Request to participate
TENDER DOCUMENTS
INVITATION OF REQUESTS TO PARTICIPATE (NEGOTIATED PROCEDURE)
Annex
Invitation of requests to participate Request to Participate Template
TENDER DOCUMENTS
INVITATION OF REQUESTS TO PARTICIPATE (NEGOTIATED PROCEDURE)
Annex
Invitation of requests to participate Request to Participate Template
SUBMISSION OF REQUESTS TO PARTICIPATE
BY CANDIDATE ECONOMIC OPERATORS
Request to participate
SUBMISSION OF REQUESTS TO PARTICIPATE
BY CANDIDATE ECONOMIC OPERATORS
Request to participate

Figure 5-3: Tender documents for the first stage of the negotiated procedure
The tender documents for the first stage do not differ substantially from the respective
documents of the restricted procedure, as in both cases the purpose of the stage is to select
suitable economic operators who will be invited to submit their proposals for negotiation or
their tenders for evaluation, respectively.
The invitation of requests to participate contains, inter alia, the requirements for participation
in the negotiation, the minimum number of candidates to be invited to negotiate, the selection
criteria and a summary description of the contract scope.
Stage of invitation to negotiate
The Figure below presents the tender documents for the second stage of the
negotiated procedure.

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Instructions to Economic Operators
Part
Draft agreement and Special Conditions of
Contract
Part
General Conditions of Contract
Annex
Terms of Reference Technical
Specifications
Annex
Templates for Forms
Appendix
TENDER DOCUMENTS
INVITATION TO NEGOTIATE
Modifications Document of the tender documents
MODIFICATIONS TO THE TENDER DOCUMENTS INVITATION TO NEGOTIATE STAGE
(if required)
PROPOSALS OF PREQUALIFIED CANDIDATES
Invitation to negotiate
Instructions to Economic Operators
Part
Draft agreement and Special Conditions of
Contract
Part
General Conditions of Contract
Annex
Terms of Reference Technical
Specifications
Annex
Templates for Forms
Appendix
TENDER DOCUMENTS
INVITATION TO NEGOTIATE
Instructions to Economic Operators
Part
Draft agreement and Special Conditions of
Contract
Part
General Conditions of Contract
Annex
Terms of Reference Technical
Specifications
Annex
Templates for Forms
Appendix
TENDER DOCUMENTS
INVITATION TO NEGOTIATE
Modifications Document of the tender documents
MODIFICATIONS TO THE TENDER DOCUMENTS INVITATION TO NEGOTIATE STAGE
(if required)
Modifications Document of the tender documents
MODIFICATIONS TO THE TENDER DOCUMENTS INVITATION TO NEGOTIATE STAGE
(if required)
PROPOSALS OF PREQUALIFIED CANDIDATES
Invitation to negotiate
PROPOSALS OF PREQUALIFIED CANDIDATES
Invitation to negotiate

TENDERS OF PREQUALIFIED CANDIDATES
Technical Offer Financial Offer
CONTRACT
Agreement and Special Conditions of Contract
General Conditions of Contract
Annex
Terms of Reference Technical
Specifications
Annex
Contractors Technical Offer
Contractors Financial Offer
Modifications Document of the tender
documents
Annex I
TENDERS OF PREQUALIFIED CANDIDATES
Technical Offer Financial Offer
TENDERS OF PREQUALIFIED CANDIDATES
Technical Offer Financial Offer
CONTRACT
Agreement and Special Conditions of Contract
General Conditions of Contract
Annex
Terms of Reference Technical
Specifications
Annex
Contractors Technical Offer
Contractors Financial Offer
Modifications Document of the tender
documents
Annex I
CONTRACT
Agreement and Special Conditions of Contract
General Conditions of Contract
Annex
Terms of Reference Technical
Specifications
Annex
Contractors Technical Offer
Contractors Financial Offer
Modifications Document of the tender
documents
Annex I

Figure 5-4: Tender documents for the second stage of the negotiated procedure
The tender documents for the second stage of the negotiated procedure should
provide the following information, in addition to the information contained in the
respective documents for the restricted procedure:
The terms of the tender documents which are, and those which are not, the subject of
the negotiation.
The steps, method and schedule of the negotiation.
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5.3.3 Negotiation techniques
Contracting Authorities enjoy great flexibility in terms of the negotiation methods and
techniques which they wish to use during the negotiation. They must however ensure
that their every action or technique adheres to the principles of the EU Treaty and complies
with the provisions under the Community and the national law regarding this procedure.
The above-mentioned principles are discussed in detail in the Code of Ethics in Public
Procurement which accompanies this Guide. In what in particular regards the negotiated
procedure, the Code points out that "in case that the negotiated procedure is followed, the
negotiations should be conducted in a fair, structured, ethical and equitable manner (Code,
par. 2.3, item 8, p. 15).
The table below provides guidelines to assist Contracting Authorities in their task during
the negotiation:

GUIDELINES FOR CONDUCTING THE NEGOTIATION
The various types of documents sent by the Contracting Authority to the economic operators
participating in the negotiation must be dispatched in a way which will be clearly indicate:
The senders data,
The date of dispatch, and
The subject of the document together with its attachments (written invitation to negotiate
with proof of mailing etc.).
The Contracting Authority should determine the negotiation framework by specifying the subject, the
issues related with it, and the agenda of the negotiations.
The Contracting Authority should determine an indicative schedule of the negotiation stages, which
shall include the dates of the meetings to be held, the issues to be discussed, and the interim
deliverables, if any, of the economic operators in the form of reports or proposals or comments on
the tender documents. The same schedule should also include the dates on which the Contracting
Authority shall provide its answers on the above, together with any other commitments of the
Contracting Authority during the procedure, as well as the expiry date of the negotiation, which is a
crucial element of the procedure. Although this schedule is indicative, the Contracting Authority
must make every effort to adhere to it, as this reflects its ability to manage effectively the framework
which it has laid down itself and, consequently, the tender procedure in its entirety.
The negotiation meetings should be minuted in detail and the minutes should be signed by all
participants.
The results of the negotiations should be communicated in writing to all participants with proof of
receipt.
In cases where the Contracting Authority negotiates with each economic operator separately, the
other economic operators should be aware of this and should be notified of the results of every such
negotiation held. The order of negotiations must be strictly observed in every negotiation cycle, and
may be based on the order in which the requests to participate (if a contract notice was published)
or the invitations to negotiate (if a contract notice was not published) were entered in the records of
the Contracting Authority. In all cases, the economic operators must be aware of this order. During
this negotiation, the Contracting Authority should not disclose to other economic operators data or
information designated as confidential by a particular economic operator, especially when such data
or information concerns technical or trade secrets or confidential aspects of that operators
proposals.
In cases where the Contracting Authority negotiates simultaneously with more than one economic
operators (concurrent negotiation), the economic operators should be notified beforehand of the
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GUIDELINES FOR CONDUCTING THE NEGOTIATION
negotiation framework, while the agenda of the discussions must be strictly observed. Upon
completion of the procedure, all participants must be informed of the final decisions of the
Contracting Authority.
The table below presents some basic negotiation techniques regarding the tender
documents, as an indicative example of a method which can be used in the
negotiations between the Contracting Authority and the economic operators, and which
conforms to the principles and provisions of the Community and the national law.

BASIC NEGOTIATION TECHNIQUES REGARDING THE TENDER DOCUMENTS
The Contracting Authority should include in the tender documents the terms which are, and those
which are not, the subject of the negotiation.
The economic operators may submit questions in writing and may request clarifications.
The questions submitted by economic operators and the answers/clarifications of the Contracting
Authority shall be communicated to all economic operators, without disclosing the data of the
economic operator that submitted the question.
If an economic operator considers that a question submitted by it is confidential, it must indicate this
by marking the question as confidential and must also justify the questions confidential nature.
If the Contracting Authority considers, at its absolute discretion, that the question regards all
economic operators, it shall communicate its view to the economic operator who submitted the
question, and the latter shall have the option to withdraw it in writing.
If the economic operator does not withdraw the question, then this question and the respective
answer of the Contracting Authority shall be communicated to all participants.
If however the Contracting Authority considers, at its absolute discretion, that the question is
confidential, the answer shall be communicated only to the economic operator who submitted the
question.
The economic operators may also submit comments on the terms of the draft contract.
The comments to be submitted shall be ordered and shall indicate clearly the article to which they
refer. More in particular, any modifications proposed by each economic operator should be
accompanied by the respective complete wording which is proposed. In all cases, the proposed
modifications should be accompanied by a brief justification.
The application of the above techniques in a negotiation procedure, together with any other
techniques which the Contracting Authorities may adopt, requires the establishment of an
experienced negotiation mechanism. This mechanism forms part of the Contracting
Authority's Procurement Team, which has been presented in Chapter 2 of this Guide.
The negotiation commences with the submission of clarification questions about the content
of the tender documents and of comments on the draft contract.
The negotiation team may include:
Administrative officials with experience in public procurement procedures and in
market research (in the case of public supply contracts).
Legal experts with experience in the Community law on public procurement.
Technicians with experience in self-financing projects (in the case of public works
contracts or public services contracts).
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Economists with experience in structured funding.
Depending on the size and complexity of the project, specialised external financial-
legal and technical consultants.
The above experts must have received training on the conduct of negotiations.
5.4 APPLICATION OF THE NEGOTIATED PROCEDURE
5.4.1 Negotiated procedure with one (1) economic operator
In many cases, such as for example in negotiated procedures without publication of a
contract notice, Contracting Authorities have to negotiate with only one economic operator of
their choice.
This may happen either because the particular case concerns only one economic operator
(for example, the 2
nd
case of the negotiated procedure without publication of a contract
notice, which concerns the award of the contract only to one economic operator; or the 5
th
,
9
th
and 10
th
cases of the same procedure, which concern the award of additional supplies
and of additional or new works or services under an original contract) or because only one
economic operator submitted a request to participate in response to a relevant invitation.
In these cases, the negotiation is conducted directly with the selected economic operator,
and concerns the operators technical offer as well as and his financial offer.
To this end, the Contracting Authority issues tender documents on the basis of which the
economic operator is invited to submit a tender. The provisions of the tender documents
depend on the complexity of the contract.
The Contracting Authority evaluates the tender submitted by the tenderer (technical offer and
financial offer) and, if it considers it to be disadvantageous, invites the tenderer to negotiate.
During this procedure, the Contracting Authority initially negotiates with the tenderer the
technical part of his tender and, if an agreement is reached, invites the tenderer to submit an
improved financial offer.
The Contracting Authority reserves the right to accept or reject this offer.
It is not appropriate for the Contracting Authority to negotiate the tenderers financial offer
with a view to forcing the tenderer to accept an additional reduction, as the latter will be
aware that if this does not happen, then he shall not be awarded the contract.
5.4.2 Two cases of a negotiated procedure
In this section, two cases of negotiated procedure are presented:
The first case refers to the submission of irregular or unacceptable tenders in response to
an open or restricted procedure or a competitive dialogue (this is one of the cases of
paragraph 5.2.2). The Contracting Authority intends to repeat the tender procedure using
the negotiated procedure with publication of a contract notice, invoking the provisions of
the aforementioned paragraph, and
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The second case is a case where the Contracting Authority cannot establish beforehand
the specifications of a public service contract with sufficient precision (this is also one of
the cases of paragraph 5.2.2).
Negotiated procedure with publication of a contract notice following the submission of
irregular or unacceptable tenders
This case refers to the submission of irregular or unacceptable tenders in response to
an open or restricted procedure or a competitive dialogue.
In tender procedures for the award of public works contracts, public supply contracts and
public service contracts, there may be cases of irregular or unacceptable tenders being
submitted by economic operators. In such cases, Contracting Authorities may cancel the
previous tender procedure and repeat it using the negotiated procedure with publication of a
contract notice. This option is only possible insofar as the original terms of the contract are
not substantially altered.
The new procedure is usually a two-stage procedure (consisting of the stage of invitation of
requests to participate, and of the stage of submission of tenders which also includes the
invitation to negotiate).
The Contracting Authority publishes an invitation of requests to participate, inviting interested
economic operators to participate in the negotiation. It then proceeds to select the economic
operators with whom it shall negotiate their tenders. This selection (prequalification) is based
on the selection criteria described in the invitation of requests to participate.
In the invitation to negotiate, the Contracting Authority sets the negotiation framework and
specifies the elements of the economic operators tenders which may be the subject of
negotiations.
The tenders are prepared on the basis of the tender documents for the negotiated procedure,
whose terms cannot be substantially different from those of the respective tender documents
for the previous tender procedure.
In these cases, the financial offers of the participants in the negotiation are not subject to
negotiations, but are usually prepared and submitted separately, in a sealed envelope,
during the stage of submission of binding tenders which follows after conclusion of the
negotiation.
During the negotiation, the Contracting Authority and the economic operators negotiate the
contents of the technical offers in order to adapt them to the specifications and terms of the
tender documents and to the terms of the contract, if there are deviations from them.
Once the negotiation is concluded, the Contracting Authority invites the economic operators
who participated to submit their binding tenders (technical offers and financial offers), which
must be adapted to the requirements of the tender documents as these have been modified
as a result of the negotiation procedure.
The Contracting Authority then evaluates these tenders on the basis of the award criteria as
predetermined in the tender documents, and appoints the Interim Contractor. The
Contracting Authority negotiates with the latter the final terms of the contract, which cannot
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be substantially different from those provided for in the tender documents, and the procedure
is concluded with the signature of the relevant contract.
In the present case, which refers to the first condition under paragraph 5.2.1, the Contracting
Authority (as also mentioned in the respective paragraph) may not publish a contract notice if
it includes in the negotiations all economic operators who meet the qualitative selection
criteria and who, during the previous open or restricted procedure or competitive dialogue,
have submitted tenders complying with the formal requirements (submission of tender
guarantee, submission of tenders within the specified time limit, completeness of the tender
envelope etc.) of the contract award procedure.
Negotiated procedure with publication of a contract notice where prior establishment
of the specifications of a public service contract is not possible
This case refers mainly to the services in category 6 Annex of Community Directive
2004/18 and of Law 12()/2006 of the Republic of Cyprus (financial services including
insurance services, banking and investment services etc.), but also to other intellectual
services generally.
In the case of these services, when the Contracting Authority cannot establish with sufficient
precision its specifications and requirements in order to award a service contract using the
open or restricted procedure, then it may use the negotiated procedure to select the best
tender.
The negotiated procedure in this case may be carried out as follows.
The Contracting Authority publishes an invitation of requests to participate, in which it defines
the objectives it wishes to accomplish, its key requirements and needs, the selection criteria
and the basic criteria for the award of the contract.
Within this framework, the Contracting Authority has two options:
To provide, in the invitation to participate, for the submission only of the documents
regarding the personal situation of the candidates and of the information about their
technical and financial capacity. The selection criteria must be appropriate and must
be related to the scope of the particular contract.
To provide, in the invitation to participate, for the submission, in addition to the above
documents and information, of a draft solution, i.e. a preliminary description of the
solution which the candidate intends to propose in response to the Contracting
Authority's requirements and criteria. The economic operators may also be invited to
supply an estimate of the cost for the implementation of their proposed draft solution.
After the requests for participation are received, the Contracting Authority proceeds in both
cases to the selection of the economic operators to participate in the negotiation.
The selection (prequalification) is made on the basis of the predetermined selection criteria
(technical and financial capacity), and is preceded by the usual verification of the information
concerning the personal situation of the candidates. Pursuant to the Community Directives
and the national law, the minimum number of candidates to qualify for participation in the
negotiation cannot be less than three (3) (provided that the number of candidates is
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sufficient). In all cases, the number of candidates to be invited must be sufficient to ensure
genuine competition.
It is also possible to provide for a subsequent optional stage, in which the Contracting
Authority, after the prequalification of candidates on the basis of the selection criteria
specified in the invitation, may request prequalified candidates to submit a draft solution
which can serve as the basis for the negotiation to follow.
In all cases, the Contracting Authority shall then enter into negotiations with the prequalified
economic operators, for the purpose of examining the best way in which its needs may be
covered.
Once the negotiation is concluded, the Contracting Authority, taking into consideration the
proposed solutions and the results of the negotiation with the participants, prepares the
tender documents for the invitation to tender.
The Contracting Authority invites the participants to submit their tenders on the basis of the
above tender documents.
The tenders are evaluated on the basis of the award criteria, and the contract is awarded,
without any possibility of further negotiation, either to the most economically advantageous
tender or to the tender with the lowest price.
This procedure is a typical and simple negotiated procedure that follows the stages and
individual steps presented in paragraph 5.3.1.
It should be pointed out that the above refer mainly to the negotiated procedure with
publication of a contract notice. However, they can also be applied to the negotiated
procedure without publication of a contract notice. In the latter case, the Contracting
Authorities are more flexible in their negotiations with the economic operators: for example,
they may examine the candidate contractor's suitability (personal situation and technical and
financial capacity, which are the qualitative selection criteria), before the signature of the
relevant contract.
5.4.3 Negotiated procedures with reduction of the number of economic
operators
Pursuant to the Community law and the national transposition law, the Contracting
Authority may gradually reduce the number of economic operators which shall be
invited to submit their final tenders [Directive 2004/18, recital 41, and Law 12()/2006,
Chapter IV, paragraph 31(4) & paragraph 32(4)].
The gradual reduction of the number of economic operators to be invited to submit
their final tenders is usually applied:
When prior overall pricing is not possible (paragraph 5.2.1) in a negotiated procedure
with publication of a contract notice,
In extremely complex contracts in a competitive dialogue, examined in Annex 5-1, and
In Concessions and Public-Private Partnerships, examined Annex 5-2.
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In these cases, the Contracting Authority may gradually reduce the number of candidates in
successive stages of the procedure, if it estimates that the number of the interested parties
will be extremely high, a situation which would lead to a complex, time-consuming and costly
negotiation procedure with an increased likelihood of appeals.
The Contracting Authority must however always bear in mind that, pursuant to the
Community Directives and the national transposition law, the minimum number of candidates
to be invited to negotiate cannot be less than three (3).
The Contracting Authority shall indicate in the tender documents the minimum number
of candidates participating in the procedure, taking into account the principles of
equality of treatment and of transparency throughout the negotiated procedure and until the
award of the contract.
The procedure may be carried out in four successive stages:
First stage: Invitation of requests to participate
Second stage: Initial or preliminary invitation to negotiate
Third stage: Final invitation to negotiate
Fourth stage: Submission of binding tenders
First phase: Invitation of requests to participate
In this stage, the Contracting Authority publishes a contract notice for a negotiated procedure
and decides, for example, to select 5 to 7 candidates with whom to enter into an initial
negotiation.
This selection (prequalification) is carried out, as above, on the basis of the predetermined
objective selection criteria (technical and financial capacity) and after the usual verification of
the information concerning the personal situation of the candidates. In these criteria the
Contracting Authority may also include criteria relating to the evaluation of "draft solutions",
should the submission of draft solutions be requested at this stage.
The objective criteria mentioned above do not necessarily imply the application of weightings
(Directive 2004/18/EC, recital 40). Therefore, they do not preclude them. Consequently, the
Contracting Authority may include in the Contract Notice and in the Invitation of Requests
to Participate weighted prequalification criteria, and associate these directly to the technical
and financial capacity of the participants and to the "draft solution" whose submission may be
requested at this stage.
Second stage: Initial or preliminary invitation to negotiate
In the next stage, the Contracting Authority, taking also in consideration the proposed
solutions, and based on the draft solution, prepares an Initial or Preliminary Invitation to
Negotiate.
This invitation includes the draft terms for the submission of tenders and the draft terms of
the contract.
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The Contracting Authority shall hold a consultation on this invitation with the prequalified
economic operators, who may submit questions or comments.
The Initial or Preliminary Invitation to Negotiate is an invitation which may serve as
intermediate stage between the 1
st
and 2
nd
stage of the negotiated procedure described in
the paragraph 5.3.1 above.
Through the Initial or Preliminary Invitation to Negotiate, the Contracting Authority aims to:
Specify in the tender documents the way in which its needs and requirements could be
met, as well as the scope of the project, from the early stages of the negotiation with the
economic operators, and at the same time
Reduce the number of economic operators who will continue to participate in the
negotiation, as this is procedure is a complex and costly one, especially for the
participating economic operators.
Based on the results of the negotiation, the Contracting Authority prepares the documents for
the submission of tenders, and invites the prequalified economic operators to submit their
tenders.
During the procedure for submission of tenders by the economic operators, the Contracting
Authority may include again a new stage in order to reduce the number of participants from
5-7 to three (3).
This reduction should be made using the award criteria, which must be described in
the tender documents for the submission of tenders. These award criteria may be
weighted. If weighting is not possible for demonstrable reasons, the Contracting Authority
shall indicate in the relevant contract notice the criteria in descending order of importance
(Directive 2004/18/EC, Article 53, 2, and Law 12()2006, Article 50, 4, page 71).
For example, this stage may only involve the submission of technical offers at a specific level
of detail (e.g. preliminary project designs, specific commitments regarding financing of the
project, and acceptance by the economic operators of the basic terms of the contract).
Third stage: Final invitation to negotiate
Based on the negotiation completed up to this point, the Contracting Authority may prepare
the modified tender documents, which should under no circumstances alter the non-
negotiable terms of the tender procedure as determined in the tender documents, and may
use these to proceed to the Final Invitation to Negotiate, whereby the three (3) participants
shall be invited to submit their tenders.
During the procedure for submission of these tenders, the Contracting Authority may include
another stage in order to reduce the number of participants from three (3) to two (2).
This reduction stage too must be described in the tender documents as above, in such a way
as to ensure adherence to the principles of equality of treatment and of transparency during
the procedure.
For example, this stage may involve only the submission of technical offers at a more
detailed level (e.g. final project designs, more strict commitments regarding financing of the
project, acceptance of the terms of the contract).
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The Contracting Authority then negotiates with the remaining economic operators their
tenders, in order to clarify any ambiguities or gaps in their technical offers and commit the
participants to the terms of the contract, while ensuring that these clarifications or additions
do not in any way violate the terms of the tender documents based on which these economic
operators participate in the procedure This negotiation procedure is concluded with the
selection of two economic operators on the basis of the predetermined award criteria.
Fourth stage: Submission of binding tenders
The two economic operators that participate in the procedure shall then submit their binding
tenders. These tenders are evaluated by the Contracting Authority and, based on this
evaluation, the "Interim Contractor" is appointed, using as award criterion the most
economically advantageous tender or exclusively the lowest price.
The Contracting Authority negotiates and finalises the contract with the Interim Contractor
without substantially altering or modifying the contract and, thus, violating the terms of the
tender documents.
The need to gradually reduce the number of participating economic operators which is
imposed by the above procedure is dictated by the complexity of the respective cases, the
high participation costs for the economic operators, and the markets behaviour, response
and commitment regarding such contracts (negative behaviour of financial institutions and
banks regarding specific commitments contained in the contracts etc.). The gradual reduction
of participants aims to resolve these problems and enhance the reliability of the Contracting
Authority in terms of its capability to achieve its objective, which is to award the contract
successfully.
The negotiation steps described above offer several alternatives, ranging from
the simple to the complex, which Contracting Authorities may adopt. Before
determining the stages of the procedure, due consideration must be given to a
number of parameters, such as the complexity of a contract.
It should be noted that, according to the case-law of the European Court of Justice,
such dialogues, consultations and negotiations are not permitted under the existing
open and restricted procedures.
5.5 GENERAL REFERENCE TO THE NEGOTIATED PROCEDURE FOR PUBLIC
CONTRACTS IN THE WATER, ENERGY, TRANSPORT AND POSTAL SERVICES
SECTORS (DIRECTIVE 2004/17/EC & LAW 11()2006)
In the following paragraphs, a general reference is made (in the form of tables) to the
negotiated procedure for public contracts awarded in the Water, Energy, Transport and
Postal Services Sectors, pursuant to the provisions of Directive 2004/17/EC and Law
11()2006.
In the Water, Energy, Transport and Postal Services Sectors, Contracting Entities may award
contracts:
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Using the negotiated procedure with publication of a contract notice, at their
absolute discretion,
Using the procedure without publication of a contract notice restrictively and in
specific cases, according to their reasoned opinion.
"Negotiated procedure is the procedure whereby Contracting Entities consult the economic
operators of their choice and negotiate the terms of the contract with one or more of
these" (Community Directive 2004/17/EC and Law 11()/2006 of the Republic of Cyprus).
During the negotiated procedure the Contracting Entities negotiate with the tenderers the
tenders submitted by them, in order to adapt them to the requirements which have been set
out in the tender documents and to seek out the best tender, in exactly the same way as the
one described in the previous Sections of this Chapter for the respective negotiated
procedure under Law 12 () 2006.
Pursuant to the national legislation, there are eleven cases justifying the use of a procedure
without publication of a contract notice.
These cases are summarised in the following table:
FIELD OF APPLICATION
No.
CASES JUSTIFYING USE OF A PROCEDURE WITHOUT PUBLICATION
OF A CONTRACT NOTICE IN THE WATER, ENERGY, TRANSPORT
AND POSTAL SERVICES SECTORS
(DIRECTIVE 2004/17/EC & LAW 11()/2006, article 38, paragraph 3a)
SUPPLIES SERVICES WORKS
a
When no tenders or suitable tenders or no applications have
been submitted in response to a procedure with a prior
tender procedure, provided that the initial terms of the
contract are not substantially altered

b.
Where a contract is purely for the purpose of research,
experiment, study or development, and not for the purpose
of securing a profit or of recovering research and
development costs, and insofar as the award of such
contract does not prejudice the competitive award of
subsequent contracts with do seek, in particular, those ends

c
When, for technical or artistic reasons, or for reasons
connected with the protection of exclusive rights, the
contract may be awarded only to a particular economic
operator

d
In the case of "extreme urgency" brought by "unforeseeable
events"

e In the case of additional deliveries by the original supplier
f
In the case of additional works or services not included in
the original contract

g
In the case of new works consisting in the repetition of
similar works or services of the original contract

h
In the case of supplies quoted and purchased on a
commodity market

i
In the case of contracts awarded on the basis of a
framework agreement

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FIELD OF APPLICATION
No.
CASES JUSTIFYING USE OF A PROCEDURE WITHOUT PUBLICATION
OF A CONTRACT NOTICE IN THE WATER, ENERGY, TRANSPORT
AND POSTAL SERVICES SECTORS
(DIRECTIVE 2004/17/EC & LAW 11()/2006, article 38, paragraph 3a)
SUPPLIES SERVICES WORKS
j
In the case of bargain purchases, where it is possible to
procure supplies by taking advantage of a particularly
advantageous opportunity available for a very short time at a
price considerably lower than normal market prices

k In the case of contracts that follow a design contest
The above cases are codified in the following tables:
Law 11()/2006, Chapter V, Article 38, 3, (a)
When no tenders or suitable tenders or no applications have been submitted in
response to a procedure with a prior tender procedure, provided that the initial terms
of the contract are not substantially altered
Tenders are considered unsuitable when their contents are not in agreement with the
contract scope as this is described in the tender documents, and thus do not meet the
requirements of the Contracting Entity as laid down in these documents.

EXAMPLES OF UNSUITABLE TENDERS
Tenders that do not meet the qualitative selection criteria (e.g. failure to submit a certificate or
document regarding the tenderers personal situation, thus making it impossible to obtain additional
information or clarifications) or the requirements of the award criteria.
Tenders made with reservations or tenders containing intentional or systematic errors.
Tenders made conditionally or containing conditions for counter-offers.
Tenders whose prices are demonstrably the product of collusion between the tenderers and are
sheltered from competitive forces, or if more generally there are serious indications of collusion
between the tenderers with the purpose of circumventing genuine competition or if, in the opinion of
the Contracting Entity, there was not sufficient competition during the tendering procedure.
Financial offers that exceed the estimated budget of the Contracting Entity (when this budget is set as
the ceiling in the tender documents, i.e. when negative reductions are not acceptable).
Abnormally low tenders that cannot be justified in writing by the tenderers following a request by the
Contracting Entity.

EXAMPLES OF LACK OF TENDERS
When no tender is submitted.
Tenders not submitted within the specified time limit.
Tenders which are irrelevant to the terms of the tender documents.

EXAMPLES OF LACK OF TENDERS
When the requests for participation or negotiation of all interested parties are found, during their
evaluation, not to meet the requirements of the qualitative criteria (e.g. failure to submit a certificate or
document regarding the tenderers personal situation, thus making it impossible to obtain additional
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information or clarifications).

SUBSTANTIAL ALTERATION OF THE ORIGINAL TERMS OF THE CONTRACT
Every change that may violate a specific principle of community law, especially the principles of free
and undistorted competition, of equality of treatment of the tenderers, and above all the principle of
ensuring the effectiveness of the Community Directives.
Changes in the technical specifications.
Changes in the contract financing method or to the payment of the contractor.
Changes in the contract schedule.
Changes in the conditions for the acceptance of the deliverables under the contract.
Changes in the construction techniques of a project.
Changes in the price. For example, an increase of the pre-estimated value of the original contract,
even if such increase does not exceed 10% (Judgment of 13.01.05 in Case C-84/03 Commission v
Spain, not yet published, point 47 and ff.).

Law 11()/2006, Chapter V, Article 38, 3, (b)
Where a contract is purely for the purpose of research, experiment, study or
development

CASES WHERE A CONTRACT IS AWARDED PURELY FOR THE PURPOSE OF
RESEARCH - EXPERIMENT - STUDY or DEVELOPMENT or FOR RECOVERING
RESEARCH and DEVELOPMENT COSTS
When a work, service or supply is performed for the first time purely for the purpose of research,
experiment, study or development (R&D).
When a work, service or supply as above is performed for the purpose of securing a profit (e.g. a
product manufactured solely for the purpose of research).
When a work, service or supply as above is not performed for the purpose of securing a profit or of
recovering research and development costs, and insofar as the award of such contract does not
prejudice the competitive award of subsequent contracts with do seek, in particular, those ends (e.g.
manufacture of a product in quantities that do not secure its commercial viability or for the purpose of
selling it in order to recover research and development costs or for meet the costs of purchasing
capital equipment for experimental or research laboratories).

Law 11()/2006, Chapter V, Article 38, 3, (c)
The case when, for technical or artistic reasons, or for reasons connected with the
protection of exclusive rights, the contract may be awarded only to a particular
economic operator

Law 11()/2006, Chapter V, Article 38, 3, (d)
The case of extreme urgency brought about by unforeseeable events

CASES OF EXTREME URGENCY DUE TO UNFORESEEABLE EVENTS
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When for reasons of extreme urgency brought about by events unforeseeable by the Contracting
Entity, the time limits laid down for the open, restricted and negotiated procedures cannot be adhered
to.
Unforeseeable events are considered to be events transcending the normal bounds of economic and
social life (for example, earthquakes or flooding) and requiring immediate action for relief and
assistance to those affected.
This case refers only to works, supplies or services which are necessary for meeting and alleviating
the immediate needs which have resulted from the unforeseeable events.

Law 11()/2006, Chapter V, Article 38, 3, (e)
The case of additional deliveries by the original supplier

THE CASE OF ADDITIONAL DELIVERIES BY THE ORIGINAL SUPPLIER
This case refers to additional deliveries by the original supplier which are intended:
either as a partial replacement of normal supplies,
or installations in use,
or as the extension of existing supplies or installations,
where a change of supplier would oblige the Contracting Entity to acquire material having different
technical characteristics which would result in incompatibility or disproportionate technical difficulties in
operation and maintenance.

Law 11()/2006, Chapter V, Article 38, 3, (f)
The case of additional works or services not included in the original contract

CASES OF ADDITIONAL WORKS or SERVICES NOT INCLUDED IN THE ORIGINAL
CONTRACT WHICH CAN NOT BE FORESEEN
Additional works or services that cannot be technically or economically separated from the original
contract without great inconvenience to the Contracting Entity.
Additional works or services which, although separable from the performance of the original contract,
are strictly necessary for its completion.
Unforeseen circumstances are considered to be those due to events or circumstances which could
not be identified and included in the scope of the original contract, although the necessary
investigations were conducted and the necessary designs were developed, and due care and diligence
was applied in accordance with the rules of workmanship and science", which include the official
(approved) regulations and specifications for works and services in the Republic of Cyprus or in the
European Union.
The Contracting Entity must provide actual and detailed justification of the above.

Law 11()/2006, Chapter V, Article 38, 3, (g)
The case of new works consisting in the repetition of similar works of the original
contract

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CASES OF NEW WORKS CONSISTING IN THE REPETITION OF SIMILAR WORKS OF
THE ORIGINAL CONTRACT
This case refers to works or services consisting in the repetition of similar works or services awarded
to the contractor to whom the same Contracting Entities awarded an earlier contract through a tender
procedure, provided that:
such works are in conformity with the design for the original contract,
the tender documents for the original contract provide that the award of such works may be made
to the original contractor on terms which are the same with those of the original contract,
and that the total budget of the works has been taken into consideration in putting out to tender the
original contract in accordance with the provisions of the law (thresholds).

Law 11()/2006, Chapter V, Article 38, 3, (g)
The case of supplies quoted and purchased on a commodity market

THE CASE OF SUPPLIES QUOTED AND PURCHASED ON A COMMODITY MARKET
This case refers to supplies quoted and purchased on a commodity market (crude oil, coal etc.)

Law 11()/2006, Chapter V, Article 38, 3, (h)
Contracts awarded on the basis of a framework agreement

THE CASE OF CONTRACTS AWARDED ON THE BASIS OF A FRAMEWORK
AGREEMENT
When Contracting Entities have already awarded a framework agreement, they may award further
contracts on the basis of that framework agreement.
A "framework agreement" is an agreement between one or more Contracting Entities and one or
more economic operators, the purpose of which is to establish the terms governing contracts to be
awarded during a given period, in particular with regard to price and, where appropriate, the quantities
envisaged.

Law 11()/2006, Chapter V, Article 38, 3, (k)
The case of bargain purchases

THE CASE OF BARGAIN PURCHASES
This case refers to bargain purchases, where it is possible to procure supplies by taking advantage of
a particularly advantageous opportunity available for a very short time at a price considerably lower
than normal market prices.
It concerns supplies purchased on particularly advantageous terms:
either from a supplier who is definitively winding up its business activities,
or from the receivers or liquidators of a bankruptcy, a court settlement, or a similar procedure
under national laws or regulations.

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Law 11()/2006, Chapter V, Article 38, 3, (l)
The case of a design contest

THE CASE OF CONTRACTS FOLLOWING A DESIGN CONTEST
This case refers to designs (services), when the contract concerned is part of the follow-up to a design
contest organised in accordance with the provisions of the Law and must, in accordance with the
applicable rules, be awarded to the winner or to one of the winners of that contest.
In the latter case, all the winners should be invited to participate in the negotiations. This provision
should be included in the documents of the original design contest.

For all the above cases, the steps of the procedure for the award of the respective contracts
are identical to the steps of the negotiated procedures with one or more economic operators,
as described in the previous paragraphs.
During the procedure for the prequalification of economic operators, the Contracting Entities
must apply, inter alia, the principles of the European Union Treaty.