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Procurement Reform (Scotland) Act 2014

Regulated contracts

Section 3 – Regulated contracts

9.This section defines what is meant by a “regulated contract”. A regulated contract is a contract which is a “public contract” (defined in section 42 as having the same meaning as in Directive 2004/18/EC2) under which the contracting authority expects to pay £50,000 or more. If the contract is a “public works contract” (also defined in section 42 as having the same meaning as in Directive 2004/18/EC), the threshold value is £2,000,000 or more. Section 5 provides further detail on the estimated values of contracts, for the purpose of these thresholds. Public contracts meeting these thresholds will be subject to the provisions of this Act unless they are explicitly excluded (see section 4).

10.Section 3(3) enables the Scottish Ministers by order to amend the thresholds for application of this Act. By virtue of section 44(2) such regulations are subject to the affirmative procedure.

Section 4 – Excluded contracts

11.Section 4(1), by reference to regulations 6(1) and 6(2) of the Public Contracts (Scotland) Regulations 2012, excludes certain specific types of contracts from the scope of the Act. A contract is also excluded where it is for the purpose of acquiring goods, works or services in order to sell, hire or provide them to other persons, where the contracting authority will not have an exclusive right to sell, hire or provide the goods, works or services, and the conditions on which the contracting authority intends to sell, hire or provide them are the same as or similar to the conditions on which another person could sell, hire or provide the same or similar goods, works or services as a reseller. Contracts that are for the principal purpose of undertaking research and development activity will also be excluded from the application of the Act.

12.Section 4(2) enables the Scottish Ministers to amend, by regulations, the types of contracts which are excluded from the scope of this Act. By virtue of section 44(2) such regulations are subject to the affirmative procedure.

Section 5 – Estimated value of contract

13.Section 5 provides that, for the purposes of calculating contract values for the purposes of the Act, the relevant amount is the sum that a contracting authority expects to pay under a public contract. It is an estimate of the amount, excluding any VAT, that the contracting authority expects to pay as opposed to the actual sum payable.

14.Section 5(2) enables the Scottish Ministers to make further provision by regulations regarding the method used to calculate the value of the contract. These regulations will be subject to the negative procedure (see section 44(3)).

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Text created by the Scottish Executive department responsible for the subject matter of the Act to explain what the Act sets out to achieve and to make the Act accessible to readers who are not legally qualified. Explanatory Notes were introduced in 1999 and accompany all Acts of the Scottish Parliament except those which result from Budget Bills

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