Negotiated Procedure
The negotiated procedure allows contracting authorities to negotiate the terms and conditions of a contract with selected candidates. It can only be used under specific circumstances defined in the Public Procurement Act. This procedure is sometimes called the competitive procedure with negotiation.
Definition
The negotiated procedure is a procurement method where the contracting authority negotiates with pre-qualified candidates to develop one or more solutions that meet its requirements. Initial tenders serve as a basis for negotiation. The procedure may be used when the contracting authority's needs cannot be met without adaptation of readily available solutions, or when the procurement involves design or innovative solutions. It is governed by Section 34 of the Public Procurement Act (1397/2016).
Practical Example
A hospital district needs a customized patient information system. Since no off-the-shelf solution fits its needs, it uses the negotiated procedure. Three qualified vendors are invited to submit initial proposals, followed by multiple negotiation rounds to refine the technical solution and pricing.
Common Mistake
Bidders may assume that all aspects of the procurement are open for negotiation. However, the contracting authority must define minimum requirements and award criteria that cannot be changed during negotiations.
Frequently Asked Questions
When can a contracting authority use the negotiated procedure?
The negotiated procedure can be used when the authority's needs cannot be met without adaptation of available solutions, when the procurement includes design or innovation, when technical specifications cannot be established precisely, or when only irregular or unacceptable tenders were received in a prior open or restricted procedure.
How many candidates must be invited in a negotiated procedure?
At least three candidates must be invited to participate. If fewer than three qualified candidates apply, the authority may proceed with those who meet the suitability requirements.
Related Terms
Restricted Procedure
Understand the restricted procedure in Finnish public procurement. A two-stage process where candidates are pre-qualified before submitting tenders.
Competitive Dialogue
Understand competitive dialogue in Finnish procurement. A flexible procedure for complex projects where the solution needs to be developed with suppliers.
Direct Award
Learn about direct award (suorahankinta) in Finnish public procurement. When contracting authorities may procure without competitive tendering.
Framework Agreement
Understand framework agreements in Finnish public procurement. How multi-year agreements with one or more suppliers work under hankintalaki 1397/2016.
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