Changes to public procurement come into effect

The Procurement Act 2023

The much-anticipated Procurement Act 2023 (“The Act”) came into force on 24 February 2025. The Act repeals and replaces the following four regulations:

• The Public Contracts Regulations 2015
• Utilities Contracts Regulations 2016
• Concession Contracts Regulations 2016
• Defence and Security Public Contracts Regulations 2011.

Replacing the aforementioned regulations with a single act is intended to create a simpler, more transparent, faster, and more flexible procurement process.

What are the key changes in the Procurement Act 2023?

Competitive tendering

In addition to replacing the former four sets of regulations with one act, the existing multiple routes to market will be simplified into two procedures:

• The Open Procedure – a single-stage process whereby any supplier who is in a position to deliver the contract may tender for the opportunity
• The Competitive Flexible Procedure – described as “such other competitive tendering procedure as the contracting authority considers appropriate for the purpose of awarding the public contract”.

In addition, the Act introduces the concept of “open frameworks”. An open framework is similar in nature to a framework agreement as existed prior to the Act. They still exist under the new Act, but must be re-opened to competition at least once during the lifetime of the framework. In principle, this will provide suppliers who were initially unsuccessful in bidding for a place on the open framework with a chance to obtain a place when competition is re-opened.

Limitations and challenges

A detailed article concerning remedies and challenges under the new regime can be found here.

In short, the limitation period for issuing proceedings under the new Act will continue to be just 30 days. However, in the event that a bidder wishes to benefit from the automatic suspension on contract making, proceedings will now need to be issued within just eight working days. It will no longer be sufficient to simply issue proceedings before the contract is executed so as to benefit from the automatic suspension.

There is also a new procurement-specific test to be applied by the court when considering applications to lift the automatic suspension.

Supplier exclusion regime and debarment list

Whist the Act maintains mandatory and discretionary grounds where a supplier must or may be excluded from the procurement process, the language in the new Act has been changed to refer to “excluded” and “excludable” suppliers.

The Act also creates a central debarment list to which bidders can be added. The debarment list will be a public list of either excluded or excludable suppliers who have been added to the list following an investigation by the government.

A supplier who is on the list by virtue of a mandatory ground for exclusion will not be permitted to partake in a procurement. Contracting authorities must exercise their discretion as to whether to permit a supplier who is on the list by virtue of a discretionary ground for exclusion to participate in a procurement.

Guidance for utilities

As set out above, the Act has introduced new rules regulating utilities procurement in the UK, replacing the repealed Utilities Contracts Regulations 2016 (“UCR”). The Act applies equally to utilities and utility contracts by public authorities, public undertakings and private utilities who have been granted a special or exclusive right to carry out a utility activity, as they do to other contracting authorities.

Key points to note for businesses

Utilities: The definition of ‘utilities’ is consistent with the UCR. Utilities companies should consider whether they qualify as a public authority, public undertaking, or private utility, as defined in Section 2(2).

Utility activities: These are defined in section 6(2) of the Act, with Schedule 4 outlining the scope of these activities in two parts:

• Part 1 details the activities considered utility activities and thus covered by the Act
• Part 2 lists activities that are not considered utility activities and are therefore excluded.

The list of in-scope utility activities under the Act largely mirrors the utility activities listed in Chapter 2 of the UCRs. However, the Act no longer includes postal services.

Exemptions: The Act retains the exemptions previously available under the UCR.

Term: The maximum term for utilities frameworks let by either a public authority or public undertaking remains eight years. There is no maximum term specified for frameworks awarded by private utilities.

Timescales: Similar to the position under the UCR, the minimum timescale for tenders is 10 days. However, there are no minimum timescales where tenderers are already members of a utilities dynamic market, where a shorter tendering period has been agreed.

Assessment and award: Private utilities have a wider discretion to exclude suppliers.

Tender notices: Under section 40 of the Act, there are limitations on the duty to publish tender notices. The duty will not apply where there is an award of a contract and the supplier is a member of a utilities dynamic market, established by a qualifying utilities dynamic market notice. In that situation, a contracting authority must provide a tender notice to members of the dynamic market, or to the relevant part of it.