The main source of law for public procurement in Italy is Legislative Decree No 50 of 18 April 2016 ("Public Contracts Code" or PCC).

The PCC transposed the EU Directive 2014/23/EU on concessions, Directive 2014/24/EU on public procurement, Directive 2014/25/EU on tender procedures of entities operating in the water, energy, transport and postal services (so-called “special sectors”) and therefore constitutes the legal framework for the awarding of public contracts and concessions concluded by contracting authorities and other awarding entities. The PCC has been subject to several amendments in order to implement European legislative acts, such as:

• Legislative Decree 19 April 2017 No 56 (the “Corrective Decree”);
• Law 14 June 2019 No 55 (the “Sblocca Cantieri Law”);
• Decree Law 16 July 2020 No 76 (the "Simplification Decree") converted into Law 11 September 2020 No 120.

In the last year, the following key developments are worth mentioning:

• Decree Law 31 May 2021 No 77 (the "Simplification Decree bis") converted into Law 29 July 2021, No 108, which introduced several provisions for the National Recovery and Resilience Plan, NRRP (Piano Nazionale di Ripresa e Resilienza, PNRR) and measures to accelerate and streamline tender procedures;
• Law 23 December 2021 No 238 (the “European Law”) containing the provisions issued by the Italian state to fulfil obligations arising from the EU.

In addition, the Code expressly mentions some implementing acts issued by various authorities, including:

• 14 decrees to be issued by the Minister for Infrastructure and Transport (Ministero delle Infrastrutture e della Mobilità Sostenibili, MIMS);
• 15 Acts to be issued by the National Anti-Corruption Authority (Autorità Nazionale Anticorruzione, ANAC);
• six decrees to be issued by the Prime Minister;
• 15 decrees issued by other ministers.

The regulatory framework currently in force is still ongoing, as the health emergency caused by the COVID-19 pandemic has strongly influenced the public procurement sector, leading to major derogations from the regulations laid down in the PCC to simplify and speed up the tender procedures, in most cases through the introduction of a provisional regime valid until 30 June 2023.

Under Legislative Decree No 50/2016, there are two types of entities subject to the public procurement regulation: (i) entities operating as awarding authorities or contracting authorities, and (ii) subjects that operate as economic operators.

With reference to the first type, Article 3, paragraph 1 of Legislative Decree No 50/2016 provides for the application of the PCC to:

• state administrations;
• local governments;
• non-economic public authorities;
• bodies governed by public law (organismi di diritto pubblico), according to Article 2(1)(4) of Directive 2014/24/EU, Article 3(4) of Directive 2014/25/EU, as well as Article 6(4) of Directive 2014/23/EU;
• associations, unions, consortia, formed by one or more of these subjects;
• public companies over which the contracting authorities may exercise a dominant influence by virtue of their ownership, financial participation or on the basis of the rules governing such companies.

Concerning economic operators, Article 3(1)(p) of PCC specifies that a bid may be submitted by "a natural or legal person, a public body, a grouping of such persons or bodies, including any temporary association of companies, a body without legal personality, including the European Economic Interest Grouping (EEIG) as described by Legislative Decree No 240 of 23 July 1991, which offers on the market the execution of works, the supply of products or the provision of services".

Specifically, Article 45 includes:

(a) individual entrepreneurs, including artisans, and companies, including co-operatives;

(b) consortia of production and work co-operatives;

(c) stable consortia, including those constituted as consortia of individual entrepreneurs, including artisans, of commercial companies and production and work co-operatives;

(d) temporary groups of competitors formed of the parties referred to in a), b) and c) above;

(e) ordinary consortia of competitors formed by the entities referred to in a), b) and c) above, including in the form of companies;

(f) aggregations between companies that are members of network contracts;

(g) entities that have entered into a European Economic Interest Grouping (EEIG) contract.

Pursuant to Article 3, paragraph 1, letter dd of Legislative Decree 50/2016, procurement law applies to

• works concessions – ie, contracts for pecuniary interest concluded in writing whereby one or more contracting authorities entrust the design and execution of works;
• service concessions – ie, contracts for pecuniary interest concluded in writing whereby one or more contracting authorities entrust one or more economic operators with the supply and management of services other than the execution of works provided for in public procurement contracts.

Both categories also operate for the so-called "special sectors" – ie, the sectors of public contracts relating to gas, heat, electricity, water, transport, postal services, land use, as governed by Part II of the Public Contracts Code.

Article 35 of the PCC has incorporated, for the purposes of its application, the following EU thresholds:

• EUR5,382,000 for public works contracts and concessions;
• EUR140,000 for public supply and service contracts and design contests awarded by contracting authorities that are central government authorities;
• EUR215,000 for public supply and service contracts and design contests awarded by sub-central contracting authorities;
• EUR750,000 for contracts for social and other specific services.

In regard to special sectors, the EU minimum value thresholds are:

• EUR5,382,000 for works contracts; 
• EUR431,000 for supply and service contracts and for design contests;
• EUR1 million for service contracts, social services contracts and other specific services.

However, contracting authorities may proceed with the award of contracts for works, services and supplies below the aforementioned minimum value thresholds, by following the procedure set out in Article 36 of PCC.

It should be noted that the Simplification Decree has temporarily modified the regulation of the direct awarding procedure, allowing direct awarding for works below EUR150,000 and for services and supplies, including engineering and architectural services and design activities, below EUR139,000. In such cases, the contracting authority may proceed with the direct award, even without consulting several economic operators, albeit always in compliance with the principles set out in Article 30 of the Public Contracts Code.

Based on the Government Procurement Agreement (GPA) – signed in Marrakech on 15 April 1994 – governments, including the EU, are obliged to grant other members products, services and their supplier’s treatment no less favourable than that granted to national products, services and suppliers. Furthermore, it is not allowed to discriminate between products, services and suppliers of other parties to the GPA.

To this extent, Article 45 of the Public Contracts Code provides that economic operators established in other member states of the EU, and which have been constituted in accordance with the legislation in force in their respective countries, are also admitted to public contract award procedures.

The Administrative Regional Court (TAR) of Piedmont recently expressed on the consequences of Brexit concerning the admission of British economic operators to the procedures for the award of public contracts and concessions with a value below the EU thresholds (TAR of Piedmont, Section III, 3 December 2021, No 1110). The Court stated that the access of such companies to the procurement market excluded from the framework of EU law is not prohibited but only "not guaranteed" and that, therefore, it is necessary to verify on a case-by-case basis whether the contracting authority has exercised this option.

The main obligations under the public procurement regulation arise from the fundamental principles of the EU Treaty and EU directives: the principles of freedom of movement of goods, freedom of establishment and freedom to provide services, as well as the principles deriving therefrom, such as equal treatment, non-discrimination, mutual recognition, proportionality, transparency, environmental protection and energy efficiency.

These principles are laid down in Article 30 of the Public Contracts Code, according to which “the award and execution of works, services and supplies contracts and concessions within the meaning of this Code shall ensure the quality of the performances and shall be carried out with respect to the principles of cost-effectiveness, efficacy, timeliness and correctness. In awarding contracts and concessions, the contracting authorities shall also respect the principles of competition, non-discrimination, transparency, proportionality, as well as publicity, according to the modalities indicated in this Code. The principle of cost-effectiveness may be derogated, within the limits in which it is expressly allowed for in current legislation and in this Code, by criteria, provided in the call for competition, inspired to social exigencies, as well as to the safeguard of health, environment, cultural heritage and the promotion of sustainable development, also under an energy standpoint”.

According to the national legislation, contracting authorities may not restrict competition in any way in order to favour or disadvantage certain economic operators and, therefore, the criteria for participation in contracts must be such that they do not exclude micro, small and medium-sized enterprises. On the other hand, to pursue the public interest, only candidates satisfying the moral, financial and technical requirements that provide adequate guarantees of proper performance should participate in the tender procedures.

Public contract regulations set forth two different systems of publicity. The first entails the duties of legal publicity (MIT Decree 2 December 2016 and Articles 70, 71, 78 and 98 of the Public Contracts Code). The second relates to the concept of transparency, as an instrument to allow citizens to supervise administrative activities and the proper use of public resources, also in order to prevent corruption (Article 29 PCC, Article 5 Legislative Decree 33/2013, so-called “civic access”).

Legal Publicity

The PCC and the MIMS Decree 2 December 2016, having regard to (i) the value of the contract and/or the concession (ie, whether it is below or above the thresholds set out in Article 35 of the PCC) and (ii) the type of contract (ie, whether it is a supply, services or works contract), mandate for prior advertisement of notices on:

• the Italian Official Gazette, Special Series of Public Contracts;
• the Public Administration website, in the Transparent Government section, Calls for Tenders and Contracts (eg, the website of the Municipality of Milan);
• the IT digital platform of the Ministry of Infrastructures and Transports (MIT) https://portaleappalti.mit.gov.it/PortaleAppalti/it/homepage.wp also, through regional e-procurement platforms (eg, Sintel, with reference to the Lombardy Region);
• the Official Journal of the European Union, Contracts and Grants, Procurement;
• by abstract, in two national newspapers and two local newspapers having large circulation in the territory where the contract is implemented;
• the office of the secretary of the municipality where the works are implemented (eg, in relation to the Municipality of Milan).

The information included in the notices is:

• details of the contracting authority;
• subject matter;
• value;
• duration and place of performance of the contract;
• selection criteria;
• type of procedure and term for submission of bids.

Contracting authorities may conduct preliminary market consultations for all types of contracts, regardless of their value (see Articles 66 and 67 of the PCC and ANAC Guidelines No 14 of 6 March 2019), provided that they are carried out before launching a tender procedure, as a support aid for:

• preparing tender documents and more accurate tender specifications;
• designing the relevant procedure, particularly for complex procurements;
• clarifying certain aspects, including technical aspects, of a contract;
• informing economic operators of their upcoming procurement plans and requirements thereof.

To this extent, awarding authorities may acquire advice, information or technical documentation from experts, market participants and independent authorities.

Such contribution is provided free of charge, without any right to reimbursement of fees or expenses.

Consultations are initiated by means of a "consultation notice", which must indicate:

• the assumptions and purposes that induce the administration to avail itself to preliminary consultations;
• the specific needs of the contracting authority;
• type and form of contribution requested;
• the timescales set for the submission of contributions and, where possible, those for the publication of the selective procedure and for the implementation of the contract;
• possible incompatibility effects determined by the participation in the consultation;
• the modality of progress of the relevant procedure.

Preliminary market consultations are particularly relevant when the assignment is of a "novel" nature (ie, innovative or unusual).

The procedure must be conducted in a way to guarantee the protection of fair participation, the “par condicio” (equal treatment) of the economic operator and transparency. Therefore:

• the information and/or documentation provided by economic operators cannot take the form of a technical/economic bid; and
• all information exchanged during the consultation phase can subsequently be disclosed to any economic operator expressing interest in participating to the future selective procedure.

Procedures that May Be Used for the Award of a Contract

Public competitive procedures are divided into general procedures and negotiated procedures.

General procedures

Open procedure (Article 60 PCC)

It is called by the publication of: (i) a tender notice, together with the tender regulation, (ii) instructions to tenderer and (iii) a performance specifications document (lex specialis), followed by the submission of tender (the administrative documentation, the technical and economic bid of each participant). Upon checking the eligibility requirements of the candidates, the awarding authority proceeds to complete the comparative assessment in order to draw up a ranking list and then arrange for the award.

Restricted procedure (Article 61 PCC)

It is called by the publication of a tender notice, but the economic operators are simply invited to provide a request for tender participation; only after the assessment of the information related to admission requirements provided by the bidders does the award authority formally invite the candidates to submit a bid offer. Contracting authorities may limit the number of suitable candidates to be invited to participate in the procedure, but must indicate the relevant criteria in the tender notice.

Negotiated procedures

The main feature of these procedures is the presence of a discussion between public administrations and private operators.

Competitive procedure with negotiation (Article 62 PCC)

Following the publication of the tender notice, the operators first send a request for tender participation and, subsequently, an initial bid. The latter will be negotiated with the public administration which, however, is required to:

• comply with the principle of fair and equal treatment – it is prohibited to disclose information that can benefit one of the competitors;
• inform all bidders of any changes to the procurement documents during the negotiation phase, assigning a deadline for integrating the bid.

At the end of the negotiation, the awarding authority provides the bidders a time limit to submit their final, unmodifiable bids.

Competitive dialogue procedure (Article 64 PCC)

Unlike the competitive procedure with negotiation, in this procedure the awarding authority has only to specify the need that it wants to satisfy. Therefore, a broader comparison is established which must lead to the identification of the optimal tailor-made solutions to be submitted to the administration and, subsequently, to the participants in order to request them to submit their final bids. The competitive dialogue procedure is used for particularly complex and/or innovative procurements.

The awarding authorities have the right to provide for reward mechanisms and payments in favour of the competitors who are not chosen as the winner of the contract award, in consideration of the remarkable effort required by this procedure.

Innovation partnership (Article 65 PCC)

This specific procedure allows the administration to identify a solution that is still unavailable on the market: to this extent, in the tender notice it is sufficient to formulate the correct admission requirements of the competitors, without specifying the subject matter.

Later, the contracting authority can choose whether to activate the partnership with one or more operators. This selection is essentially based on the evaluation of the potential supplier capabilities in the research and development field.

Following the negotiation phase, the bid(s) shall be scrutinised.

The contract award criterion is the most economically advantageous tender.

Negotiated procedure without prior publication of the tender notice (Article 63 of PCC)

Upon the occurrence of the cases laid down by Article 63 of the PPC, the public procurer may invite (without previously publishing the tender notice) economic operators, in a minimum number of five, to submit a bid. In this case, the contracting authority proceeds to verify the requisites of the competing economic operators and, subsequently, to the comparative evaluation of the bid offers submitted, to arrange the award in favour of the best one.

Negotiated procedure with a prior call for competition (Article 124 of PCC)

This procedure is conducted exclusively within special sectors (ie, water, transport, postal services, fuel, thermal energy, electricity and geographical area exploitation) and possesses similar features of the restricted procedure.

Modalities of Selecting Tender Procedures

The Public Contracts Code imposes various criteria to be assessed by public administrations in order to select the type of procedure feasible for the award of a public contract, the most important one is the value of the contract. The award of contracts whose amount is below the EU threshold is governed by Article 36 of the PCC.

A distinction is to be made between general procedures and negotiated procedures.

General Procedures

Open procedures and restricted procedures are the two standard ways of selecting the contracting operator, both are feasible to the public administration for all types of assignment, since no eligibility assumptions have been provided.

However, if the contracting authority selects the restricted procedure, a specific motivation is deemed as necessary.

Competitive Procedures with Negotiation and Competitive Dialogue

The negotiated procedure can only be conducted on the grounds of the "eligibility assumptions" governed by the PCC and, in particular, both for the competitive procedure with negotiation and for the competitive dialogue, the contracting authority is requested to provide proper justification in relation to: (i) the demand of technical requirements and/or (ii) following an unsuccessful attempt to carry out an open or restricted procedure.

Innovative Partnership

Regarding the use of innovation partnership, public administrations must reach a decision based on:

• the needs or demand to be met;
• the unavailability of the solution on the open market;
• the effective need to find alternative solutions.

Negotiated Procedure without Prior Publication of a Contract Notice

This refers to a procedure with novel characteristics, therefore it is necessary that procuring entities relying on this procedure shall assess particularly stringent criteria and, consequently, it is required to justify the occurrence of the conditions specifically spelled out by Article 63 of the PCC, such as:

• the failure of the attempt to call general procedures;
• the existence of a single operator on the open market (eg, in case of a unique work of art);
• in so far as it is strictly necessary where, for reasons of extreme urgency, it is not possible to comply with the time limit for open or restricted procedures.

As a general rule, procurement regulations do not impose to contracting authorities specific time limits for the publication of procurement documents.

Nevertheless, with reference to each tender procedure the time limits for submitting applications and bids are (i) essential; (ii) binding and (iii) shall be expressly indicated in the lex specialis. The failure to comply with such time limits leads to the inadmissibility of the proposed bid.

Article 79 of the PCC states that public authorities must fix the deadlines for the receipt of the requests to participate and bids, considering (i) the complexity of the contract, and (ii) the time required to prepare bids, without prejudice to the minimum time limits set out by Articles 60–65 of the PCC. 

These deadlines may be extended in case of:

• a timely request for additional significant information for the purpose of submitting adequate bids that are not provided at least six days before the deadline set for the receipt of bids (Article 74 of the PCC); or
• significant changes to the tender documents, in which case it must be granted a period of time proportionate to the importance of the information and/or of the changes.

The PCC also establishes the operating procedures to be followed in the event of a malfunction of the digital e-procurement platform affecting the correct bid submission, if necessary, also providing for the suspension of the time limits for submitting the bid until restoration of the normal functioning of the digital e-procurement platform (paragraph 5 bis, Article 79 of the PCC). In case of suspension and/or extension, the public authorities are obliged to:

• provide adequate publicity;
• ensure the confidentiality of bids already sent by competitors;
• allow competitors to withdraw their bid and to update and or replace it.

Article 79 of Legislative Decree No 50/2016 defines the terms and time limits that contracting authorities must take into account within the public procurement process, being necessary to consider the particular complexity of each individual single contract and the time needed to submit the bids.

In other words, the public administration has to consider two different aspects when it sets deadlines:

• the subject matter (work, service or supply) of the contract – ie, the level of complexity of the work or service to be carried out by the contractor during the execution of the contract;
• the preparation of the bid – ie, the level of complexity of the technical and economic bid to be prepared.

The ordinary minimum time limits for the submission of the bids in open (“procedure aperte”) and restricted procedures (“procedure ristrette”) are those provided by Articles 60 and 61 respectively of Legislative Decree 50/2016, namely: 

• with regard to open procedures, there is a minimum ordinary term of 35 days starting from the date of transmission of the invitation to submit a bid;
• with regard to restricted procedures, there is a minimum ordinary term of 30 days for the receipt of tender, starting from the date of transmission of the tender notice or, if a prior information notice is used, since the invitation to confirm interest has been sent; also a minimum ordinary term of 30 days is provided to submit a bid, starting from the date of transmission of the invitation to submit a bid.

In both cases, the contracting authority may reduce the above-mentioned time limits. For open procedures, the minimum time limit to submit a bid may be reduced to 15 days and, for restricted procedures, it may be reduced to ten days. In both cases, however, the following two conditions must be satisfied:

• the pre-information notice must contain all the information required for the tender procedure – if such information is available at the time of publication of the tender notice;
• the pre-information notice must have been sent for publication not less than 35 days and not more than 12 months before the date of the tender notice;
• the time may also be reduced for reasons duly motivated by the public administration.

Criteria that an Economic Operator Must Meet in Order to Be Eligible for Participation in a Procurement Process

In order to bid to a public tender procedure, economic operators are requested to possess certain prerequisites set out by the law.

Article 94 of PCC set forth that, before proceeding with the evaluation and selection of the bid, it is necessary to verify the compliance of each bid with:

• “general or subjective requirements”, consisting in moral requisites envisaged under Article 80 of the PCC, and
• the so-called “special or objective requirements”, namely the conditions and criteria encapsulated in the tender documents referring to technical/professional and economic/financial requirements, as regulated by Articles 83 and 84 of the Public Code of Contracts.

General or Subjective Requirements

In particular, Article 80 of the PCC specifies the grounds for exclusion for moral reasons, by:

• listing certain hypotheses determining the inability to contract with the public administrations, therefore originating a mandatory exclusion (paragraphs 1, 2, 4 and 5); and
• listing a series of cases in which the administration has the burden to assess and evaluate the relevance of the offence and/or violation committed by the tenderer (paragraph 4 – “tax irregularities not definitively ascertained”, and paragraph 5, letter c) – “professional offences”).

Special or Objective Requirements

Articles 83 and 84 of the PCC set the minimum bar of technical/professional and economic/financial requirements for the bidder entering into a tender process: the main purpose of such requirements is to select those contractors/suppliers whose capabilities, qualifications and experience would minimise the risk of non-performance under the proposed contract.

It is worth noting that paragraph 8 of Article 83 of the PCC provides that the public authorities, in addition to the general and special requirements, cannot introduce further grounds for exclusion other than those expressly required by the PCC.

Pursuant to Article 91 of Legislative Decree No 50/2016, for restricted procedures, competitive procedures with negotiation (“procedure competitive con negoziazione”), competitive dialogue procedures (“dialoghi competitivi”) and innovation partnership procedures (“partenariato per l’innovazione”), the contracting authority may limit the number of candidates who meet the selection criteria and who may be invited to submit a bid, negotiate or participate in the dialogue, if the difficulty or complexity of the works, supply or services requires it – this, as long as it is ensured a minimum number of qualified candidates, as follows:

• in restricted procedures, the minimum number of candidates may not be less than five;
• in competitive procedures with negotiation, competitive dialogue procedures and in innovation partnerships, the minimum number of candidates may not be less than three.

In the tender notice or invitations to confirm interest, the contracting authorities indicate the minimum number of candidates they intend to invite and, where they deem it appropriate for justified reasons of good performance, the maximum number of the candidates themselves.

The contracting authority could evaluate a bid/tender according to two different criteria: (i) the most economically advantageous tender (MEAT) and (ii) the lowest price criterion. Furthermore, for each criterion, the public administration could also provide other sub-criteria or sub-scores.

MEAT is the most widely used criterion in the tender procedures for selecting the winner of the contract award procedure.

Article 95 of the PCC allows the contracting authority to award the tender according to a complex comparison between the technical data and the economic/quantitative data of the bid. Specifically, the most economically advantageous bid based on the best price/quality ratio is evaluated according to objective criteria such as qualitative, environmental and social aspects, related to the subject matter of the contract as set out in the procurement documents.

Tenders awarded only by the MEAT criterion are:

• those relating to social services and hospitals, schools and care catering, as well as labour-intensive services;
• those relating to engineering and architectural services and other services of a technical and intellectual nature with a value equal to or greater than EUR40,000;
• those for an amount equal to or greater than EUR40,000, with considerable technological content or which have an innovative character.

On the other hand, with the lowest price criterion – regulated by Article 95 of Legislative Decree No 50/2016 – the contracting authority compares bids in relation to the greater price reduction in relation to the auction base, exclusively in the context of services and supplies with standardised characteristics or whose conditions are defined by the market, with the exception of labour-intensive services.

Disclosure of Tender Evaluation Methodologies

Awarding authorities are obliged to determine both contract tender evaluation methodology (Article 95 PCC – ie, MEAT or lowest price) and the selection of the bid criteria (ANAC guidelines No 2 on the most economically advantageous tender, approved with Resolution No 1005 of 21 September 2016).

Tender Evaluation

For the tender evaluation criteria, please refer to 2.9 Evaluation Criteria.

Selection of the Bidders

The regulation of the call of the tender, in the event in which the tender evaluation is the MEAT, must include the criteria used by the awarding authority to evaluate the bids (ie, “selection of the bidder’s criteria”).

In particular, it is possible to distinguish between (i) constrained criteria, so-called "on-off", attributing a certain pre-determined, fixed score in case of a peculiar feature of the performance; (ii) discretional, namely the Selection Board proceeds with a comparative evaluation of bids – in this case, the regulation of the call of the tender shall assess a score range (not overly broad), within which the Selection Board shall assign the score to each of the candidates, having regard to the “justification criteria” that compose the score range itself.

For each selection of the bidder criteria, the regulation of the call of the tender could contemplate sub-criteria or sub-weights or sub-scores.

An example of selection of the bidder’s criterion is the life-cycle costing, calculating all costs incurred by the authority throughout the life-cycle of the product/services.

Pursuant to Article 76, paragraph 5, letter b) of Legislative Decree No 50/2016, the contracting authorities must notify the exclusion provision to excluded bidders and to other candidates immediately, and in any case no later than five days from the date of the exclusion.

Similarly, pursuant to paragraph 2, letter a-bis of the same article, if a written request is received from the bidder and the interested candidate, the contracting authority must inform each excluded candidate immediately (and in any case within 15 days from the request) about the reasons that led to rejecting the application.

The above-mentioned communications are sent by certified email system or by similar systems used in other member states.

Pursuant to Article 76, paragraph 5 of Legislative Decree No 50/2016, contracting authorities must notify immediately – and, in any case, within five days – the provision of the award to:

• the winner;
• the operator ranked in second place;
• all the candidates who have submitted an accepted bid;
• the candidates excluded from the procedure if they have challenged the exclusion decision or if they are in terms to challenge the exclusion decision.
• the bidder that challenged the tender notice or the invitation letter, if the appeals have not been rejected with a definitive judgment.

The above-mentioned communication is sent by a certified email system (or any similar system used in the other member states) and indicates the expiration date for the contract subscription.

The award provision must indicate – pursuant to Article 3 Law No 241/1990 – “the factual presuppositions and legal reasons that have determined the administration's decision, in relation to the results of the preliminary investigation. If the reasons for the decision result from another act of the administration referred to by the decision itself, together with the communication of the latter, the act to which it refers must also be indicated and made available, in accordance with this law. In each document notified to the recipient, the deadline and the authority to which it is possible to appeal must be indicated”.

Legislative Decree No 50/2016 provides for two different types of “standstill period” – the “substantial” standstill and the “procedural” standstill.

Article 32, paragraph 2 of Legislative Decree No 50/2016 provides that "the contract cannot, in any case, be stipulated before thirty-five days since the dispatch of the last of the notifications of the contract award decision". The regulation refers to the substantial standstill: here the term of 35 days has been co-ordinated with the procedural term (30 days) for challenging the contract award decision, and so to prevent the contract from being entered into during the pending judgment.

This mechanism includes the procedural standstill, which provides for an automatic suspensive effect of 20 days from the appeal that also includes a request for precautionary measures. In this sense, Article 32, paragraph 11, of Legislative Decree No 50/2016 provides that "if an appeal is lodged against the contract award decision with a request for precautionary measures, the contract cannot be stipulated from the time of notification of the precautionary request to the Contracting Authority and for the following twenty days, provided that within this term at least the precautionary measure of first instance takes place or the publication of the device of the sentence of first instance in case of a decision on the merits at the precautionary hearing, or until the pronouncement of said measures if subsequent".

As a general rule, the awarding authority has the power to review the decisions it has issued. This power of administrative self-protection is justified by the need for the public administration to conduct a thorough investigation, to allow inspections and functional checks aimed at making the final decision to maintain or remove the act from the system. 

In the context of tender procedure, this power can affect the final contract award decision (so-called "external self-protection", since it affects an act that is prodromal and temporally previous to the contract itself) and is most frequently expressed in the institutes of revocation (revoca– regulated by Article 21-quinques of Law No 241/1990) and self-annulment (annullamento d’ufficio, ruled by Article 21-nonies of Law No 241/1990).

On the other hand, "internal self-protection" relates to all the powers of unilateral intervention of the public administration in the contract, which can also lead to the termination of the contract itself: for example, revocation (regulated by Article 108 of Legislative Decree No 50/2016) and termination for convenience (recesso unilaterale, regulated by Article 109 of Legislative Decree No 50/2016).

Pursuant to Article 120, paragraph 5 of the Code of Administrative Procedure (Legislative Decree No 104/2010), these measures may be challenged before the Administrative Court within 30 days from knowledge of the act.

Breach of Procurement Legislation

In the event that the public administration adopts an act in violation of the public procurement regulations, the aggrieved economic operator can (i) bring a claim for administrative self-annulment against the contracting authority that adopted the administrative act, and/or (ii) challenge the provision deemed unlawful (eg, award to a supplier not possessing the requisites specified by the tender regulations or tender notice lacking the essential elements) by proposing a judicial appeal to the courts.

Application for Administrative Self-Protection

The prejudiced economic operator is entitled to submit a request to the administration, explaining the grounds, aimed at reviewing the choices and evaluations made in the tender. In this case, the contracting authority will be required to evaluate the application and, in the light of the self-assessment carried out, will determine whether to confirm the act/decision adopted or, alternatively, to annul it in self-defence (that is, to cancel it from the “legal knowledge”).

The Appeal

The economic operator can challenge the competent TAR, alleging breach of the procurement rules. The proceeding must be started within 30 days of knowing that grounds for starting the proceeding had arisen. The disputing party is also entitled to apply for interim measures in order to preserve its rights and interests.

The economic operator assuming an infringement of public tender regulations may apply for review and, at the same time, request from the court the application of interim precautionary measures, with the aim of correcting the alleged infringement or preventing further damage to the eligible entity’s interest. Such measures may consist in the suspension of the decision under review or, alternatively, the scheduling of a hearing upon the merits of the proceeding, as described by Article 55 of the Code of Administrative Procedure.

The application is aimed at imposing interim measures that could be either (i) “monocratic”, issued – without hearing attorneys – until the collegial hearing discussing the interim measures, or (ii) “collegial”.

Monocratic interim measures are disposed by the TA.R President with a presidential decree (that may be adopted just a few hours after the filing of the application), “in case of extreme gravity and urgency” – such as not to allow a delay until the date the council next meets in chambers. Collegial interim measures postulate the hearing of the defendant, and the discussion takes place orally. The TAR for interim relief, if it considers the grounds favourable, fixes with a collegial order the date of the hearing on the merits, usually a few weeks after the filing of the application, authorising the production of written statements.

Requisites for the Adoption of Interim Measures

The conditions for the issuance of interim measures by the court are:

• fumus boni iuris, a positive judgment regarding the not-unreasonable nor reckless content of the petition;
• periculum in mora, the reasonable risk for the applicant to suffer “serious and irreparable damage during the time necessary to obtain a decision”.

Such requirements are strictly evaluated in case of monocratic measures, given the absence of any discussion and the extremely short duration of the phase.

The right to challenge the public administration’s decisions stems from the Code of Administrative Procedure (Legislative Decree 104/2010) which states that the review procedures can be activated by any concerned entity having concrete and current interest.

In particular, within public procedure matter, it may result in:

• the possibility for any economic operator to challenge the tender notice, if it contains “immediately exclusive clauses” (“Clausole immediatamente esclusive”), namely clauses excluding the competitor from tender process or, alternatively, that do not provide the severability of a serious and well-weighted bid;
• the possibility to challenge the exclusion decision by the bidder allegedly unlawfully excluded from a procedure – in order to maintain concrete and current interest, according to court jurisprudence (except in limited cases such as reports to ANAC, or the calling on of a bid bond/provisional guarantee) it is also necessary to challenge any awarding that occurred to another competitor;
• the possibility to challenge the award decision.

If the entity is ranked in a position other than second, is required to justify not only the unlawful attribution of the score of the successful bidder, but also with reference to the evaluation of the bids of the competitor who preceded them in ranking.

Pursuant to Article 120 paragraph 1 of Legislative Decree No 104/2010, “the acts of awarding procedures relating to public works, services or supplies” are subject to the public procurements process, that is a judgment carried out before the Administrative Court and that concerns the overall activity of the public administration aimed at the conclusion of contracts.

In order to challenge the above-mentioned public procedure acts, the appeal must be brought within the term of 30 days:

• from the awarding communication (regulated by Article 76 paragraph 5 of Legislative Decree No 50/2016);
• from the publication of the tender notice or other notices on the public administration website (in the section entitled Transparent Government);
• in any other case since the act was known.

The administrative legal enforcement of public contracts is quicker in comparison to civil and criminal procedures, as Legislative Decree No 104/2010 set forth very short time limits for reviews in respect of the ordinary procedure (ie, the time limit to challenge the award decisions is 30 days from their communication). 

It is worth mentioning that if the economic operator requests the application of interim and precautionary measures (“misure cautelari”), the courts must schedule a hearing following the tenth day since the notification and five days from the depositing of the application. (It is estimated that interim measure reviews have an average length of 30 days).

Within such procedure, the courts not only rule on interim measures but, in the event they detect the manifest foundation of the application, are entitled to rule in relation to the whole proceeding with a simplified judgment. The grounds of the judgment may consist of a brief reference to the point of fact or law deemed conclusive or, if appropriate, to a conforming precedent.

In particular, the estimation of the length of proceedings relating to a procurement claim should consider the complexity of the matter dealt with, which typically depends on the number of parties involved in the proceeding, and/or on the complexity of the procedure, as well as on the workload of the courts seized of the case.

Nevertheless, according to “Relazione sulla amministrazione della Giustizia nell’anno 2021” published on the site of the Ministry of Justice, the average length for the definition of a new judgment in the field of public contracts is 104 days, while an appeal to the Administrative Supreme Court is decided, on average, in 163 days. Consequently, the time to complete a case relating to public contracts including two instances could be approximately 12 months.

Number of Procurement Claims Considered by the Review Bodies per Year

Before considering the number of public procurement claims reviewed every year, it might be useful to highlight that, in Italy, disputes can be settled by the courts of “ordinary jurisdiction” or by the courts of “administrative jurisdiction”. The first courts can take cognisance of every controversy of a civil nature involving the relationship between individuals (such as contract law or corporate law), whereas the second type of courts resolve disputes in which a private entity interacts with a public power.

The following data concerns exclusively the administrative judgments and are provided on the Giustizia Amministrativa website, the official web portal of the administrative jurisdictions in Italy.

It may also be appropriate to distinguish between claims to TAR and appeals to the Administrative Supreme Court.

Both challenge the legitimacy of a decision adopted by the public administration: TAR as first instance court, Council of State as second instance court.

As concerns the procurement claims to TAR, it is esteemed that they amount on average to about 7% of the whole administrative disputes and, consequently, to around 4,000 claims per year.

Referring to the appeals, they account for 7–8% of overall administrative appeals; the total amount of cases that can be attributed to public procurement appeals is therefore approximately 1,000 per year. 

Costs to Challenge an Award Authority's Decision

The typical costs to challenge an award authority’s decision essentially refer to two different kinds of fees: (i) the court registration fee and (ii) the attorney’s fee.

The Court Registration Fee

The court registration fee is a tax that, according to Article 9 of Presidential Decree No 115/2002, any applicant must pay – for any instance and for any type of dispute – for the registration of new litigation.

It is determined on a fixed basis, according to Article 13 of Presidential Decree No 115/2002.

For public procurement matters, the court registration fee varies in proportion to the value of the tender as indicated in the tender notice. Therefore, concerning proceedings before the court of first instance:

• EUR2,000 if the tender value is below or equal to EUR200,000;
• EUR4,000 if the tender value is between EUR200,000 and EUR1 million;
• EUR6000, if the tender value is above EUR1 million.

In case of appeal before the court of second instance, the court registration fee is increased by 50%.

Attorney's Fee

The legal assistance of an attorney is mandatory in case of challenge of an award authority’s decision: the calculation of this fee has to be conducted according to the parameters identified by Ministerial Decree No 55/2014, which provides, considering the value of the dispute, (i) a minimum fee, (ii) a medium fee, and (iii) a maximum fee.

In order to determine the value of the dispute, it is necessary to refer to the “effective profit” that, according to the case law consists of an amount not lower than 10% of the tender value; please see Administrative Supreme Court Advice No 183/2022.

However, sometimes, the effective profit could be specifically indicated within the procurement documents.

The attorney’s fee can be increased in relation to particularly complex dispute cases.

During contract execution, amendments are allowed within the limits of Article 106 of Legislative Decree No 50/2016 and are subject to authorisation from the Official Responsible for the Procedure (Responsabile Unico del Procedimento, RU.P) in accordance with internal rules of the contracting authority.

Specifically, contracts may be edited (both from a subjective and objective point of view) without a new awarding procedure in the following cases:

• whether the changes, regardless of their monetary value, were provided for in the original procurement documents in clear, precise and unambiguous clauses, which may include price revision clauses;
• for additional works, services or supplies that became necessary and were not included in the original contract, if a contractor change could involve cumulatively the following effects (also considering that for contracts in the ordinary sectors the contract may be amended if any increase in price does not exceed 50 % of the value of the original contract):
1. it is unsustainable for economic or technical reasons such as meeting the requirements for interchangeability or interoperability between existing equipment, services or facilities provided under the original contract;
2. it causes significant inconveniences or substantial duplications of costs for the contracting authority;
• where certain conditions are met, namely:
1. the need for modification is brought about by circumstances unforeseen and unforeseeable by the contracting authority;
2. the modification does not change the general nature of the contract;
• if a new contractor replaces the contractor who was initially awarded the contract due to any of the following circumstances:
1. an unambiguous review clause in accordance with the provisions of the first bullet point above;
2. the initial contractor is succeeded, by death or as a result of corporate restructuring, including takeovers, mergers, demergers, acquisitions or insolvency, by another economic operator meeting the qualitative selection criteria originally established, his does not entail other substantial modifications to the contract and is not aimed at circumventing the application of the Public Contracts Code;
3. when the contracting authority takes the obligations that the main contractor had to its subcontractors;
• when the changes are not substantial – ie, when the changes do not significantly modify the essential elements of the contract originally signed; 
• contracts may also be edited if the value of the modification is lower than both the following values:
1. the EU thresholds set out in Article 35 of the PCC;
2. 10% of the initial value of the contract for service and supply contracts in both ordinary and special sectors, or 15% of the initial value of the contract for works contracts in both ordinary and special sectors.

Pursuant to Article 36 of the PCC, the contracting authorities shall award contracts for works, services and supplies below the thresholds set out in Article 35 in accordance with the following procedures.

For assignments of less than EUR40,000, by direct awarding even without prior consultation of two or more economic operators or for works in direct administration. In this case, the public administration is not obliged to publish the contract award decision.

For assignments of an amount equal to or greater than EUR40,000 and less than EUR150,000 for works, or the thresholds referred to in Article 35 for supplies and services, by direct awarding after assessing three estimates, if any, for works, and, for services and supplies, of at least five economic operators identified on the basis of market surveys or through lists of economic operators, in compliance with a criterion of rotation of invitations. The works can also be carried out by direct administration, except for the purchase and hire of vehicles, for which the procedure referred to in the previous sentence is applied. In this case, the public administration must publish the contract award decision, also indicating in the provision itself the candidates invited to submit a bid.

The norms regarding the direct contract awarding procedure have been temporarily amended by the Simplification Decree, as well as by the Simplification-bis Decree. The temporary regulations apply to all cases in which the contracting determination, or other equivalent internal act of initiation of the procedure, has been adopted by the deadline of 30 June 2023.

In particular, Contracting Authorities may proceed with the direct awarding of works, services and supplies, as well as engineering and architectural services, including the design activity, for amounts below the EU thresholds referred to in Article 35 of Legislative Decree 50/2016 as follows.

Direct awarding for works below EUR150,000 and for services and supplies, including engineering and architectural services and design activity, below EUR139,000. In such cases, the contracting authority may proceed with direct awarding, even without consulting several economic operators, subject to compliance with the principles set out in Article 30 of the Public Contracts Code.

Negotiated procedure without notice pursuant to Article 63 of Legislative Decree 50/2016 after consulting at least five economic operators identified on the basis of market surveys, or through lists of economic operators, taking into account not only the principle of rotation of invitations but also a different territorial dislocation of companies, in the case of the award of services and supplies for an amount equal to or greater than EUR139,000 and up to the thresholds referred to in Article 35 of the Public Contracts Code.

We highlight three significant court decisions that affected public procurement matters in 2021.

Administrative Supreme Court, Plenary Assembly, 25 January 2021, No 2

This ruling of the Plenary Assembly is interesting since it states the possibility of “subjective change of temporary groups of tenderers (art. 45, paragraph 2, letter d) of the PCC, editor’s note), in case of loss of eligibility requirements provided by art. 80 PCC of the principal or one of the agents, it is allowed not only during the execution phase but also within the tender validity period, so interpreting art. 48, paragraphs 17, 18 and 19-ter of the PCC”.

Administrative Supreme Court, Section VI, 24 February 2022, No 1308

This decision is particularly interesting as it clarifies the scope of application of two peculiar tools, specifically regulated by public procurement regulations, namely: (i) regularisation power, and (ii) Reliance on the capacities of other entities.

Regularisation power (Soccorso Istruttorio) is the power, granted to a tenderer, to integrate incomplete or irregular tender documents previously provided to the contracting authority.

At the end of a complex process of normative review, it is now possible to use the regularisation power, not only to “regulate”, but also “to integrate” the missing tender documents.

The current Article 83, paragraph 9, of the PPC, is clear when it extends the applicability of regularisation power to all “the formal lacks of the application” and, particularly, to the cases of ”total lack and any other essential irregularity of the elements of the bid and the European Single Procurement Document”.

The situations in which this provision does not apply are to the lacks and the irregularities that concern “the economic and technical bid”, and to "the lack of documents that do not allow the individuation of the content or the responsible party of it”.

Reliance on the capacities of other entities (Avvalimento) is a tool regulated by the PCC, conferring to a tenderer the possibility, to the pre-qualification stage, to utilise the requirements possessed by a third company.

“The necessity of executive involvement of the auxiliary does not apply indistinctly to all requirements that refer to the experience of the economic operator, but only to those concerning the holding of educational and professional qualifications of the service provider and the enterprise’s manager (art. 89, paragraph one is an exception to the general rule of art. 83, paragraph 8 PCC). This interpretation, other than literal, is coherent with the underlying function of the contract of availing, which relies not on the association to execute the contract, but, instead, on the borrowing of other’s resources to allow the award-winner to perform in its own the contract.”

Lombardy TAR, Milan, Section IV, 30 November 2021

The so-called “necessary or qualifying” subcontract, positively envisaged only for works contracts, also applies to service contracts, and even if it is not expressly provided for by the lex specialis of the tender.

The uniformity of the contractual object does not preclude that, for certain performances or activities included in the scope of the contract, the tenderer may be qualified through the recourse of the “necessary subcontract”, also considering the general scope of this institution and its purpose of promoting competition.

The RRNP provides for an overall reform of the regulatory framework on public procurement in compliance with the following targets:

• by June 2021, entry into force of a Decree Law concerning the simplification public contracts system (amendments already introduced with the Legislative Decree No 77/2021, converted with amendments by Law 29 July 2021, No 108);
• by June 2022, entry into force of the Delegated Law for the revision of the Public Contracts Code – the delegated draft law for the revision of the Public Contracts Code was presented by the government to the Senate (AS 2330), and is currently under scrutiny by the competent Legislative Commission;
• by March 2023, entry into force of the Legislative Decree implementing the delegation for the revision of the PCC;
• by June 2023, entry into force of all laws, regulations and relating enforcement acts (including private law) for the revision of the public procurement system;
• by December 2023, the full operation of the national eProcurement system.