Friday, March 12, 2021
The Greek Parliament has passed a new Law (L. 4782/2021), amending current legislation on public procurements and defence procurements. The full title of the Law is the “Modernization, simplification and reform of the regulatory framework of public contracts, particular provisions of procurement in the sectors of defence and security and other provisions for the development, infrastructure and health” (GovGazette No. 36/Α/9.3.2021).
As to Defence Procurements, the new provisions amend the main Defence Procurement Law 3978/2011 which had introduced both new procedural procurement rules in line with EU Law (Dir.2009/81/EC). In addition, in the wake of a wave of alleged scandals relating to defence procurements, Law 3978/2011 had formalized the 2009 MoD Ethics Order and introduced new and more stringent ethics rules. Commercial agents were been literally ousted, only defence manufacturers were allowed to actively engage the MoD and numerous transparency and integrity requirements (such as restrictions on use of certain corporate vehicle- offshore companies) were imposed. To view our 2012 newsletter on Law 3978/2011 click on https://www.ballas-pelecanos.com/up/files/Defence_Procurement_Law_No.pdf
The new provisions re-introduce a certain degree of flexibility but also introduce new restrictions.
The present newsletter deals with the Ethics aspects of defence procurement, governed by Law 3978/2011, as amended by L. 4782/2021. Procedural aspects shall be dealt in a future newsletter.
In particular, with regards to Ethics:
Law 3978/2011 before the changes |
Law 3978/2011 as amended by L. 4782/2021 |
Previous position: Obligations to the personnel of the MoD |
New rule: Obligations to the personnel of the Armed Forces (AF) |
Previous position: AF market research not included as a situation lawfully entitling an economic undertaking to provide info update to AF on products/services |
New rule: Informative updates can now be provided in the course of market research by AF |
Previous position: Prior notice to functional Head/Chief of Staff needed before contact/informative update by an economic undertaking |
New rule: No prior notice needed |
Previous position: Prohibition on economic entities in employing in private sector of AF officers within three (3) years from retirement or resignation |
New rule: The engagement by an economic undertaking of active AF personnel, who handle procurement contracts, is now a disciplinary offence for said personnel (including engagement within three (3) years from leaving office) |
Former Articles 9 and 10 L. 3978/2011 (“Integrity Clause”) are now merged in a new Article 10 with same title as former Article 9 (“Transparency and anti-corruption rules which are imposed on the economic undertakings”). |
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Previous position: Companies participating in procurement procedures or implementing contracts were prohibited from having/using any intermediary, middle-man or broker during the process for the conclusion and implementation of a contract |
New rule: The new Article 10 L. 3978/2011 expressly allows the use of bona fide commercial agents of PD 219/1991 (Dir. 86/653/EEC) |
Previous position: The awarding authority included in the contract Documentation binding declarations on antitrust and other issues concerning the participating undertaking |
New rule: The participating economic undertaking is obliged to provide binding declarations on antitrust and other issues |
Previous position: - At the time of the tender award the economic entity must provide in effect a solemn declaration that they have abided by the Integrity clause |
New rule: At the time of the tender award the economic entity must provide in effect a solemn declaration that they have abided by their binding declarations |
Previous position: Article 11 provided for extensive investigative powers of audit and inspection of the economic entity |
New rule: Article 11 is now abolished |
Previous position: Economic entities were prohibited from using offshore companies as subcontractors/suppliers/service providers in relation to the contract subject-matter |
New rule: Said defence procurement-specific prohibition is now abolished – offshore company involvement is dealt with in the wider framework of public procurement rules |
This newsletter is distributed for information purposes only. It is not intended to be relied upon nor should it be understood or used as legal advice. For legal advice on defence procurement matters please contact Gregory Pelecanos, Senior Partner, ([email protected]) or Panayiotes Yiannakis, Senior Associate, ([email protected]), or Alexander Rammos, Senior Associate ([email protected]).