The essentials of public tender procedures in Panama

Khatiya Asvat and Joaquin de Obarrio highlights the essential considerations for bidders in public tender procedures in Panama.

An extract from Lexology

The procurement procedures

Fundamental principles

Does the relevant legislation require compliance with certain fundamental principles when designing and carrying out a contract award procedure?

The Public Procurement Law specifically states that the following principles shall govern public tenders: economy, equal treatment, transparency and competition, among others previously stated.

Independence and impartiality

Does the relevant legislation or case law require that a contracting authority is independent and impartial?

The Public Procurement Law specifically states that authorities must select bidders objectively and fairly. It also states that the Administrative Court for Public Procurement must be independent and impartial.

Conflicts of interest

Does the legislation address expressly the issue of conflicts of interest?

All tender bids are reviewed by verification committees, which are comprised of professionals within the scope of the tender. Both the advisers of the committees and the members of these must be free of real or apparent conflicts of interest with respect to the bidders.

The Public Procurement Law states that public servants may not celebrate, by themselves or through interposed persons, contracts with the entity in which they work, or participate in as owners, partners or shareholders of the company or as administrators, managers, directors or legal representatives of the bidder in a public tender.

Any violation of this principle may give way to action before the General Contracting Direction, an agency in charge of overseeing all public procurement. The General Contracting Direction may order the correction of any step in the tender process that was not done in accordance with the law. The Administrative Court for Public Procurement may declare the nullity of the tender process should a conflict of interest be proven.

Bidder involvement in preparation

Are there any restrictions on the ability of a bidder to be involved in the preparation of a contract award procedure?

Any person who is hired as a consultant to conduct studies, feasibility projects, diagnostics, plans, designs and other actions who has a connection to a project cannot participate in the future tender selection because of incompatibility and conflict of interest. This prohibition is absolute.

Procedure

Which procurement procedure is primarily used for the award of regulated contracts?

The most widely used procedure is the public tender – a process in which the price is the determining factor, given that all the legal, financial and technical aspects required are fulfilled. This procedure will be used when the amount of the contract exceeds US$50,000.

Award criteria

Does the relevant legislation specify the criteria that must be used for the evaluation of submitted tenders?

The contracting authority must base its award criteria on the parameters included in the tender specifications. If the selection process requires criteria surpassing price assessment, the tender specifications may include all qualifications and evaluation parameters. The public procurement principles will also be taken into consideration in the evaluation.