A few days ago, an amendment to the Public Procurement Act (PPPA) came into effect, introducing two significant changes.

For the first time since 2004, the thresholds for small-scale public contracts have been increased. If your project remains within the new financial limits, you are not required to follow one of the procurement procedures regulated by the PPPA. This allows you to avoid the relatively strict rules governing public procurement. The financial thresholds have been raised as follows:

• from CZK 2 million to CZK 3 million (excluding VAT) for services and supplies;
• from CZK 6 million to CZK 9 million (excluding VAT) for construction work.

You might be wondering whether this increase reflects the continuous rise in inflation. According to data published by the Office for the Protection of Competition, goods and services that would have cost CZK 2 million in 2004 would now cost CZK 3.6 million. In the case of construction work, a project that cost CZK 6 million in 2004 would now amount to nearly CZK 11 million.

The second major change in the PPPA is the increase in the financial threshold above which the contracting authority must publish the contract awarded on its public procurement profile – from CZK 500,000 (excluding VAT) to CZK 1 million (excluding VAT).

Author: Vladěna Svobodová