Ministry of Defence

Westwells Rd, Corsham SN13 9GB

Corsham

SN13 9GB

UK

E-mail: liam.barker121@mod.gov.uk

NUTS: UK

Internet address(es)

Main address: https://www.google.com/url?sa=t&rct=j&q=&esrc=s&source=web&cd=&cad=rja&uact=8&ved=2ahUKEwioooXT58uQAxUfT0EAHTKaKhIQFnoECBgQAQ&url=https%3A%2F%2Fwww.contracts.mod.uk%2F&usg=AOvVaw23esGPI_6uePA764SaLdRS&opi=89978449

II.1.1) Title

II.1.2) Main CPV code

64220000

II.1.3) Type of contract

Services

II.1.4) Short description

The requirement is to provide a business broadband service with Wi-Fi distribution and

interconnects for BFSAI across the Falkland Islands to 1052 users across 85 sites.

Welfare broadband is excluded from this requirement.

II.1.6) Information about lots

This contract is divided into lots: No

II.1.7) Total value of the procurement

Value excluding VAT: 4 969 433.16  GBP

IV.1.1) Type of procedure

Award of a contract without prior publication of a call for competition

Justification for selected award procedure:

The procurement falls outside the scope of application of the Directive

Explanation

Where the proposed contract is below threshold

At £407,629.74 (in effect inc of VAT as there is no VAT in the FIs) your proposed 2-year new contract award is below the PA23 financial thresholds for a Defence and Security Contract (as defined by s. 7 which you have confirmed this contract will fall within). As such you are not a “covered procurement” for the purposes of the Act. This means, as far as the Act is concerned, you have significantly greater freedoms in terms of your Route to Market where you are looking to make a direct award – in effect your obligations under the Act including notice requirements are switched off.

That said, I believe that MoD Policy still requires you to advertise and compete these below threshold procurements where viable. You would still have UK Public Law legal duties to act reasonably and a breach of MoD Policy could be relied on by an aggrieved supplier to challenge the award on the grounds that MoD had not acted reasonably. As a result, the fact your proposed contract is below threshold does not in and of itself give you the right to make a direct award.

However, here you have also put forward a quasi - technical reasons ground for a direct award to SURE on the basis that competition is not viable. Had you been above the PA23 threshold and a covered procurement, meaning the full Act regime would have applied, then this would have given you direct award grounds under para. 6 schd 5 and so you can use this fact to demonstrate that MoD is acting reasonably here iaw UK public law where the PA23 doesn’t apply.

You should also look to publish a “MoD VTN or informal Transparency Notice” to meet your MoD Policy transparency obligations and we can look at the wording of this in due course. (In other words, you wouldn’t publish a formal Transparency Notice in the new PA23 platform but you could publish an informal one iaw with MoD Policy.)

Looking at your SSJ rationale I think this needs tweaking a bit to ensure your audit trail is robust. I do wonder whether the rationale you have sent me is an earlier draft and has been since improved when looking at the previous award? For example, it states that: “ …it is considered that the award of a single source contract is lawful for reasons connected with the protection of exclusive rights on technical grounds” – however you are not relying on protection of ER (which is a different ground under DSPCR and PA23) and are just relying on TR.

If the total contract value creeps up and reaches the PA23 threshold

The potential fly in the ointment is if the total value of the negotiated contract creeps up and exceeds the Defence & Security contract threshold under PA23 of £426, 955 (inc VAT). In such circumstances the PA23 will deem it a “covered procurement” and the full PA23 regime will apply (absent an exemption ground).

You are considering whether an exemption switching off PA23 might apply pursuant to para. 28 schd 2 of the Act. However, I think there would be problems with trying to rely on this exemption (and in fact para 27 which is quite similar). This is because the factual position with your proposed contract does not really fit with the criteria you must meet in order to rely on para 28 – as strictly speaking the FI government is not requiring MoD to procure these connectivity services with SURE. In fact, my understanding is that the FI govt only has an exclusivity agreement with SURE for civilian connectivity and so the real reason why you have to contract with this supplier for military connectivity is because indirectly only SURE have the necessary infrastructure on Island to deliver this requirement.

As a result, my advice would be to not try to rely on this exemption here and simply rely on Technical Reasons – para. 6 schd 5 PA23 – to make the direct award. You would also need to comply with the PA23 notice provisions including the requirement to publish a Transparency Notice.

IV.1.8) Information about Government Procurement Agreement (GPA)

The procurement is covered by the Government Procurement Agreement: Yes

Sure South Atlantic Ltd

Ross Road, Stanley

Stanley

FK

NUTS: FK

The contractor is an SME: Yes

VI.4.1) Review body