or substantial duplication of cost,
provided that any increase in price does
not exceed 50 percent of the original
contract value.
been brought about by unforeseeable
circumstances, provided that the
modification does not change the
overall nature of the contract and any
increase in price does not exceed 50
percent of the original contract value.
new one as a consequence of either:
(i) an unequivocal review provision
or option (see point 1); or (ii) there
being a universal or partial successor
of the original contractor as a result
of a corporate restricting, merger
or takeover, provided that the new
contractor fulfils all the criteria
for initial selection and there are
no substantial modifications to the
contract.
new tender would be one that substantially
changes the contract, including, (i) a
modification that materially changes the
character of the contract; or (ii) its scope; or
(iii) changes which, if included, would have
attracted different participants or potential
candidates or might have resulted in the
acceptance of an alternative tender; or (iv)
where it provides for a new contractor, it is
one that does not fulfill the conditions for
the exclusion.
The new rules under the 2014 Directive
apply to all tender procedures that
began after February 26, 2015. Tender
procedures that began before that date
remain regulated by the previous Directive
and the Pressetext case law.
2015 on Public Procurement (hereinafter
referred to as Public Procurement Act)
entered into force in Hungary on November
1, 2015, transposing the provisions of
the 2014 Directive. It sets forth that the
contract awarded following the public
by the successful tenderer, or grouping
of tenderers, to whom the contract was
awarded, or if the contracting authority
permits or requires the establishment
of a business association by the
successful tenderer (tenderers) or the
business association established and
owned exclusively by the successful
tenderer/tenderers (referred to as "project
consortium"). However, exceptions can
also be found. One of them is that the
successful tenderer or tenderers to whom
the contract is awarded may be replaced
in consequence of its legal succession
provided that (i) the successor entering
the contract is not subject to any of the
grounds for exclusion from the public
procurement procedure, (ii) it is able
to meet the eligibility criteria applied
in public procurement procedures, in
accordance with the provision applicable to
tenderers and (iii) succession is not aimed
at circumventing the application of the
Public Procurement Act.
For the purposes of the Public
Procurement Act, legal succession means
(i) the restructuring, merger or division of
the legal person, or (ii) if terminated by way
of succession by any other means, or (iii)
upon universal or partial succession where
a business line functioning as an economic
unit (including all contracts, assets and
employees) is transferred, or (iv) if the
contract is transferred upon the insolvency
of the initial contractor and succession is
not aimed at circumventing the application
of the Public Procurement Act.
In all the aforementioned cases the
successful tenderer may be replaced
without launching a new public
procurement procedure.
The provisions of the Public
Procurement Act applies mostly to
procurements and public contracts
concluded following an award procedure,
to design contests and to review procedures
and pre-contractual remedies requested in
connection with these or initiated ex officio
commencing after the time of entry of force.
However, the above quoted provisions
apply also to the possibility of modification
without a new procedure of procurements
an award procedure opened before the
time of entry into force of the Public
Procurement Act and to monitoring
the amendment and fulfillment of such
contracts, and the provisions of rules of
review procedures applies to the related
review procedures.
Comparing the Public Procurement
Act to the 2014 Directive, we can draw the
conclusion that the question of changes
in contractor is dealt with in the Public
Procurement Act among the provisions
specifying the persons participating in the
performance of the contract. Actually, the
Hungarian text of the Public Procurement
Act is even more unambiguous than Article
72 of the 2014 Directive because the terms
used by the latter one such as "corporate
restructuring, including takeover, merger,
acquisition" are a bit vague and would
deserve some explanation.
The category "legal succession" is set
forth by various fields of Hungarian law in
different ways. From the aspects of civil
law (i) inheritance, (ii) assignment and
(iii) transfer of contracts equally qualify
as legal succession. From the aspect of
corporate law, among others, merger,
demerger and transformation mean legal
succession. From the aspect of labor law,
legal succession occurs when rights and
obligations arising from employment
relationships, existing at the time of
transfer of an economic entity (organized
grouping of material or other resources) by
way of a legal transaction, are transferred
to the transferee employer. This last regime
stands closest to Public Procurement Act
defining the transfer of a business line
as legal succession. We can say that the
term "legal succession" is interpreted in
Hungarian law quite broadly.
Bearing in mind that the Public
Procurement Act became effective on
November 1, 2015, of course, no judicial
practice has been developed. Nevertheless,
the guidelines of the national public
procurement authority also emphasizes that
merely the change in contractor does not
result in amendment to the contract.