Competitive Procedure with Negotiation

A procurement procedure allowing contracting authorities to negotiate with selected suppliers after initial tender evaluation to improve bids before final award.

How it works

The Competitive Procedure with Negotiation allows contracting authorities to engage in discussions with tenderers after the initial submission and evaluation of bids. Unlike the open or restricted procedures, this route permits genuine negotiation to refine technical specifications, contractual terms, or pricing.

The process follows a structured approach: authorities publish contract notices, evaluate initial tenders against pre-published criteria, then invite selected suppliers to successive rounds of negotiation. Each negotiation round may involve revised bids, with suppliers able to improve their offers based on discussions with the contracting authority.

Authorities must treat all tenderers equally during negotiations, sharing the same information and maintaining confidentiality of individual bids. The procedure concludes when the authority determines no further improvements are possible, followed by a final tender round and contract award.

When to use it

This procedure suits complex procurements where requirements cannot be fully specified upfront, or where innovative solutions are sought. The Public Contracts Regulations 2015 permit its use for works, supplies, or services contracts above threshold values.

Common applications include construction projects requiring design development, IT systems needing technical refinement, or service contracts where delivery methods need optimisation. The procedure proves particularly valuable when market engagement reveals that initial specifications require adjustment.

Key considerations

Negotiations must remain transparent and proportionate. Authorities cannot use this procedure simply to drive down prices - substantive improvements to technical solutions or contract terms must be possible. Detailed record-keeping of all negotiation stages is essential for audit purposes and potential legal challenges.