The Defence and Security Public Contracts Regulations 2011

Criteria for the rejection of economic operators U.K.

23.—(1) Subject to paragraph (2), a contracting authority shall treat as ineligible and shall not select an economic operator in accordance with these Regulations if the contracting authority has actual knowledge that the economic operator or its directors or any other person who has powers of representation, decision or control of the economic operator has been convicted of any of the following offences—

(a) conspiracy within the meaning of section 1 or 1A of the Criminal Law Act 1977 M1 or article 9 or 9A of the Criminal Attempts and Conspiracy (Northern Ireland) Order 1983 M2 , or in Scotland the offence of conspiracy, where that conspiracy relates to participation in a criminal organisation as defined in Article 2 of the Council Framework Decision 2008/841/JHA M3 ;

(b) involvement in serious organised crime or directing serious organised crime within the meaning of section 28 or 30 of the Criminal Justice and Licensing (Scotland) Act 2010 M4 ;

(c) corruption within the meaning of section 1 of the Public Bodies Corrupt Practices Act 1889 M5 or section 1 of the Prevention of Corruption Act 1906 M6 ;

(d) the offence of bribery;

(e) bribery within the meaning of section 1, 2 or 6 of the Bribery Act 2010 M7 ;

(f) bribery or corruption within the meaning of section 68 and 69 of the Criminal Justice (Scotland) Act 2003 M8 ;

(g) fraud, where the offence relates to fraud affecting the European Communities' financial interests as defined by Article 1 of the Convention on the protection of the financial interests of the European Communities M9 , within the meaning of—

(i) the offence of cheating the Revenue;

(ii) the offence of conspiracy to defraud;

(iii) fraud or theft within the meaning of the Theft Act 1968 M10 , the Theft Act (Northern Ireland) 1969 M11 , the Theft Act 1978 M12 or the Theft (Northern Ireland) Order 1978 M13 ;

(iv) fraud within the meaning of section 2, 3 or 4 of the Fraud Act 2006 M14 ;

(v) in Scotland, the offence of fraud;

(vi) in Scotland, the offence of theft;

(vii) fraudulent trading within the meaning of section 458 of the Companies Act 1985 M15 , article 451 of the Companies (Northern Ireland) Order 1986 M16 or section 993 of the Companies Act 2006 M17 ;

(viii) fraudulent evasion within the meaning of section 170 of the Customs and Excise Management Act 1979 M18 or section 72 of the Value Added Tax Act 1994 M19 ;

(ix) an offence in connection with taxation in the European Union within the meaning of section 71 of the Criminal Justice Act 1993 M20 ;

(x) destroying, defacing or concealing of documents or procuring the execution of a valuable security within the meaning of section 20 of the Theft Act 1968 M21 or section 19 of the Theft Act (Northern Ireland) 1969 M22 or making, adapting, supplying or offering to supply articles for use in frauds within the meaning of section 7 of the Fraud Act 2006;

(xi) in Scotland, the offence of uttering; or

(xii) in Scotland, the criminal offence of attempting to pervert the course of justice;

(h) terrorist offences or offences linked to terrorist activities, as defined in Articles 1 and 3 of Framework Decision 2002/475/JHA M23 ;

(i) money laundering within the meaning of the Money Laundering Regulations 2003 M24 or money laundering or terrorist financing within the meaning of the Money Laundering Regulations 2007 M25 ;

(j) an offence in connection with the proceeds of criminal conduct within the meaning of section 93A, 93B or 93C of the Criminal Justice Act 1988 M26 or article 45, 46 or 47 of the Proceeds of Crime (Northern Ireland) Order 1996 M27 ;

(k) an offence in connection with proceeds of drug trafficking within the meaning of section 49, 50 or 51 of the Drug Trafficking Act 1994 M28 ;

(l) in Scotland, the offence of incitement to commit any of the crimes described in this paragraph; or

(m) any other offence within the meaning of Article 39(1) of the Defence and Security Procurement Directive as defined by the national law of any member State.

(2) In any case where an economic operator or its directors or any other person who has powers of representation, decision or control has been convicted of an offence described in paragraph (1), a contracting authority may disregard the prohibition described there if it is satisfied that there are overriding requirements in the general interest which justify doing so in relation to that economic operator.

(3) A contracting authority may apply to the relevant competent authority to obtain further information regarding the economic operator and in particular details of convictions of the offences listed in paragraph (1) if it considers it needs such information to decide on any exclusion referred to in that paragraph.

(4) A contracting authority may treat an economic operator as ineligible or decide not to select an economic operator in accordance with these Regulations on one or more of the following grounds, namely that the economic operator—

(a) being an individual is a person in respect of whom a debt relief order has been made or is bankrupt or has had a receiving order or administration order or bankruptcy restrictions order or debt relief restrictions order made against him or has made any composition or arrangement with or for the benefit of creditors or has made any conveyance or assignment for the benefit of creditors or appears unable to pay, or to have no reasonable prospect of being able to pay, a debt within the meaning of section 268 of the Insolvency Act 1986 M29 , or article 242 of the Insolvency (Northern Ireland) Order 1989 M30 , or in Scotland has granted a trust deed for creditors or become otherwise apparently insolvent, or is the subject of a petition presented for sequestration of his estate, or is the subject of any similar procedure under the law of any other State;

(b) being a partnership constituted under Scots law has granted a trust deed or become otherwise apparently insolvent, or is the subject of a petition presented for sequestration of its estate;

(c) being a company or any other entity within the meaning of section 255 of the Enterprise Act 2002 M31 has passed a resolution or is the subject of an order by the court for the company's winding up otherwise than for the purpose of bona fide reconstruction or amalgamation, or has had a receiver, manager or administrator on behalf of a creditor appointed in respect of the company's business or any part of the company's business or is the subject of the above procedures or is the subject of similar procedures under the law of any other State;

(d) has been convicted of a criminal offence relating to the conduct of the economic operator's business or profession;

(e) has committed an act of grave misconduct in the course of the economic operator's business or profession, including a breach of obligations regarding security of information or security of supply required by a contracting authority in accordance with regulation 38 or 39 during a previous contract;

(f) has been found, on the basis of any evidence, including protected data sources, not to possess the reliability necessary to exclude risks to the security of the United Kingdom;

(g) has not fulfilled obligations relating to the payment of social security contributions under the law of any part of the United Kingdom or of the member State in which the economic operator is established;

(h) has not fulfilled obligations relating to the payment of taxes under the law of any part of the United Kingdom or of the member State in which the economic operator is established;

(i) is guilty of serious misrepresentation in providing any information referred to within this regulation or regulation 24, 25, 26 or 27 or has not provided such information in response to a request by the contracting authority;

(j) in relation to procedures for the award of a services contract, is not licensed in the member State in which the economic operator is established or is not a member of an organisation in that member State when the law of that member State prohibits the provision of the services to be provided under the contract by a person who is not so licensed or who is not such a member; or

(k) subject to paragraphs (7), (8), (9), (10), (11), (12) and (13), is required to be registered on the professional or trade register of the member State specified in Schedule 3 from which the economic operator originates or in which it is established, in order to pursue its professional activity and is not so registered.

(5) The contracting authority may require an economic operator to provide such information as it considers it needs to make the evaluation in accordance with paragraphs (1) and (4) except that it shall accept as conclusive evidence that an economic operator does not fall within the ground specified in paragraphs (1) or (4)(a), (b), (c), (d), (g) or (h) if that economic operator provides to the contracting authority—

(a) in relation to a ground specified in paragraphs (1) and (4)(a), (b), (c) or (d)—

(i) an extract from the judicial record; or

(ii) in a member State which does not maintain such a judicial record, a document issued by the relevant judicial or administrative authority;

(b) in relation to the ground specified in paragraph (4)(g) or (h), a certificate issued by the relevant competent authority; and

(c) in a member State where the documentary evidence specified in paragraphs (5)(a) and (b) is not issued in relation to one of the grounds specified in paragraphs (1), (4)(a), (b), (c), (d), (g) or (h), a declaration on oath made by the economic operator before the relevant judicial, administrative or competent authority or a relevant notary public or Commissioner for oaths.

(6) In this regulation, “relevant” in relation to a judicial, administrative or competent authority, notary public or Commissioner for oaths means an authority designated by, or a notary public or Commissioner for oaths in the member State in which the economic operator is established.

(7) Sub-paragraphs (j) and (k) of paragraph (4) are without prejudice to EU law on the freedom of establishment and the freedom to provide services.

(8) An economic operator established in the United Kingdom or Ireland shall be treated as registered on the professional or trade register for the purposes of paragraph (4)(k) if the economic operator—

(a) is established in Ireland and is certified as registered with the Registrar of Friendly Societies; or

(b) is established in either State and is either—

(i) certified as incorporated by their respective Registrar of Companies; or

(ii) is certified as having declared on oath that it is carrying on business in the trade in question in the State in which it is established at a specific place of business and under a specific trading name.

(9) An economic operator established in Cyprus shall be treated as registered on the professional or trade register for the purposes of paragraph (4)(k) if—

(a) in relation to procedures for the award of a services contract or a supply contract the economic operator is either—

(i) certified as incorporated by the Registrar of Companies and Official Receiver (�?φορος Εταιρει�?ν και ΕφίσημοςΠαραλήφτης); or

(ii) certified as having declared on oath that the economic operator is carrying on business in the trade in question in Cyprus at a specific place of business and under a specific trading name; or

(b) in relation to procedures for the award of a works contract the economic operator is certified by the Council for the Registration and Audit of Civil Engineering and Building Contractors (Συμβούλιο Εγγραφήςκαι Ελέγχου Εργοληφτ�?ν Οικοδομικ�?ν και Τεχνικ�?ν �?ργων) according to the Registration and Audit of Civil Engineering and Building Contractors Law of Cyprus.

(10) An economic operator established in Malta shall be treated as registered on the professional or trade register for the purposes of paragraph (4)(k) if—

(a) the economic operator produces its “numru ta' registrazzjoni tat-Taxxa tal-Valur Miżjud (VAT) u n-numru tal-licenzja ta' kummerc”; and

(b) where the economic operator is a member of a partnership or is a company, it produces the relevant registration number by the Malta Financial Services Authority.

(11) In relation to procedures for the award of a services contract, an economic operator established in Greece shall be treated as registered on the professional or trade register for the purposes of paragraph (4)(k)—

(a) when the services to be provided under the contract are specified in category 14 of Schedule 2 and when Greek legislation requires persons who provide those services to be registered on the professional register (Μητρ�?ο Μελετητ�?ν and Μητρ�?ο Γραφείων Μελετ�?ν), if it is registered on that register; and

(b) in any other case, in accordance with paragraph (14).

(12) In relation to procedures for the award of a services contract, an economic operator established in Hungary shall be treated as registered on the professional or trade register for the purposes of paragraph (4)(k) if the economic operator is certified as being entitled to be engaged in the trade in question in Hungary.

(13) In relation to procedures for the award of a supply contract, an economic operator established in Spain shall be treated as registered on the professional or trade register for the purposes of paragraph (4)(k) if the economic operator is certified as having declared on oath that it is entitled to be engaged in the trade in question in Spain.

(14) An economic operator established in a member State, other than the United Kingdom or Ireland, which either has an equivalent professional or trade register which is not listed in Schedule 3 or which does not have an equivalent professional or trade register shall be treated as registered on a professional or trade register for the purposes of paragraph (4)(k) on production of either a certificate that he is registered on the equivalent professional or trade register or where no such register exists, a declaration on oath, or in a member State which does not provide for a declaration on oath a solemn declaration, made by the economic operator before the relevant judicial, administrative or competent authority or a relevant notary public or Commissioner for oaths, that he exercises the particular profession or trade.

Marginal Citations

M1 1977 c. 45. Section 1 was amended by section 5(1) of the Criminal Attempts Act 1981 (c. 47), Part 2 of Schedules 1 and 2 to the Criminal Justice (Terrorism and Conspiracy) Act 1998 (c. 40) and Schedule 1 to the Trade Union and Labour Relations (Consolidation) Act 1992 (c. 52). Section 1A was inserted by section 5(1) of the Criminal Justice (Terrorism and Conspiracy) Act 1988 and was amended by section 72(1)(a) of the Coroners and Justice Act 2009 (c. 25).

M2 S.I. 1983/1120 (N.I.13); amended by section 6(1) of, and Part 2 of Schedules 1 and 2 to, the Criminal Justice (Terrorism and Conspiracy) Act 1998 (c. 40). There are other amendments which are not relevant to these Regulations.

M3 OJ No L 300, 11.11.2008, p.42.

M4 2010 asp 13.

M5 1889 c. 69. This Act has been repealed by Schedule 2 to the Bribery Act 2010 (c. 23).

M6 1906 c. 34. Section 1 was amended by section 108(2) of the Anti-terrorism, Crime and Security Act 2001 (c. 24) and repealed by Schedule 2 to the Bribery Act 2010 (c. 23).

M7 2010 c. 23.

M8 2003 asp 7.

M9 OJ No C 316, 27.11.1995, p.49; relevant amending instruments are Council Act of 26 July 1995, OJ No C 316, 27.11.1995, p.48 and Council Decision of 6 December 2007, OJ No L 9, 12.1.2008, p.23.

M10 1968 c. 60. Sections 15A and 15B were inserted by section 1(1) of the Theft (Amendment) Act 1996 (c. 62) and section 15B was amended article 278 of the Financial Services and Markets Act 2000 (Consequential Amendments and Repeals) Order 2001 (S.I. 2001/3649). Section 16 was amended by section 5(5) of the Theft Act 1978 (c. 31). Section 14(3) was repealed by Schedule 2 to the Postal Services Act (Consequential Modifications) Order 2003 (S.I. 2003/2908). Sections 15, 15A, 15B and 16 were repealed, and section 20 was amended, by Schedules 1 and 3 to the Fraud Act 2006 (c. 35). There are other amendments which are not relevant to these Regulations.

M11 1969 c. 16 (N.I.). Section 14(3) was repealed by Schedule 2 to the Postal Services Act 2000 (Consequential Modifications) Order 2003 (S.I. 2003/2908). Sections 15A and 15B were inserted by article 3(1) of the Theft (Amendment) (Northern Ireland) Order 1997 (S.I. 1997/277 (N.I.3)). Section 15B was amended by section 279 of the Financial Services and Markets Act 2000 (Consequential Amendments and Repeals) Order 2001 (S.I. 2001/3649). Sections 15, 15A, 15B and 16 were repealed, and sections 19 and 23 were amended, by Schedules 1 and 3 to the Fraud Act 2006 (c. 35). There are other amendments which are not relevant to these Regulations.

M12 1978 c. 31. Section 1 was amended by section 4(1) of the Theft (Amendment) Act 1996 (c. 62). Section 5 was amended by Schedule 2 to the Extradition Act 1989 (c. 33) and Schedules 1 and 3 to the Fraud Act 2006 (c. 35). Sections 1 and 2 were repealed by Schedules 1 and 3 to the Fraud Act 2006. There are other amendments which are not relevant to these Regulations.

M13 S.I. 1978/1407 (N.I.23); article 3 was amended by article 6(1) of the Theft (Amendment) (Northern Ireland) Order 1997 (S.I. 1997/277 (N.I.3)). Articles 3 and 4 were repealed by Schedules 1 and 3 to the Fraud Act 2006 (c. 35). There are other amendments which are not relevant to these Regulations.

M14 2006 c. 35.

M15 1985 c. 6. Section 458 was modified by regulation 4 of, and Part 1 of schedule 2 to, the Limited Liability Partnerships Regulations 2001 (S.I. 2001/1090) and repealed by Schedule 16 to the Companies Act 2006 (c. 46).

M16 S.I. 1986/1032 (N.I.6); article 451 was modified by regulation 4 of, and Part 1 of Schedule 2 to, the Limited Liability Partnerships Regulations (Northern Ireland) 2004 (S.R. (NI) 2004 No 307) and repealed by Schedule 16 to the Companies Act 2006 (c. 46).

M17 2006 c. 46; applied (with modifications) by regulation 47 of the Limited Liability Partnerships (Application of Companies Act 2006) Regulations 2009 (S.I. 2009/1804) and by regulation 3 of, and Schedule 1 to, the Unregistered Companies Regulations 2009 (S.I. 2009/2436).

M18 1979 c. 2.

M19 1994 c. 23. Section 72 was amended by section 17 of the Finance Act 2003 (c. 40).

M20 1993 c. 36.

M21 1968 c. 60. Section 20 was amended by Schedules 1 and 3 to, the Fraud Act 2006 (c. 35).

M22 1969 c. 16 (N.I.). Section 19 was amended by Schedules 1 and 3 to the Fraud Act 2006 (c. 35).

M23 OJ No L 164, 22.6.2002, p.3, as amended by Council Framework Decision 2008/919/JHA, OJ No L 330, 9.12.2008, p.21.

M24 S.I. 2003/3075. These Regulations were revoked in relation to England, Wales and Scotland by regulation 1(3) of S.I. 2007/2157 and in relation to Northern Ireland by S.I. 2008/1741.

M25 S.I. 2007/2157. Regulation 2(1) is amended by regulation 1 of S.I. 2009/1912. There are other amendments which are not relevant to these Regulations.

M26 1988 c. 33; sections 93A, 93B and 93C were inserted by sections 29(1), 30 and 31 of the Criminal Justice Act 1993 (c. 36) and were repealed by Schedules 11 and 12 to the Proceeds of Crime Act 2002 (c. 29).

M27 S.I. 1996/1299 (N.I. 9); articles 45 to 47 were repealed by Schedules 11 and 12 to the Proceeds of Crime Act 2002 (c. 29). There are other amendments which are not relevant to these Regulations.

M28 1994 c. 37. Sections 49, 50 and 51 were repealed by Schedules 11 and 12 to the Proceeds of Crime Act 2002 (c. 29).

M29 1986 c. 45.

M30 S.I. 1989/2405 (N.I. 19). There are amendments to this Order which are not relevant to these Regulations.

M31 2002 c. 40.