When Nynäshamn Municipality had a property rebuilt into a group residence, this was a building contract that should have been procured in accordance with the Public Procurement Act. The fact that the agreement was signed without prior announcement meant that the municipality was guilty of an illegal direct award of contract. This is the conclusion of the Swedish Competition Authority, which is now presenting a claim that the municipality shall pay a procurement fine of SEK 1,500,000.
In autumn 2018, Nynäshamn Municipality entered into an agreement with a property owner to rent pre-school premises. In connection with this, the municipality made an agreement with the property owner that the property would be rebuilt to also house a group residence. In July 2019, a lease agreement was signed with related tenant adjustments to the property. The value of the agreement amounts to approximately SEK 17 million.
In the opinion of the Swedish Competition Authority, the tenant adjustment is of such an extent that it is a building contract, which should have been the subject of a procurement process. The fact that the building contract was not preceded by a notice pursuant to the Public Procurement Act means that the municipality has committed an illegal direct award of contract.
"We are increasingly seeing different types of contract awards without prior notice when it comes to building contracts. It is therefore important that we as the supervisory authority take action on this issue," says Rikard Jermsten, Director General of the Swedish Competition Authority.
The Swedish Competition Authority is now turning to the Administrative Court in Stockholm, petitioning for Nynäshamn Municipality to be ordered to pay a procurement fine of SEK 1,500,000.
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