Region Stockholm performed illegal purchase of staffing services

During the spring of 2020, at the start of the pandemic, Region Stockholm performed a direct award of a framework agreement for staffing services. The procurement was conducted on the basis of extreme urgency, as the existing framework agreement was approaching its end date.

A notice of a new procurement had previously been published, but the Region cancelled this procurement during the fall of 2021, choosing instead to directly award a framework agreement for staffing services amounting to SEK 800 million. The framework agreement was signed at the end of last year and initially encompassed the period from January to June 2022, but was later extended to the last of December this year. As the framework agreement was not subject to competition in accordance with the Public Procurement Act, the Swedish Competition Authority considers it as an illegal direct award.

The Region argues, among other things, that the ongoing pandemic led to a very large need for healthcare staff and that access to staffing services was crucial to its operations. Therefore, according to the Region, the direct award is justified based on the exemptions in the procurement rules for extreme urgency and exceptional reasons.

The Swedish Competition Authority holds the view that the Region has placed itself in a situation of extreme urgency through its own actions. The fact that an existing framework agreement on staffing services was approaching its end date was known. The decision to cancel the published procurement led to an urgent need to directly award the services in question. At the time of the decision to directly award the staffing services, the pandemic had been going on for so long that it could no longer be considered an unexpected event. Thus, no extreme urgency was at hand at that time.

‘The fact that the pandemic caused unexpected difficulties in many organizations is understandable, but there is a limit to what constitutes an unexpected event under the procurement legislation and what can thus be valid grounds for extreme urgency’, says Rikard Jermsten, Director-General of the Swedish Competition Authority.

The Swedish Competition Authority is now petitioning that the Administrative Court in Stockholm will rule that Region Stockholm must pay a procurement fine of SEK 10 million for the illegal direct award. Region Stockholm has been found guilty of illegal direct awards on multiple occasions, which impacts the size of the fine. As SEK 10 million is the largest procurement fine possible, the Swedish Competition Authority cannot petition for a larger fine to be imposed.

Marie Strömberg Lindvall, press officer, +46(0)76 542 15 92, marie.stromberglindvall@kkv.se
Anna Görgård, legal counsel, +46(0)8 700 16 67, anna.gorgard@kkv.se

Read the application, dnr 773/2020 (in Swedish)