Tierp is required to pay procurement fine

Tierp Kommunfastigheter AB’s agreement for the refurbishment and extension of Vegavallen constituted an illegal direct award. This is the finding of the Swedish Competition Authority, which is therefore referring the matter to the Administrative Court in Uppsala demanding that the municipal company pays SEK 2.5 million in procurement fine.

Tierps Kommunfastigheter made incorrect use of a framework agreement for construction services when the company concluded the contract. In the view of the Swedish Competition Authority, the framework agreement covers neither purchases of this size nor the type of work involved.

The agreement, which is worth SEK 35 million, therefore constitutes an illegal direct award. The contract should have been advertised to provide additional suppliers with the opportunity to submit tenders.

“Illegal direct awards represent a serious breach of the procurement rules. Exposure to competition increases the possibilities that it is the best and most favourable contract that is concluded. This is good for the taxpayer and for competition”, says the Swedish Competition Authority’s Deputy Director General Karin Lunning.

Read the application (in Swedish), dnr 238/2017