How Digital Procurement Platforms (PADs) change procurement
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The Italian version of this article has been published on May 6, 2024 on AgendaDigitale.eu, within our “Legal Health” monthly column.
Among the main types of infrastructure needed to achieve full digitization of public procurement are Digital Procurement Platforms, or “PADs.”[1]
On January 1, 2024, the provisions of the new Public Procurement Code on the digitization of tender procedures became fully effective.[2] These norms provide for digital management of all stages of the procedure, from planning and design activities to the award and execution of contracts.
Below we will analyze how PADs are being used and how they are changing procurement activities.
What are Digital Procurement Platforms (PADs)?
PADs are used by procuring entities to manage individual instances of procurement and are interoperable with the National Database of Public Contracts (Banca Dati Nazionale dei Contratti Pubblici – “BDNCP”) managed by the National Anticorruption Authority (Autorità Nazionale Anticorruzione – “ANAC”). Their use is envisaged as mandatory for general procurements under the code, except for a temporary waiver for tendering without notice with a value of less than 5,000 euros.[3] This is a remarkable paradigm shift: Italian contracting authorities have been required to start managing their award procedures completely electronically, without any transitional period to implement the new rules and procedures.[4] Thus, they often make use of PADs owned by other central purchasing bodies and contracting entities.
ANAC data
According to the latest update available on the ANAC website, after an initial settling-in phase, digitization is full swing, with the number of procedures undertaken by the end of January—nearly 100,000 Tender Identification Numbers (Codice Identificativo di Gara – “CIG”) issued per week—broadly in line with the previous year’s figures.
However, despite the successful launch of many procedures by means of new digital modalities, several technical and operational problems have emerged and been reported. These range from malfunction of ANAC’s computer infrastructure to issues related to the management of platform access to lack of adequate training for authority staff in charge of using the PADs.
Moreover, procurement platforms must obtain prior certification from the Agency for Digital Italy (Agenzia per l’Italia Digitale – “AgID”), and they currently number just over 50, with the predictable consequence that most contracting authorities are forced to use platforms made available to them by other entities.
Function of PADs
According to the code, a PAD consists of a set of interconnected and interoperating IT services and systems used by contracting authorities in various phases of tender procedures. In brief, through PADs individual contracting authorities are required to manage digitally:
- the planning phase of the procedure;
- the publication of notices and announcements;
- the contracting and awarding phase;
- the contract execution phase, including technical, accounting, and administrative controls.
Through a PAD, a proceeding entity can acquire a CIG (which will no longer go through the SIMOG/SmartCIG systems) and share documents and notices for the initial stages of the procedure.[5] Thanks to the interoperability between PADs and the BDNCP—as guaranteed by the ANAC through the Public Contracts Platforms—PADs can then access the information made available by the BDNCP.
For example, PADs have access to necessary documentation that is not in the possession of the contracting authorities (such as documents and certificates required for economic operator oversight from other administrations whose systems interoperate with the BDNCP).[6] Transparency and publication obligations can be met by transmitting documents to a PAD for legal publicity (a section of the BDNCP[7]), and access is provided to an economic operator’s virtual file, or FVOE.
PAD certification process
Only PADs that have obtained prior certification from the AgID can be used by procuring entities. This certification is required to confirm they meet the technical requirements established by the AgID in its resolution No. 137 of June 1, 2023.[8] Another AgID document—the operating system integrated with the indications provided on the authority’s website—identifies procedures for submitting a certification request, provides the forms to be filled out and transmitted to the authority via certified email, and governs the individual stages that must occur until such time as a certificate is issued to the applicant.
How long are PAD certificates and digital provisioning platforms valid?
A certificate issued by the AgID has a maximum duration of one year. To keep it active, under penalty of forfeiture a platform holder must also apply for and obtain certification of the platform by a third-party compliance assessment body during that period. That confirms that the technical requirements set by the AgID are met.[9]
The certification obtained from a third-party body and sent by the holder to the AgID is valid for 24 months. During that period the platform must undergo an annual surveillance audit by the same third-party body. By the end of those two years, the platform holder must then apply for and obtain renewal of the certificate and submit it to the AgID.
Certifications issued to platform holders are transmitted by the AgID to the ANAC, which enters their references into the special list maintained by the authority. To date that list has 55 platforms that belong to both public and private entities.
It is worth noting that platforms can also obtain certification individually for one or more phases of the contract lifecycle—which essentially correspond to the functions identified by the AgID[10]—and thus a contracting authority could find itself using different PADs for different activities for the same tender (e.g., one platform for planning and call for tender activities; one PAD for publication and fulfillment of transparency obligations; yet another to manage the award and contracting phase).
Operation of PADs
Although the ANAC notice displayed great optimism, in the few months since digitization rules took effect, contracting authorities predictably have encountered problems and application issues. Some are summarized in a document that the National Association of Italian Municipalities (“ANCI”) made publicly available on the association’s website.
Major issues were as follows:
- Use of multiple platforms, including those of other administrations
As mentioned, in some cases an administration uses several different PADs, often belonging to other entities, for the management of a single tender procedure. This dynamic can create critical issues rather than simplifying management of the procedure. In addition to the fact that managing different platforms can make the process more time-consuming, those operating the platform—RUPs and the party responsible for each stage of the proceeding (“Phase Manager”)—must learn to use different applications. Although these are certified and therefore to some extent uniform, there may be differences in how they are used. Similar problems may arise when an entity decides to change the platform used for management of one or more phases of the procedure.
- Access via SPID
Some entities have reported that when an RUP (or Phase Manager) uses SPID (a public digital identity system) to access platforms, the offices in charge of operational management of the procedure encounter problems, since the individual must perform a series of activities that do not require any decisions or input from the company but do involve procedural steps. For example, this occurs with acquisition of a CIG. On this issue, the ANCI states that it would be appropriate to differentiate between decision-making activities that require the presence of qualified individuals who assume the relevant responsibilities and other activities that could be carried out more flexibly by the offices involved (or others could be granted access to and use of the platforms).
- General technical malfunctions
Numerous entities have reported malfunctions of the ANAC public procurement platform (which ensures access and interoperability between PADs and the BDNCP), starting with difficulties and errors in accessing the platform, frozen screens, slowdowns, and inability to obtain CIGs. The ANCI document summarizes these and other issues.
- Platform training
To date, there have been few initiatives at the central level designed to train staff to use the infrastructure, which includes PADs and the BDNCP and related sections thereof. Such initiatives should be promoted and coordinated by the authorities involved (first and foremost the ANAC and the AgID). It should be kept in mind that many administrations use different PADs developed by different owners to manage various phases of the same tender.
To its credit, the ANAC has taken positive steps to remedy these problems.
First, it appears that on March 1, 2024, the ANAC carried out technical and maintenance activities on the public procurement platform to address the malfunctions noted by ANCI and mentioned above.
Relations with local authorities
In addition, the extensive FAQ on the authority’s website addresses numerous operational and other issues that emerged in the early months of application of the rules on digitization of tender procedures. In further evidence of the ANAC’s efforts, the FAQ has already been updated.
After the new Public Procurement Code took effect, the ANAC launched a permanent roundtable with representatives of the ANCI and other local authorities. The group was convened to analyze critical issues that emerged and come up with possible solutions, some of which are discussed in the FAQ on the authority’s website.
Despite these difficulties, it seems to have been decided to proceed with full implementation of the digitization rules, and that any future problems that emerge will be handled on a case-by-case basis, without entities and operators being granted any extensions when it comes to implementing the new rules.
In the aggregate, this seems to be good news, provided, of course, that such problems do not significantly impact the operations of entities and the performance (and conclusion) of tender procedures.
[1] According to Article 25 of the code, a digital procurement platform consists of a set of interconnected and interoperating IT services and systems used by contracting authorities to carry out the planning, design, publication, awarding, and execution phases of contracts, thus ensuring the total digitization of the public contract lifecycle.
[2] Legislative Decree No. 36 of March 31, 2023.
[3] The ANAC has granted contracting authorities the opportunity to use a web interface made available by the authority as an alternative to PADs for all contracts below a threshold of 5,000 euros, only until October 1, 2024.
[4] The full effectiveness of which, however, was subject to a six-month extension from the full applicability of the code as of July 1, 2023.
[5] The SIMOG/SmartCIG system will remain active only to allow display of SmartCIGs acquired before January 1. Detailed guidance on how to acquire CIGs can be found in Resolution No. 582 of December 13, 2023, and the ANAC FAQ.
[6] Such as the registry of natural and legal persons, the business registry, the Ministry of Justice, and the Revenue Agency.
[7] In addition to the Legal Publicity Platform, the BDNCP contains the following sections: the Public Contracts Platform; the economic operator’s virtual file; the Unique Registry of Contracting Stations; the Registry of Economic Operators; and Computer Records.
[8] AgID Determination No. 137 of June 1, 2023.
[9] If the request to the third-party evaluation body has been submitted during the annual period of validity of the certificate issued by the AgID, validity is extended by three months to obtain certification from the third-party body as well.
[10] These include procedure planning functions; awarding functions; publication functions; contracting/awarding functions; and contract execution functions.