Supplementing rules to the Public Procurement Code: The new Decree and its impact on tenders and contracts

The new Legislative Decree 209/2024 (the “Decree”) introduces complementary and corrective provisions to the Italian Public Procurement Code^[1] (or the “Code”) with the aim of simplifying the current legislation and solving the problems that have arisen in the application of the new provisions of the Code, as also requested by the European Union. The Decree is applied from the beginning of 2025 and has a very wide scope, as it amends more than 70 articles of the Public Procurement Code. Below is an overview of the provisions implemented by the Decree that will have a major impact on economic operators participating in public tenders.

Tendering procedures: transparency, participation, and efficiency

The Decree introduces several amendments to the provisions of the Code governing the conduct of tendering procedures with the aim of making them more transparent, efficient and open to competition. In particular:

• The Decrees clarifies that contracting authorities may directly award to private operators single lots of tenders with a value below EUR 80,000 for contracts of supply and services and EUR 1,000.000 for contracts of work, provided that the total value of the lots awarded does not exceed the 20% of the total amount^[2]. The previous version of the Code (Art. 14 ph. 11) stated that the Code did not apply to these cases, and such wording raised uncertainty on its actual meaning.
• With regard to the timing of the procedures, the Decree provides that in addition to the provisions of articles 17 and 18 – which set out the time limits for the conclusion of tendering procedures and the signing of contracts- the following shall apply: (i) for contracts of work, the initial tender documents must be published within three months from the date of the approval of the project; (ii) the parties must sign the public contract not earlier than 32 days (instead of the current 35 days) after the award of the tender, in order to allow other economic operators participating in the public tender to challenge the award if they consider that there have been errors or irregularities in the procedure (e. the so-called “substantial standstill”). The latter change was introduced in response to the request of the European Union to speed up the procurement process and in line with the milestone M1C1 of the National Resistance and Resilience Plan (NRRP)^[3].
• For contracts below EU thresholds, the rotation of tendering principle (which prohibits the direct award of public contracts to the same operator for two or more times in a row) may be waived only if justified by reasons relating to the structure of the market and the lack of available alternatives on the market and after verifying the correct execution of the previous contract and the quality of the fulfilled obligations^[4].
• With regard to framework agreements, the Decree provides that: (i) tendering documents must specify the programming needs that the contracting authority has identified on the basis of the market analysis; (ii) when the framework agreement is concluded between several operators, the tendering documents will identify the percentages that will be assigned to the various economic operators. The Decree also specifies that parties can freely withdraw from the framework agreement in case of supervening impossibility to perform contractual obligations^[5].
• If expressly provided for in the tender notice, economic operators are allowed to submit a bid at a higher price than the starting price indicated in the tender documents, in accordance with the decision of the Council of State no. 9078 of October 18, 2023^[6].
• 109 of the Code on “operator reputation” has been repealed. According to this provision, ANAC managed a digital system in the virtual operator file with the aim to monitor the performance of the operators participating in tenders. This system was based on reputational requirements, assessed on the basis of qualitative, quantitative, objective and measurable indexes.

Revision of prices

The amendments to the price revision clauses are one of the provisions that have the greatest impact on the Public Procurement Code. Price revision is regulated in article 60 of the Public Procurement Code which provides that the tender documents must include price revision clauses that allow the contracting parties to adjust the price of the goods, services or works in certain circumstances. The Code, prior to the introduction of the Decree, provided that a variation of the contractual price was allowed only in exceptional objective circumstances that determined a variation (in increase or decrease) in the cost of the service, supply or work.

With regard to the price revision clause, the Decree has first lowered, for contracts of work, the thresholds for the variation: indeed, a variation is now allowed in the event of circumstances determining a variation of the cost of the work exceeding 3% of the works; in addition, the variation is allowed to the extent of 90% of the excess value in relation to the performance due.

In the case of contracts of service and supply, the thresholds remain unchanged (variation of more than 5% and up to 80% of the value of the activity to be carried out); however, for these contracts, the Decree has introduced a price revision mechanism in addition to the “traditional” one described above. Indeed, in these cases, the Decree allows an “ordinary” variation of the cost of the procurement aimed at adjusting the cost of the procurement to the inflation rate. The parties define in the contract the inflation rate that can determine the price revision.

In order to ensure the correct application of the price revision clause, the Decree introduces a new index to be used as a reference for determining the price variation. In particular, for contracts of works, the Decree empowers the Ministry of Infrastructure and Transport (after consulting the Italian National Statistics Institute – ISTAT) to determine the index of the price variation. In the case of supply and service contracts, the indexes (established in accordance with article 60 paragraph 3 b) which remain unchanged) will instead be published on the ISTAT website. In addition, the Decree allows the contracting parties to use sectoral-based indexes to determine the price variation if they are more in line with the economic reality of the sector concerned.

Digitalization of public procurement

The Decree introduced new provisions aimed at promoting the use of digital technologies in public procurement and updated several provisions of the Code^[7]:

• It specifies that contracting authorities may use digital infrastructure platforms and services, directly owned by them or owned by third parties but directly available to them, to carry out their procurement activities.
• Contracting authorities (in addition to ANAC) are now authorised to notify to the Italian Digital Agency (Agenzia per l’Italia Digitale – AGID) of any omissions relating to the activities necessary to ensure data interoperability.
• With regard to the economic operator’s virtual file, the Decree stipulates that the provisions of the Code take precedence over the provisions regulating the individual databases that feed the National Database of Public Contracts.
• AGID^[8] must specify the requirements for the certification of digital procurement platforms as well as their obligation to demonstrate their interoperability with the digital procurement ecosystem and the security of information.

Execution of contracts and cooperation agreements

An absolute novelty of the Decree is the introduction of the cooperation agreement^[9], which is a coordination tool that contracting authorities can use to improve the management and execution of public contracts.

More specifically, the cooperation agreement is a plurilateral agreement by which the contracting parties define the forms, methods and objectives of their cooperation. The agreement must define the objectives of the cooperation and include possible rewards for achieving these objectives. The cooperation agreement does not replace the main contract or other related contracts that are essential for the performance of the contract, nor does it incorporate their contents.

The Decree introduced the cooperation agreement in the Public Procurement Code despite the negative opinion of the Council of State^[10] which considered this agreement too complex, burdensome and potentially ineffective.

With regard to the other provisions of the Decree concerning the execution of public contracts, we mention the following:

• The contracting authorities must allocate at least 20% of the subcontracting contracts of services to micro, small and medium-sized enterprises (MSMEs), unless the object or characteristics of the services or the relevant market do not consent to the application of this threshold.
• Some provisions have also been introduced to regulate minor aspects of the execution of public contracts such as the advance payment, the method and terms of payment of the fee and contractual penalties.

[1] Legislative Decree no. 36/2023.

[2] Article 14 of the Public Procurement Code.

[3] Articles 17 and 19 of the Public Procurement Code.

[4] Article 49 of the Public Procurement Code.

[5] Article 59 of the Public Procurement Code.

[6] Article 70 of the Public Procurement Code.

[7] Articles 19, 23, 24, 26 of the Public Procurement Code.

[8] Together with the National Cybersecurity Agency and the Government, through the Department for Digital Transformation.

[9] Art. 82 bis of the Italian Procurement Code.

[10] Opinion 1463/2024.