Public procurement contracts are subject to several important limitations on freedom of contract. This gives rise to the need to take a case-by-case look at certain contractual issues which are known under the provisions of the Civil Code (CC)[1], but should be interpreted taking into account the wording and purpose of the regulations of the Public Procurement Law (PPL)[2]. Such issues include the transfer of claims from the remuneration for the performance of the contract, the securing of this remuneration or the possibility of assuming a debt in the form of an obligation to perform the contract.

Transfer of claims

Subjective changes of the party to a civil law contract (on the creditor’s side) may occur under the transfer of claims. This institution is regulated in Article 509 of the CC. It is important especially when assessing the possibility of transferring the contractor’s right to receive remuneration from a public procurement contract.

In the public procurement regime, there is no autonomous regulation of the transfer of claims[3], although this institution should undoubtedly be interpreted taking into account the general principles of the public procurement system, including the principle of fair competition.

According to Article 509 § 1 and 2 of the CC, a creditor may, without the consent of the debtor, transfer a claim to a third party (assignment), unless this would be contrary to:

  • the Act,
  • contractual stipulation or
  • the nature of the obligation.

Along with the claim, all rights associated with it, in particular the claim for overdue interest, are transferred to the purchaser. Furthermore, the consent of the debtor (in the case of an assignment of contractual remuneration, this is the contracting authority as the party obliged to pay the remuneration) is not, in principle, required for the assignment of claims.

Divergent views

The case law of the National Appeals Chamber, shaped still on the grounds of the 2004 PPL Act[4], offers views that negate the possibility of assigning contractual claims, precisely because of the PPL regime. Such a position was expressed by the NAC, among others, in its judgement of 24 August 2018, ref. No. KIO 1568/18.

However, this view should be disputed. It can be inferred from the grounds of the judgement that the panel has hastily treated assignment of rights and assumption of debts equally. In principle, the prohibition on the assumption of a contractor’s debt from a public procurement contract is not in doubt. Indeed, the assumption of such a debt could be treated as a circumvention of Article 17(2) of the PPL, according to which the contract is awarded to the contractor selected in accordance with the provisions of the PPL Act.

Moreover, in large projects (including IT projects), the transfer of the contractor’s remuneration from the contract is often collateral for the claims of banks that provide loans to finance the project. In practice, the contractor may have an easier or more difficult path to obtaining the necessary financing for the contract, depending on the ability to assign a contract.

Admittedly, a contractor, when submitting a bid in a public procurement procedure, in most cases declares that it has the capacity (including financial capacity) to carry out the project. The contracting authority may additionally verify the economic or financial situation of the contractor as part of the assessment of fulfilment of the conditions for participation in the procedure. However, the reality is that the verification of the conditions for participation in the procedure often does not give a full and objective picture of the contractor’s capabilities. Consideration should also be given to circumstances that may change between the time when the contractor verifies that it meets the conditions for participation in the procedure and the time when it actually commences carrying out the work.

With this in mind, the contracting authority should assess, on a case-by-case basis, the extent to which it is reasonable to introduce a prohibition on the assignment of claims into the draft contract. This clause is often a design risk for the contractor, resulting in a higher bid price. Furthermore, the contracting authority, in placing such a prohibition, will probably have to revise its position after time, assessing to what extent this constitutes an acceptable amendment to the contract.

In the context of the prohibition on assignment of claims, procuring entities should bear in mind the prohibition in Article 9a(1) of the Act on Prevention of Excessive Delays in Commercial Transactions of 8 March 2013. According to the provision, in commercial transactions in which the debtor is a large entrepreneur and the creditor is a micro-entrepreneur, small entrepreneur or medium-sized entrepreneur, a contractual stipulation excluding or limiting the creditor’s right to assign a claim becomes ineffective if the payment is not made within the period specified in the contract, and if this period is not specified in the contract – from the due date of the monetary benefit.

[1] The Act of 23 April 1964 – Civil Code.

[2] The Act of 11 September 2019 – Public Procurement Law.

[3] Article 509 of the Civil Code applies to the public procurement contract based on the reference in Article 8(1) of the PPL, according to which the provisions of the Civil Code shall apply to contracts in public procurement matters, unless the provisions of the PPL provide otherwise.

[4] The Act of 29 January 2004 – Public Procurement Law.