Forming Consortia for Tenders: Collaborating on Public Procurement

What is a consortium?

A consortium (combination) is a collaboration where two or more economic operators jointly tender for a public contract. The consortium acts as one entity and is jointly responsible for execution.

Why form a consortium?

• Complementary expertise: combine specialisms
• Meet suitability requirements together (turnover, references)
• Increase capacity for larger contracts
• Geographic coverage through regional partners

Legal framework

Procurement Act 2012

• Article 2.52: No specific legal form required for tender submission
• Article 2.53: Legal form may be required after award if needed for execution
• Guide to Proportionality: combination bans are generally disproportionate

Competition law

Combinations are permitted if partners cannot individually execute the contract. Combinations between parties who can each individually bid may be seen as cartel agreements.

Forms of collaboration

1. Consortium (joint liability): All partners jointly liable for the entire contract
2. Subcontracting: Main contractor is fully responsible, subcontractor executes part
3. Reliance on third parties: Use third-party capacity to meet suitability requirements

The consortium agreement

Essential elements: task division, financial arrangements, lead partner, decision-making, liability allocation, exit clauses, confidentiality, and dispute resolution.

Tips for success

1. Choose complementary, reliable partners
2. Draft the agreement before the tender
3. Each partner completes their own ESPD
4. Communicate transparently
5. Comply with competition law