<abstract xmlns="http://www.w3.org/1999/xhtml"><p>Public procurement is a crucial activity undertaken by the public sector. However, public procurement entails a wide range of transaction costs. While many papers focus on the ex-ante transaction costs, it is equally important to evaluate the types of ex-post transaction costs. The disputes stemming from conflicts between procuring authorities and proposers often bring additional costs to both parties. One of the ways to ensure that the procuring authority wins the dispute is using the services of an external law firm to represent the procuring authority in the review process. The aim of the paper is to examine the extent of the use of external law services in the public-procurement review process by procuring authorities and proposers in Slovakia and in the Czech Republic. The focus is also on the impact the use of external law firms in the review process may have on the length of the review process and the outcome of the dispute. Our results suggest that while the use of the external law firm may lead to a higher success rate of the review process on the side of a procuring authority, the same does not apply to proposers. There were no conclusive findings regarding the impact of the outsourcing on the length of the review process.</p></abstract>

Public procurement is a crucial activity undertaken by the public sector. However, public procurement entails a wide range of transaction costs. While many papers focus on the ex-ante transaction costs, it is equally important to evaluate the types of ex-post transaction costs. The disputes stemming from conflicts between procuring authorities and proposers often bring additional costs to both parties. One of the ways to ensure that the procuring authority wins the dispute is using the services of an external law firm to represent the procuring authority in the review process. The aim of the paper is to examine the extent of the use of external law services in the public-procurement review process by procuring authorities and proposers in Slovakia and in the Czech Republic. The focus is also on the impact the use of external law firms in the review process may have on the length of the review process and the outcome of the dispute. Our results suggest that while the use of the external law firm may lead to a higher success rate of the review process on the side of a procuring authority, the same does not apply to proposers. There were no conclusive findings regarding the impact of the outsourcing on the length of the review process.

Transaction Costs, Outsourcing, and the Public Procurement Review Process in the Czech Republic and Slovakia

The College of Regional Development and Banking Institute – AMBIS

NISPAcee Journal of Public Administration and Policy

This work is licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 License.

Public procurement is a crucial activity undertaken by the public sector. However, public procurement entails a wide range of transaction costs. While many...

Transaction Costs, Outsourcing, and the Public Procurement Review Process in the Czech Republic and Slovakia

Published Online: Dec 11, 2019

Page range: 233 - 250

DOI: https://doi.org/10.2478/nispa-2019-0021

Keywords
transaction costs, outsourcing, public procurement, complaints, review, supervisory authority, rationality

© 2019 Markéta Šumpíková et al., published by Sciendo

This work is licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 License.

Transaction Costs, Outsourcing, and the Public Procurement Review Process in the Czech Republic and Slovakia

Published Online: Dec 11, 2019

Page range: 233 - 250

DOI: https://doi.org/10.2478/nispa-2019-0021

Keywordstransaction costs, outsourcing, public procurement, complaints, review, supervisory authority, rationality

© 2019 Markéta Šumpíková et al., published by Sciendo

This work is licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 License.

Keywords
transaction costs, outsourcing, public procurement, complaints, review, supervisory authority, rationality