Trust Bloomberg Tax for the international news and analysis to navigate the complex tax treaty networks and global business regulations.
Germany’s parliament cleared legislation that would establish a federal competition registry for procurement contracts, to contain information on companies convicted of crimes and misdemeanors such as money laundering and tax evasion.
The Bundesrat, the parliament’s upper house, approved the bill July 7, in a move lawmakers say will increase transparency by making it easier for government bodies awarding public tenders to determine whether there are reasons to exclude companies for receiving these public procurements.
The bill aims to do this by creating a nationwide electronic competition registry listing crimes and misdemeanors committed by companies, including bribery, human trafficking, financing terrorism, money laundering, tax evasion and withholding social security contributions.
Government bodies are already required by German law to determine whether there are grounds to exclude potential contractors from an offer, but difficulties in conducting these background investigations have allowed companies with criminal histories to obtain procurements, lawmakers wrote in their justification for the bill.
The competition registry should thus ensure that public tenders are “only awarded to firms that haven’t committed any substantial legal violations and that compete fairly,” the lawmakers said.
Under the bill, public authorities awarding contracts over 30,000 euros would be required to check the registry for entries.
The bill was approved by the Bundestag, the lower house, on June 1. It will now be submitted to the federal president for his expected signature. When signed, the law will go into effect the day after its publication in Germany’s Federal Law Gazette.
The bill doesn’t automatically exclude companies in the register from being awarded contracts, but those that find themselves listed might face problems, attorneys said.
“It will be compulsory to check the register before awarding a contract over a certain amount,” Oliver Geiss, a partner at Squire Patton Boggs, told Bloomberg BNA in a July 7 interview. “So it can have pretty damaging consequences for companies that get onto this registry.”
Public officials might also proceed more carefully with awarding contracts to companies listed on the registry, he added. “If something goes wrong, this person will have fingers pointed at them—I think indirectly it will have a very strong effect.”
To contact the reporter on this story: Jabeen Bhatti in Berlin at email@example.com
To contact the editor responsible for this story: Penny Sukhraj at firstname.lastname@example.org
Copyright © 2017 The Bureau of National Affairs, Inc. All Rights Reserved.
All Bloomberg BNA treatises are available on standing order, which ensures you will always receive the most current edition of the book or supplement of the title you have ordered from Bloomberg BNA’s book division. As soon as a new supplement or edition is published (usually annually) for a title you’ve previously purchased and requested to be placed on standing order, we’ll ship it to you to review for 30 days without any obligation. During this period, you can either (a) honor the invoice and receive a 5% discount (in addition to any other discounts you may qualify for) off the then-current price of the update, plus shipping and handling or (b) return the book(s), in which case, your invoice will be cancelled upon receipt of the book(s). Call us for a prepaid UPS label for your return. It’s as simple and easy as that. Most importantly, standing orders mean you will never have to worry about the timeliness of the information you’re relying on. And, you may discontinue standing orders at any time by contacting us at 1.800.960.1220 or by sending an email to email@example.com.
Put me on standing order at a 5% discount off list price of all future updates, in addition to any other discounts I may quality for. (Returnable within 30 days.)
Notify me when updates are available (No standing order will be created).
This Bloomberg BNA report is available on standing order, which ensures you will all receive the latest edition. This report is updated annually and we will send you the latest edition once it has been published. By signing up for standing order you will never have to worry about the timeliness of the information you need. And, you may discontinue standing orders at any time by contacting us at 1.800.372.1033, option 5, or by sending us an email to firstname.lastname@example.org.
Put me on standing order
Notify me when new releases are available (no standing order will be created)