Nueva Ley de Compras y Contrataciones Públicas en RD | Entrevista a Ricardo González Hernández

Interview on the Implementation of Public Procurement Law

Introduction to the Interview

• The segment features an expert discussion on the application of the Public Procurement Law (Ley de Compras y Contrataciones Públicas) in the Dominican Republic.

• Ricardo González Hernández, Executive Director of the Association of Contractors and Suppliers of the State, is introduced as a guest.

Overview of New Legislation

• The new law, 47-25, aims to enhance transparency and efficiency in public procurement processes. It replaces the previous law from 2006 (34006), which had become outdated after 20 years.

• González highlights that while the old law contributed positively to state growth, it was time for modernization to reflect current trends and practices in procurement.

Key Features of Law 47-25

• This legislation introduces new contracting modalities such as framework agreements and abbreviated bidding formats aimed at reducing procurement timelines significantly.

• The law emphasizes planning as a critical component; entities must plan adequately or risk failing to execute contracts effectively under either old or new regulations.

Challenges in Implementation

• Implementing this new law requires regulatory adjustments, technological upgrades to procurement portals, and extensive training for public administration personnel and suppliers.

• The Directorate of Public Procurement has initiated training programs for around 700–800 collaborators from various institutions to prepare them for these changes.

Implementation Challenges of New Law

Insufficient Numbers and Gradual Implementation

• The speaker expresses concern that the current number of resources is insufficient for implementing the new law effectively, especially after a six-month waiting period.

• There is apprehension regarding the gradual implementation announced by the governing body, which may lead to confusion and inefficiency in execution.

Legal Uncertainty and Compliance Issues

• The lack of unified criteria among control bodies (e.g., budget office, treasury) raises fears about how to comply with both old and new regulations.

• The speaker highlights legal ambiguities surrounding gradual implementation, emphasizing that ignorance of the law cannot be claimed once it is promulgated.

Criminal Sanctions Under New Law

• Concerns are raised about new criminal sanctions introduced in Law 47-25 for misuse of public funds, which were not present before.

• Specific types of offenses now included are false declarations, prohibited agreements between suppliers, bribery, and corporate criminal liability.

Accountability of Public Officials

• Discussion includes accountability measures for mayors and other officials under constitutional provisions established in 2010.

• The potential for personal liability in cases where official actions compromise public trust is noted as a significant advancement.

Recommendations for Implementation Timeline

• A recommendation is made to extend the implementation period by an additional six months to allow adequate training on the new legislation.

• Emphasis on ensuring that systems like those at the Treasury are updated to accommodate changes from the new law before full enforcement begins.

Support for MIPYMES and Women-Led Businesses

Increased Reservations for MIPYMES

• The new law increases reservations from 20% to 30% specifically for micro, small, and medium enterprises (MIPYMES).

Support for Women Entrepreneurs

• Reservations for women-led MIPYMES have also increased from 5% to 10%, reflecting a commitment to gender equity in business opportunities.

Women's Participation in Public Procurement

Overview of Women-Led Microenterprises

• The law mandates that state institutions must allocate at least 30% of their budget for contracts with microenterprises led by women.

Changes in Bidding Processes

Introduction to Abbreviated Bidding

• The new law introduces abbreviated bidding, reducing the timeframe from 30 to 15 days for common goods and services. This aims to streamline procurement processes.

Examples of Bidding Thresholds

• Different thresholds apply based on the nature of the purchase; for instance, purchasing two vehicles can utilize abbreviated bidding, while equipping a hospital requires traditional public bidding due to complexity.

Implementation Status

• Although the new regulations are established, they have not yet been implemented fully; current thresholds remain as per previous laws until updated figures are published in 2026.

Eligibility and Restrictions in State Contracts

Who Can Negotiate with the State?

• All registered suppliers, including local companies and foreign entities under international treaties, can negotiate with the Dominican state. However, there are strict rules regarding public officials acting as suppliers.

Ineligibility of Public Officials as Suppliers

• The law explicitly prohibits first and second-level public officials (e.g., ministers, judges) from being state suppliers to avoid conflicts of interest. This includes a complete ban on any ownership stake in supplier companies.

Specific Cases and Regulations

Unique Supplier Situations

• If a public official is the sole supplier of a product, an international tender must be conducted instead of allowing direct procurement from that official's company. This aims to ensure fairness and transparency in procurement processes.

Clarification on Advertising Services

State Contracting for Advertising

• There has been confusion regarding whether only state institutions can receive advertising services directly or through intermediaries; however, this remains consistent with past legislation despite some clarifications made in the new law.

Contracting Public Services in the Dominican Republic

The Role of Advertising Agencies in Public Contracts

• The process of selecting advertising agencies for public contracts now requires a competitive bidding process, ensuring transparency and fairness.

• Previously, institutions could select an intermediary agency without a bidding process, leading to potential conflicts and lack of accountability.

• The new law clarifies that direct contracts with media outlets are preferred over using intermediaries like advertising agencies.

Improvements in the New Legislation

• Observations were made regarding the previous law's ambiguities; the new legislation aims to eliminate these issues by enforcing competitive selection processes.

• There is a positive balance with this new legislation, but challenges remain in its implementation to ensure quality goods and services from providers.

Timely Payments to Providers

• A significant improvement in the new law is the stipulation for timely payments to service providers, which includes penalties for late payments.

• Many companies have hesitated to work with the state due to payment delays; this law aims to address those concerns effectively.

Legal Framework for Payment Processes

• The law establishes specific timelines for payment after invoice submission, aiming to reduce delays that previously extended up to four months.

• Institutions must adhere strictly to these timelines or face legal consequences if they fail to comply.

Educational Opportunities Related to New Legislation

• There are various educational programs available at universities focusing on public contracting laws, including master's degrees and specialized courses.

• Ricardo González Hernández offers training specifically on Law 47-25 at CEF Santo Domingo, aimed at helping stakeholders understand and implement these regulations.

Conclusion of Discussion

• The conversation wraps up with gratitude expressed towards Ricardo González Hernández for sharing insights on public contracting laws.