Common Mistakes in Public Procurement in Ecuador and How to Avoid Them
Public procurement in Ecuador is a key process for businesses and professionals seeking to establish commercial relationships with the State. However, this process can be complex and is often surrounded by challenges. Identifying and avoiding the most common mistakes is essential to ensuring success in government tenders and compliance with the resulting contracts.
In this article, we will explore the most frequent mistakes in public procurement processes in Ecuador and propose the most appropriate guidelines to correct and avoid them. To start or improve your chances in state tenders, it is crucial to acquire key knowledge of administrative law, as it can make the difference between successful processes and healthy business practices.
1. Lack of Knowledge of the Legal Framework
One of the most common mistakes is not being familiar with the Organic Law of the National Public Procurement System (LOSNCP), its general regulations, and other related laws. When participating in tenders or executing contracts with the State, it is essential to consider that, in addition to these, the Administrative Organic Code, specific opinions from the State Attorney General’s Office, technical regulations from the Office of the Comptroller General, and internal regulations of contracting entities also apply.
The large volume of secondary regulations, while present in the legal framework to provide legal certainty, can become a disadvantage if misunderstood or overlooked. Failing to observe these laws can result in non-compliance with legal requirements, deviation from the intended process, and even disqualification from the outset.
How to Avoid It:
- Dedicate time to training on the legal framework governing public procurement.
- Stay updated on legal reforms and regulations related to administrative law.
- Carefully study the internal regulations governing the contracting processes of the institution you plan to work with.
- Seek specialized legal advice.
At Legal Access, we are continuously updated through periodic research on changes and reforms in current regulations. Our goal is to help you navigate this complex landscape and successfully manage the bidding processes for your business with the State.
2. Incomplete or Incorrect Documentation
Another frequent error is submitting incomplete, incorrect, or late documentation. Keep in mind that procurement processes are structured around well-defined stages, which generally do not allow exceptions. This issue often arises from poor organization or failure to thoroughly review tender requirements.
In fact, a misinterpretation of the tender bases can lead to an unfixable deviation in the submitted offer. This is why it is crucial that procurement processes are properly guided from the start.
How to Avoid It:
- Create a checklist of mandatory documents, such as the RUC (Taxpayer Identification Number), tax compliance certificates, and financial statements.
- Verify that you have all the documents proving your technical capacity and the experience required in the tender bases.
- Assign a dedicated team or person to review and prepare the documentation.
If you still have doubts about the requirements to begin a procurement process or face difficulties during project execution or service delivery, you can always consult a public procurement expert. At Legal Access, we provide the support you need to ensure your procurement processes stay on the path to success.
3. Uncompetitive Offers
Some companies submit offers that fail to meet the contracting authority’s expectations. This may be due to uncompetitive pricing, poorly structured proposals, or a lack of understanding of technical specifications.
How to Avoid It:
- Analyze the market and competition before structuring your proposal.
- Ensure you fully understand the tender documents and the contracting entity’s needs.
- Work with a multidisciplinary team to develop strong and well-founded proposals.
In procurement processes, thorough knowledge of the competitive environment and your company’s capabilities is essential. Many proposals lack adequate market analysis before submission, leading to missed opportunities to clarify doubts or respond to the contracting entity’s observations.
4. Underestimating Contract Compliance
Once a contract is awarded, some companies underestimate the importance of strictly adhering to the agreed conditions. This can result in penalties, fines, or even early termination of the contract. Therefore, maintaining proper control over the terms and conditions outlined in both the contract and the Terms of Reference is critical.
How to Avoid It:
- Fully read and understand the contract’s content and scope before signing.
- Develop a detailed plan to meet project deadlines and specifications.
- Collaborate with legal experts to address any contractual doubts and ensure compliance.
In Ecuador, one of the most common mistakes in public procurement is that companies fail to use the appropriate legal channels when they believe irregularities have occurred in the process. This can be a missed opportunity to defend their rights. Knowing your legal limits and enforceable obligations, as well as anticipating available administrative and judicial remedies, is advisable for safeguarding your interests.
If you identify irregularities, consult a specialized attorney to evaluate the feasibility of legal action, and rely on expert advice to execute these actions effectively.
Benefits of Avoiding These Mistakes
Avoiding these mistakes not only increases your chances of success in public procurement processes but also enhances your company’s reputation and strengthens its capacity to build sustainable business relationships with the State.
Why Choose Legal Access?
At Legal Access, we have a highly qualified team specializing in public procurement, administrative law, and 17 other areas of law. This expertise allows us to assist you through every stage of the public procurement process in Ecuador to help you avoid mistakes. From reviewing tender documents and preparing submissions to ensuring contract compliance, we are here to guarantee a successful and hassle-free experience.
Don’t let common mistakes stand in the way of new opportunities. Contact us today and take the first step towards success in public procurement!