In case tender documents prescribe the obligation of bidders to submit bank guarantee for successful completion of the work in the amount proportionate to the value of the public procurement contract based upon Article 17 Paragraph 1 of Regulation on Mandatory Elements of Tender Documents in Public Procurement Procedures and Way to Prove Fulfilment of Requirements, the value of the public procurement contract means total price, VAT excluded, offered by the bidder that was awarded the contract.
Article 3 Paragraph 1 Point 33 of Public Procurement Law (“Official Gazette of Republic of Serbia” no. 124/12; hereinafter: PPL) prescribes that the acceptable offer is the one that is timely, which contracting authority did not reject due to essential deficiencies, which is adequate, which does not restrict or condition either the rights of contracting authority or the obligations of bidder, and which does not exceed the amount of estimated value of public procurement in question.
Article 64 Paragraph 1 of PPL prescribes that estimated value is to be expressed in RSD, without VAT.
Article 17 Paragraph 1 of Regulation on Mandatory Elements of Tender Documents in Public Procurement Procedures and Way to Prove Fulfilment of Requirements (“Official Gazette of Republic of Serbia” no. 29/2013 and 104/2013, hereinafter: Regulation) prescribes that bank guarantee for successful completion of the work is issued for the amount of maximum 10 % of the value of the contract (15% in case of Article 83 Paragraph 12 of PPL), bearing in mind the duration of contract execution.
Article 1 of Value Added Tax Law (“Official Gazette of Republic of Serbia” no. 84/2004, 86/2004 – amendments 61/2005, 61/2007, 93/2012, 108/2013 and 6/2014 – adjusted amount in RSD), prescribes that value added tax – VAT is the general tax on expenditure calculated and paid for goods delivered and services provided throughout all phases of production and trading of goods and services, and the income thus achieved belongs to the budget of Republic of Serbia.
As Article 3 Paragraph 1 Point 33 of PPL prescribes that the offer is deemed acceptable if, among other things, the offered price does not exceed the estimated value of the public procurement, therefore at expert evaluation of the offers the offered price expressed in RSD, VAT excluded, should be taken into consideration as the only comparable price related to the estimated value of the public procurement which, in accordance with the Article 64 Paragraph 1 of PPL is expressed in RSD and without VAT.
Therefore, the Republic Commission believes that the value of the contract as in Article 17 Paragraph 1 of Regulation is the offered price without VAT, as it is standard price both in the procedure of establishing the acceptability of the offer and comparability of the offers.
In support to such attitude of Republic Commission there are the provisions of Article 83 Paragraph 12 and 13 of PPL, to which Article 17 Paragraph of Regulation refers. They explicitly prescribe the obligation of the contracting authority to, in case when subject of public procurement is not identical to the subject for which bidder got negative reference, within tender documents prescribe additional security for fulfilment of contractual obligations to the certain amount of the offered price. As offered price, in accordance with the quoted provisions of PPL and position taken by Republic Commission, is the offered price without VAT, therefore Republic Commission is of the opinion that the percentage of additional security in all of the cases where submitting of bank guarantee for successful completion of work is prescribed, should be calculated in relation to the total price without VAT offered by the bidder who was awarded the contract, and this price is deemed to be the value of the public procurement contract.