Public Tender Rules for Education Institutions in the Czech Republic

Understanding the Czech public procurement framework for education institutions

Public procurement in the Czech Republic is regulated primarily by Act No. 134/2016 Coll., on Public Procurement, which implements the relevant European Union Directives and establishes a comprehensive legal framework for all public sector purchasing activities.

Educational institutions, whether they are municipal schools, regional secondary schools, or state and public universities, qualify as contracting authorities under this legislation. They must comply with its requirements whenever they award contracts for supplies, services, or construction works.

The Act distinguishes between three categories of public contracts based on their estimated value: above-threshold contracts, below-threshold contracts, and small-scale public contracts (VZMR). Each category carries different procedural requirements and compliance obligations.

The fundamental principles underlying Czech public procurement law are transparency, proportionality, equal treatment, and non-discrimination. These principles are enforced rigorously by the ÚOHS, which possesses broad investigative and sanctioning powers. For educational institutions, this means that every phase of the procurement process must be documented, justifiable, and demonstrably objective.

How thresholds determine procedural requirements

The estimated value of a contract serves as the critical determinant of which procurement procedure an educational institution must follow. For the 2024–2025 period, key thresholds in the Czech Republic generally include CZK 3,653,000 for supplies and services involving central government authorities.

Sub-central authorities, including regions, municipalities, and most public universities and schools established by them, face a threshold of CZK 5,642,000. Educational institutions below these thresholds must still follow the small-scale public contract rules for amounts exceeding CZK 3,000,000 for supplies and services.

The stakes of misidentifying contract value are extraordinarily high, as incorrect determination might trigger investigations by ÚOHS and potentially invalidate the entire procurement procedure.

The calculation must include not only the immediate contract value but also the total estimated value of all similar or related supplies, services, or works. This aggregation obligation creates significant complexity in practice, particularly for universities and larger school districts.

The categorization of public contracts and threshold determination

Determining the correct estimated value is considered one of the most significant errors in Czech public procurement. Educational institutions are particularly vulnerable to miscalculation because their purchasing spans multiple departments, facilities, and fiscal periods.

The law requires that contracting authorities sum the values of all similar and related supplies or services that they intend to procure during the accounting period. In practice, educational institutions often lack integrated procurement systems that would facilitate this calculation.

Consider a regional secondary school that needs to procure cleaning services for multiple buildings. If the school is not careful to aggregate cleaning contracts across all its facilities, it may incorrectly conclude that individual contracts fall below the small-scale threshold.

However, if the total value of all cleaning services across all buildings exceeds CZK 3,000,000, the institution has committed an artificial splitting violation. The ÚOHS has demonstrated willingness to impose substantial fines in such cases. This applies even when the institution's intent was merely administrative convenience rather than deliberate rule circumvention.

For contracts without a fixed term or with terms exceeding 48 months, the institution must estimate the value for a 48-month period. A university that enters into a three-year service contract must project 48 months of costs, not simply multiply the annual cost by three.

Determining when contracts must be split or combined

The law allows educational institutions to award separate lots of a public contract using procedures corresponding to each lot's individual estimated value. This is permitted provided that the aggregate value of lots awarded in this simplified manner does not exceed twenty percent of the total estimated value.

This flexibility creates dangerous opportunities for manipulation that ÚOHS actively investigates. Educational institutions that claim to be splitting a contract into distinct parts may find their characterization rejected if the parts are components of a single functional unit.

A practical example helps illustrate this complexity: a university seeks to procure equipment and installation services for a new laboratory. The institution might attempt to award the equipment supply and installation services separately to keep both below the threshold. If ÚOHS determines that the equipment and installation constitute a single functional unit, the institution faces allegations of unlawful contract splitting.

The international dimension and foreign supplier participation

Educational institutions that receive EU funding or are classified as contracting authorities must ensure that their procurement procedures are open to suppliers from all EU Member States. This requirement frequently catches smaller schools or municipalities unaware.

When an educational institution sets qualification criteria or technical specifications that effectively exclude foreign suppliers, ÚOHS may characterize this as a violation of non-discrimination principles. A school district might specify that bidders must be registered in the Czech Commercial Register (Obchodní rejstřík). While this appears reasonable, it effectively excludes foreign suppliers that have different registration requirements in their home countries.

While the institution may argue that the requirement is simply a verification mechanism, ÚOHS may determine that less discriminatory alternatives exist.

Selection and award criteria: The most commonly identified mistakes

Technical specifications represent one of the most frequent sources of ÚOHS enforcement actions against educational institutions. The core issue arises when an institution drafts requirements with such precision that only one supplier can meet them.

While the institution may believe it is specifying necessary quality standards, ÚOHS examines whether comparable alternative products exist. In one case, an institution sought to procure interactive learning equipment with highly specific technical parameters.

Upon investigation, ÚOHS determined that the institution had copied the technical specifications directly from marketing materials of a specific manufacturer. The institution was unable to demonstrate why alternative products would be unsuitable.

This vulnerability particularly affects educational procurement because instructors often have legitimate preferences for specific equipment brands. However, preferences are not justifications for excluding competition. An educational institution cannot require that network infrastructure upgrades employ equipment from a particular vendor simply because the school's existing systems use that vendor's technology.

Educational institutions can significantly reduce this risk by conducting market research before finalizing specifications. When an institution requires a specific parameter, it should specify the functional requirement rather than the specific product.

ARROWS Law Firm regularly handles disputes involving technical specifications in education procurement and can assist institutions in reviewing specifications before they are published. (consultation@arws.cz)

The mixing of selection and award criteria: A persistent source of invalidity

Czech procurement law makes a critical distinction between "selection criteria" and "award criteria." Educational institutions frequently blur this distinction by including quality requirements in the selection phase when they should reserve them for the award phase.

The consequence of mixing these categories is often contract invalidity. If an institution evaluates a bidder's qualifications at the award stage using criteria that should have been applied during selection, the procedure may be deemed unlawful. ÚOHS has consistently held that the sequence and categorization of criteria matter because they affect bidder participation decisions and market transparency.

A university might announce that it will select the "most economically advantageous tender" based on factors including previous experience. However, if these factors are not established as minimum selection criteria applied before the award stage, procedural defects arise.

The artificial splitting of contracts and sanctions

Contract splitting represents one of the most heavily penalized violations of Czech procurement law. Educational institutions are particularly vulnerable because they manage multiple facilities with comparable needs that lend themselves to disaggregated contracting.

The ÚOHS has demonstrated consistent severity in pursuing splitting cases. The Office has imposed significant fines on municipalities and ministries for splitting construction and service contracts, establishing that even sophisticated institutions are held accountable.

If a contracting authority fails to publish a procedure that should have been published, ÚOHS may apply a financial correction of one hundred percent of the improperly awarded contract value.

Educational institutions can defend themselves against splitting allegations only if they can demonstrate that the separated contracts are genuinely distinct functional units. A school procuring carpeting for different floors would face difficulty arguing these are separate contracts.

Temporal proximity and functional relatedness: The core tests

When evaluating whether an educational institution has unlawfully split contracts, ÚOHS applies two interconnected tests: temporal proximity and functional relatedness. Contracts awarded in close succession for similar goods are presumed to constitute a single unit.

A university that awards separate contracts for maintenance services in three dormitory buildings within a three-month period faces significant scrutiny. The university's defense would rely on proving distinct administrative arrangements.

Even if the contracts are technically separate, ÚOHS may aggregate them on the basis that they are functionally related components of the institution's broader maintenance program.

These tests are highly fact-specific, and educational institutions frequently underestimate the extent to which ÚOHS will probe their decisions. The Office examines whether separate procurement decisions reflected genuine operational independence.

Publishing requirements and transparency obligations

Educational institutions must publish information about contracts meeting specified thresholds in the Register of Contracts and on their Contracting Authority Profiles within strict timelines. The current threshold for mandatory publication is CZK 50,000 (excluding VAT).

The practical requirements are stringent. The contracting authority must publish the final, signed contract within thirty days of its conclusion to ensure validity, though best practice dictates immediate publication. For contracts exceeding CZK 50,000, this publication is mandatory; omission results in contract cancellation by operation of law.

Educational institutions frequently underestimate the complexity of these timelines. A university that delays publishing a contract award notice because it is still negotiating implementation details may inadvertently fail to meet the deadline.

The National Electronic Tool (NEN) and EU Tenders Electronic Daily (TED)

Educational institutions classified as central government authorities must use the National Electronic Tool (NEN) for all procurement documentation. This digital system enforces format requirements and serves as the official record of the procurement process.

For contracts exceeding EU thresholds, educational institutions must additionally publish notices on the Tenders Electronic Daily (TED) system. This applies typically to amounts over CZK 3,653,000 or CZK 5,642,000 depending on the institution type.

This dual publication requirement creates significant compliance complexity, as institutions must ensure consistency between their national NEN filings and their EU TED announcements.

Misidentifying the threshold and failing to publish on TED is a serious breach of procurement law. ÚOHS possesses authority to impose heavy fines or prohibit performance of an already-signed contract when threshold-based publication failures are identified.

Evaluation procedures and common errors in bid assessment

Czech public procurement law and EU policy encourage contracting authorities to move beyond purely price-based evaluation. However, Czech educational institutions have overwhelmingly resisted this shift, often awarding contracts solely on the basis of lowest price.

This reliance on price-only criteria reflects budget constraints and a lack of training in designing quality-based evaluation methodologies. Legal uncertainty regarding ÚOHS's scrutiny of subjective criteria also favors the apparent objectivity of price comparison. When lifecycle costs are considered, the cheapest initial bid frequently proves most expensive over time due to maintenance frequency and replacement cycles.

Educational institutions seeking to incorporate quality criteria must clearly define quality factors in advance. Institutions that structure quality evaluation carefully can successfully defend more sophisticated procurement methodologies.

Abnormally low tenders and the validation problem

When a bidder submits a tender price significantly below competing bids, the procuring institution faces the obligation to request clarification. An abnormally low tender might reflect superior efficiency, or it might signal a plan to reduce quality.

Educational institutions frequently mishandle abnormally low tenders by simply rejecting them or accepting them without investigation. Both approaches create legal vulnerability. If an institution rejects a low tender without requesting clarification, the institution may be found to have violated principles of equal treatment and proportionality.

The appropriate response involves requesting written clarification from the bidder regarding its pricing methodology. The bidder should be given an opportunity to provide documentation supporting its low price, such as evidence of lower supplier costs.

Modification of tenders during evaluation: A categorical prohibition

One of the most serious evaluation errors involves allowing bidders to modify their tenders after submission. This practice violates fundamental procurement principles and creates severe consequences when identified.

A concrete example illustrates the risks: a university's evaluation committee discovers that the winning bidder omitted required documentation. The committee contacts the bidder and requests the missing files. If the university accepts the supplementary documentation submitted after the tender deadline, ÚOHS would likely view this as unlawful modification.

Educational institutions must establish and strictly enforce policies requiring that once the tender submission deadline has closed, no modifications are permitted. This strict approach protects against accusations of favoritism.

Contract implementation and post-award management risks

A frequently encountered complexity involves the application of contractual penalties for supplier non-performance. The law permits contracting authorities to include penalty provisions, but they must be enforced consistently once included.

If the contracting authority later declines to enforce the contractual penalty, the authority has fundamentally altered the conditions under which suppliers made their bidding decisions. This non-enforcement may constitute a "substantial modification" to the contract that violates procurement law, even if the modification appears minor.

The practical implication is that contracting authorities must carefully consider whether to include contractual penalties before publishing tender documents. If the institution finds that enforcement becomes impractical, it should memorialize this decision in writing.

Substantial contract modifications and their prohibition

Czech law permits limited modifications to concluded contracts without requiring a new procurement procedure. However, this is allowed only if the modifications are non-fundamental and non-substantial.

Educational institutions frequently encounter situations requiring contract amendments, such as expanding the scope of a renovation project. The law provides mechanisms for limited modifications, but these are constrained. Modifications explicitly anticipated in the original contract documents and tender terms are permitted without re-procurement, provided the potential variations were outlined.

Modifications exceeding these parameters require re-procurement. An educational institution that expands a service contract significantly without a new competitive procedure violates procurement law.

Enforcement mechanisms and penalty structures

The Office for the Protection of Competition possesses broad enforcement authority over public procurement violations. The Office can initiate investigations, request extensive documentation, and impose substantial administrative fines.

Administrative fines for procurement violations under the Act can reach up to 10% of the total contract value or CZK 20,000,000. For educational institutions with limited budgets, even modest fines represent significant financial impacts.

The financial corrections applied to EU-funded projects can be far more substantial, with one-hundred-percent correction possible for procedurally deficient procurements.

Additionally, ÚOHS can order the cancellation of procurement procedures. It can also ban contracting authorities from performing already-concluded contracts if violations are sufficiently severe.

Criminal liability and prosecution risks

While administrative fines represent the primary enforcement mechanism, Czech law also establishes criminal offenses related to public procurement violations. This is particularly relevant in cases involving collusion or abuse of procurement procedures.

Particular risk arises where an official uses procurement procedures to direct contracts toward a supplier with whom they have a relationship. Even if the bid is competitive, investigators may examine whether procedures were structured to favor that supplier.

Educational institutions must establish robust conflict-of-interest policies and must ensure that procurement decisions are made by committees with no personal stakes.

Sanctions for international sanctions violations

Educational institutions face an often-overlooked procurement risk: contracting with suppliers subject to international sanctions. Entering into contracts with sanctioned parties violates Czech laws and can result in fines reaching up to CZK 50,000,000 .

Educational institutions must screen all prospective suppliers against international sanctions lists before contract award. The penalty structure makes this a critical compliance obligation that many procurement officers overlook.

Risk and Sanctions 

Executive summary for management

Key decision points for educational institution leadership:

• Threshold miscalculation and contract splitting represent the highest-risk procurement errors. Establishing centralized procurement systems with mandatory value aggregation protocols is essential before major procurement decisions are made.
• Publication and transparency violations create contract invalidity risks. Missing the publication deadline for the Register of Contracts or failing to publish on TED can render contracts void even if the award decision was proper.
• Technical specification discrimination and subjective evaluation criteria require expert guidance. The balance between establishing quality standards and remaining open to competitive solutions is delicate and often targeted by ÚOHS.
• Procurement procedure complexity creates substantial time and expertise demands. Successfully navigating the distinction between selection and award criteria and managing evaluation methodologies requires ongoing institutional knowledge.
• International sanctions screening and foreign supplier compliance obligations extend beyond traditional procurement concerns. The requirement to screen all suppliers against international sanctions lists represents a compliance frontier that must be systematized.

Conclusion of the article

Public procurement for educational institutions in the Czech Republic exists at the intersection of complex legal requirements and severe penalties. Educational institution leaders must recognize that procurement compliance is a core governance obligation with direct implications for financial stability.

The common mistakes identified in this analysis are not merely theoretical concerns. ÚOHS routinely investigates these violations, imposes fines reaching into millions of Czech crowns, and orders contract cancellations that force educational institutions to re-procure critical services.

The ARROWS Law Firm brings two decades of specialized experience in education sector procurement to institutional clients. We work with educational institutions to establish procurement protocols that achieve both legal compliance and value for money in purchasing, and we provide aggressive representation when ÚOHS investigations occur.

Based in Prague, ARROWS Law Firm combines deep knowledge of Czech public procurement law with experience handling cross-border cases. We regularly assist educational institutions in establishing compliant procurement procedures and in defending against enforcement actions.

Educational institution officials who recognize procurement compliance as a core institutional priority should reach out to consultation@arws.cz to discuss how ARROWS Law Firm can support your institution.