Bill 14.

Summary.

The bill states that its purpose is to raise the standards required of persons contracting with the State. To that end, it proposes disqualifying natural or legal persons convicted of corruption or who have entered into judicial cooperation or plea agreements. Its subsequent articles propose new wording for Articles 2 and 24 of Law 22 of 2006, which regulates public procurement.

The amendment to Article 2 sets out three definitions. A notice of invitation must contain, at a minimum, a description of the public procurement event and identification of the procuring entity. It must also state the electronic address or office where the bidding documents can be examined or obtained, and the place, day and time for submitting bids and commencing the public event. Where applicable, it includes those particulars for the preliminary meeting and harmonization. It adds a brief description of the subject of the contract, the budget allocation and the reference price; for disposals of state property, it includes the estimated value.

The same provision defines the beneficial owner as a natural person who directly or indirectly owns, controls or exercises significant influence, or who exercises ultimate effective control over a legal person. It defines an electronic certificate as a document issued by an electronic signature certification service provider that links signature verification data to a signatory and confirms that person's identity. These definitions would form part of the terminology used in Law 22 of 2006.

The proposed wording of Article 24 permits natural persons with capacity under ordinary law and legally constituted legal persons, whether domestic or foreign, to contract with state entities, subject to the listed grounds of legal incapacity. Those grounds include arrears in paying a fine for breach of a contract or purchase order and disqualification from contracting. They also include participation, in any manner, in the preparation, evaluation, award or execution of a contractor selection procedure, an exceptional procurement procedure or a special procurement procedure.

The list covers persons who have received in Panama, by final judicial judgment, an ancillary penalty barring them from public functions or a sanction disqualifying them from contracting with the State. It also covers liquidation, supplying false information required under the law, and participation by foreign legal persons that fail to meet their home country's incorporation requirements or applicable national rules governing their operation. It includes administrative termination of a contract for negligent or intentional breach for the duration of the disqualification. Item 8 refers to natural persons sentenced by final judicial judgment to imprisonment for one or more years.

The provisions concern state entities that invite bids and enter into contracts, as well as sectors involved in public procurement in Panama: suppliers, contractors, foreign legal persons and electronic signature certification service providers.