A framework agreement is a general term for agreements with suppliers that set out terms and conditions under which specific purchases (call-offs) can be made throughout the term of the agreement. In most cases a framework agreement itself is not a contract, but the procurement exercise to establish a framework agreement is subject to the public procurement rules.
Framework agreements can help suppliers to participate in national and large collaborative contracts where the framework is often divided into specialist or geographical lots.
The value of the framework is the estimated value of all contracts envisaged to be awarded under the agreement during its duration.
The duration of the framework must be limited to four years except in exceptional circumstances (the duration of the call off may be different and will be determined by the terms of the framework).
Buyers will clearly state in the contract notice if they are intending to set up a framework agreement. This will advertised on Public Contracts Scotland.
The framework agreement does not bind any public body to purchase goods, works or service – the public body can decide to use the framework agreement if it represents value for money. If the public body does not consider that the framework agreement provides value for money it can choose to award a contract outside of the framework agreement.
Types of framework agreement
Framework agreements can take one of two forms:
- a single supplier framework
- a multi-supplier framework
Single supplier framework agreements - call-offs
Within a single supplier framework, any call-off contracts will be based on the terms laid down in the framework agreement. Buyers may on occasion consult the supplier asking them to supplement the tender as necessary, but this must not result in the inclusion of terms that are substantially amended from the terms laid down in the original framework agreement.
Multi-supplier framework agreements - call-offs
Call off contracts can be awarded either:
Direct Award: by application of the terms set out in the framework agreement itself
Mini Competition: where not all the terms are set out in the framework agreement, the public body must run a mini competition between the suppliers that are capable of performing the proposed call-off contract. Under a mini-competition, the call-off contract must be placed with the bidder who has submitted the best tender in accordance with the award criteria.
It is important that suppliers understand that being part of a multi-supplier framework is not a guarantee of business - you will still have to compete and be successful in mini-competitions.
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