Competitive Procedure with Negotiation
A PCR 2015 procurement procedure allowing negotiation with shortlisted bidders after initial tender submission; replaced by Competitive Flexible under PA 2023.
Definition
Competitive Procedure with Negotiation (CPN) is a PCR 2015 procurement procedure where the contracting authority shortlists candidates via a Selection Questionnaire, receives initial tenders, then negotiates with shortlisted bidders to improve the offer before a final tender. CPN is used for complex contracts where some specification flexibility is needed but full Competitive Dialogue is disproportionate. Under the Procurement Act 2023 CPN is absorbed into the Competitive Flexible procedure umbrella.
How it works in practice
CPN sits between Restricted Procedure (single response, no negotiation) and Competitive Dialogue (extensive iterative dialogue). The procedure has five phases: contract notice and selection; initial tender; negotiation with one or more shortlisted bidders to improve the offer; final tender; evaluation and award. Negotiation can focus on price, technical solution, contract terms, or all three. The buyer must run negotiations fairly: each bidder negotiates separately but the buyer cannot use one bidder's offer to drive negotiations with another. PCR 2015 limits the use of CPN to specific circumstances including where the requirement involves design or innovation, where the specification cannot be defined with sufficient precision, or where the contract is for technically complex services. The Procurement Act 2023 simplifies this by folding CPN into the Competitive Flexible procedure which allows greater design freedom but retains the negotiation concept. Bidders responding to CPN should treat the initial tender as a strong opening offer rather than a final position: the negotiation phase is the substantive evaluation point and bidders who arrive with maximum-flexibility offers do well. Pricing should be costed bottom-up so the bid team knows how much flex is available for the negotiation.
Common questions
How is CPN different from Competitive Dialogue?
CPN starts from initial tenders and negotiates to refine offers; Competitive Dialogue starts from outline specification and uses dialogue to develop the specification itself before any tenders are submitted. CPN is lighter procedurally; Dialogue is suitable for genuinely complex contracts where the specification cannot be written upfront.
Is CPN still used under the Procurement Act 2023?
The PCR 2015 procedure label "Competitive Procedure with Negotiation" no longer exists as a separate procedure under PA 2023. The concept is absorbed into the new Competitive Flexible procedure which allows greater design freedom and retains negotiation as one possible design choice within the procedure.
Can the buyer negotiate with only some shortlisted bidders?
PCR 2015 allows the buyer to progressively narrow the negotiation to the most promising candidates provided the published criteria support this. The Procurement Act 2023 Competitive Flexible procedure gives more design freedom. Either way, the buyer must run any narrowing transparently against published criteria.