{"id":4236,"date":"2026-05-29T15:06:32","date_gmt":"2026-05-29T13:06:32","guid":{"rendered":"https:\/\/lome.legal\/the-personal-performance-trap-in-construction-bids-and-how-to-avoid-it\/"},"modified":"2026-08-26T12:19:25","modified_gmt":"2026-08-26T10:19:25","slug":"the-personal-performance-trap-in-construction-bids-and-how-to-avoid-it","status":"publish","type":"post","link":"https:\/\/lome.legal\/en\/the-personal-performance-trap-in-construction-bids-and-how-to-avoid-it\/","title":{"rendered":"The \u201cpersonal performance\u201d trap in construction bids\u2014and how to avoid it?"},"content":{"rendered":"\n

Public procurement in the construction industry resembles a chessboard. General contractors, seeking to remain competitive and maintain operational flexibility, often base their business model on extensive collaboration with specialized subcontractors. From an economic and logistical perspective, this makes sense. A single company rarely has the full range of machinery and engineering staff needed to carry out every aspect of a massive infrastructure or building project. On the other side of the contract, we have<\/strong> Public-sector contracting authorities\u2014government agencies, state-owned companies, and road and rail authorities. Their primary goal is to minimize the risk of improper project execution. To protect their interests, these entities are increasingly turning to legal tools such as the legal institution known as \u201cpersonal performance of key parts of the contract.\u201d <\/strong><\/p>\n\n

In practice, this mechanism can sometimes, instead of safeguarding the quality of investments, become a tool that completely blocks smaller businesses from participating in a tender. What can be done in such a situation?<\/p>\n\n

In-House Performance vs. Limitations on the Use of Subcontractors<\/h2>\n\n

To understand the essence of the problem, let\u2019s examine the relationship between the provisions of the Act of September 11, 2019\u2014Public Procurement Law<\/a> (Journal of Laws of 2019, item 2019, as amended). The contracting authority\u2019s combination of these provisions in the Terms of Reference (SWZ) may, in practice, deprive smaller contractors of the opportunity to win a public contract.<\/p>\n\n

On the one hand, Article 118(1) of the Public Procurement Law allows contractors to \u201cborrow\u201d capabilities (experience, qualifications, or education) from third parties <\/strong>in order to meet the stringent requirements for participation in a procurement proceeding. An entity that makes its resources in the form of experience or qualifications available is legally obligated to physically perform the construction work or services to which those capabilities pertain.<\/p>\n\n

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Article 118. 1. In order to confirm compliance with the conditions for participation in the procurement procedure or the selection criteria, the contractor may, in appropriate situations and with respect to a specific contract or part thereof, rely on the technical or professional capabilities or the financial or economic standing of entities providing resources, regardless of the legal nature of the legal relationships between the contractor and such entities.<\/p>\n\n\n\n

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2. With regard to requirements concerning the contractor\u2019s education, professional qualifications, or experience, contractors may rely on the capabilities of entities providing resources, provided that those entities perform the construction work or services for which such capabilities are required.<\/p>\n<\/blockquote>\n\n

However, a few articles later, a restriction appears in Article 121 of the Public Procurement Law. This provision grants the contracting authority the right to stipulate that key tasks must be performed personally by the contractor itself<\/strong>. Such a provision automatically precludes the possibility of entrusting this work to subcontractors.<\/p>\n\n

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Article 121. The procuring entity may require that the contractor personally perform key tasks related to: 1) contracts for construction work or services, or 2) work related to the deployment and installation under a supply contract.<\/p>\n<\/blockquote>\n\n

For construction companies, this provision could become a trap. Since a third party providing a reference must personally carry out a specific part of the project (as a subcontractor), and at the same time the Contracting Authority, pursuant to Article 121(1) of the Public Procurement Law, has categorically prohibited the participation of any entities other than the contractor itself in tasks deemed critical, it becomes legally impossible to use external references.<\/p>\n\n

What exactly are \u201ckey tasks\u201d? Where is the line drawn?<\/h2>\n\n

Many myths have arisen in the construction industry surrounding the concept of \u201ckey tasks.\u201d Sometimes, certain contracting authorities use regulations to artificially narrow the pool of companies eligible to bid on a project. In the tender documentation (formerly IDW, now SWZ), provisions then appear that elevate entirely standard, repetitive tasks to the status of \u201ckey\u201d tasks. Does an official have complete discretion in this matter? Well, no.<\/p>\n\n

\u201cKey components of the contract\u201d is an undefined term; however, its scope has been delineated quite precisely by legal doctrine and case law. These cannot be works of an auxiliary, routine, or general nature.<\/p>\n\n

Only those elements of the project that are characterized by exceptional:<\/strong><\/p>\n\n