1. Centralization of procurement.

The main novelty of the adopted document is the development of a centralized procurement system: firstly, a single Register of procurement procedures and economic operators, and a list of goods and services to be procured with their approximate price (updated every six months) are to be compiled; and secondly, all goods and services, except for certain specifically designated cases or a situation where a specific body is authorized to procure independently, must be purchased:

• through the Administration of the Patrimony of the Apostolic See (abbreviated APSA, which stands for Amministrazione del Partimonio della Sede Apostolica, in Italian) - in the case of the bodies of the Roman Curia and the institutions administratively linked to the Holy See or falling within its authority;
• through the Governorate of the State - in the case of the dicasteries and authorities.

These measures are primarily aimed at rationalizing the expenditure of public funds. Previously, when each body independently drew up the list of suppliers, they had to purchase goods from the same entity for ages, even if they could have acquired the same goods from a different supplier, potentially on better terms.

There is a list of exceptions regarding, for instance, procurement in a state of emergency, where bodies can procure independently. However, in this instance the respective body should submit a report justifying the procurement to APSA or the Governorate and subsequently obtain its authorization, which is also targeted at minimizing unsubstantiated expenses and reduce the risks of corruption and favouritism.

In other cases, even if such exceptions are not provided for by the legal act, bodies can ask for the authorization to procure independently. However, they will have to submit the request to APSA or the respective Governorate, providing arguments in favour of such decision, a provisional cost estimate and the information about the financial coverage, as well as to describe “specific technical skills” of the unit that will be held accountable for organizing the procurement procedures. Besides achieving the abovementioned objectives, these measures are also aimed at increasing the professionalism of the personnel responsible for procurement.

2. Requirements for the participants of procurement.

The document, at the same time, imposes a set of requirements on the entities that participate in public procurement, which is designed to minimize the risks of corruption. In particular, a company cannot bid for a public contract in the event that:

• top managers or major shareholders of the company are under investigation or convicted of offences, including corruption, fraud or money laundering;
• the company is based in a country regarded as offshore;
• representatives of the company have attempted to exert undue influence on decision-making or to obtain confidential information which could have given it an unfair advantage in the procurement procedure.
• the client has a conflict of interest.

3. Measures for preventing conflict-of-interest situations.

According to the document, all public bodies should take measures to prevent, detect and manage the conflict-of-interest situations, arising in the course of the procurement process so as to prevent fraud and corruption, and to ensure equal access to participation in public procurement. 

As per the document, a conflict-of-interest situation arises when an official or a representative of the contractor, who participates in tendering and influences in some way its outcome, has a direct or indirect financial, economic or personal interest in the outcome of the bid, which may affect his/her impartiality and independence throughout the tendering procedures.

In the event that there is a potential or actual conflict of interests the official must advise the competent public body and refrain from participating in the tender. The infringement of these requirements entails disciplinary liability which does not override simultaneous imposition of the applicable measures of administrative and criminal liability.

Besides that, the legal act provides for a set of restrictions on participation in the activities of procurement commissions and fulfillment of the functions of a developer or expert throughout the procurement process. In particular, these positions cannot be occupied by an employee, temporary worker or resource person, if he/she:

• has applied together with the organisation participating in the tender or has another interest in concluding the contract, which may generate profit, an advantage or other benefit for him/her;
• is up to a fourth-degree relative of or has other relation of this kind of up to a second-degree kinship with a member of the organisation that has applied for the bid.
• has worked for the organisation that has applied for the bid or has had close business relations with it over the past five years;
• is or was in the previous five years a partner of the organisation that has applied for the bid.

4. Other corruption prevention measures.

The document also provides for other measures designed to prevent corruption and abuse in public procurement.

For instance, when applying for a bid a company should submit a list of organisations that it intends to engage as subcontractors along with a detailed description of the work to be carried out by each subcontractor. Such requirements permit to minimize the potential use of certain typical corruption practices (see Misuse of Subcontracting, in Russian).

In addition, the issued document stipulates that the Secretariat for the Economy and the Office of the General Auditor can exert control over procurement: these authorities can take measures against fraud, nepotism and corruption as well as regulate the prevention, detection and management of conflict-of-interest situations, arising throughout the public procurement process.

The adoption of the legal act of this kind by Vatican is due, inter alia, to the big 2012 scandal, also known as Vati-Leaks. Back then a massive leak of classified data and personal letters of the Pontiff unveiled, among other things, corruption in public institutions and overpriced procurement that cost the Holy See millions of dollars. A Vatican department for example, paid a construction company EUR 550,000 (roughly USD 617,000) to setup the annual Nativity scene in Saint Peter’s Square.

At the same time the analysed document was adopted by the Holy See as a result of its accession to the UN Convention against Corruption back in 2016.

The legal act comes into force on July 1, 2020.