This October marks sixty years since the opening of the last section of the Autostrada del Sole from Milan to Naples. What is perhaps most striking about this strategic infrastructure for Italy is that it was completed in the 1960s in just eight years. This reflection raises serious doubts about the current state of the national system, where projects—despite being funded by the EU—often face endless delays due to contracting with inadequate companies, a cascade of subcontracts, and firms that are technically and financially insufficient, often going bankrupt during project execution.

However, the new Public Procurement Code (Legislative Decree March 31, 2023, No. 36), updated with the amendments introduced by Decree-Law March 2, 2024, No. 19, and converted, with amendments, by Law April 29, 2024, No. 56, represents a turning point in the regulation of public contracts. It introduces a more modern and integrated approach to risk management. For companies awarded contracts, the Code places particular emphasis on identifying and managing risks to ensure the effectiveness, efficiency, and proper execution of contracts. In this context, companies are required to adopt tools and resources—such as security professionals—to manage all risks associated with a contract, thereby mitigating the overall risk for the country.

Although the Code does not feature a section exclusively dedicated to an exhaustive list of risks and related corrective actions, these elements are embedded in various provisions and are especially emphasized in the following areas. Here are some highlights, although there are numerous points to consider.

SAFETY AND COORDINATION PLAN
This plan, mentioned in Article 28 (Annex I.7) “Safety and Coordination Plan,” outlines the organization of work to prevent or reduce safety and health risks for workers on construction sites. It includes measures to manage specific risks related to the site area and organization, including interferences and additional risks. Corrective actions are specified as necessary to ensure safety.

SAFETY COSTS
Safety-related costs are identified in the Safety and Coordination Plan (PSC), in the risk assessment document (DUVRI), and in the contracting authority’s cost estimate. These costs are excluded from the bidding discount and are a crucial part of risk management in procurement projects.

The criterion of the most economically advantageous tender requires a complex evaluation that goes beyond mere price. This involves a careful assessment of risks related to contract execution, which companies must consider when preparing their offers. For example, Article 107 “General Principles on Selection” states: “The contracting authority may decide not to award the contract to the bidder with the most economically advantageous offer if it finds that the offer does not meet environmental, social, and labor obligations established by European and national legislation, collective agreements […]”.

Article 95 “Non-Automatic Exclusion Causes” is even more explicit, listing several conditions that disqualify an economic operator, such as violations of health and safety regulations, conflicts of interest, competition distortions, professional misconduct, or integrity issues.

OPERATIONAL RISK TRANSFER
As described in Article 177 “Concession Contract and Transfer of Operational Risk,” the award of a concession implies transferring operational risk to the concessionaire. This risk may concern the execution of the work or service management and must be tied to unpredictable market factors beyond the parties’ control. Additionally, penalties for service non-performance or reduced compensation act as corrective measures to ensure service quality and quantity.

The risks that a company may face in executing a public contract are numerous and vary depending on the nature of the agreement. Key risks include:

• Economic risks: price fluctuations, difficulties in sourcing materials, payment delays;
• Technical risks: project complexity, design changes, technical contingencies;
• Legal risks: disputes, regulatory changes, contractual breaches;
• Organizational risks: personnel management challenges, coordination problems, organizational deficiencies.

Corrective actions that a company can take to manage these risks include:

• Risk analysis: thorough risk assessment before submitting the offer;
• Planning: developing a detailed plan for contract execution that accounts for identified risks;
• Insurance: taking out insurance policies to cover the most significant risks;
• Consultant collaboration: engaging experts in various fields (legal, technical, financial) for more effective risk management;
• Continuous monitoring: periodic contract performance checks and adjustments to measures as risk conditions change.

SUBCONTRACTING
Article 119 “Subcontracting” may involve risk-sharing between the main contractor and subcontractors. The Code provides detailed regulations on subcontracting to ensure that risks are distributed fairly and transparently.

ECONOMIC, FINANCIAL, TECHNICAL, AND PROFESSIONAL CAPACITY
Verifying the economic and financial capacity of companies (see Article 106 “Guarantees for Participation in the Procedure”) aims to ensure their solidity and ability to meet contractual commitments. This involves a risk assessment related to contract execution, which the company must demonstrate it can manage.

Companies are also subject to verification of their technical and professional capacity (see Article 105 and Annex II.8 “Test Reports, Quality Certifications, Means of Proof, Online Certificate Register, and Life Cycle Costs”), to ensure they have the necessary skills for proper contract execution. Here, too, risk assessment related to contract execution and the measures the company intends to adopt to manage them are implied.

The Public Procurement Code places a strong emphasis on risk management in public contracts. Companies seeking to participate in tenders must be aware of the risks they face and must take all necessary measures to manage them effectively. Proper risk management is essential to ensure successful contract execution and protect the company’s reputation.

This Code should be seen by companies as a further push towards security and risk management and the enhancement of professional roles related to Risk & Security Management.

Download: Full and updated Public Procurement Code PDF with annexes – BibLus-net (acca.it)