Review of events in 2018

In 2018, the emphasis was strongly on the merger with KL-Kuntahankinnat Oy. The negotiations started early in the year based on an initiative of KL-Kuntahankinnat, and quickly led to the completion of a merger plan and a merger agreement in May 2018. The owners of the companies, the State of Finland and the Association of Finnish Local and Regional Authorities, were of the opinion that a joint joint procurement unit for the entire public sector would provide major benefits to the customers both in the form of the development of procurement expertise and in the form of more extensive service selection. Furthermore, centralising volume as such induces savings.

Hansel’s strategy period, which started in 2016, was concluded. The goals were met. With its operations, Hansel increases the productivity of Government procurement, and in accordance with its vision, Hansel has renewed public procurement. The “Customer is the focus” operating model was launched and resulted in a high level of customer satisfaction. Development of the business operations, as well as the transfer to digital tools, such as electronic tendering, went according to plan. Preparation of a new strategy was started in May 2018 in cooperation with KL-Kuntahankinnat.

The merger required an amendment of the Act on a Limited Liability Company Called Hansel Oy. A government proposal regarding the amendment was prepared by the Ministry of Finance and submitted to Parliament in September. The amended Act entered into force as of the beginning of 2019. A note that Hansel is fully owned by the state was deleted from section 1. Municipalities, joint municipal authorities, the Evangelical-Lutheran church, the Orthodox church and their parishes were added to the list of customers in section 3. Due to the amendment, public law bodies governed by the above-mentioned organisations can also be Hansel’s customers. Furthermore, Keva was added to the list of customers.

The preparation of the merger was very intensive during the latter half of the year. The merger of business operations and administration was planned by several integration teams. In the autumn, the Boards of Directors of the companies met to discuss future strategic policies of the new Hansel. The original merger schedule proved too tight, however, and the merger was postponed to 2019. A decision of Hansel’s owner to reduce the company’s share capital by €7.5 million to €5 million was connected to the preparation of the merger. This action will enable returning capital to the owner before the merger, as agreed.

The merger speeded up the process of renovating Hansel’s office in the main post office building in Helsinki to a more versatile space. The employees came back to a renewed office after their summer holiday; the change has been considered positive.

Over the course of the year, Hansel was involved in a variety of projects, such as Hanki, a project for the digitalisation of government procurement managed by the Ministry of Finance, the State Treasury’s Tietokiri project, a project on the Competence Centre for Sustainable and Innovative Public Procurement (KEINO) by the Ministry of Economic Affairs and Employment and a working group on the black economy and public procurement managed by the Finnish Competition and Consumer Authority. Hansel completed several development projects, the most major of which were development of electronic tools for managing the customers’ simplified tendering processes and a reform of Hansel’s CRM system. Hansel received an assignment and funding from the Ministry of Finance to renew Hilma, the notice channel for public procurement. The Hilma project is currently ongoing.

Actions connected the new General Data Protection Regulation (GDPR), which entered into force in the spring of 2018, caused a major workload for the legal unit and the different categories. Centralised procurement contracts were analysed and revised as required by the GDPR. Agreement templates and model clauses were prepared for new tendering processes. Training on privacy protection was arranged for the entire personnel. The work was successful, which was confirmed by an internal audit report commissioned by the Board of Directors.

Hansel’s experts have also been involved in a process of updating privacy protection clauses connected to the general contractual terms for IT procurement in public administration (JIT). The Trade Secret Act (liikesalaisuuslaki, 595/2018), which entered into force in the autumn of 2018, has caused the need to further specify templates for invitations to tender and work instructions. Training related to this legislative reform was also arranged for the personnel.

Parliament is processing a legislative proposal submitted in 2017 (HE 63/2017 vp) that proposes a right for the regional governments to use Hansel’s services. The proposal also includes certain specifications of Hansel’s duties, such as the opportunity to participate in joint procurement across administrative borders, the processing of procurement data and related access to information. The legislative proposal was discussed by the Parliament’s Commerce Committee, but the process was discontinued because a legislative reform related to the regional government reform fell through.

Rulings on the scope of procurement by the Supreme Administrative Court and the Market Court, as well as a decision by the European Court of Justice in case C-216/17, caused the need to consider access to information in the case of future procurement projects of procurement units that use joint procurement contracts and the need to offer more detailed information about the scope of procurement in the invitations to tender. Related reforms of operating methods will be introduced in 2019.

At the end of 2018, Hansel had seven complaints regarding three tendering processes pending in the Market Court. Three of the complaints pending in the Market Court involve a procurement decision deleted because of a correction of a procurement process. Furthermore, there were two complaints pending in the Supreme Administrative Court at the end of 2018. Hansel is also involved in ongoing legal proceedings regarding the publicity of documents in the Administrative Court. In 2018, Hansel received two decisions of the Market Court where the related complaints were rejected.

Hansel follows the processing of public procurement matters in the European Union. Hansel is a member of a cooperation group for key joint procurement bodies in the EU. Other members include the following joint procurement bodies: SKI (Denmark), Kammarkollegiet and SKL Kommentus (Sweden), BBG (Austria), Consip (Italy) and ANCP (Portugal). In June 2018, it was Hansel’s turn to arrange a two-day CPB network meeting for the European joint procurement bodies. The meeting was arranged at the Finlandia Hall.

Key events after the close of the financial year

In January 2019, Hansel’s Board of Directors approved a new strategy, which will be updated after the merger. The business operations have remained essentially unchanged after the close of the financial year.