Termination of Administrative Contracts in Bolivia

Regulatory framework for administrative procurement

In the Plurinational State of Bolivia, public procurement procedures—such as public bidding and proposal competitions—are governed by specific rules that establish the conditions, stages, and mandatory documents.

The Procurement Base Document (DBC) is an essential instrument prepared by the contracting entity. This document sets the rules of the procedure, including technical, legal, and administrative requirements. Its content is binding on both the contracting entity and the awarded supplier.

Likewise, the Goods and Services Administration System, as well as the rules exclusively applicable to procurement procedures through public bidding, proposal competitions, and administrative contracts for the acquisition of goods and services, are governed by the NB-SABS. These rules, together with the Procurement Base Document (DBC) prepared by the contracting entity pursuant to article 46 of the NB-SABS, form the legal framework applicable to the procurement procedure.

In this sense, the administrative contract for the acquisition of goods must strictly comply with these provisions, without departing from the previously defined framework. This principle is linked to the provisions of the Political Constitution of the State, which recognizes legality and legal certainty as pillars of state action.

Procedure for termination of the administrative contract

When breaches or grounds justifying termination arise, a specific procedure is triggered and must comply with certain formal rules.

Notice and cure period

The party seeking to terminate the contract—whether the entity or the supplier—must communicate its intention by means of a notarized letter, clearly stating the grounds invoked. From that notice, a period of fifteen business days begins for the other party to cure the deficiencies.

If the breaches are corrected within that period, the contract remains in force. For example, if a supplier delays the delivery of goods but regularizes the situation within the deadline, the entity may refrain from terminating the contract.

Formalization of termination

If there is no response or the observations are not remedied, termination of the contract is formalized by a second notarized communication.

When the cause is attributable to the supplier, relevant legal effects arise:

• Enforcement of contractual guarantees.
• Determination of amounts owed in favor of or against the parties.
• Possibility for the entity to continue the procurement with another supplier.

This mechanism ensures continuity of public service and protects state resources.

Challenges and review mechanisms in contractual termination

A key aspect is that review mechanisms in these proceedings are not governed by the general rules of administrative procedure.

Exclusion of general administrative appeals

The applicable rules establish that remedies such as reconsideration or hierarchical appeal are not admissible in this context. This is because the public procurement system has its own legal regime, separate from the general administrative procedure.

This exclusion is supported by Bolivian administrative legislation, which provides that certain systems, such as government control, are governed by their own rules. Consequently, disputes arising from contractual termination must be channeled through the specific mechanisms provided by procurement regulations.

Legal certainty and special procurement rules

The special nature of the public procurement regime responds to the need to ensure efficiency, transparency, and control in the use of public resources. This means that both entities and suppliers must know and comply with the particular rules of the system.

In summary, the termination of administrative contracts in the area of goods and services is governed by a specific procedure that requires formal notice, an opportunity to cure, and clear consequences in the event of breach. Likewise, review mechanisms are limited to the procurement system itself, excluding the application of general administrative appeals.