1) What is the current legal landscape in your practice area in your jurisdiction?

In public procurement, Bolivia operates under a framework strongly oriented towards the public interest, with rules for contractor selection, contract performance, and oversight of state agreements. The Constitution and the government administration and control system establish principles of transparency, economy, efficiency, and social oversight, implemented through the Basic Regulations for the Procurement of Goods, Works, General Services, and Consulting Services (“SD181”), as well as other specific regulations and manuals applicable to central and subnational entities.

The Bolivian procurement process is structured through electronic platforms such as the System for Public Procurement (Sistema de Contrataciones Estatales, or SICOES, for its acronym in Spanish) for publicity and traceability, with procurement methods that include public bidding, National Support to Production and Employment (Apoyo Nacional a la Producción y Empleo, or ANPE, for its acronym in Spanish), direct invitation and exception procedures, among others.

SD181 includes specific rules on domestic preferences for goods and services, disqualifications, and conflicts of interest, as well as the applicable guarantees (bid security, performance security, and proper use of advances), and the administrative challenge mechanisms (queries, observations, and appeals) available to bidders who disagree with how the procurement process took place. It is important to point out that these administrative challenge mechanisms are only applicable for the procurement process and do not apply once the contract is signed between the Bolivian State and the contractor.

During contract execution, key elements are described in the Base Procurement Documents (Documento Base de Contratación, or DBC, for its acronym in Spanish), and include provisions related to subcontracting restrictions, work orders, deadlines, penalties, and provisional and final acceptance procedures, with defined responsibilities for the contracting state, supervising engineer or contract administrator and the contractor.

Finally, one of the biggest faults in current public procurement regulation and the DBC’s issued by State Entities is the fact that dispute resolution almost always refers conflicts to administrative instances, whereby the conflicts are brough before the Bolivian Supreme Court and take years to be concluded. Conciliation and arbitration procedures are rare, and generally applicable in exception procedures that include foreign financiers such as BID or CAF.

2) What are three essential tips for clients involved in these matters?

Given Bolivia’s current political and economic developments in the last two months, the current administration’s focus continues to progress towards infrastructure, energy, technology, and social projects. Thus, public procurement is being recognized as a gateway for foreign companies seeking to position themselves in one of the region’s most strategically resource-rich jurisdictions.

Notwithstanding the recent progress, success in public procurement in Bolivia still requires more than competitive pricing and knowhow in each area, it demands anticipation to (sometimes) arbitrary decisions by the State, compliance, discipline, and an informed local strategy. Consequently, based on recent market trends and our experience advising major international bidders, below we describe three key considerations for clients looking to enter or expand their presence in Bolivian public contracting:

1. Understand the regulatory landscape early, not midway through the process.

Bolivia’s procurement system is structured under administrative law principles and complemented by sector-specific regulations, guidelines and internal directives issued by contracting entities. While bidding documents, called Base Procurement Documents (Documento Base de Contratación, or DBC, for its acronym in Spanish) appear straightforward and complete, their practical application and interpretation, especially regarding qualification criteria, evaluation methodology, liability standards, and documentation requirements, is sometimes arbitrary, highly technical and can vary from one authority to another.

Thus, early legal assessment of the area where a company is bidding is critical. A preliminary regulatory review allows bidders to identify mandatory conditions, structure their participation to avoid disqualification risks, and evaluate whether the contractual framework sufficiently protects their operational and financial exposure.

2. Compliance and reputational readiness matter as much as commercial competitiveness

Bolivia has strengthened its scrutiny over public contracts, particularly in sectors involving state-owned entities, infrastructure, and natural resources in order to attract foreign investment and attract international financiers such as the World Bank, BID, and others, which demand these types of requirements. Authorities increasingly expect contractors to demonstrate robust reporting policies, and alignment with local compliance standards.

For foreign participants, this means preparing before the tender process, adopting clear anti-corruption protocols, implementing AML controls, ensuring transparent corporate structures, and training their teams in document management and negotiation etiquette. Strong compliance governance not only reduces exposure to administrative sanctions or suspension from bidding; it also builds credibility and positions foreign companies as long-term partners in the eyes of state entities, which can significantly influence award perception and contract monitoring.

3. Secure reliable local support

Public contracts in Bolivia require continuous management: approvals, extensions, adjustments, price-readjustment claims, and sometimes, dispute resolution, often under deadlines that are short and procedural in nature. Delays or missteps in administrative filings can quickly escalate into penalties or contract resolution.

A strategic relationship with local counsel, experienced in contract administration, negotiation with authorities and dispute prevention is essential. Counsel plays an important role in coordinating technical and legal deliverables, engaging with supervising entities, and, when necessary, directing the matter through administrative, or arbitration venues.

Bolivia offers important opportunities for foreign companies prepared to enter the market with diligence, transparency, and strong local support. Understanding the regulatory environment, investing in compliance culture, and partnering with experienced counsel are decisive elements for navigating procurement processes efficiently. As the country increases demand for innovative solutions and international know-how, well-structured foreign bidders stand to benefit the most.

3) What are the biggest threats and opportunities over the next 12 months?

While risks remain significant, especially around economic shifts and administrative uncertainty, opportunities are emerging in Bolivia for sophisticated companies that are able to navigate local complexities and practices, with creativity and localized execution support.

Out of these risks, the three main threats and opportunities in Bolivia over the next 12 months will be as follows:

Opportunities:

1. Future Reforms in Public Procurement in Bolivia and the Strategic Opportunities emerging through Public-Private Partnerships

Recent legislative endorsements regarding public procurement regulation, and a policy shift towards private and foreign capital present an emerging legal and commercial opportunity for international investors. These reforms demonstrate the current administration’s intent to modernize public procurement, align it with international best practices, and unlock private sector participation through public-private partnerships (PPPs).

The regulation for PPPs in Bolivia is undergoing a process of adaptation and development. Even though Bolivia has not yet fully implemented this mechanism for private investments in state projects, public-private partnership structures are already being explored in infrastructure and telecom projects. However, the lack of a national regulatory framework that efficiently allocates medium and long-term risks, defines the financing structure, and establishes international dispute resolution mechanisms still obstructs the effective implementation of PPPs in the country.

2. Large-scale infrastructure funding and multilateral project growth

Bolivia is focusing on redirecting and obtaining new credit lines into infrastructure projects, sanitation works, energy systems and social and telecom projects. To achieve these international fundings, the current administration is focusing its attention on raising its standards for public procurement, often demanding more transparency, competitive biddings, and strong compliance with local and international anti-corruption regulations, thus favoring international contractors.

3. Procurement digitalization & modernization efforts

The current administration is focusing its resources and attention on increasing reforms to electronic procurement systems, publication processes, and bid thresholds, to improve procedural clarity, access, and transparency, enabling foreign bidders to track opportunities efficiently and enter tenders with better predictability.

Threats:

1. Non-Negotiable Model Administrative Contracts

Within Bolivia’s administrative law framework, public procurement processes are structured around standardized Base Procurement Documents (DBCs), which regularly incorporate a pre-approved model administrative contract. This contract must be executed by the successful contractor on a nonnegotiable basis. As a result, these contracts are heavily biased in favor of the State, including rigid provisions designed to maximize public interest protection, often at the expense of contractual balance. In practice, this approach significantly limits the contractor’s ability to challenge or negotiate key aspects of risk allocation, including issues related to dispute resolution and the scope of arbitrability, therefore constraining legal certainty and commercial predictability for private counterparties.

2. Political volatility impacting contract continuity.

Changes in priorities, budget reallocations or procurement plan reviews may still affect public procurements’ timing and post-award execution, even if the current administration’s focus is to create regulation that allows for better risk mitigation and its addition to the contracts and contractually and the operations.

3. Slow administrative procedures and discretionary interpretations

Formal rules continue to co-exist with arbitrary interpretations on the part of the State entities. Such inconsistent implementation and interpretations may delay approvals, certifications, payments, or price-adjustment claims.

4. High exposure to corruption-related inquiries

Any irregular interaction may trigger investigations or blacklisting. Foreign bidders must avoid informal shortcuts and operate with zero-tolerance compliance posture.

5. FX constraints and cash flow pressure during execution

Projects that depend on the importation of goods or services; or contracts that are to be paid in foreign currency will require currency risk planning, supplier payment strategies, and resilient financial structuring on the part of the contractor.

6. Weak dispute resolution methods

Administrative contracts for public works still do not allow for the inclusion of arbitration clauses. These exclusions may lead to prolonged administrative appeals and subjective awards.

7. Reduced Public Spending

In the context of a macro‑fiscal crisis and the 2025 change in government, a reduction in public spending of approximately 30% is anticipated, implying a lower volume of procurement processes, stricter prioritization of essential projects, reprogramming, and heightened risks of delays in payments and approvals.

4) How do you ensure high levels of client satisfaction?

We combine technical advice with operational execution tailored to selection procedures and public contracts. We are familiar with and understand the new regulatory trends being created by the current administration regarding public procurement, which allows us to be prepared for each process (SICOES registration, queries, site visits, bid submission).

During the contracting phase, our experience allows us to be able to foretell requirements not specifically included in the applicable regulation or contracting documents.

Finally, we prioritize predictability through alerts on regulatory changes and the entity’s criteria, and we document comprehensive support for audits and governmental control. We measure our client satisfaction by awards obtained, sanction‑free execution of works, and timely recovery of payments and guarantees.

5) What technological advances are transforming practice and how can clients benefit?

Standardized processes in SICOES and the use of electronic signatures and digital files have improved publicity, traceability, and timelines in procurement. Document management and automation tools enable consistent bid preparation aligned with the bidding documents, control over the validity of guarantees and qualifications, and monitoring of execution milestones with digital evidence. Data analytics on published procedures help shape pricing strategies and risk assessments. For clients, this translates into more competitive bids, fewer formal errors, real‑time visibility on process status, and an auditable repository for responding to observations, audits, and social oversight.