- If the contract is for a 'one-off' purchase, estimate the total value including all component parts, transport costs, installation and commissioning.
- If the contract is regular in nature, the value of successive contracts of the same type should be estimated over 12 months (either based historically or in the future). Note, however, requirements cannot be disaggregated in order to avoid the legislation.
- Fixed term contracts for the lease, rental or hire purchase, should be estimated for the duration of the contract and where the term of the contract is greater than 12 months, the total value including the estimated residual value.
- Where the contract is part of a series, the whole series should be estimated over a 12-month period or longer, if appropriate.
- If a contract is for a fixed period, say one year, but has an option(s) to extend, for example, for a further period of one or two years. Then, regardless of whether or not there is uncertainty about exercising the extension options, the maximum duration, ie 3 years, is used when estimating its value.
- In the case of contracts without a fixed term or the term of which cannot be defined, (e.g an indefinite or uncertain period), the monthly value multiplied by 48.
- Where there is a single requirement for goods and a number of supplies contracts for similar requirements have been, or are to be, entered into, then the total value of all individual contracts must be calculated.
- Where a proposal for the acquisition of similar supplies may result in contracts being awarded in the form of separate lots, then the total value of all the individual lots must be calculated. Note: individual lots may be removed from the EU procurement exercise where they are valued at less than £62,842 and taken together they represent less than 20% of the total overall valuation.
Note: Where the proposed contract includes more than one of the above elements, the value must be determined by calculating its highest possible value. In addition, the contracting authority shall not enter into separate contracts with the intention of avoiding the application of the rules, nor use a valuation method that gives the lowest estimated value.