How to challenge a winning bid
The industry might complain about public bodies over interpretation of EU procurement rules, but the other side of the coin is that unless they follow rules to the letter they could find themselves being challenged by an unsuccessful bidder.
Since 2009, substantial changes have been made to the remedies available and the time limits for bringing a claim under the public procurement process. As a result of these changes, bidders should now be vigilant throughout the bid process of any circumstances that could potentially merit a procurement challenge rather than wait until a decision has been made.
There are a number of key points that bidders should be aware of when considering whether they should challenge a procurement decision.
Breach of procurement rules
When determining whether a procuring authority has breached the procurement rules, the following core principles should be kept in mind:
- The competition for public contracts should be honest, open and unbiased.
- Has the process been transparent? For example, full and accurate information regarding a contract and the procedures that will be used to select bidders and to award the contract should be disclosed at the outset.
- Has the process been conducted in a non-discriminatory manner? For instance, public bodies in the UK must not discriminate in their procurement processes against suppliers from other EU member states.
- Has the procuring authority complied with the principle of proportionality? An example could be where excessive conditions, such as insisting on a minimum turnover, are placed on bidders.
Ensure all information is available
Before a disappointed bidder can decide whether to make a formal challenge, they will need to have the information on the reasons for why it was unsuccessful. Any contract award notice must now contain the following information:
- criteria for the award of the contract;
- the name of the winning bidder and reasons for the decision;
- the scores obtained by the winning bidder and the disappointed bidder;
- any reason why the disappointed bidder did not meet the technical specifications.
It is not unusual for an unsuccessful bidder to want further information in addition to that outlined above. If such information is not forthcoming at the debrief session, then there are other avenues that can be followed, such as requests under the Freedom of Information Act.
However, due to the tight limitation periods and the mandatory 10-day standstill period between the date of the decision notice and the actual contract award, a more expeditious course of action may be to seek an order from the court for pre-action disclosure.
Since 1 October 2011, there is now a limit of 30 days (previously three months) from the date that a bidder first knew or ought to have known, that grounds for bringing a challenge had arisen. The court does have the discretion to extend this by up to a maximum of three months, but it will need to have good reason for doing so.
What was the reason behind making such a change? Well, the judgment of the Court of Justice of the European Union in the case of Uniplex (UK) Ltd v NHS Business Services Authority, held that the previous time limit of three months under the UK’s public procurement rules was incompatible with EU Law.
The impact of such a significant change is likely to be far-reaching. More claims are susceptible to being out of time than before and procuring authorities can abuse the new rules by structuring tender processes in a way that eliminates the risk of challenges.
David Quinlan is a partner in the construction and engineering group at Taylor Wessing. Email: [email protected]