Practical Law

PLC Public Sector reports:

Our public procurement case law digest for May 2012 focuses on sustainability and the extent of the requirement to disclose award criteria and weightings.

Please feel free to submit a comment below or contact us at: feedback@practicallaw.com if you have any views on the cases covered or think that we have missed a case that should be brought to the attention of public procurement practitioners. 

Eco-labels – equivalents must be accepted  (European Commission v Kingdom of Netherlands (Case C-368/10))

Somewhat unsurprisingly, the ECJ has held that a requirement for specific eco-labels and fair trade labels in the context of a tender for the supply of coffee machines was in breach of the public procurement directive. The technical specifications used should instead have referred to the underlying specifications defined by the eco-label.

Perhaps more interesting was the guidance given by the ECJ on how issues relating to sustainability and the environment can be taken into account more generally. The procurement in question also stated that tenderers must comply with the “criteria of sustainability of purchases and socially responsible business”. The ECJ considered that this related to the tenderers’ technical and professional ability within the meaning of Article 48 of the Directive and was not (as the Netherlands claimed) a condition for performance of the contract.  The ECJ then held that this:

• Established a minimum level of technical ability that is not authorised by Articles 44(2) and 48 of the Directive.
• Breached the obligation of transparency in Article 2 of the Directive. The requirement was not so clear, precise and unequivocal as to enable all reasonably informed tenderers exercising ordinary care to be completely sure what the criteria governing the requirements were. In particular, the tender documents did not indicate what information tenderers should provide to show compliance with the criteria.

How clear do award criteria need to be? (Healthcare At Home Ltd v The Common Services Agency [2012] ScotCS CSOH_75)

Public procurement evaluation techniques are constantly evolving and becoming more complex.  One consequence of this is that it can be difficult to know exactly how much needs to be disclosed to tenderers on the basis that it is part of the award criteria or applicable weightings.  In a judgment that will be welcomed by many contracting authorities, the Court of Session has held that, while a contracting authority must disclose to potential tenderers the existence and relative importance of the criteria that it will take into account in identifying the MEAT, this does not mean that a tenderer is not expected to use reasonable foresight in its analysis of what the stated criteria or sub-criteria entail. The court considered that, in assessing whether there has been adequate disclosure of a criteria or sub-criteria, it can ask whether the matter that is alleged not to have been disclosed would have been reasonably foreseeable by a reasonably well-informed and normally diligent tenderer as being encompassed by that criteria or sub-criteria.  This approach sounds very … reasonable … to us.

Contracting authority co-operation: AG sets out the law as it currently stands (Azienda Sanitaria Locale de Lecce v Ordine degli Ingegneri della Provincia di Lecce and others, (Case C-159/11) (Advocate General’s opinion))

In the context of an Italian law which permits written agreements to be entered into between contracting authorities for the study of the seismic vulnerability of hospital buildings, Advocate General Trstenjak considered the law as it applies to co-operation between contracting authorities without complying with the public procurement regime. In finding that the Italian law did not exempt the authority letting the contract from the obligation to comply with the public procurement regime, the AG provides a run through of the law in this area as it currently stands.  Obviously with the proposed codification of Teckal and Hamburg waste and a general move toward joint procurement and sharing services, this is an area which is likely to continue to be the focus of much attention in the future.

Litigating a public procurement challenge (Montpellier Estates Ltd v Leeds City Council [2012] EWHC 1343 (QB)) 

As is often commented on, we are seeing more and more substantive case law on public procurement matters.  However, we are also now starting to see more cases that consider general litigation issues in the public procurement context. This month we saw the approach that the court will take to an application for security for costs and also the disclosure of documents.