Procurement in a nutshell – disclosure in public procurement
15th May, 2015
In this Procurement in a Nutshell update, we will be looking at a case with important implications for procurement exercises.
The recent decision of the High Court in Geodesign Barriers Ltd v The Environment Agency [2015] centred on an application for specific disclosure in a procurement dispute and has valuable lessons on the need to keep thorough records.
The judgment is available in full here.
What’s new?
The facts
The Environment Agency (EA) ran a procurement under the Public Contracts Regulations 2006 for temporary flood barriers.
Geodesign Barriers Ltd (Geodesign) was the incumbent supplier of the services and bid for the contract but was subsequently informed that it had been unsuccessful and that the successful bidder was Inero AB (Inero).
Documents disclosed to Geodesign showed that their score was the same as Inero’s in relation to the technical requirements but that they had lost on price and were ranked sixth overall, with four other bidders scoring higher marks.
Geodesign challenged the procurement process alleging that Inero’s winning bid did not comply with the mandatory performance specification and /or that the scoring of Inero’s bid failed to take into account deficiencies in the whole life costs of its solution.
Geodesign made an application for specific disclosure in relation to tender evaluation documents which included the names and scores of the four other bidders ranked above it.
EA had applied to have the automatic suspension lifted and /or to have the claim struck out because, due to its poor ranking, even if Inero’s bid was disqualified, Geodesign would not have been awarded the contract.
The claim for strike out was later withdrawn and it was agreed between the parties that the suspension should be lifted. Geodesign’s only claim is for damages.
The judgment
The High Court held that although Geodesign had established its case prima facie, its case could not be considered particularly strong because it was unlikely that EA would accept a bid that did not meet its own technical requirements and it would be difficult for it to show all of the other four bids were non-compliant.
As a result, the EA should have been able to show how and why it had concluded that Inero’s bid was compliant.
However, the documents disclosed by the EA with regard to its tender evaluation process were unsatisfactory. No documents at all were produced relating to the evaluation meetings where technical compliance was assessed.
The EA confirmed to the Court that no contemporaneous evaluation reports existed at all and the lack of these was said to “raise a significant question mark as to the transparency and clarity of the procurement exercise.”
Considering categories for specific disclosure, the Court held that:
- in the absence of any evaluation documents or scoring sheets, the EA had to disclose any and all contemporaneous documents relating to the evaluation meetings (and if it were found that evaluation reports did exist later significant consequences would flow from that);
- emails between the evaluators and the procurement officer, in the absence of formal guidance to the evaluators, had to be disclosed as they were likely to be the only contemporaneous documents available;
- the bid documents of the other four tenderers should be disclosed because they were relevant to the pleaded issues on causation (whether or not Geodesign would have been awarded the contract if these were compliant). These were to be disclosed to a confidentiality ring made up of Geodesign’s lawyers and an expert to advise on issues of their technical compliance;
- the identity of the bidders should not be disclosed – only the content of their bids.
Why is it important?
The case clearly demonstrates the need for Contracting Authorities (CAs) to keep thorough records of all steps and decisions taken during a procurement exercise. As a minimum, CAs now need to comply with the record keeping and reporting requirements set out under regulation 84 of the Public Contracts Regulations 2015 but this case illustrates the importance of record keeping to safeguard procurement decisions in case of challenge.
The case is also significant because the Court was willing to disclose the bids of tenderers other than the successful tender. It follows another procurement decision earlier this year where the ECJ was prepared to annul a decision of the European Parliament to award a contract for Greek translation services where it held it had breached its obligations to provide adequate reasons in not disclosing the financial aspects of the successful tenderers bid (Veloss International SA and Attimedia SA v European Commission [2015]).
It seems that courts are widening the scope of disclosable information in the case of challenge.
How can I find out more?
If you have any queries on the issues raised or on any aspect of procurement, please contact us via our procurement hotline on 0191 204 4464.
Please note that this briefing is designed to be informative, not advisory and represents our understanding of English law and practice as at the date indicated. We would always recommend that you should seek specific guidance on any particular legal issue.
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