Procurement Update - Winter 2018

26 October 2018

Author: Niamh Magee
Practice Area: Procurement Law

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Our new-look procurement update focuses on recent case law of both the European and national courts as well as updates published by the Cabinet Office and European Parliament. Of particular note is the decision of the High Court in Lancashire Care NHS Foundation v Lancashire County Council, another case highlighting the importance of note-taking in the evaluation process and demonstrating that this really is a “hot-topic” for the courts at this time.

Turning then to the spooky (or utterly terrifying) topic of Brexit, we are planning to hold an event on what Brexit actually will mean for the procurement landscape (in real terms) in December/early January, once (hopefully) the final (or near final!) terms of the exit deal are known. We have previously spoken on what the various options could mean and, in order to make best use of your valuable time, want to hold off to be able to give some meaningful guidance on what the future really does hold.

In the meantime, we are holding an event addressing the potential impact of Brexit on contractual clauses, with a high level overview on what the GPA/WTO means, at 8am on Thursday 29 November in the Merchant Hotel. If this event is of interest, please sign up here.

No evaluation notes? No contract award

The High Court in England has ruled that a procurement by Lancashire County Council (the Council) was conducted in breach of its own evaluation process and procurement law and ordered that the award of the contract be set aside. The award decision was made in favour of Virgin Care Services Limited (Virgin). The claim was brought by incumbent providers and unsuccessful consortium, Lancashire Care NHS Foundation Trust and Blackpool Teaching Hospitals NHS Foundation Trust (the Trusts). The scores achieved by the two tenderers were very similar and the Trusts had concerns regarding the Council’s approach to scoring the submissions.

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How do you take steps to level the playing field without disadvantaging the incumbent?

The General Court of the EU has dismissed an application for interim measures by Amplexor Luxembourg Sàrl (Amplexor) in relation to a procurement by the EU Publications Office (Publications Office). The procurement was for a framework contract for the publication of procurement notices in the Official Journal. Three tenderers were to be appointed and Amplexor, the incumbent provider, was appointed to the framework in second place. Contracts under the framework were to be awarded in a cascade system.

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The risks of a photo finish evaluation

A bidder who missed out on a £245m highways contract by just 0.03% has brought a procurement challenge to the decision. Amey Highways Limited (Amey) has challenged the decision of West Sussex County Council (Council) to award a ten-year contract for highway construction and maintenance to Ringway Infrastructure Services Limited (RIS).

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What is a concession contract?

The High Court has given guidance on what constitutes a concession contract in its first ruling under the Concession Contracts Regulations 2016 (CCR). The question before the court was whether a lease entered into over a property which permitted advertising next to a highway was a concession contract. The question before the court was whether a lease entered into over a property which permitted advertising next to a highway was a concession contract.

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Tactical bidding – what is “abnormally low”?

The High Court in England has given further guidance on the obligation on a contracting authority to investigate a potential abnormally low tender. An unsuccessful tenderer (SRCL) in a procurement for clinical waste disposal by the National Health Service Commissioning Board (Board) has claimed that there was a duty on the Board to investigate both the successful and second ranked tenderers as abnormally low (both bids were c.35% cheaper than SRCL).

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No deal Brexit – where will tenders be published post March 2019?

As you will be aware, all procurement opportunities governed by the EU procurement directives are advertised on the Official Journal of the European Union (OJEU) via Tenders Electronic Daily (TED). Procurement opportunities are also advertised on tendering portals, such as eTendersNI in Northern Ireland. If the UK leaves the EU without a deal in March 2019, the government has been preparing a solution: a replacement UK-specific e-notification service. Changes will be made to existing procurement legislation to ensure continued interoperability.

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Cheapest isn’t always best…

The European Parliament has produced a report on public procurement strategy which has highlighted particular concerns regarding the continued use of lowest price as the only award criterion in public procurement, with 55% of EU procurements based on lowest price. We have seen very recently the impact of awarding contracts based on lowest price across various sectors of the market with continued pressure on contractors to bid low prices and squeeze margins, in turn raising issues regarding the sustainability of the price over the life of the contract.

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