Clarification on contract challenges is good news for buyers

26 August 2011
The Cabinet Office yesterday published the long awaited new amendment regulations to deal with the issue caused by the European Court of Justice's (ECJ) decision in the Uniplex case. These are important changes to the rules and will apply from 1 October 2011. The Public Procurement (Miscellaneous Amendments) Regulations 2011 will apply to the Public Contract Regulations rules in England, Wales and Scotland, the Utilities Contracts Regulations and the Defence and Security Public Contracts Regulations. A key change is to require unhappy bidders to bring any proceedings in relation to a procurement decision within 30 days of the date of knowledge of the issue that gives rise to the suspected breach. The date of knowledge is the date that the challenger knew or ought to have known about the breach and is a change from the old regime which provided that a challenger must bring claims “promptly”, and in any event within three months of becoming aware of the issue. The Court will have what appears to be a broad discretion to extend the 30-day period up to a limit of three months where it has "good reasons" for so doing. Only future cases will tell as to what these reasons will need to include. This change has been brought about by the ECJ ruling in the Uniplex case that decided that the old time limits in the UK regulations (in particular, the requirement that such proceedings be brought "promptly") were incompatible with EU law. There are transitional provisions that will apply to current procurements where the relevant date of knowledge has occurred before 1 October 2011. There are also changes to what is needed when automatic suspension is sought. The amendment rules also clarify when there is no obligation to send an award decision notice at the start of the mandatory standstill period to certain bidders who have been "definitively excluded" from the procurement process. Finally, there is clarification as to the grounds for exclusion of bidders to reflect the changes brought about by the Bribery Act and other changes. Practically, these changes clear up some of the (many) tricky areas in the rules. The clarity on time limits is good news as it provides more certainty to what is needed and by when for suppliers to challenge. The new rules should help contracting authorities to manage risk and to progress with procurement processes. Would-be challengers cannot sit on their hands when bringing a complaint about a process but the rules are clearer on the general principles, and may discourage litigation on spurious claims. Finally, contracting authorities will want update their standard procurement documentation and buying guidance to reflect the new rules and to minimise risk.   David Hansom is a partner and head of the public sector team at Veale Wasbrough Vizards
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