Before the end of the standstill period, an unsuccessful bidder puts us on notice that it has issued court proceedings. Can we award the contract anyway?
No. For procurements commenced on or after 20 December 2009, if a claim form has been issued in relation to legal proceedings on the decision to award a contract, the contracting authority is not permitted to enter into the contract. For procurements commenced before 20 December 2009, contracting authorities can enter into the contract until an injunction is obtained by the relevant supplier preventing the contracting authority from concluding the contract. However, in general it would not be advisable to enter into the contract if any relevant formal court proceedings have been issued, and urgent legal advice should be sought.
What are the time limits for an unsuccessful bidder to bring a claim?
Claims for damages under the procurement Regulations must be brought promptly, and in any event within three months of the date the grounds for a claim arose. The previously confusing question of whether the word "promptly" acts as a limitation on the three month period has been addressed recently in the case of Uniplex (UK) Limited v NHS Business Services Authority (Case C-406/08). This case makes it clear that the courts should now always allow a challenger the full three month period in which to bring a claim (regardless of how promptly the bidder acted). It also confirms that the three month period starts to run from the point at which the bidder became aware of the breach by the contracting authority. The Regulations do also give the court the discretion to extend the three month period if there are good reasons to do so. Any claim for ineffectiveness (as opposed to damages) would need to be brought within the earlier of 30 days from either the issue of an award letter to the unsuccessful bidder or publication of an award notice, or 6 months from the date of contract award.
Is it right that, once a contract has been awarded, a bidder's only remedy is damages?
This was the position for procurements commenced before 20 December 2009. For procurements commenced on or after that date, there is a new remedy of ineffectiveness, which can be awarded after the contract has been entered into. There are additional time limits relating to bringing an ineffectiveness claim.
We made a mistake in the procurement process, but the outcome was the right one. Does this matter?
Potentially, yes. Cases have suggested that in certain circumstances a bidder may have a claim even where they are unable to establish that, other than for a breach of the Regulations, they would have been likely to be successful.
What remedies are available to suppliers if we are found to have breached the Regulations?
If a court finds that the Regulations have been breached, it may (in certain circumstances for procurements commenced on or after 20 December 2009) render the contract ineffective, shorten the contract, and fine the contracting authority. In addition, a bidder may claim damages for its losses resulting from the breach.
When might a contract be declared ineffective?
Ineffectiveness is only available for procurements commenced on or after 20 December 2009. In such procurements, there are three main circumstances when this remedy may be available to suppliers. Firstly, where the contracting authority has directly awarded a contract without placing an OJEU advertisement in circumstances where an OJEU advertisement is required by the legislation. Secondly, where there has been a breach of the rules relating to the standstill period and that breach has denied the supplier an opportunity to challenge the contract award. Thirdly, where a call-off contract under a framework agreement for goods or services with a value over the EC procurement threshold has been entered into without following the relevant call-off procedures under that framework.
When could we be fined?
A court is required to impose a fine (described in the legislation as a "civil financial penalty") in any circumstances where the court declares a contract ineffective.
What will the level of fine be?
There is no prescribed "tariff" for fines under the Public Contracts (Amendment) Regulations 2009. However, the Regulations do state that fines must be "effective, proportionate and dissuasive".