Challenging an Unsuccessful Tender Outcome

Why you may choose to challenge a tender outcome

The decision to challenge an outcome is unique to each organisation and hinges mostly on whether they feel that the tender process has been fairly run and that their own submission has been fairly evaluated. Examples of why a bidder may choose to challenge a procurement decision include:

• The successful bidder submitted an unrealistically low price
• Incorrect scoring of the response, e.g. the feedback suggests that responses have not been read in their entirety
• The process specified by the regulations was not followed
• The design/documentation of the tender favours a particular bidder
• The bidder was barred from bidding at the qualification stage
• There was inappropriate negotiation with bidders
• Suspected corruption or bribery.

A typical complaint raised by unsuccessful bidders is that their price was lower than the winning bidder. However, to ensure quality of the service, tenders are not solely assessed based on price: the process also includes quality elements, which means that whilst you may score higher on price, it does not necessarily mean that it is a winning bid, as it is judged on overall best value.

A formal challenge must be able to demonstrate the contract award is non-compliant with its award criteria or fundamental principles on equality of treatment, transparency, mutual recognition and proportionality.

Therefore, ensure you think carefully and critically about your reasoning before you proceed with a formal challenge; successful challenges ordinarily centre on objective grounds rather than subjective opinions. Take the time to re-review the ITT documents (including the evaluation and scoring criteria) to better inform your understanding of why the decision was made. If you still believe you have grounds for challenge, seek professional advice.

When to challenge and how

You do not have to wait until the tender outcome to challenge.

In fact, you should immediately challenge processes which do not comply with the Public Contracts Regulations 2015. Non-compliant processes may involve, for example, a change of criteria or an unclear instruction in the ITT documents.

The regulations state:

“Such proceedings must be started within 30 days beginning with the date when the economic operator first knew or ought to have known that grounds for starting the proceedings had arisen.”

Consequently, you should carefully review tender documents once released by the buyer. If you have an issue/area of concern, the first step is to contact the Authority for clarification. The Authority may then decide to recall the tender, re-evaluate or start the tendering process again. No further action therefore needs to be taken. In turn, this stage reduces the need to challenge tenders through litigation, saving you time and money.

After the contract award notification, bidders have a minimum 10-day period called a “standstill period”. Firstly, you must establish if you have legitimate grounds to submit a challenge, contacting the Authority (if appropriate) to:

• Explain your concerns over the award with your reasoning – the more detail and evidence you can provide, the higher the chance of your challenge being upheld.
• Ask for an extension to the standstill period while your request for clarification is being reviewed.
• Request the Regulation 84 report (which provides details of the evaluation process undertaken).

Although Authorities are not obliged to extend this period, they may do so in light of the TCC Guide on Procedures for Public Procurement Cases.

To maximise the chance of overturning the contract award, bidders should raise their objections within this period before conclusion of the procurement process. As noted above, bidders might be advised to base their challenge on objective rather than subjective grounds. If the challenge is upheld, the Authority would then take appropriate action, such as re-issuing the tender.

The contract award is unlikely to be overturned if a challenge is raised after the 10-day standstill period but within the 30-day period. Instead, any redress is likely to be limited to payment of compensation. The court may declare the contract to be ‘ineffective’. The contract thus ceases to exist and so too the award. But this is rare, and so should not be relied upon from the outset.

If you want to challenge an outcome but are unsure where to start, contact us today for support.

This article has been produced as a source of general information and does not constitute professional advice.