public procurement regulations
The Public Procurement (miscellaneous amendments) Regulations
2011
22 September 2011
From 1 October 2011, the Public Procurement (Miscellaneous
Amendments) Regulations 2011 (the Miscellaneous Amendments
Regulations) will amend the Public Contracts Regulations 2006 (the
Regulations). The most important of these miscellaneous amendments
is that the time limit for commencing legal proceedings now runs
for 30 days, but starts from the date a potential claimant knows,
or ought to know, that they could bring a claim.
Time limits
As outlined above, the Miscellaneous Amendments Regulations
change the time limit for bringing an action in relation to a
public procurement exercise to 30 days from the ‘date of knowledge’
– the date the potential claimant first knew or ought to have known
that the grounds for bringing an action had arisen.
The Regulations originally provided for a three month time
limit, which a court could extend indefinitely if it considered
that there was a good reason for doing so. The European Court of
Justice (ECJ) felt that this did not did not provide sufficient
certainty and so the Miscellaneous Amendments Regulations seek to
bring the Regulations into line with the current case law in
particular the decision in the Uniplex case.
At first glance, a reduction from three months with a possible
indefinite extension, to 30 days with a possible extension to three
months seems onerous for potential claimants. In reality the
three-month time limit (and extension) was rarely open to
claimants. Although claims were almost always only brought after an
award decision, the courts expected proceedings to be issued almost
immediately after the decision was communicated, ordinarily within
a matter of days. So should a bidder only become aware of grounds
for a claim on the date that a contract was awarded to a
competitor, they will in effect have a longer period in which to
bring a claim as a result of these amendments.
However, under the Miscellaneous Amendments Regulations, the
clock will often start ticking much earlier than this, once a
bidder spots a potential flaw in the process. As such bidders may
be faced with no choice but to issue proceedings whilst a public
procurement process is still underway in order to comply with the
30 day time limit. Given that the test setting out whether a court
may allow an extension has not changed (i.e. when the court
considers there are good reasons to do so) it may be difficult to
persuade a court to allow extensions beyond the 30 day limit.
Bidders may find themselves deciding whether to continue with a
flawed process and attempting to bring a claim if they are
unsuccessful or bringing a claim as soon as the issue is
apparent.
Time will tell whether courts are going to utilise their power
to allow three month extensions as it is difficult to see why
allowing bidders to wait until the process is complete would be a
good reason once the Miscellaneous Amendments Regulations come into
force. If a process runs for longer than three months from date of
knowledge then any right of action could fall away unless new and
unconnected breaches come to light. Potential claimants may feel it
necessary to issue protective proceedings whilst still part way
through a public procurement exercise in order to avoid missing the
limitation period. Alternatively, courts may prefer to allow
extensions in order to limit the numbers of claims being issued. We
wait with interest for the approach of the market and the
courts.
Other amendments
‘Promptly’ requirement
The requirement that proceedings be brought ‘promptly’ is
removed from the Regulations. Given the 30 day time limit, it is
arguable that proceedings must still be brought promptly in order
to comply, but it is possible that extensions to the limitation
period could be granted in circumstances where proceedings have not
been brought promptly but the court still feels that an extension
is appropriate. The removal of this requirement should mean that
claimants always have 30 days to consider claims, whereas claimants
may have previously only been allowed a few days in which to issue
and serve a claim at the end of a procurement process.
Issuing proceedings and serving the claim
form
The Miscellaneous Amendments Regulations change the date at
which proceedings are started (for the purposes of limitation
periods) to the date that the claim form is issued, rather than the
date it is served on any defendants. This alteration will provide a
few days’ grace to claimants, who have to undertake fewer steps to
ensure their claim falls within the newly reduced limitation
period. This will be particularly important for those claimants who
are required to issue part way through a public procurement
exercise. The claim form must be served within seven days of the
date of issue, meaning that it can be served outside the limitation
period.
Communicating award decision notice
Contracting authorities will no longer be required to
communicate decision notices to any tenderers whose offers have
been definitively excluded. An exclusion will only be classed as
definitive if the relevant tenderer has been notified and
either:
- the exclusion has been held to be lawful by the courts, or
- the maximum permissible time limit for commencing proceedings
(three months including the discretionary extension) has
expired.
Automatic suspension
The automatic suspension provisions of the Regulations (which
previously required a contracting authority not to enter into the
relevant contract once the claim form was served) will apply when
the contracting authority becomes aware that the claim form has
been issued.
Criminal offences
The list of convictions which prevent a contracting authority
from entering into a contract with economic operators has been
expanded to include offences under the Bribery Act 2010.
The content of this bulletin is provided for the purposes of
general interest and information. It contains only brief summaries
of aspects of the subject matter and does not provide comprehensive
statements of the law. It does not constitute legal advice and does
not provide a substitute for it.